Contract
EXHIBIT
2.3
EXECUTION
COPY
OF
AMERICAN
CAPITAL STRATEGIES, LTD.
Commitment
Agreement, dated as of March 28, 2008 (this “Commitment
Agreement”), by American Capital Strategies, Ltd., a Delaware corporation
(“ACAS”), in
favor of Merisel, Inc., a Delaware corporation (the “Company”).
1. LIMITED
GUARANTEE. To induce the Company to enter into an Agreement
and Plan of Merger dated as of the date hereof (as amended, amended and
restated, supplemented or otherwise modified from time to time, the “Merger Agreement”),
among TU Holdings, Inc., a Delaware corporation (“Parent”), TU Merger,
Inc., a wholly-owned subsidiary of Parent and a Delaware corporation (“Merger Sub”), and the
Company, ACAS hereby unconditionally and irrevocably guarantees to the Company,
the due and punctual observance, performance and discharge of any payment
obligations of Parent with respect to the Reverse Termination Fee payable by
Parent pursuant to Section 6.3(b) of the Merger Agreement (the “Obligations”); provided that in no
event shall ACAS’s liability under this Commitment Agreement exceed $3,500,000
(the “Cap”).
The parties agree that this Commitment Agreement may not be enforced without
giving effect to the Cap. The Company hereby agrees that in no event
shall ACAS be required to pay any amount to the Company under, in respect of, or
in connection with this Commitment Agreement or the Merger Agreement other than
as expressly set forth herein. All payments hereunder shall be made
in lawful money of the United States, in immediately available
funds. Each capitalized term or other term used and not defined
herein but defined in the Merger Agreement shall have the meaning ascribed to it
in the Merger Agreement, except as otherwise provided.
2. NATURE OF
GUARANTEE. The Company shall not be obligated to file any
claim relating to any Obligation in the event that Parent or Merger Sub becomes
subject to a bankruptcy, reorganization or similar proceeding, and the failure
of the Company to so file shall not affect the obligations of ACAS
hereunder. In the event that any payment to the Company in respect of
any Obligation is rescinded or must otherwise be returned for any reason
whatsoever, ACAS shall remain liable hereunder with respect to the Obligation as
if such payment had not been made. This Commitment Agreement is an
unconditional guarantee of payment and not of collection.
3. CERTAIN
WAIVERS. ACAS agrees that the obligations of ACAS hereunder
shall not be released or discharged, in whole or in part, or otherwise affected
by (a) the failure of the Company to assert any claim or demand or to enforce
any right or remedy against Parent; (b) any change in the time, place or manner
of payment of any of the Obligations; (c) any rescission, waiver, compromise,
consolidation or other amendment or modification of any of the terms or
provisions of the Merger Agreement or any other agreement evidencing, securing
or otherwise executed in connection with any of the Obligations; (d) any change
in the corporate existence, structure or ownership of Parent; (e) any
insolvency, bankruptcy, reorganization or other similar proceeding affecting
Parent or, (f) any defenses or benefits that may be derived from or afforded by
law which limit the liability of or exonerate ACAS or sureties (other than
pursuant to the Cap), in each case which may conflict with the terms of this
Commitment Agreement; (g) the adequacy of any other means the Company may have
of obtaining repayment of any of the Obligations; or (h) the existence of any
claim or set-off which ACAS or any of its affiliates may have at any time
against Parent, Merger Sub or the Company in connection with the Obligations or
otherwise. To the fullest extent permitted by law, ACAS hereby
expressly waives any and all rights or defenses arising by reason of any law
which would otherwise require any election of remedies by the
Company. ACAS waives promptness, diligence, notice of the acceptance
of this Commitment Agreement and of the Obligations, presentment, demand for
payment, notice of non-performance, default, dishonor and protest, notice of any
Obligations incurred and all other notices of any kind (except for notices to be
provided to Parent and its counsel in accordance with the Merger Agreement), all
defenses which may be available by virtue of any valuation, stay, moratorium law
or other similar law now or hereafter in effect, any right to require the
marshalling of assets of Parent or any other person interested in the
transactions contemplated by the Merger Agreement, and all suretyship defenses
generally (other than fraud or willful misconduct by the Company or any of its
subsidiaries, defenses to the payment of the Obligations that are available to
Parent under the Merger Agreement or breach by the Company of this Commitment
Agreement). ACAS acknowledges that it will receive substantial direct
and indirect benefits from the transactions contemplated by the Merger Agreement
and that the waivers set forth in this Commitment Agreement are knowingly
made in contemplation of such benefits.
The
Company hereby covenants and agrees that it shall not institute, and shall cause
its respective affiliates not to institute, any proceeding or bring any other
claim arising under, or in connection with, the Merger Agreement or the
transactions contemplated thereby, against any ACAS or Parent Affiliate (as
defined below) except for claims against ACAS under this Commitment Agreement,
and ACAS hereby covenants and agrees that it shall not institute, and shall
cause its respective affiliates not to institute, any proceeding asserting that
this Commitment Agreement is illegal, invalid or unenforceable in accordance
with its terms, subject to the effects of bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium or other similar laws affecting
creditors' rights generally, and general equitable principles (whether
considered in a proceeding in equity or at law).
ACAS
hereby unconditionally and irrevocably agrees not to exercise any rights that it
may now have or hereafter acquire against Parent that arise from the existence,
payment, performance, or enforcement of ACAS’s Obligations under or in respect
of this Commitment Agreement or any other agreement in connection therewith,
including, without limitation, any right of subrogation, reimbursement,
exoneration, contribution or indemnification and any right to participate in any
claim or remedy of the Company against Parent or such other person, whether or
not such claim, remedy or right arises in equity or under contract, statute or
common law, including, without limitation, the right to take or receive from
Parent, directly or indirectly, in cash or other property or by set-off or in
any other manner, payment or security on account of such claim, remedy or right,
unless and until all of the Obligations and all other amounts payable under this
Commitment Agreement shall have been paid in full in cash. If any amount shall
be paid to ACAS in violation of the immediately preceding sentence at any time
prior to the payment in full in cash of the Obligations and all other amounts
payable under this Commitment Agreement, such amount shall be received and held
in trust for the benefit of the Company, shall be segregated from other property
and funds of ACAS and shall forthwith be paid or delivered to the Company in the
same form as so received (with any necessary endorsement or assignment) to be
credited and applied to the Obligations and all other amounts payable under this
Commitment Agreement, in accordance with the terms of the Merger
Agreement.
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4. NO WAIVER; CUMULATIVE
RIGHTS. No failure on the part of the Company to exercise, and
no delay in exercising, any right, remedy or power hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise by the Company of any
right, remedy or power hereunder preclude any other or future exercise of any
right, remedy or power. Each and every right, remedy and power hereby
granted to the Company or allowed it by law or other agreement shall be
cumulative and not exclusive of any other, and may be exercised by the Company
at any time or from time to time.
5. REPRESENTATIONS AND
WARRANTIES. ACAS hereby represents and warrants
that:
(a) the
execution, delivery and performance of this Commitment Agreement have been duly
authorized by all necessary action and do not contravene any provision of ACAS’s
charter or bylaws or any law, regulation, rule, decree, order, judgment or
contractual restriction binding on ACAS or its assets;
(b) all
consents, approvals, authorizations, permits of, filings with and notifications
to, any governmental authority necessary for the due execution, delivery and
performance of this Commitment Agreement by ACAS have been obtained or made and
all conditions thereof have been duly complied with, and no other action by, and
no notice to or filing with, any governmental authority or regulatory body is
required in connection with the execution, delivery or performance of this
Commitment Agreement;
(c) this
Commitment Agreement constitutes a legal, valid and binding obligation of ACAS
enforceable against ACAS in accordance with its terms, subject to (i) the
effects of bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium or other similar laws affecting creditors’ rights generally, and (ii)
general equitable principles (whether considered in a proceeding in equity or at
law); and
(d) ACAS has
the financial capacity to pay and perform its obligations under this Commitment
Agreement, and all funds necessary for ACAS to fulfill its Obligations under
this Commitment Agreement shall be available to ACAS for so long as this
Commitment Agreement shall remain in effect in accordance with Section 8
hereof.
6. ASSIGNMENT. Neither
ACAS nor the Company may assign their respective rights, interests or
obligations hereunder to any other person (except by operation of law) without
the prior written consent of the Company or ACAS, as the case may
be.
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7. NOTICES. All
notices and other communications hereunder shall be in writing and shall be
given (a) on the date of delivery if delivered personally, (b) on the first
business day following the date of dispatch if delivered by a nationally
recognized next day courier service, (c) on the fifth business day following the
date of mailing if delivered by registered or certified mail (postage prepaid,
return receipt requested) or (d) if sent by facsimile transmission, when
transmitted and receipt is confirmed. All notices to ACAS hereunder shall be
delivered as set forth below or to such other address or facsimile number as
ACAS shall have notified the Company in a written notice delivered to the
Company in accordance with the Merger Agreement:
American
Capital Strategies, Ltd.
0
Xxxxxxxx Xxxxx Xxxxxx, 00xx
Xxxxx
Xxxxxxxx,
XX 00000
Facsimile: (000)
000-0000
Attention: Compliance
Officer
with
separate copies (which shall not constitute notice) to:
O’Melveny
& Xxxxx LLP
Times
Square Tower
0 Xxxxx
Xxxxxx
Xxx Xxxx,
XX 00000
Facsimile: 000-000-0000
Attention: Xxxxxxx
X. Xxxxx, Xx., Esq.
All
notices to the Company hereunder shall be addressed as set forth below or to
such other address or facsimile number as the Company shall have notified to
ACAS in a written notice delivered to ACAS in accordance with the Merger
Agreement:
Merisel,
Inc.
000 Xxxx
00xx Xxxxxx
Xxx Xxxx,
XX 00000
Facsimile: (000)
000-0000
Attention: Xxxxxx
X. Xxxx
with
separate copies (which shall not constitute notice) to:
Weil,
Gotshal & Xxxxxx LLP
000 Xxxxx
Xxxxxx
Xxx Xxxx,
XX 00000
Facsimile: 000-000-0000
Attention: Xxxxxxx
X. Xxxxxx, Esq.
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8. CONTINUING
GUARANTEE. This Commitment Agreement shall remain in full
force and effect and shall be binding on ACAS, its successors and assigns until
all of the Obligations and all amounts payable under this Commitment Agreement
have been paid, observed, performed or satisfied in
full. Notwithstanding the foregoing, this Commitment Agreement shall
terminate and ACAS shall have no further obligations under this Commitment
Agreement as of the earliest to occur of (i) the Closing and the payment of
the aggregate Merger Consideration, (ii) receipt in full by the Company or
its affiliates of the payment obligations of Parent pursuant to Section 6.3(b)
of the Merger Agreement, (iii) termination of the Merger Agreement pursuant
to Section 6.1 thereof under circumstances that do not give rise to any payment
obligations of Parent pursuant to Section 6.3(b) of the Merger Agreement and
(iv) the one year anniversary of any other termination of the Merger Agreement
in accordance with its terms, except as to a claim for payment of any Obligation
presented by the Company to Parent, Merger Sub or ACAS on or prior to such one
year anniversary; provided, that such
claim shall set forth in reasonable detail the basis for such claim and ACAS
shall not be required to pay any claim not submitted on or before the one year
anniversary of such termination of the Merger
Agreement. Notwithstanding the foregoing, in the event that the
Company or any of its affiliates asserts in any litigation or other proceeding
that the provisions of Section 1 hereof limiting ACAS’s liability to the Cap or
the provisions of this Section 8 or Section 9 hereof are illegal, invalid or
unenforceable in whole or in part, or asserting any theory of liability against
ACAS or any ACAS or Parent Affiliates with respect to the transactions
contemplated by the Merger Agreement other than liability of ACAS under this
Commitment Agreement (as limited by the provisions of Section 1), then (A) the
obligations of ACAS under this Commitment Agreement shall terminate ab initio and be null and
void, (B) if ACAS has previously made any payments under this Commitment
Agreement, it shall be entitled to recover such payments, and (C) neither ACAS
nor any ACAS or Parent Affiliate shall have any liability to the Company with
respect to the transactions contemplated by the Merger Agreement under this
Commitment Agreement or otherwise.
9. NO
RECOURSE. The Company acknowledges that, as of the date
hereof, each of Parent’s and Merger Sub’s sole assets are a de minimis amount of cash,
and that no additional funds are expected to be contributed to Parent unless and
until the Closing occurs. Notwithstanding anything that may be expressed or
implied in this Commitment Agreement or any document or instrument delivered
contemporaneously herewith, (i) in no event shall the Company or any of its
Subsidiaries seek any other Company Damages or any other recovery, judgment, or
damages of any kind, including consequential, indirect, or punitive damages,
against Parent, Merger Sub or any ACAS or Parent Affiliate (as defined below) in
excess of the Cap in connection with the Merger Agreement or the transactions
contemplated thereby, and (ii) by its acceptance of the benefits of this
Commitment Agreement, the Company acknowledges and agrees that it has no right
of recovery against, and no personal liability shall attach to, in each case,
with respect to Company Damages in connection with the Merger Agreement or the
transaction contemplated thereby, ACAS or the former, current or future
stockholders, controlling persons, directors, officers, employees, agents,
affiliates, members, managers, general or limited partners or assignees of ACAS
or Parent or any former, current or future stockholder, controlling person,
director, officer, employee, general or limited partner, member, manager,
affiliate, agent or assignee of any of the foregoing (each an “ACAS or Parent
Affiliate”), through Parent or otherwise, whether by or through attempted
piercing of the corporate veil, by or through a claim by or on behalf of Parent
against any ACAS or Parent Affiliate, by the enforcement of any assessment or by
any legal or equitable proceeding, by virtue of any statute, regulation or
applicable law, or otherwise, except for its rights to recover from ACAS (but
not any ACAS or Parent Affiliate) under and to the extent provided in this
Commitment Agreement and subject to the Cap and the other limitations described
herein. Recourse against ACAS under this Commitment Agreement shall
be the sole and exclusive remedy of the Company and all of its affiliates
against ACAS and ACAS or Parent Affiliates in respect of any liabilities or
obligations arising under, or in connection with, the Merger Agreement or the
transactions contemplated thereby. Nothing set forth in this Commitment
Agreement shall confer or give or shall be construed to confer or give to any
Person other than the Company (including any Person acting in a representative
capacity) any rights or remedies against any Person other than ACAS as expressly
set forth herein.
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10. GOVERNING
LAW. This Commitment Agreement shall be governed by, and
construed in accordance with, the laws of the State of Delaware, regardless of
any Laws that might apply the laws of any other jurisdiction. In any
Action between any of the parties arising out of or relating to this Commitment
Agreement, (i) each of the parties irrevocably and unconditionally consents
and submits to the exclusive personal and subject matter jurisdiction and venue
of the federal or state courts of the State of Delaware and shall not deny or
contest such jurisdiction and venue (including by claiming that such court is an
inconvenient forum), and (ii) each of the parties irrevocably consents to
service of process by first class certified mail, return receipt requested,
postage prepaid, to the address at which such party is to receive notice in
accordance with Section 7.
11. WAIVER OF JURY
TRIAL. EACH PARTY HERETO ACKNOWLEDGES AND AGREES THAT ANY
CONTROVERSY WHICH MAY ARISE UNDER THIS COMMITMENT AGREEMENT IS LIKELY TO INVOLVE
COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE EACH SUCH PARTY HEREBY
IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL
BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RELATING TO THIS COMMITMENT AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY. EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (I) NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK
TO ENFORCE THE FOREGOING WAIVER, (II) SUCH PARTY UNDERSTANDS AND HAS CONSIDERED
THE IMPLICATIONS OF THIS WAIVER, (III) SUCH PARTY MAKES THIS WAIVER VOLUNTARILY
AND (IV) SUCH PARTY HAS BEEN INDUCED TO ENTER INTO THIS COMMITMENT AGREEMENT BY,
AMONG OTHER THINGS, THE MUTUAL WAIVERS AND AGREEMENTS CONTAINED IN THIS SECTION
11.
12. COUNTERPARTS. This
Commitment Agreement may be executed and delivered (including by facsimile
transmission) in one or more counterparts, and by the different parties hereto
in separate counterparts, each of which when executed shall be deemed to be an
original but all of which taken together shall constitute one and the same
instrument.
[Signature Page
Follows]
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IN
WITNESS WHEREOF, ACAS has caused this Commitment Agreement to be executed and
delivered as of the date first written above by its officer thereunto duly
authorized.
| AMERICAN CAPITAL STRATEGIES, LTD. | |||
|
|
By:
|
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| Name: | |||
| Title: | |||
IN
WITNESS WHEREOF, the Company has caused this Commitment Agreement to be executed
and delivered as of the date first written above by its officer thereunto duly
authorized.
| MERISEL, INC. | |||
|
|
By:
|
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| Name: | |||
| Title: | |||
