EXHIBIT 10.7
XXXXXXXXXXXXX.XXX, LLC
PURCHASE AGREEMENT
THIS PURCHASE AGREEMENT (the "AGREEMENT") is made as of December 30,
1999, by and among XxxxxXxxxxxxx.xxx, LLC, a Delaware limited liability company
(the "COMPANY"), Xxx Xxxxxxx (the "SELLER"), Madison Dearborn Capital Partners
III, L.P., a Delaware limited partnership ("MDCP"), Madison Dearborn Special
Equity III, L.P., a Delaware limited partnership ("MDSE") and Special Advisors
Fund I, LLC, a Delaware limited liability company ("SAF," together with MDCP and
MDSE, the "PURCHASERS," and each a "PURCHASER").
WHEREAS, the Seller desires to sell to MDCP, and MDCP desires to
purchase from the Seller, 157,252 economic interests of the Company (such
157,252 economic interests being referred to herein as the "ECONOMIC
INTERESTS");
WHEREAS, the Company desires to issue and sell to the Purchasers, and
the Purchasers desire to purchase from the Company, an aggregate of 314,503
membership interests of the Company (such 314,503 membership interests being
referred to herein as the "INTERESTS," together with the Economic Interests, the
"MEMBERSHIP INTERESTS").
NOW THEREFORE, in consideration of the mutual agreements,
representations, warranties and covenants herein contained, the parties hereto
agree as follows:
1. PURCHASE AND SALE. The Membership Interests and the aggregate purchase price
as set forth in this Section 1 shall be allocated to each of the Purchasers as
set forth on SCHEDULE 1 hereto.
1.1 PURCHASE AND SALE OF ECONOMIC INTERESTS. Subject to and upon the
terms and conditions set forth in this Agreement, the Seller agrees to sell to
MDCP, and MDCP hereby agrees to purchase from the Seller, at the Closing (as
hereinafter defined), the Economic Interests at a purchase price of $6.35923456
per Economic Interest. The aggregate purchase price payable by MDCP to the
Seller for all of the Economic Interests shall be $1,000,000.
1.2 PURCHASE AND SALE OF INTERESTS. Subject to and upon the terms and
conditions set forth in this Agreement, the Company agrees to issue and sell to
the Purchasers, and the Purchasers hereby agree to purchase from the Company, at
the Closing (as hereinafter defined), the Interests at a purchase price of
$6.35923456 per Interest. The aggregate purchase price payable by the Purchasers
to the Company for all of the Interests shall be $2,000,000.
1.3 CLOSING. The closing of the transactions contemplated under this
Agreement (the "CLOSING") shall take place at the Boston offices of Xxxxxxx Xxxx
LLP, 000 Xxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000 on or before December 29,
1999, or on such other date as may be agreed upon in writing between the
Purchasers and the Company.
1.4 DELIVERY. At the Closing, (i) the Purchasers shall deliver to the
Company, as set forth on SCHEDULE 1 hereto, a cash amount equal to $2,000,000 by
certified check or wire transfer; (ii) MDCP shall deliver to the Seller a cash
amount equal to $1,000,000 by certified check or
wire transfer; (iii) the Seller shall deliver to MDCP an executed Assignment of
Economic Interests whereby the Seller assigns the Economic Interests to MDCP;
and (iv) the Company shall revise Exhibit A to the Operating Agreement (as
defined below) to reflect the Purchasers' purchase of the Membership Interests.
Notwithstanding the foregoing terms of this Section 1.4, the Seller hereby
authorizes and directs MDCP to deliver to the Company, on behalf of the Seller,
all amounts referred to in clause (ii) of this Section 1.4 and that the Company
remit such amounts to the Seller (promptly upon the Company's receipt thereof)
but only after the Company deducts therefrom any amounts owed to the Company by
the Seller and any amounts in respect of withholding or other employee taxes
payable by the Seller in connection with the Seller's obtaining ownership of the
Economic Interests to be purchased by MDCP hereunder. The Purchasers agree that
in connection with any conversion of the Company to a corporation, each
Purchaser shall, upon request of the Management Board of the Company (the
"MANAGEMENT BOARD"), execute documents required to effect such conversion,
including documents evidencing such Purchaser's agreement to comply with any
restrictions imposed by the Management Board upon such Purchaser's Membership
Interests (or the capital stock or other securities received in exchange for
such Membership Interests (or into which such Membership Interests are
converted)) with respect to the transfer or voting thereof. Each Purchaser
understands and agrees that this constitutes an irrevocable commitment which
such Purchaser shall not have the right to cancel or veto.
2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company hereby
represents and warrants to the Purchasers as of the date hereof as follows:
2.1 ORGANIZATION AND STANDING; CERTIFICATE OF FORMATION. The Company is
a limited liability company duly organized, validly existing under, and by
virtue of, the laws of the State of Delaware, and is in good standing under such
laws. The Company has all requisite power and authority to own and operate its
properties and assets, and to carry on its business as presently conducted and
as proposed to be conducted. The Company is duly qualified and authorized to
transact business and is in good standing in each jurisdiction in which the
failure so to qualify would have a material adverse effect on its business,
properties, prospects, or financial condition. The Company has furnished the
Purchasers with copies of its Certificate of Formation and its Amended and
Restated Operating Agreement, dated as of June 1, 1999 (the "OPERATING
AGREEMENT").
2.2 POWER AND AUTHORITY. The Company has all requisite legal power and
authority to execute and deliver this Agreement, to authorize the issuance of
the Interests hereunder, and to carry out and perform its obligations under the
terms of this Agreement and the Operating Agreement and the transactions
contemplated hereby and thereby.
2.3 OWNERSHIP OF INTERESTS. The membership interests of the Company
consist of 37,408,468 outstanding membership interests and up to an additional
9,767,021 membership interests and/or economic interests (such outstanding and
additional interests being referred to collectively as the "PRESENT INTERESTS")
which may be outstanding in the future pursuant to the exercise of warrants
and/or options authorized to be issued (excluding the 2,000,000 options
authorized by the Management Board on or about November 23, 1999). The Present
Interests do not include (i) those certain membership interests and/or economic
interests of the Company issued by the Company to MSD Capital, L.P. and/or one
or more of its affiliates (collectively, "MSD CAPITAL") pursuant to that certain
Purchase Agreement, by and between the Company and
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MSD Capital, dated as of even date herewith, and (ii) those certain membership
interests and/or economic interests of the Company issued by the Company to
Xxxxx Xxxxxxxxx and/or one or more of his affiliates (collectively, "XXXXXXXXX")
pursuant to that certain Purchase Agreement, by and between the Company and
Xxxxxxxxx, dated as of even date herewith. The Interests acquired hereby shall
have the rights, preferences, privileges and restrictions set forth in the
Operating Agreement.
2.4 AUTHORIZATION. All limited liability company action on the part of
the Company, its managers, members, directors and officers necessary for the
authorization, execution, delivery and performance of this Agreement and the
Operating Agreement by the Company, the authorization of the transfer of the
Interests and the performance of all of the Company's obligations hereunder and
under the Operating Agreement have been taken or will be taken prior to the
Closing. This Agreement and the Operating Agreement constitute valid and legally
binding obligations of the Company, enforceable in accordance with their
respective terms, subject to laws of general application relating to bankruptcy,
insolvency and the relief of debtors and rules of law governing specific
performance, injunctive relief or other equitable remedies.
2.5 VALID ISSUANCE OF THE COMPANY'S INTERESTS. The Interests will, upon
issuance pursuant to the terms hereof, be duly authorized and validly issued in
compliance with the Certificate of Formation of the Company and the Operating
Agreement, and such Interests will be free and clear of any liens or
encumbrances; provided, however, that the Interests shall be subject to
restrictions on transfer under state and/or federal securities laws and pursuant
to the terms of the Operating Agreement.
2.6 NO CONFLICT. The execution and delivery of this Agreement by the
Company and the consummation of the transactions contemplated hereby will not
conflict with or result in any violation of or default by the Company (with or
without notice or lapse of time, or both) under, or give rise to a right of
termination, cancellation or acceleration of any obligation or to a loss of a
benefit under (i) any provision of the organizational documents of the Company
or (ii) any agreement or instrument, permit, franchise, license, judgment,
order, statute, law, ordinance, rule or regulations, applicable to the Company
or its respective properties or assets.
2.7 BROKERS. The Company has not retained, utilized or been represented
by any broker or finder in connection with the transactions contemplated by this
Agreement.
2.8 CONSENTS. All consents, approvals, orders and authorizations
required on the part of the Company in connection with the execution, delivery
or performance of this Agreement and the consummation of the transactions
contemplated herein have been obtained and are effective as of the Closing.
3. REPRESENTATIONS AND WARRANTIES OF THE SELLER. The Seller represents and
warrants to MDCP as follows:
3.1 VALID TRANSFER OF THE SELLER'S ECONOMIC INTERESTS. The Economic
Interests will be transferred to MDCP free and clear of any liens or
encumbrances; provided, however, that the Economic Interests shall be subject to
restrictions on transfer under state and/or federal securities laws and pursuant
to the terms of the Operating Agreement.
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4. REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS. Each of the Purchasers
represents and warrants to the Company as follows:
4.1 AUTHORIZATION. All action on the part of each Purchaser and, if
applicable, its officers, directors, managers, members, shareholders and/or
partners necessary for the authorization, execution, delivery and performance of
this Agreement and the consummation of the transactions contemplated herein has
been taken. When executed and delivered, this Agreement will constitute the
legal, valid and binding obligation of each Purchaser, enforceable against each
Purchaser in accordance with its terms, except as such may be limited by
bankruptcy, insolvency, reorganization or other laws affecting creditors' rights
generally and by general equitable principles. Each Purchaser has all requisite
power and authority to enter into each of this Agreement and to carry out and
perform its obligations under the terms of this Agreement.
4.2 PURCHASE ENTIRELY FOR OWN ACCOUNT. Each Purchaser is acquiring the
Membership Interests for its own account for investment and not for resale or
with a view to distribution thereof in violation of the Securities Act of 1933,
as amended, and all of the rules and regulations promulgated thereunder (the
"SECURITIES ACT").
4.3 INVESTOR STATUS; ETC. Each Purchaser certifies and represents to
the Company that it is an "Accredited Investor" as defined in Rule 501 of
Regulation D promulgated under the Securities Act and was not organized for the
purpose of acquiring any of the Membership Interests. Each Purchaser's financial
condition is such that it is able to bear the risk of holding the Membership
Interests for an indefinite period of time and the risk of loss of its entire
investment. Each Purchaser has been afforded the opportunity to ask questions of
and receive answers from the management of the Company concerning this
investment and has sufficient knowledge and experience in investing in companies
similar to the Company in terms of the Company's stage of development so as to
be able to evaluate the risks and merits of its investment in the Company.
4.4 MEMBERSHIP INTERESTS NOT REGISTERED. Each Purchaser understands
that the Membership Interests have not been registered under the Securities Act,
by reason of their issuance by the Company in a transaction exempt from the
registration requirements of the Securities Act. Each Purchaser understands that
the exemptions from registration afforded by Rule 144 (the provisions of which
are known to it) promulgated under the Securities Act depend on the satisfaction
of various conditions, and that, if applicable, Rule 144 may afford the basis
for sales only in limited amounts.
4.5 INVESTMENT REPRESENTATIONS. Each Purchaser represents and warrants
to the Company that: (i) it is a Delaware limited partnership, or a Delaware
limited liability company, as the case may be, (ii) each of its constituent
members is an "accredited investor" as such term is defined in Rule 501(a)
promulgated under the Securities Act, (iii) its principal office is located in
Three First Xxxxxxxx Xxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxxx 00000, and (iv) the
principal office of its general partner, or its manager, as the case may be, is
located in Three First Xxxxxxxx Xxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxxx 00000.
4.6 NO CONFLICT. The execution and delivery of this Agreement by each
Purchaser and the consummation of the transactions contemplated hereby will not
conflict with or result in any violation of or default by any Purchaser (with or
without notice or lapse of time, or both)
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under, or give rise to a right of termination, cancellation or acceleration of
any obligation or to a loss of a benefit under (i) any provision of the
organizational documents of any Purchaser or (ii) any agreement or instrument,
permit, franchise, license, judgment, order, statute, law, ordinance, rule or
regulations, applicable to any Purchaser or its respective properties or assets.
4.7 BROKERS. None of the Purchasers has retained, utilized or been
represented by any broker or finder in connection with the transactions
contemplated by this Agreement.
4.8 CONSENTS. All consents, approvals, orders and authorizations
required on the part of each Purchaser in connection with the execution,
delivery or performance of this Agreement and the consummation of the
transactions contemplated herein have been obtained and are effective as of the
Closing.
5. CONDITIONS TO THE OBLIGATIONS OF THE COMPANY AT CLOSING. The obligations of
the Company under Section 1 of this Agreement are subject to the fulfillment at
or before the Closing of each of the following conditions, any of which may be
waived in writing by the Company:
5.1 INSTRUMENT OF ACCESSION. Each Purchaser shall execute an Instrument
of Accession, substantially in the form of EXHIBIT A attached hereto,
simultaneously with the purchase of the Membership Interests hereunder, in order
to become a party to the Operating Agreement thereby agreeing to be bound by the
restrictions set forth in the Operating Agreement.
5.2 PERFORMANCE. Each Purchaser shall have performed or fulfilled all
agreements, obligations and conditions contained herein required to be performed
or fulfilled by them before the Closing.
5.3 PROCEEDINGS SATISFACTORY. All partnership, and/or limited liability
company, as the case may be, and legal proceedings taken by the Purchasers in
connection with the transactions contemplated by this Agreement and all
documents and papers relating to such transactions shall be satisfactory to the
Company, in the reasonable exercise of the judgment of the Company.
6. CONDITIONS TO THE OBLIGATIONS OF THE PURCHASERS AT CLOSING. The obligations
of the Purchasers under Section 1 of this Agreement are subject to the
fulfillment at or before the Closing of each of the following conditions, any of
which may be waived in writing by the Purchasers:
6.1 CONVERSION OF ECONOMIC INTERESTS. MDCP shall have received evidence
that the Economic Interests were converted into full membership interests of the
Company at or prior to the date hereof so that such Economic Interests,
effective immediately upon the transactions contemplated hereunder, shall have
all of the attendant rights and privileges that accompany full membership
interests pursuant to the Operating Agreement.
6.2 PERFORMANCE. The Company shall have performed or fulfilled all
agreements, obligations and conditions contained herein required to be performed
or fulfilled by them before the Closing.
6.3 PROCEEDINGS SATISFACTORY. All limited liability company and legal
proceedings taken by the Company in connection with the transactions
contemplated by this Agreement and
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all documents and papers relating to such transactions shall be satisfactory to
the Purchasers, in the reasonable exercise of the judgment of the Purchasers.
7. MISCELLANEOUS
7.1 ENTIRE AGREEMENT; SUCCESSORS AND ASSIGNS. This Agreement and the
exhibits hereto constitute the entire agreement among the parties relative to
the subject matter hereof. Any previous agreement among the parties is
superseded by this Agreement. Subject to the exceptions specifically set forth
in this Agreement, the terms and conditions of this Agreement shall inure to the
benefit of and be binding upon the respective executors, administrators, heirs,
successors and assigns of the parties.
7.2 GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware applicable to contracts
entered into and wholly to be performed within the State of Delaware by Delaware
residents.
7.3 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be an original, but all of which together
shall constitute one and the same instrument.
7.4 HEADINGS. The headings of the Sections of this Agreement are for
convenience and shall not by themselves determine the interpretation of this
Agreement.
7.5 NOTICES. Any notice required or permitted hereunder shall be given
in writing and shall be conclusively deemed effectively given upon personal
delivery, or by telecopier (confirmed thereafter by U.S. mail) or delivery by
overnight courier, or five days after deposit in the United States mail, by
registered or certified mail, postage prepaid, addressed as set forth below
(with copies as indicated), or at such other address as each party may designate
by ten (10) days' advance written notice to all other parties:
IF TO THE COMPANY: IF TO THE PURCHASERS:
000 Xxxxxxxx Xxxxxx, 0xx Xxxxx Three First Xxxxxxxx Xxxxx, Xxxxx 0000
Xxxxxx, XX 00000 Xxxxxxx, Xxxxxxxx 00000
Attention: President and CEO Attention: Xxxxxx X. Xxxxxxx,
Telecopier No.: (000) 000-0000 Xxxxxx X. Xxxxxxxx
Telecopier No.: (000) 000-0000
WITH COPIES TO: WITH A COPY TO:
Xxxxxxx Xxxx LLP Xxxxxxxx & Xxxxx
000 Xxxxxxx Xxxxxx 000 X. Xxxxxxxx Xxxxxx
Xxxxxx, XX 00000 Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxxx X. Xxxxxxxxx, Esq. Attention: Xxxxxxx X. Xxxxxx, Esq.
Telecopier No.: (000) 000-0000 Telecopier No.: (000) 000-0000
7.6 SURVIVAL OF WARRANTIES. The representations and warranties of the
parties contained in or made pursuant to this Agreement shall survive the
execution and delivery of this Agreement and the Closing; provided, however,
that, except as provided above, such
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representations and warranties need only be accurate as of the date of such
execution and delivery and as of the Closing.
7.7 AMENDMENT OF AGREEMENT. Any provision of this Agreement may be
amended by a written instrument by agreement of the parties hereto.
[SIGNATURE PAGE TO FOLLOW]
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IN WITNESS WHEREOF, the parties hereto have executed this Purchase
Agreement as of the day and year first above written.
XXXXXXXXXXXXX.XXX, LLC
a Delaware limited liability company
By: /s/ Xxxx X. Xxxxx
------------------------------------
Name: Xxxx X. Xxxxx
Title: President and CEO
Address: 000 Xxxxxxxx Xxxxxx
Xxxxxx, XX 00000
MADISON DEARBORN CAPITAL
PARTNERS III, L.P.
a Delaware limited partnership
By: Madison Dearborn Partners III, L.P.,
its general partner
By: Madison Dearborn Partners, LLC,
its general partner
By: /s/ Xxxxxx Xxxxxxx
----------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Managing Director
Address: Three First Xxxxxxxx Xxxxx,
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
MADISON DEARBORN SPECIAL
EQUITY III, L.P.
a Delaware limited partnership
By: Madison Dearborn Partners III, L.P.,
its sole general partner
By: Madison Dearborn Partners, LLC,
its sole general partner
By: /s/ Xxxxxx Xxxxxxx
_________________________________
Name: Xxxxxx X. Xxxxxxx
Title: Managing Director
Address: Three First National Plaza,
Suite 3800
Xxxxxxx, Xxxxxxxx 00000
SPECIAL ADVISORS FUND I, LLC
a Delaware limited liability company
By: Madison Dearborn Partners, LLC
its manager
By: /s/ Xxxxxx Xxxxxxx
Name: Xxxxxx X. Xxxxxxx
Title: Managing Director
Address: Three First National Plaza,
Suite 3800
Xxxxxxx, Xxxxxxxx 00000
/s/ Xxx Xxxxxxx
_____________________________________________
Xxx Xxxxxxx
Address: 000 Xxxxxxx Xxxxxx #0
_____________________________________
Xxxxxx, XX 00000
_____________________________________
SCHEDULE 1
ALLOCATION OF MEMBERSHIP INTERESTS AND PURCHASE PRICE
PURCHASE FROM THE SELLER
- MDCP is purchasing 157,252 Economic Interests from Xxx Xxxxxxx for a total
purchase price of $1,000,000.
PURCHASE FROM THE COMPANY
- MDCP is purchasing 281,180 Interests from the Company for a total purchase
price of $1,788,091.27.
- MDSE is purchasing 9,735 Interests from the Company for a total purchase
price of $61,907.14.
- SAF is purchasing 23,588 Interests from the Company for a total purchase
price of $150,001.59.
EXHIBIT A
INSTRUMENT OF ACCESSION
Reference is hereby made to that certain Amended and Restated Operating
Agreement for XxxxxXxxxxxxx.xxx, LLC, a Delaware limited liability company (the
"COMPANY"), dated as of June 1, 1999 (as amended, the "OPERATING AGREEMENT"), by
and among the Persons (as defined in the Operating Agreement) whose names are
set forth on Exhibit A thereto.
_______________________, as the [transferee and/or purchaser] of an
aggregate of ________ Membership Interests (as defined in the Operating
Agreement) of the Company, hereby agrees to become and hereby does become a
"MEMBER" of the Company and agrees to be bound by all of the terms and
provisions of the Operating Agreement as a Member of the Company.
IN WITNESS WHEREOF, the undersigned has executed and delivered this
Instrument of Accession as of the ___ day of ________, 1999.
[NAME OF TRANSFEREE/PURCHASER]
By:_______________________________
Name:
Title:
Address:__________________________
__________________________
__________________________
Accepted and Agreed to as of the
date set forth above.
XXXXXXXXXXXXX.XXX, LLC
By: ________________________________
Name:
Title:
