Exhibit 10.6
SUBSCRIPTION AGREEMENT FOR FORTRESS INVESTMENT FUND LLC
Fortress Investment Fund LLC
c/o Fortress Investment Group LLC
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xx. Xxxxxx X. Xxxxxxx
Ladies and Gentlemen:
The undersigned hereby subscribes for the percentage of membership
interests (the "Membership Interests") in Fortress Investment Fund LLC, a
Delaware limited liability company (the "Fund"), set forth on the signature page
hereof for the Commitment amount set forth thereon (minimum subscription $10
million of Commitments, subject to the discretion of Fortress Fund MM LLC
("Managing Member") and the Fund to accept subscriptions for less $10 million of
Commitments). Terms used but not defined herein have the same meanings ascribed
thereto in the Confidential Private Placement Memorandum (as the same has been
amended, supplemented or modified from time to time, the "Memorandum"), pursuant
to which the Membership Interests of the Fund are being offered. Capitalized
terms used but not otherwise defined herein have the meanings ascribed thereto
in the Memorandum.
I. The undersigned hereby agrees that this subscription is and shall be
revocable until accepted by the Fund. The undersigned has been furnished with
and has carefully read the Memorandum. The undersigned is aware that:
(a) The Fund has only recently been formed and has no financial or
operating history.
(b) The Fund reserves the unrestricted right to reject any
subscription, in whole or in part, and no subscription will be binding unless
and until accepted by the Fund. Subscriptions need not be accepted in the order
received.
(c) There are substantial risks incident to the purchase of Membership
Interests, as summarized under "Certain Investment Considerations and Potential
Conflicts of Interest" and in other portions of the Memorandum.
(d) Managing Member will receive compensation in connection with the
Fund irrespective of the success of the Fund's operations, and Affiliates of
Managing Member may now be (and in the future may continue to be) engaged in
businesses that are competitive with that of the Fund. The undersigned agrees
and consents to these activities even though there may be conflicts of interest
inherent in such activities and even though the undersigned will have no
interest in such activities, subject to any restrictions with respect to such
activities as set forth in the Memorandum.
(e) No U.S. federal or state government or foreign agency has passed
upon or endorsed the Membership Interests or made any finding or determination
as to the fairness of this investment.
(f) The discussion of the tax consequences arising from an investment
in the Fund set forth in the Memorandum is general in nature, and the tax
consequences to the undersigned of an investment in the Fund may depend on its
circumstances. Neither the Fund, Managing Member nor any their respective
Affiliates or consultants, assumes any responsibility for the tax consequences
to the undersigned of any investment in the Fund. The undersigned should consult
its own tax advisors regarding such issues.
(g) There can be no assurance that the Internal Revenue Code of 1986,
as amended (the "Code") or the regulations thereunder will not be amended in
such a manner as to materially and adversely affect the tax treatment of the
Fund or its members. There can be no assurance that any applicable tax treaty or
foreign tax law will not be amended or changed in such a manner is to deprive
the holders of Membership Interest of some or all of the tax benefits they might
now receive.
(h) The undersigned is subscribing for, and upon acceptance by the
Fund, will become obligated to purchase, all of the Membership Interests
subscribed for as indicated on the undersigned's Signature Page attached hereto.
(i) Each Subscriber must contribute its pro rata share, in accordance
with its share of the total Commitments, of the total amount requested by
Managing Member to be contributed on the date of the Initial Closing. The
balance of the Commitments will be called for by Managing Member, upon 10
business days' prior written notice to all Subscribers who will be required to
contribute additional portions of their Commitments, on an as needed basis
within three years after the final Closing, except that after the termination of
such three-year period
2
Commitments may be called for by Managing Member for the limited purposes of (x)
paying Fund expenses, including principal and interest and other sums due
pursuant to the Fund's financing facilities, (y) completing investments of the
Fund in progress at the end of such three-year period and (z) effecting
follow-on investments in existing Fund investments up to an aggregate of fifteen
percent (15%) of total Commitments. All Subscribers acquiring Membership
Interests after the Initial Closing will fund a pro rata portion of Commitments
in their Closings on the basis of existing Fund investments valued at cost, plus
expenses, and otherwise pro rata on the basis of capital then to be drawn with
respect to identified, prospective Fund investments.
(j) Should the undersigned default in its obligation to make any
required contribution of any portion of its Commitments, the undersigned agrees
that the Fund may exercise any remedy available to it at law or in equity. The
undersigned agrees that, not in limitation of any of the Fund's remedies,
interest will accrue on the portion of its Commitment which the undersigned
fails to fund, at the prime rate plus 2% per annum, up to the highest rate
permitted under law. The Fund shall also be entitled to reimbursement from the
undersigned for any and all costs and expenses incurred by the Fund in
collecting any portion of the Commitments the undersigned fails to fund when
required from the undersigned including, without limitation, attorneys' fees and
disbursements (to the extent allowed under applicable law). Additionally, in the
event of such a default, the undersigned may be subject to the additional
remedies set forth in the Memorandum, as more particularly described in the
Limited Liability Company Operating Agreement of the Fund (the "Fund
Agreement").
(k) The undersigned must bear the economic risk of its investment in
the Fund for an indefinite period of time since the Membership Interests have
not been registered for sale under the Securities Act and, therefore, cannot be
sold or otherwise transferred unless either they are subsequently registered
under the Securities Act or an exemption from such registration is available,
and the Membership Interests cannot be sold or otherwise transferred unless they
are registered under applicable state securities or blue sky laws or an
exemption from such registration is available. The Managing Member currently has
no intention of registering Membership Interests, and will be under no
obligation to do so now or in the future.
(l) There is no established market for the Membership Interests, none
is expected to develop and the undersigned bears the risk that no active trading
market will develop. The Managing Member currently has no intention to
facilitate the transfer of Membership Interests.
(m) The undersigned's right to transfer the Membership Interests is
restricted by the terms of the Fund Agreement.
(n) If the undersigned is a resident in the State of New York, the
undersigned acknowledges the following: (i) this offering of Membership
Interests has not been reviewed by the Attorney General of the State of New York
because of the offeror's representations that this is intended to be a
non-public offering pursuant to Regulation D of the Securities Act, and that if
all of the conditions and limitations of Regulation D of the Securities Act are
not complied with, the offering will be resubmitted to the Attorney General for
amended exemption. The undersigned understands that any offering literature used
in connection with this offering has not been prefiled with the Attorney General
and has not been reviewed by the Attorney General. The Membership Interests are
being purchased for the undersigned's own account for investment, and not for
distribution or resale to others. The undersigned agrees that it will only sell
or otherwise transfer the Membership Interests in compliance with the Securities
Act and other applicable laws and
3
only (1) pursuant to Rule 144A under the Securities Act to an institutional
investor that the holder reasonably believes is a qualified institutional buyer,
within the meaning of Rule 144A ("QIB") purchasing for its own account or a QIB
purchasing for the account of a QIB, whom the holder has informed, in each case,
that the reoffer, resale, pledge, or other transfer is being made in reliance on
Rule 144A, (2) in an offshore transaction in accordance with Rule 903 or 904 of
Regulation S under the Securities Act, (3) pursuant to an exemption from
registration provided by Rule 144 under the Securities Act (if available),
subject to (a) the receipt by the Fund of a letter substantially in the form of
Schedule 1 or Schedule 2 attached hereto or (b) the receipt by the Fund of an
opinion of counsel acceptable to the Fund that such reoffer, resale, pledge or
other transfer is in compliance with the Securities Act, or (4) to the Fund or
its Affiliates. The undersigned represents that it has adequate means of
providing for its current needs and possible personal contingencies, and that it
has no need for liquidity of this investment; (ii) the undersigned understands
that all documents, records and books pertaining to this investment have been
made available for inspection by the undersigned and the undersigned's attorney
and/or accountant and/or offeree representative, and that the books and records
of the Fund will be available on reasonably advance notice, for inspection by
investors during reasonable hours at its principal place of business; and (iii)
the undersigned understands that the Fund annually will provide financial
statements, including a balance sheet and the related statements of income and
retained earnings and changes in financial position, accompanied by a report of
an independent public accountant stating that an audit of such financial
statements has been made in accordance with generally accepted auditing
standards, stating the opinion of the accountant in respect of the financial
statements and the accounting principles and practice reflected therein and as
to the consistency of the application of the accounting principles, and
identifying any matters to which the accountant takes exception and stating, to
the extent practicable, the effect of each such exception on such financial
statements.
(o) The undersigned hereby irrevocably constitutes and appoints the
Managing Member (and any substitute or successor managing member(s) of the Fund)
as its true and lawful attorney in its name, place and stead, (A) to receive and
pay over to the Fund on behalf of the undersigned all funds received hereunder,
(B) to complete or correct, on behalf of the undersigned, all documents to be
executed by the undersigned in connection with the undersigned's subscription
for Membership Interests, including, without limitation, filling in or amending
amounts, dates, and other pertinent information, and (C) as applicable, to
execute, acknowledge, swear to and file (i) any counterparts of the Fund
Agreement and amendments thereto to be entered into pursuant hereto and
amendments to the Fund Agreement (as provided therein), (ii) any agreements or
other documents relating to the obligations of the Fund, as limited and defined
in the Fund Agreement, (iii) any certificates of limited liability company
required by law and all amendments thereto, (iv) all certificates and other
instruments necessary to qualify, or continue the qualification of, the Fund in
the states where it may be doing business, (v) all assignments, conveyances or
other instruments or documents necessary to effect the dissolution of the Fund
and (vi) all other filings with agencies of the federal government, of any state
or local government, or of any other jurisdiction, which the Managing Member
considers necessary or desirable to carry out the purposes hereof, of the
Partnership Agreement and the business of the Fund. This power of attorney shall
be deemed coupled with an interest, shall be irrevocable and shall survive the
transfer of the undersigned's Membership Interest.
(p) The undersigned acknowledges and agrees that it is not entitled to
cancel, terminate or revoke this subscription, the power of attorney granted
hereby or any agreements of the undersigned hereunder, except as otherwise
provided (i) herein, or (ii) under applicable law, and such subscription and
agreements and power of attorney shall survive (x) changes in the transaction,
documents and instruments described in the Memorandum which in the aggregate are
not material or which are contemplated by the Memorandum and (y) the death,
disability,
4
incapacity, incompetency, termination, bankruptcy, insolvency or dissolution of
the undersigned; provided, however, that if the Fund shall not have accepted
this subscription on or before the latest date on which the Managing Member
accepts subscriptions for Membership Interests, this subscription, all
agreements of the undersigned hereunder and the power of attorney granted hereby
shall be canceled, and this Subscription Agreement will be returned to the
Investor.
II. The undersigned represents and warrants to Managing Member, its
Affiliates and the Fund that (The following representations and warranties shall
survive the closing date applicable to the undersigned and will be deemed to be
reaffirmed by the undersigned at any time the undersigned makes an additional
capital contribution to the Fund. The act of making such capital contributions
will be evidence of such reaffirmation.):
(1) The undersigned has carefully reviewed and understands the risks
of, and other considerations relating to, a purchase of the Membership Interests
and an investment in the Fund, including the risks set forth under "Certain
Investment Considerations and Potential Conflicts of Interest" in the Memorandum
and the considerations described under "Certain Federal Income Tax Consequences"
in the Memorandum. The undersigned has carefully read the Memorandum, including
the exhibits thereto.
(2) The undersigned has been furnished any materials relating to the
Fund, the offering of the Membership Interests or anything set forth in the
Memorandum that it has requested, including the Fund Agreement, trust
declarations, operating agreements or other relevant governance documents of
certain entities described in the Memorandum which are to be beneficially owned,
directly or indirectly, by the Fund (collectively, the "Organizational
Documents") and the management agreement and advisory agreement described in the
Memorandum (collectively, the "Management Agreements"), and has been afforded
the opportunity to ask questions and receive answers concerning the terms and
conditions of the Offering and obtain any additional information which the Fund
or Managing Member possesses or can acquire without unreasonable effort or
expense that is necessary to verify the accuracy of any representations or
information set forth in the Memorandum.
(3) Representatives of the Fund or Managing Member have answered all
inquiries that the undersigned has made of them concerning the Fund or any other
matters relating to the formation and proposed operation of the Fund and the
offering and sale of the Membership Interests. No statement, printed material or
inducement that is contrary to the information contained in the Memorandum has
been given or made by or on behalf of the Fund or Managing Member to the
undersigned. Other than as set forth in the Memorandum, the Organizational
Documents and the Management Agreements, the undersigned is not relying on any
other information, representation or warranty of the Fund. The undersigned has
consulted to the extent deemed appropriate by the undersigned with the
undersigned's own advisors as to the financial, tax, legal and related matters
concerning an investment in Membership Interests and on that basis believes that
an investment in the Membership Interests is suitable and appropriate for the
undersigned. The undersigned understands that Skadden, Arps, Slate, Xxxxxxx &
Xxxx LLP acts as counsel to the Fund and the Managing Member and no attorney
client relationship exists with any other persons solely by virtue of such
person making an investment.
(4) The undersigned has not been furnished any offering literature
other than the Memorandum, the documents attached as exhibits thereto and other
materials that the Fund or Managing Member may have provided as contemplated in
the Memorandum or at the request of the undersigned; and the undersigned has
relied only on the information contained in the
5
Memorandum and such exhibits and the information furnished or made available to
the undersigned by the Fund or Managing Member as described in subparagraph (b)
above.
(5) The undersigned's ordinary business includes buying or selling
shares and debentures (whether as principal or agent) or the undersigned has
such knowledge and experience in financial and business matters that the
undersigned is capable of evaluating the merits and risks of investment in the
Fund and of making an informed investment decision.
(6) The undersigned has adequate means of providing for its current
needs and possible future contingencies, and it has no need, and anticipates no
need in the foreseeable future, to sell the Membership Interests for which it
subscribes. The undersigned is able to bear the economic risks of this
investment and, consequently, without limiting the generality of the foregoing,
it is able to hold the Membership Interests for an indefinite period of time and
has sufficient net worth to sustain a loss of its entire investment in the Fund
in the event such loss should occur.
(7) The undersigned has no need for liquidity with respect to its
investment in the Fund and will have sufficient liquid assets to purchase all of
the Membership Interests subscribed for hereunder.
(8) Except as otherwise indicated herein, the undersigned is the sole
party in interest as to its investment in the Fund, and it is acquiring the
Membership Interests solely for investment for its own account and has no
present agreement, understanding or arrangement to subdivide, sell, assign,
transfer or otherwise dispose of all or any part of its Membership Interests to
any other person.
(9) All of the representations and information provided in the
undersigned's Confidential Investor Questionnaire, and any additional
information that the undersigned has furnished to the Fund with respect to the
undersigned's financial position are accurate and complete as of the date of
this Subscription Agreement. If there should be any material adverse change in
any such representations or information either prior or subsequent to the
issuance of the Membership Interests to the undersigned, the undersigned will
immediately furnish accurate and complete information concerning any such
material change to the Fund and Managing Member. The undersigned shall furnish
to the Fund any additional information that it or Managing Member may reasonably
request.
(10) The undersigned has not distributed the Memorandum to any other
entities and no entities other than the undersigned have used the Memorandum.
(11) The undersigned has not been organized or reorganized for the
specific purpose of acquiring the Membership Interests. If the undersigned is a
corporation, it has enclosed with this Subscription Agreement copies of its
Articles of Incorporation, By-laws (or other organizational documents as may be
applicable under the laws of the jurisdiction where it is organized) and the
corporate resolution or other evidence of the due authorization of the
individual executing the Signature Page so to act on behalf of the corporation,
all of which have been certified by the Secretary or an Assistant Secretary of
the corporation (or such other officer of the corporation as may be authorized
under applicable law) as being true and correct copies thereof and in full force
and effect. If the undersigned is a partnership, limited liability company or a
trust, the undersigned has enclosed with this Subscription Agreement a copy of
its Partnership Agreement or Operating Agreement (or other governing agreement)
or a copy of its Declaration of Trust (or other governing instrument), as the
case may be, together with evidence
6
of the due authorization of the individual executing the Signature Page so to
act on behalf of such partnership, limited liability company or trust, all of
which have been certified by an appropriate officer or trustee of such
Subscriber. All such documentation is complete, current and in effect as of the
date hereof.
(12) Except as previously disclosed to Managing Member and the Fund, no
Affiliate of the undersigned has subscribed to purchase any Membership
Interests.
(13) The undersigned (i) is a QIB or an institutional accredited
investor meeting the requirements of Rule 501(a)(1), (2), (3) or (7) of
Regulation D under the Securities Act that is not a QIB, (ii) has not and will
not solicit offers for, or offer or sell, the Membership Interests by means of
any form of general solicitation or general advertising (as those terms are used
in Regulation D under the Securities Act) or in any manner involving a public
offering within the meaning of Section 4(2) of the Securities Act and has not
and will not engage in any directed selling efforts (as defined in Rule 902
under the Securities Act) in the United States in connection with the Membership
Interests, (iii) is not purchasing with a view to or for offer or sale in
connection with any distribution that would be in violation of federal or state
law and (iv) will solicit offers for the Membership Interests pursuant to Rule
144A, Section 4(2) of the Securities Act or Regulation S, as applicable, only
from, and will offer, sell or deliver the Membership Interests only to,
respectively, (A) persons in the United States whom it reasonably believes to be
QIBs, (B) institutional accredited investors meeting the requirements of Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act that are not
QIBs or (C) non-U.S. persons outside the United States in reliance upon
Regulation S under the Securities Act.
III. The undersigned recognizes that the sale of Membership Interests
to it will be based upon its representations and warranties set forth above, and
the undersigned agrees on demand to indemnify and to hold harmless the Fund,
Managing Member, its Affiliates and each officer, director, stockholder,
employee, affiliate and/or partner of and of the foregoing, and their successors
and assigns, from and against any and all loss, damage, liability or expense,
including costs and attorneys' fees (to the extent allowed under applicable
law), to which they may be put or which they may incur by reason of, or in
connection with, any misrepresentation made by the undersigned in this
Subscription Agreement or in any other subscription document delivered herewith,
any breach by the undersigned of warranties and/or any failure by the
undersigned to fulfill any covenants or agreements set forth in this
Subscription Agreement or in the other subscription documents or arising out of
the sale or distribution of any Membership Interests by it in violation of the
Securities Act or any applicable state securities or blue sky 1aws or the
securities laws of any applicable jurisdiction. All representations, warranties
and covenants and the indemnification contained in this Subscription Agreement
and in the other subscription documents shall survive the acceptance of this
subscription and issuance of the Membership Interests to the undersigned.
IV. The undersigned certifies, under penalties of fraud, (i) that the
U.S. taxpayer identification number, if any, shown on the Confidential Purchaser
Questionnaire is true, correct and complete and (ii) that the undersigned, if
and to the extent the undersigned is subject to taxation in the U.S., is not
subject to backup withholding either because the undersigned has not been
notified that it is subject to backup withholding as a result of a failure to
report all interest or dividends, or the Internal Revenue Service ("IRS") has
notified the undersigned that it is no longer subject to backup withholding.
NOTE: If you have been notified by the IRS that you are subject to backup
withholding of your taxable interest and dividends because you have
under-reported interest or dividends and you have not received a notice from the
IRS that backup withholding has terminated, you should strike the underlined
portion of the preceding sentence.
7
V. The undersigned understands and agrees that the following
restrictions and limitations are applicable to its purchase and any resale or
other transfer it may make of the Membership Interests:
(1) Transfer of the Membership Interests is subject to a purchase right
held by the Fund as set forth in the Memorandum and the Fund Agreement which is
triggered by a proposed transfer in ownership of Membership Interests, otherwise
consented to by Managing Member, resulting in the assets of the Fund being
deemed "plan assets" under ERISA or resulting in the Fund being subject to the
Investment Company Act of 1940, as amended.
(2) The Membership Interests may only be sold or otherwise transferred
in compliance with the Securities Act and other applicable laws and only (1)
pursuant to Rule 144A under the Securities Act to an institutional investor that
the holder reasonably believes is a QIB purchasing for its own account or a QIB
purchasing for the account of a QIB, whom the holder has informed, in each case,
that the reoffer, resale, pledge, or other transfer is being made in reliance on
Rule 144A, (2) in an offshore jurisdiction in accordance with Role 903 or 904 of
Regulation S under the Securities Act, (3) pursuant to an exemption from
registration provided by Rule 144 under the Securities Act (if available),
subject to (a) the receipt by the Fund of a letter substantially in the form of
Schedule 1 or Schedule 2 attached hereto or (b) the receipt by the Fund of an
opinion of counsel acceptable to the Fund that such reoffer, resale, pledge or
other transfer is in compliance with the Securities Act, or (4) to the Fund or
its Affiliates.
(3) Each Member will be required, upon demand, to disclose to the Fund
in writing such information with respect to direct and indirect ownership of the
Membership Interests as the Fund deems necessary to comply with provisions of
the Code applicable to the Fund or with the requirements of any other
appropriate authority.
(4) Although it is intended that the Membership Interests will be
uncertificated, and no plan exists to cause such Membership Interests to be
certificated, should the Membership Interests become certificated a legend in
substantially the following form will be placed on any certificate(s) evidencing
the Membership Interests:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR
INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "ACT") OR ANY STATE SECURITIES OR BLUE SKY LAWS,
NOR IS SUCH REGISTRATION CONTEMPLATED. BY ITS ACCEPTANCE OF THIS
CERTIFICATE THE HOLDER HEREOF IS DEEMED TO REPRESENT TO FORTRESS
INVESTMENT FUND LLC (THE "COMPANY") AND FORTRESS FUND MM LLC, THAT (i)
IT IS A "QUALIFIED INSTITUTIONAL BUYER" (WITHIN THE MEANING OF RULE
144A UNDER THE ACT) UNDER SECTION 4(2) OF THE ACT OR (ii) IT IS AN
"INSTITUTIONAL ACCREDITED INVESTOR" AS DEFINED IN RULE 501 OF
REGULATION D PROMULGATED UNDER THE ACT MEETING THE REQUIREMENTS OF RULE
501(a)(1), (2), (3) OR (7) OR (iii) THAT IT IS A NON "U.S. PERSON" AS
DEFINED IN REGULATION S, AS PROMULGATED UNDER THE ACT AND THAT IT IS
ACQUIRING THIS NOTE FOR ITS OWN ACCOUNT (AND NOT FOR THE ACCOUNT OF
OTHERS) OR AS A FIDUCIARY OR AGENT FOR OTHERS (WHICH OTHERS ALSO ARE
ACCREDITED INVESTORS OR NON U.S. PERSONS; UNLESS THE HOLDER IS A BANK
ACTING IN ITS FIDUCIARY
8
CAPACITY) FOR INVESTMENT AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE
IN CONNECTION WITH THE PUBLIC DISTRIBUTION HEREOF.
SUCH SECURITIES MAY ONLY BE SOLD OR OTHERWISE TRANSFERRED IN COMPLIANCE
WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS AND ONLY (1) PURSUANT
TO RULE 144A UNDER THE SECURITIES ACT TO AN INSTITUTIONAL INVESTOR THAT
THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER,
WITHIN THE MEANING OF RULE 144A ("QIB") PURCHASING FOR ITS OWN ACCOUNT
OR A QIB PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS
INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE, PLEDGE, OR OTHER
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (2) IN AN OFFSHORE
TRANSACTION IN ACCORDANCE WITH RULE 903 OR 904 OF REGULATION S UNDER
THE SECURITIES ACT, (3) PURSUANT TO AN EXEMPTION FROM REGISTRATION
PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE), SUBJECT
TO (A) THE RECEIPT BY THE COMPANY OF A LETTER SUBSTANTIALLY IN THE FORM
OF SCHEDULE 1 OR SCHEDULE 2 TO THE SUBSCRIPTION AGREEMENT OR (B) THE
RECEIPT BY THE COMPANY OF AN OPINION OF COUNSEL ACCEPTABLE TO THE
COMPANY THAT SUCH REOFFER, RESALE, PLEDGE OR OTHER TRANSFER IS IN
COMPLIANCE WITH THE SECURITIES ACT, OR (4) TO THE COMPANY OR ITS
AFFILIATES.
IN ADDITION, THE COMPANY HAS RETAINED CERTAIN PURCHASE RIGHTS UPON ANY
PROPOSED TRANSFER OF SUCH SECURITIES. A TRANSFER SHALL INCLUDE BUT NOT
BE LIMITED TO: (1) ANY SALE OR ASSIGNMENT OF LIMITED PARTNER INTERESTS,
AND (ii) ANY BUSINESS COMBINATION AMONG TWO OR MORE HOLDERS OF
MEMBERSHIP INTERESTS SO AS TO CAUSE SUCH HOLDERS OF MEMBERSHIP
INTERESTS TO BECOME ONE ENTITY OR AFFILIATED ENTITIES. FURTHERMORE,
SUCH SECURITIES MAY NOT BE SOLD OR OTHERWISE TRANSFERRED AT ANY TIME IF
SUCH TRANSFER WOULD CAUSE THERE TO BE MORE THAN ONE HUNDRED LIMITED
PARTNER INTEREST HOLDERS OF SUCH SECURITIES OR WOULD CAUSE THE ASSETS
OF THE COMPANY TO BE SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY
ACT OF 1974, AS AMENDED.
(5) Stop transfer instructions will be placed with respect to the
Membership Interests so as to restrict resale, or other transfer thereof,
subject to the further items hereof, including the provisions of the legend set
forth in subparagraph (d) of this Paragraph 5.
(6) The legend described in subparagraph (d) of this Paragraph 5, and
the stop transfer instructions described in subparagraph (e) of this Paragraph 5
will be placed with respect to any new certificate(s) or other document(s)
issued upon presentment of certificate(s) or other document(s) for transfer.
VI. The undersigned is delivering with this Subscription Agreement (i)
a fully executed Signature Page and (ii) a completed Confidential Investor
Questionnaire. The undersigned agrees to provide any additional documents and
information the Managing Member reasonably requests.
VII. The undersigned agrees to purchase up to the number of Membership
Interests subscribed for as indicated on the Signature Page hereof in amounts
and at times
9
designated by the Fund in the manner and upon the terms and conditions set forth
in the Memorandum.
VIII. The undersigned agrees to fund any capital commitment required to
be funded at the closing of its purchase of Membership Interests of the Fund (i)
by wire transfer, in lawful money of the United States of America in federal or
other immediately available funds (or by such other means as may be agreed upon
by the Fund), to such bank account of the Fund as it shall designate by two
days' prior notice to the undersigned for its credit no later than 10:00 a.m.,
New York City time, on such designated date or (ii) by delivery of a certified
or bank check payable to the order of the Fund in lawful money of the United
States of America and delivered to the Fund by 10:00 a.m., New York City time,
on such designated date.
IX. The undersigned understands that it may revoke its subscription by
delivery of notice to the Fund prior to the acceptance of the undersigned's
subscription by the Fund.
X. The undersigned understands that this Subscription Agreement may not
be assigned without the prior written consent of the Fund, which consent may be
withheld for any reason or no reason within the sole discretion of the Fund.
XI. This Subscription Agreement shall be governed by and construed in
accordance with the laws of the State of New York, without reference to such
State's principles of conflicts of laws.
XII. ANY CLAIM, CONTROVERSY, DISPUTE OR DEADLOCK ARISING UNDER THIS
AGREEMENT (COLLECTIVELY, A "DISPUTE") SHALL BE SETTLED BY ARBITRATION
ADMINISTERED UNDER THE RULES OF THE AMERICAN ARBITRATION ASSOCIATION ("AAA") IN
NEW YORK, NEW YORK. ANY ARBITRATION AND AWARD OF THE ARBITRATORS, OR A MAJORITY
OF THEM, SHALL BE FINAL AND THE JUDGMENT UPON THE AWARD RENDERED MAY BE ENTERED
IN ANY STATE OR FEDERAL COURT HAVING JURISDICTION. NO PUNITIVE DAMAGES ARE TO BE
AWARDED. ANY DISPUTE SHALL BE HEARD BY THREE ARBITRATORS OF WHICH EACH PARTY
SHALL SELECT ONE WITHIN 10 DAYS OF THE DEMAND FOR ARBITRATION. THE TWO
PARTY-APPOINTED ARBITRATORS SHALL SELECT A THIRD ARBITRATOR TO SERVE AS CHAIR OF
THE TRIBUNAL WITHIN 10 DAYS OF THE SELECTION OF THE SECOND ARBITRATOR. IF ANY
ARBITRATOR HAS NOT BEEN APPOINTED WITHIN THE TIME LIMITS SPECIFIED HEREIN, SUCH
APPOINTMENT SHALL BE MADE BY THE AAA UPON THE WRITTEN REQUEST OF EITHER PARTY
WITHIN 10 DAYS OF THE REQUEST.
IN WITNESS WHEREOF, the undersigned executes and agrees to be bound by
this Subscription Agreement by executing the Signature Page attached hereon on
the date therein indicated.
10
SIGNATURE PAGE FOR
FORTRESS INVESTMENT FUND LLC
SUBSCRIPTION AGREEMENT
The undersigned, by executing this Signature Page, hereby swears to adopt
and agrees to all terms, conditions, representations, warranties and covenants
contained in the Subscription Agreement included in Subscription Documents.
Membership Interests Subscribed for 18.88712% Membership Interests
Aggregate Dollar Amount of Subscriber's Membership Interests
Commitment: $100,000,000
IN WITNESS WHEREOF, the undersigned has duly executed and delivered
this document as of the 23 day of November 1999.
Fortress Partners, L.P.
_______________________________________
(Please Type Name of Member)
Fortress Investment Corp.
By: /s/ Xxxxxx X. Xxxxxxx
____________________________________
Signature
Xxxxxx X. Xxxxxxx
_______________________________________
(Please Type Name of Signatory)
Title: Chief Operating Officer
________________________________
Fortress Investment Group LLC
By: /s/ Xxxxxx X. Xxxxxxx
___________________________________
Xxxxxx X. Xxxxxxx
Chief Operating Officer
