Exhibit 10.1
EXECUTION COPY
CONTRIBUTION AGREEMENT
BY AND AMONG
BLUFF POINT ASSOCIATES CORP., XXXXXXXXX/XXXXXXXX FAMILY
LIMITED PARTNERSHIP, R. XXXXXXX X'XXXXX, XXXX X. XXXXX, MSCS
VENTURES, INC., MATRIX BANCORP, INC., MATRIX CAPITAL BANK,
OPTECH SYSTEMS, INC., LET XXX
AND
MG COLORADO HOLDINGS, INC.
Table of Contents
Page
ARTICLE I: CONTRIBUTION..................................................3
ARTICLE II: REPRESENTATIONS AND WARRANTIES OF THE OPTECH STOCKHOLDERS.....9
ARTICLE III: REPRESENTATIONS AND WARRANTIES OF OPTECH.....................11
ARTICLE IV: REPRESENTATIONS AND WARRANTIES OF MSCS VENTURES..............13
ARTICLE V: REPRESENTATIONS AND WARRANTIES OF X'XXXXX AND XXXXX..........15
ARTICLE VI: REPRESENTATIONS AND WARRANTIES OF MG COLORADO HOLDINGS.......17
ARTICLE VII: REPRESENTATIONS AND WARRANTIES OF MATRIX CAPITAL BANK........19
ARTICLE VIII: COVENANTS AND ADDITIONAL AGREEMENTS..........................26
ARTICLE IX: CLOSING CONDITIONS...........................................33
ARTICLE X: INDEMNIFICATION..............................................39
ARTICLE XI: NON-COMPETITION AGREEMENT....................................42
ARTICLE XII: MISCELLANEOUS................................................44
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Exhibits
Exhibit A - Ownership Chart
Exhibit B - Form of Certificate of Incorporation of MG Colorado Holdings
Exhibit C - Bylaws of MG Colorado Holdings
Exhibit D - Stockholders Agreement by and among MG Colorado Holdings and all its
Stockholders.
Exhibit E - Form of Second Amended and Restated Operating Agreement of Matrix
Settlement and Clearance Services, LLC.
Exhibit F - Form of Amended and Restated Administrative Services Agreement
Exhibit G - Form of Termination of Payment Agreement.
Exhibit H - Form of Termination and Transfer Amendment to NSCC Clearing
Agreement, dated as of September 2, 1999 between MSCS and Matrix Capital Bank,
as previously amended by an amendment dated as of August 31, 2001.
Exhibit I - Form of Termination and Transfer Amendment to NSCC Clearing
Agreement, dated as of August 31, 2001 between MSCS Financial Services LLC and
Matrix Capital Bank.
Exhibit J - Form of Interim Services Agreement between Matrix Bancorp and MG
Colorado Holdings.
Exhibit K - Form of Banking Services Agreement between Matrix Capital Bank and
MG Colorado Holdings.
Exhibit L - Certificate of Xxxxx.
Exhibit M - Certificate of X'Xxxxx
Exhibit N - Certificate of Xxx
Exhibit O - Matrix Bancorp Secretary's Certificate (including incumbency,
authorizing resolutions, articles and bylaws).
Exhibit P - Matrix Capital Bank Secretary's Certificate (including incumbency,
authorizing resolutions, articles and bylaws).
Exhibit Q - MG Colorado Holdings Secretary's Certificate (including incumbency,
authorizing resolutions, articles and bylaws).
Exhibit R - Certificate of MG Partnership (including incumbency, authorizing
resolutions and certificate of limited partnership).
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Exhibit S - Certificate of Bluff Point (including incumbency, authorizing
resolutions and certificate of limited partnership).
Exhibit T - MSCS Ventures Secretary's Certificate (including incumbency,
authorizing resolutions, articles and bylaws).
Exhibit U - Optech Secretary's Certificate (including incumbency, authorizing
resolutions, articles and bylaws).
Exhibit V - Matrix Capital Bank Legal Opinion - re: Trust Operations.
Exhibit W - MG Colorado Holdings Legal Opinion.
Exhibit X - MSCS Ventures Legal Opinion.
Exhibit Y - Optech Legal Opinion.
Exhibit Z - Bluff Point Legal Opinion.
Exhibit AA - MG Partnership Legal Opinion.
Exhibit BB - Form of Escrow Agreement among MG Colorado Holdings, Matrix Capital
Bank and EGS.
Exhibit CC - Form of Second Amendment to License Agreement Between Optech and
MSCS.
Exhibit DD - Form of First Lease Modification Agreement between Matrix Tower and
MSCS.
Exhibit EE - Form of Lease Termination Agreement between Matrix Tower and Matrix
Capital Bank.
Exhibit FF - MG Colorado Holdings Stock Option Agreements.
Exhibit GG - List of Agreements Continuing In Effect and Agreements Being
Terminated.
Schedules
Schedule 1.6(a) - Acquired Contracts
Schedule 1.6(b) - Securities and Cash on Hand
Schedule 1.6(d) - Licenses necessary for operation of Trust
Schedule 1.6(e) - List of all Trust Operations Customers
Schedule 1.6(f) - List of all of MCBTS's Contracts and Commitments
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Schedule 1.6(h) - List of all computer software and programs associated with
MCBTS
Schedule 1.6(i) - Rights and obligations under leases and subleases, along with
payments and prepaid expenses
Schedule 1.6(j) - Right and title to permits related to MCBTS
Schedule 1.6(k) - Trust operations marketing and business records
Schedule 1.6(l) - List of all furniture, equipment and fixtures assigned to
MCBTS
Schedule 1.6(n) - All Intellectual Property of MCBTS
Schedule 1.6(s) - Assets not included in the transfer of MCBTS
Schedule 1.6(z) - Liabilities and obligations to be included in transfer
Schedule 7.3 (a) - Liens and encumbrances
Schedule 7.5 - No Violations
Schedule 7.6 - Governmental Consents Required
Schedule 7.7 - Litigation
Schedule 7.9 - Permits for Trust Operations
Schedule 7.10 - Employee Matters
Schedule 7.12(a) - Material Agreements
Schedule 7.14 - Pricing and Tax Liability and withholdings remitted
Schedule 7.15(a)(i) - List of all Customers by revenue to MCBTS
Schedule 7.16 - Intellectual Property Rights
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CONTRIBUTION AGREEMENT
This Contribution Agreement (this "Agreement") is made and entered into as
of December 1, 2004, by and among BLUFF POINT ASSOCIATES CORP., a Delaware
corporation ("Bluff Point"), XXXXXXXXX/XXXXXXXX FAMILY LIMITED PARTNERSHIP, a
Delaware limited partnership ("MG Partnership"), LET XXX ("Xxx"), R. XXXXXXX
X'XXXXX ("X'Xxxxx"), XXXX X. XXXXX ("Xxxxx"), OPTECH SYSTEMS, INC., a Delaware
corporation ("Optech"), MSCS VENTURES, INC., a Colorado corporation ("MSCS
Ventures"), MATRIX BANCORP, INC., a Colorado corporation ("Matrix Bancorp"), and
MATRIX CAPITAL BANK, a federally chartered savings bank ("Matrix Capital Bank")
(collectively the "Contributing Parties", with the cash, stock, assets and
rights and interests being contributed by such parties, or by wholly-owned
subsidiaries of such parties, to MG COLORADO HOLDINGS (defined below), as
described herein, being sometimes referred to collectively as the
"Contributions"), and MG COLORADO HOLDINGS, INC., a newly formed Delaware
corporation ("MG Colorado Holdings") (each a "Party" and collectively, the
"Parties").
WITNESSETH
WHEREAS, MG Colorado Holdings has been formed for, among other reasons, the
transactions contemplated herein; and
WHEREAS, Matrix Settlement and Clearance Services, LLC, a New York limited
liability company ("MSCS"), is engaged in the business of providing automated
clearing and settlement services for financial institutions, trust companies,
broker-dealers and third-party administrators; and
WHEREAS, Matrix Capital Bank, through its trust services division, is
engaged in the business of providing trust and custodial services in connection
with the automated clearing and settlement services provided by MSCS (such
business, along with all of its operating assets and contracts, all as more
specifically identified in Section 1.6 hereof, being referred to herein as the
"Trust Operations"); and
WHEREAS, Optech owns fifty percent (50%) of the Class A interests of MSCS
(the "Optech A Interests"), and MG Partnership and Xxx (the "Optech
Stockholders") collectively own one hundred percent (100%) of the issued and
outstanding shares of common stock, $.01 par value, of Optech (the "Optech
Stock") and desire to contribute such Optech Stock to MG Colorado Holdings in
exchange for one million five hundred twenty-five thousand (1,525,000) shares of
MG Colorado Holdings common stock, $.001 par value (the "MG Colorado Holdings
Stock"); and
WHEREAS, MSCS Ventures owns fifty percent (50%) of the Class A interests of
MSCS (the "MSCS Ventures A Interests") and desires to contribute such MSCS
Ventures A Interests to MG Colorado Holdings in exchange for one hundred
ninety-four thousand seven hundred ninety-two (194,792) shares of MG Colorado
Holdings Stock and ten million three hundred two thousand and eighty-four
($10,302,084) dollars; and
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WHEREAS, one hundred percent (100%) of the previously issued Class B
interests of MSCS (the "MSCS B Interests") were subsequently contributed to MSCS
in connection with a restructuring of the ownership of MSCS, and there are
currently no outstanding MSCS Class B interests; and
WHEREAS, X'Xxxxx owns fifty percent (50%) of the Class C interests of MSCS
(the "X'Xxxxx C Interests") and desires to contribute such X'Xxxxx C Interests
to MG Colorado Holdings in exchange for one hundred thirty-six thousand one
hundred eleven (136,111) shares of MG Colorado Holdings Stock; and
WHEREAS, Xxxxx owns fifty percent (50%) of the Class C interests of MSCS
(the "Xxxxx C Interests") and desires to contribute such Xxxxx C Interests to MG
Colorado Holdings in exchange for one hundred thirty-six thousand one hundred
eleven (136,111) shares of MG Colorado Holdings Stock; and
WHEREAS, Matrix Capital Bank owns one hundred percent (100%) of the Trust
Operations and desires to contribute such Trust Operations to MG Colorado
Holdings in exchange for seventy-five thousand (75,000) shares of MG Colorado
Holdings Stock; and
WHEREAS, in connection with the Reorganization (as hereinafter defined),
Bluff Point desires to contribute a minimum of fifteen million three hundred two
thousand and eighty-four dollars ($15,302,084) and a maximum of nineteen million
three hundred two thousand and eighty-four dollars ($19,302,084) (the "Bluff
Point Cash Contribution," with the minimum amount of such contribution being
referred to as the "Initial Bluff Point Cash Contribution" and subsequent funds
contributed, if any, being referred to as the "Additional Bluff Point Cash
Contribution") in exchange for a minimum of one million five hundred thirty
thousand two hundred nine (1,530,209) and a maximum of one million nine hundred
thirty thousand two hundred nine (1,930,209) shares of MG Colorado Holdings
Stock, the total amount of such Bluff Point Cash Contribution to be determined
by MG Colorado Holdings (as is described more fully in Section 1.3(g) below);
and
WHEREAS, Bluff Point, the Optech Stockholders, MSCS Ventures, X'Xxxxx,
Xxxxx and Matrix Capital Bank (the "MG Colorado Holdings Stockholders") desire
to reorganize the ownership of MSCS and the Trust Operations in a tax-deferred
reorganization (the "Reorganization"), which shall be effective as of December
1, 2004, in accordance with the provisions of Section 351 of the Internal
Revenue Code of 1986, as amended (the "Code") by contributing to MG Colorado
Holdings, in exchange for certain shares of MG Colorado Holdings Stock and, in
the case of MSCS Ventures, the cash contemplated by Section 1.3(b), all of the
Optech Stock, MSCS Ventures A Interests, X'Xxxxx C Interests, Xxxxx C Interests,
Trust Operations and the Bluff Point Cash Contribution; and
WHEREAS, concurrent with the Reorganization, MG Colorado Holdings and the
MG Colorado Holdings Stockholders (except Matrix Capital Bank, which shall, upon
distribution, immediately transfer its shares of MG Colorado Holdings Stock to
MSCS Ventures) will enter into a stockholders agreement in the form attached
hereto as Exhibit D (the "Stockholders Agreement"); and
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WHEREAS, as part of the Reorganization, MG Colorado Holdings will form a
new Colorado corporation, which will be a wholly-owned subsidiary, to hold the
Trust Operations (the "Trust Entity"); and
WHEREAS, upon the effectuation of the Reorganization, MG Colorado Holdings
will own one hundred percent (100%) of the equity interests of MSCS, fifty-five
(55%) of such interests being held directly and forty-five percent (45%) of such
interests being held through Optech, MG Colorado Holdings' wholly-owned
subsidiary; and
WHEREAS, upon the effectuation of the Reorganization and the Trust
Operations Closing (as defined below), MG Colorado Holdings will own one hundred
(100%) of the equity interests of the Trust Operations through its wholly-owned
Trust Entity subsidiary; and
WHEREAS, the Parties hereto desire to re-define the various ancillary
business relationships between such parties and their Affiliates, as more fully
described in Article VIII hereto.
NOW, WHEREFORE, in consideration of the recitals above, the mutual premises
set forth herein, and other good and valuable consideration, the receipt and
legal sufficiency of which is hereby acknowledged, the parties hereby agree as
follows:
ARTICLE I: CONTRIBUTION
1.1 Contribution and Reorganization. Pursuant to the terms and subject to
the conditions set forth herein, (A) the Contributing Parties hereby agree to
make the Contributions described herein and (B) MG Colorado Holdings agrees to
(i) issue to the Contributing Parties the MG Colorado Holdings Stock described
in Section 1.3 and (ii) pay to MSCS Ventures the cash described in Section 1.3,
each in exchange for their respective contributions as described more fully in
Section 1.3. Exhibit A hereto lists the respective ownership amounts and the
percentage of MG Colorado Holdings held by all Parties hereto after giving
effect to all of the transactions contemplated by this Agreement.
1.2 Closing Date. The closing of the Reorganization (the "Closing") will
take place at the offices of Ellenoff Xxxxxxxx & Schole LLP at 10:00 a.m. local
time on December 1, 2004, or at such other date, time and place as is mutually
agreed among the parties or, if all of the conditions to the obligations of the
Parties set forth in Section 9.1 and Section 9.3 have not been satisfied or
waived by December 1, 2004 and there is no agreement among the parties as to
another day, on the day which is two business days following the date on which
all such conditions have been satisfied or waived (such date and time of closing
being herein called the "Closing Date").
1.3 Exchange. At the Closing, the following exchanges will occur:
(a) The Optech Stockholders will contribute the Optech Stock to MG
Colorado Holdings in exchange for one million five hundred and twenty-five
thousand (1,525,000) shares of MG Colorado Holdings Stock.
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(b) MSCS Ventures will contribute the MSCS Ventures A Interests to MG
Colorado Holdings in exchange for one hundred ninety-four thousand seven hundred
ninety-two (194,792) shares of MG Colorado Holdings Stock and ten million three
hundred two thousand eighty-four ($10,302,084) dollars.
(c) X'Xxxxx will contribute the X'Xxxxx C Interests to MG Colorado
Holdings in exchange for one hundred thirty-six thousand one hundred eleven
(136,111) shares of MG Colorado Holdings Stock.
(d) Xxxxx will contribute the Xxxxx C Interests to MG Colorado
Holdings in exchange for one hundred thirty-six thousand one hundred eleven
(136,111) shares of MG Colorado Holdings Stock.
(e) Matrix Capital Bank will contribute the Trust Operations to MG
Colorado Holdings (as more fully described in Section 1.6 hereto) or, if (i)
Matrix Capital Bank has not yet received the applicable regulatory approvals, if
any, necessary for Matrix Capital Bank to contribute the Trust Operations to MG
Colorado Holdings (the "MCB Regulatory Approvals"), (ii) MG Colorado Holdings
has not yet received the applicable regulatory approvals necessary for the Trust
Entity to own and operate the Trust Operations (the "MGHC Regulatory
Approvals"), and (iii) Matrix Capital Bank has not yet received the other third
party consents or approvals identified in Schedule 7.5, Schedule 7.6 and/or
Schedule 7.12 hereto necessary or appropriate in order to contribute the Trust
Operations to MG Colorado Holdings (the "Miscellaneous MCB Approvals"), then
upon the receipt of such approvals identified in (i), (ii) and (iii) above
(which are collectively referred to herein sometimes as the "Trust Operations
Approvals"), Matrix Capital Bank and MG Colorado Holdings will hold a subsequent
closing (the "Trust Operations Closing") and, at such time, execute all
documents reasonably necessary to effect such contribution (including, but not
limited to an assignment and assumption agreement and a xxxx of sale). In
exchange, MG Colorado Holdings will issue to Matrix Capital Bank seventy-five
thousand (75,000) shares of MG Colorado Holdings Stock. Such seventy-five
thousand (75,000) shares of MG Colorado Holdings Stock shall be held in escrow
by Ellenoff Xxxxxxxx & Schole LLP ("EGS") in accordance with an escrow agreement
by and among MG Colorado Holdings, Matrix Capital Bank and EGS, as escrow agent
(the "Escrow Agreement"), in substantially the form of Exhibit BB attached
hereto, until the earlier of: (A) the receipt of all Trust Operations Approvals,
or (B) December 1, 2005 (the "Expiration Date"). Upon the receipt of all the
Trust Operations Approvals and the effectuation of the Contribution of the Trust
Operations to MG Colorado Holdings (as described more fully in Section 1.6
hereto), the escrowed shares described herein will be released to Matrix Capital
Bank, which will, immediately after such issuance of the seventy-five thousand
(75,000) shares and release from escrow, transfer and sell such shares of MG
Colorado Holdings Stock to MSCS Ventures and such transfer and sale shall be
exempt from the restrictive provisions of the Stockholders Agreement. However,
if the Trust Operations Approvals for the contribution of the Trust Operations
have not been obtained prior to the Expiration Date, the escrowed shares shall
be released to MG Colorado Holdings for cancellation and all parties shall be
relieved from any further obligations in connection with the contribution of the
Trust Operations.
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(f) Matrix Bancorp will contribute its consent to use by MG Colorado
Holdings of the name "Matrix Settlement and Clearance Services, LLC," and any
derivations thereof, and all of its right, title and interest, if any, in and to
such name and derivations; provided, however, that such consent and contribution
is without representation or warranty of any kind in regards to the rights of MG
Colorado Holdings to use such name or names or whether such name or names
infringe or are confusingly similar to any trademark, servicemark, or any other
statutory or common law rights of any third party.
(g) Bluff Point will contribute the Initial Bluff Point Cash
Contribution, which is fifteen million three hundred two thousand and
eighty-four dollars ($15,302,084) to MG Colorado Holdings in exchange for one
million five hundred thirty thousand two hundred nine (1,530,209) shares of MG
Colorado Holdings Stock. The Additional Bluff Point Cash Contribution, up to the
maximum amount of nineteen million three hundred two thousand and eighty-four
dollars ($19,302,084), in the aggregate (taken together with the Initial Bluff
Point Cash Contribution), will be contributed by Bluff Point to MG Colorado
Holdings in exchange for a maximum of one million nine hundred thirty thousand
two hundred nine (1,930,209) shares of MG Colorado Holdings Stock, in the
aggregate, as needed post-Closing. The amount of such Additional Bluff Point
Cash Contribution will be determined by MG Colorado Holdings based upon: (i) the
regulatory capitalization requirements of owning and operating the Trust
Operations, and (ii) the transaction costs of the Reorganization.
1.4 Closing Deliveries. At the Closing,
(a) Subject to Section 1.3(e), the Contributing Parties will assign or
deliver the Contributions or certificates representing the Contributions, duly
endorsed for transfer, and any other documents that are necessary to transfer to
MG Colorado Holdings all right, title and interest to all such Contributions,
including any requisite consents under other third-party agreements;
(b) Bluff Point will deliver to MG Colorado Holdings the Initial Bluff
Point Cash Contribution as set forth in Section 1.3(g); and
(c) The Parties will execute and deliver all additional documents
required to be delivered by each of them, as detailed more fully in Article IX
hereto.
1.5 Trust Entity. MG Colorado Holdings will form the Trust Entity (the
"Trust Entity") upon receipt of the Trust Operations Approvals from the State of
Colorado Division of Banking.
1.6 Trust Operations Closing. Subject to the terms hereof and the
conditions set forth in Section 9.2 and Section 9.4 herein, including the
Expiration Date, upon receipt of all Trust Operations Approvals, Matrix Capital
Bank and MG Colorado Holdings shall hold the Trust Operations Closing, which
shall be held within ten (10) business days following the end of the calendar
month during which the last of the Trust Operations Approvals is received. The
last day of the calendar month during which the last of the Trust Operations
Approvals is received is referred to herein as the "TO Month End." At the Trust
Operations Closing, pursuant to the terms hereof and subject to the conditions
set forth in Section 9.2 and Section 9.4 herein, (A) Matrix Capital Bank shall
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transfer, assign, convey and deliver to MG Colorado Holdings, all right, title
and interest in and to all of the assets, whether real, personal and mixed,
tangible or intangible, used directly or indirectly by Matrix Capital Bank in or
otherwise relating to the Trust Operations, and as owned or held by Matrix
Capital Bank, all as more specifically identified in the Schedules listed below
in this Section 1.6 (the "Acquired Assets") and (B) MG Colorado Holdings will
assume all liabilities associated with such Acquired Assets, as listed on
Schedule 1.6(z) hereto, and assume the obligation to discharge all assumed
liabilities as they become due and payable (the "Assumed Obligations").
The Acquired Assets shall include all of Matrix Capital Bank's right, title
and interest in and to the following, wherever located, effective as of the TO
Month End (the "Trust Operations Closing Date"):
(a) all contracts for performance of services as more specifically
identified on Schedule 1.6(a) hereto (the "Acquired Contracts"), payments
previously made or due under such contracts will be distributed pursuant to
Section 1.7 hereof;
(b) all customer trust and custodial accounts, including the cash on
hand, cash equivalents, certificates of deposit and deposits, bank and money
market accounts, and securities associated therewith of the Trust Operations as
of the Trust Operations Closing Date, all as more specifically identified in
Schedule 1.6(b) hereto;
(c) all goodwill related to the Acquired Assets;
(d) the licenses used in connection with the operation of the Trust
Operations that are identified on Schedule 1.6(d) hereto;
(e) the customer lists, customer mailing lists and customer sales
files which are used in connection with the operation of the Trust Operations,
all as more specifically identified in Schedule 1.6(e) hereto;
(f) all of Matrix Capital Bank's interest and rights in and to the
agreements, contracts and commitments, relating to the Trust Operations to which
Matrix Capital Bank is a party or by which its assets are bound and that are
more specifically identified in Schedule 1.6(f) hereto;
(g) [reserved];
(h) the computer software and programs and any rights thereto
associated with or employed in the conduct of the Trust Operations and that are
identified in Schedule 1.6(h) hereto;
(i) all payments, deposits and prepaid expenses associated with the
leases and subleases associated with the Trust Operations, all as more
specifically identified in Schedule 1.6(i) hereto;
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(j) the rights of Matrix Capital Bank to the permits (to the extent
the same are transferable) directly or indirectly relating primarily to the
Trust Operations and that are identified in Schedule 1.6(j) hereto;
(k) all of the Trust Operations' business and marketing records,
including copies of accounting and operating records, asset ledgers, inventory
records, budgets, customer lists, supplier lists, information and data
respecting leased or owned equipment, correspondence, and other business records
directly related to the Trust Operations, all as more specifically identified in
Schedule 1.6(k) hereto, but excluding specifically any and all regulatory
correspondence, exam reports and other filings and documents that Matrix Capital
Bank is specifically prohibited by applicable law from disclosing or
transferring to MG Colorado Holdings, including pursuant to applicable OTS rules
and regulations (the "Excluded Books and Records");
(l) the furniture, equipment, fixtures and computer hardware
associated with the Trust Operations, all as more specifically identified in
Schedule 1.6(l) hereto;
(m) all original books, financial records and ledgers of the Trust
Operations (other than tax returns, minute books, stock records and the Excluded
Books and Records), provided, however that such materials (other than the
Excluded Books and Records) will be made available for inspection and
photocopying by MG Colorado Holdings upon request including any such records
which are maintained in electronic form;
(n) the Intellectual Property (as defined in Section 7.15) related to
the Trust Operations that is identified on Schedule 1.6(n) hereto;
(o) all claims, choses-in-action, warranties, refunds, rights of
recovery, rights of set-off and rights of recoupment of any kind relating to the
payment of taxes of the Trust Operations for periods after the Trust Operations
Closing Date;
(p) all mail or other communications addressed to Matrix Capital Bank
and directly relating to the Trust Operations;
(q) the surety bond regarding signature authentication, to the extent
assignable; and
(r) the federal Employer Identification Number currently being
utilized by the Trust Operations, to the extent assignable.
Notwithstanding the foregoing, the assets identified on Schedule 1.6(s)
hereto shall not be contributed or transferred to MG Colorado Holdings in
connection herewith and shall be excluded from the definition of "Acquired
Assets" (such assets being referred to herein as the "Excluded Assets").
Notwithstanding anything herein to the contrary, Matrix Capital Bank shall
deliver to MG Colorado Holdings the Schedules called for by this Section 1.6,
and Article VII hereto (A) initially on the date of execution of this Agreement
and (B) as updated within five (5) business days following the TO Month End. MG
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Colorado Holdings shall have five (5) business days following receipt of such
updated Schedules from Matrix Capital Bank to either approve or reject such
Schedules.
1.7 Settlement Statement. At the Trust Operations Closing, Matrix Capital
Bank and MG Colorado Holdings shall jointly prepare a settlement statement that
identifies all the following amounts with respect to the Acquired Contracts as
of the TO Month End: (i) fees billed in advance of services being rendered by
the Trust Operations under the Acquired Contract and for which the counterparty
under the Acquired Contract has already paid the fees billed (the "Fully Paid
Amortized Fees"); (ii) fees billed in advance of services being rendered by the
Trust Operations under the Acquired Contract but for which the counterparty
under the Acquired Contract has not yet paid the fees billed (the "Unpaid
Amortized Fees"); and (iii) fees billed in arrears or as services are performed
by the Trust Operations, prior to the Trust Operations Closing Date, under the
Acquired Contract but for which the counterparty under the Acquired Contract has
not yet paid the fees billed (the "Unpaid Fully Earned Fees").
With respect to the Fully Paid Amortized Fees, Matrix Capital Bank shall
pay to the Trust Entity at the Trust Operations Closing the pro rata share for
the Trust Entity of the Fully Paid Amortized Fees (based upon the relationship
the days covered by the xxxx in question bears to the Trust Operations Closing
Date) and the Trust Entity shall thereupon become the owner of such pro rata
portion of the Fully Paid Amortized Fees; (B) with respect to the Unpaid
Amortized Fees, the Trust Entity shall pay to Matrix Capital Bank at the Trust
Operations Closing the pro rata share for Matrix Capital Bank of the Unpaid
Amortized Fees (based upon the relationship the number of days covered by the
xxxx in question bears to the Trust Operations Closing Date) and, upon making
such payment, the Trust Entity shall become the owner of the rights to collect
all Unpaid Amortized Fees; and (C) with respect to the Unpaid Fully Earned Fees,
Matrix Capital Bank shall be entitled to all of such fees and shall remain the
owner of all of such Unpaid Amortized Fees. Matrix Capital Bank shall, as
reasonably requested by the Trust Entity, use commercially reasonable efforts to
assist the Trust Entity in its collection efforts with respect to the Unpaid
Amortized Fees. The Trust Entity, MG Colorado Holdings and each of their
Affiliates (including without limitation MSCS) shall, on behalf of Matrix
Capital Bank, timely and diligently pursue collection of the Unpaid Fully Earned
Fees and shall, consistent with past practice and on a commercially reasonable
basis, report at least monthly to Matrix Capital Bank as to the status of and
collection efforts relating to the Unpaid Fully Earned Fees; provided, however,
that the foregoing sentence shall not in any way limit the ability of Matrix
Capital Bank to pursue collection of such Unpaid Fully Earned Fees if Matrix
Capital Bank so chooses in its sole discretion. In addition and without limiting
the generality of the foregoing, to the extent that (X) Matrix Capital Bank
receives payment in respect of the Unpaid Amortized Fees, it shall promptly
remit such payment to the Trust Entity and (Y) MG Colorado Holdings, the Trust
Entity or any of their Affiliates (including without limitation MSCS) receives
payment in respect of the Unpaid Fully Earned Fees, the Trust Entity and MG
Colorado Holdings shall, and shall cause each of their Affiliates to, promptly
remit such payment to Matrix Capital Bank.
1.8 Further Assurances. At or after the Closing or the Trust Operations
Closing, as the case may be, and without further consideration, the Contributing
Parties will execute and deliver to MG Colorado Holdings such further
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instruments of conveyance and transfer as MG Colorado Holdings may reasonably
request in order to more effectively convey and transfer the Contributions to MG
Colorado Holdings and to place MG Colorado Holdings in complete operational
control and ownership of the Contributions and the Trust Operations, subject to
any necessary regulatory approvals.
ARTICLE II: REPRESENTATIONS AND WARRANTIES OF THE OPTECH
STOCKHOLDERS
The Optech Stockholders, severally, as applicable, and not jointly, hereby
represent and warrant to MG Colorado Holdings and to each of the other
Contributing Parties as follows:
2.1 Organization. MG Partnership represents and warrants that: (i) MG
Partnership is a limited partnership duly organized, validly existing and in
good standing under the laws of the State of Delaware and has full power to
conduct its business as presently conducted, and (ii) MG Partnership is not
required to be qualified to do business in any other jurisdiction.
2.2 Authority.
(a) MG Partnership represents and warrants that: (i) MG Partnership
has all requisite power and authority to execute, deliver and perform its
obligations under this Agreement and the other agreements, certificates and
instruments to be executed by MG Partnership in connection with or pursuant to
this Agreement (collectively, the "MG Partnership Documents"), (ii) the
execution, delivery and performance by MG Partnership of this Agreement and the
other MG Partnership Documents have been duly authorized by all necessary action
on the part of MG Partnership, (iii) this Agreement has been, and at the Closing
the other MG Partnership Documents will be, duly executed and delivered by MG
Partnership and (iv) this Agreement is, and, upon execution and delivery by MG
Partnership at the Closing, each of the other MG Partnership Documents will be,
a legal, valid and binding agreement of MG Partnership, enforceable against MG
Partnership in accordance with its terms, except as such enforceability may be
limited by applicable bankruptcy, insolvency, fraudulent conveyance or similar
laws affecting the enforcement of creditors' rights generally and subject to
general principles of equity (regardless of whether enforcement is sought in a
proceeding at law or in equity).
(b) Xxx represents and warrants that: (i) Xxx has all requisite power
and authority to execute, deliver and perform his obligations under this
Agreement and the other agreements, certificates and instruments to be executed
by Xxx in connection with or pursuant to this Agreement (collectively, the "Xxx
Documents"), (ii) This Agreement has been, and at the Closing the other Xxx
Documents will be, duly executed and delivered by Xxx and (iii) this Agreement
is, and, upon execution and delivery by Xxx at the Closing, each of the other
Xxx Documents will be, a legal, valid and binding agreement of Xxx, enforceable
against Xxx in accordance with its terms, except as such enforceability may be
limited by applicable bankruptcy, insolvency, fraudulent conveyance or similar
laws affecting the enforcement of creditors' rights generally and subject to
general principles of equity (regardless of whether enforcement is sought in a
proceeding at law or in equity).
9
2.3 Title.
(a) MG Partnership represents and warrants that: (i) MG Partnership
owns two thousand six hundred forty-three (2,643) shares of Optech Stock
constituting seventy-seven and sixty-seven hundredths percent (77.67%) of the
Optech Stock (the "MG Partnership Optech Stock"), (ii) there are no outstanding
options, warrants, convertible or exchangeable securities or other rights,
agreements, arrangements or commitments obligating MG Partnership, directly or
indirectly, to issue, sell, purchase, acquire or otherwise transfer or deliver
any of the MG Partnership Optech Stock, or any agreement, document, instrument
or obligation convertible or exchangeable therefore, (iii) there are no voting
trusts, proxies or other agreements or understandings to which MG Partnership is
a party or by which MG Partnership is bound with respect to the voting of the MG
Partnership Optech Stock and (iv) none of MG Partnership's Optech Stock was
acquired in violation of the Securities Act of 1933, as amended (the "Securities
Act").
(b) Xxx represents and warrants that: (i) Xxx owns seven hundred sixty
(760) shares of Optech Stock constituting twenty two and thirty-three hundredths
percent (22.33%) of the Optech Stock (the "Xxx Optech Stock"), (ii) there are no
outstanding options, warrants, convertible or exchangeable securities or other
rights, agreements, arrangements or commitments obligating Xxx, directly or
indirectly, to issue, sell, purchase, acquire or otherwise transfer or deliver
any of the Xxx Optech Stock, or any agreement, document, instrument or
obligation convertible or exchangeable therefor, (iii) there are no voting
trusts, proxies or other agreements or understandings to which Xxx is a party or
by which Xxx is bound with respect to the voting of the Xxx Optech Stock and
(iv) none of Xxx'x Optech Stock was acquired in violation of the Securities Act.
2.4 No Liens.
(a) MG Partnership represents and warrants that: (i) MG Partnership
owns the MG Partnership Optech Stock free and clear of any obligation, lien,
claim, pledge, security interest, liability, charge, contingency or other
encumbrance or claim of any nature (a "Lien") and (ii) upon the delivery of the
MG Partnership Optech Stock to MG Colorado Holdings hereunder, MG Colorado
Holdings will acquire the entire legal and beneficial interests in the MG
Partnership Optech Stock, free and clear of any Lien and subject to no legal or
equitable restrictions of any kind.
(b) Xxx represents and warrants that: (i) Xxx owns the Xxx Optech
Stock free and clear of any Lien and (ii) upon the delivery of the Xxx Optech
Stock to MG Colorado Holdings hereunder, MG Colorado Holdings will acquire the
entire legal and beneficial interests in the Xxx Optech Stock, free and clear of
any Lien and subject to no legal or equitable restrictions of any kind.
2.5 Compliance with Securities Laws.
(a) MG Partnership and Xxx represent and warrant, severally, each on
its own behalf that such Contributing Party is an "accredited investor" as
defined by Rule 501 under the Securities Act, and that such Contributing Party
is capable of evaluating the merits and risks of such Contributing Party's
investment in MG Colorado Holdings and has the capacity to protect its own
interests.
10
(b) MG Partnership and Xxx represent and warrant, severally, each on
its own behalf that such Contributing Party understands that the MG Colorado
Holdings Stock is not presently registered under the Securities Act.
(c) MG Partnership and Xxx represent and warrant, severally, each on
its own behalf that such Contributing Party is acquiring the MG Colorado
Holdings Stock for investment purposes and not with a view to distribution or
resale, nor with the intention of selling, transferring or otherwise disposing
of all or any part thereof for any particular price, or at any particular time,
or upon the happening of any particular event or circumstances, except selling,
transferring, or disposing the MG Colorado Holdings Stock in full compliance
with the Stockholders Agreement, all applicable provisions of the Securities
Act, the rules and regulations promulgated by the Securities and Exchange
Commission ("SEC") thereunder, and applicable state securities laws and that
such Contributing Party understands that an investment in the MG Colorado
Holdings Stock is not a liquid investment.
(d) MG Partnership and Xxx represent and warrant, severally, each on
its own behalf that such Contributing Party acknowledges that the MG Colorado
Holdings Stock must be held indefinitely unless subsequently registered under
the Securities Act or unless an exemption from such registration is available.
2.6 No Misrepresentations.
(a) MG Partnership represents and warrants that the representations,
warranties and statements made by MG Partnership in or pursuant to this
Agreement are true, complete and correct in all material respects and do not
contain any untrue statement of a material fact or omit to state any material
fact necessary to make any such representation, warranty or statement, under the
circumstances in which it is made, not misleading.
(b) Xxx represents and warrants that the representations, warranties
and statements made by Xxx in or pursuant to this Agreement are true, complete
and correct in all material respects and do not contain any untrue statement of
a material fact or omit to state any material fact necessary to make any such
representation, warranty or statement, under the circumstances in which it is
made, not misleading.
ARTICLE III: REPRESENTATIONS AND WARRANTIES OF OPTECH
Optech hereby represents and warrants to MG Colorado Holdings and to each
of the other Contributing Parties as follows:
3.1 Organization. Optech is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware and has
full power to conduct its business as presently conducted. Optech is duly
authorized, qualified or licensed to do business and is in good standing in
Delaware and in New York, which are the only jurisdictions in which its assets
are located or in which its business or operations as presently conducted make
such qualification necessary. Optech is not required to be qualified to do
business in any other jurisdiction.
11
3.2 Capitalization. As of the date hereof and the Closing Date, Optech
has and will have issued and outstanding three thousand four hundred and three
(3,403) shares of common stock, $.01 par value, and options to purchase up to
nine hundred ninety-three (993) shares of Optech common stock.
3.3 Authority. Optech has all requisite power and authority to execute,
deliver and perform its obligations under this Agreement and the other
agreements, certificates and instruments to be executed by Optech in connection
with or pursuant to this Agreement (collectively, the "Optech Documents"). The
execution, delivery and performance by Optech of this Agreement and the other
Optech Documents have been duly authorized by all necessary action on the part
of the Optech, including shareholder approval. This Agreement has been, and at
the Closing the other Optech Documents will be, duly executed and delivered by
Optech. This Agreement is, and, upon execution and delivery by Optech at the
Closing, each of the other Optech Documents will be, a legal, valid and binding
agreement of Optech, enforceable against Optech in accordance with its terms,
except as such enforceability may be limited by applicable bankruptcy,
insolvency, fraudulent conveyance or similar laws affecting the enforcement of
creditors' rights generally and subject to general principles of equity
(regardless of whether enforcement is sought in a proceeding at law or in
equity).
3.4 Title.
(a) The Optech A Interests constitute fifty percent (50%) of the Class
A membership interests of MSCS.
(b) Other than rights arising under the Pre-Amendment Operating
Agreement (as hereinafter defined) of MSCS, there are no outstanding options,
warrants, convertible or exchangeable securities or other rights, agreements,
arrangements or commitments obligating Optech, directly or indirectly, to issue,
sell, purchase, acquire or otherwise transfer or deliver any Optech A Interests,
or any agreement, document, instrument or obligation convertible or exchangeable
therefor. There are no voting trusts, proxies or other agreements or
understandings to which Optech is a party or by which Optech is bound with
respect to the voting of any Optech A Interests (other than the Pre-Amendment
Operating Agreement). None of Optech's Optech A Interests were acquired in
violation of the Securities Act.
3.5 No Liens. Optech owns the Optech A Interests free and clear of any
Lien, other than those arising under the Pre-Amendment Operating Agreement. Upon
the delivery of the Optech A Interests to MG Colorado Holdings hereunder, MG
Colorado Holdings will acquire the Optech A Interests, free and clear of any
Lien and subject to no legal or equitable restrictions of any kind other than as
set forth in the Amended Operating Agreement (as hereinafter defined).
3.6 No Misrepresentations. The representations, warranties and statements
made by Optech in or pursuant to this Agreement are true, complete and correct
in all material respects and do not contain any untrue statement of a material
fact or omit to state any material fact necessary to make any such
representation, warranty or statement, under the circumstances in which it is
made, not misleading.
12
3.7 No Violation. Neither the execution or delivery of the Optech
Documents nor the consummation of the transactions contemplated thereby, will
conflict with or result in the breach of any term or provision of, require
consent or violate or constitute a default under (or an event that with notice
or the lapse of time or both would constitute a breach or default) or relieve
any third party of any obligation to Optech or give any third party the right to
terminate or accelerate any obligation under, any charter provision, bylaw,
contract, agreement, Permit (as defined in Section 7.9) or any Law to which
Optech is a party or by which any of its assets are in any way bound or
obligated.
3.8 No Consents. No consent, approval, order or authorization of, or
registration, qualification, designation, declaration or filing with, any
governmental or regulatory body, or third party, is required on the part of
Optech in connection with the transactions contemplated by this Agreement.
ARTICLE IV: REPRESENTATIONS AND WARRANTIES OF MATRIX BANCORP
AND MSCS VENTURES.
Matrix Bancorp and MSCS Ventures hereby, jointly and severally, represent
and warrant to MG Colorado Holdings and to each of the other Contributing
Parties as follows:
4.1 Organization. MSCS Ventures is a corporation duly organized, validly
existing and in good standing under the laws of the State of Colorado and has
full power to conduct its business as presently conducted. MSCS Ventures is duly
authorized, qualified or licensed to do business and is in good standing in
Colorado, which is the only jurisdiction in which its assets are located or in
which its business or operations as presently conducted make such qualification
necessary. MSCS Ventures is not required to be qualified to do business in any
other jurisdiction.
4.2 Authority. MSCS Ventures has all requisite power and authority to
execute, deliver and perform its obligations under this Agreement and the other
agreements, certificates and instruments to be executed by MSCS Ventures in
connection with or pursuant to this Agreement (collectively, the "MSCS Ventures
Documents"). The execution, delivery and performance by MSCS Ventures of this
Agreement and the other MSCS Ventures Documents have been duly authorized by all
necessary action on the part of the MSCS Ventures, including shareholder
approval, if necessary. This Agreement has been, and at the Closing the other
MSCS Ventures Documents will be, duly executed and delivered by MSCS Ventures.
This Agreement is, and, upon execution and delivery by MSCS Ventures at the
Closing, each of the other MSCS Ventures Documents will be, a legal, valid and
binding agreement of MSCS Ventures, enforceable against MSCS Ventures in
accordance with its terms, except as such enforceability may be limited by
applicable bankruptcy, insolvency, fraudulent conveyance or similar laws
affecting the enforcement of creditors' rights generally and subject to general
principles of equity (regardless of whether enforcement is sought in a
proceeding at law or in equity).
13
4.3 Title.
(a) The MSCS Ventures A Interests constitute fifty percent (50%) of
the Class A membership interests of MSCS.
(b) Other than rights arising under the Pre-Amendment Operating
Agreement, there are no outstanding options, warrants, convertible or
exchangeable securities or other rights, agreements, arrangements or commitments
obligating MSCS Ventures, directly or indirectly, to issue, sell, purchase,
acquire or otherwise transfer or deliver any MSCS Ventures A Interests, or any
agreement, document, instrument or obligation convertible or exchangeable
therefor. There are no voting trusts, proxies or other agreements or
understandings to which MSCS Ventures is a party or by which MSCS Ventures is
bound with respect to the voting of any MSCS Ventures A Interests (other than
the Pre-Amendment Operating Agreement). None of MSCS Ventures' MSCS Ventures A
Interests were acquired in violation of the Securities Act.
4.4 No Liens. MSCS Ventures owns the MSCS Ventures A Interests free and
clear of any Lien, other than those arising under the Pre-Amendment Operating
Agreement. Upon the delivery of the MSCS Ventures A Interests to MG Colorado
Holdings hereunder, MG Colorado Holdings will acquire the MSCS Ventures A
Interests, free and clear of any Lien and subject to no legal or equitable
restrictions of any kind other than as set forth in the Amended Operating
Agreement.
4.5 Compliance with Securities Laws.
(a) MSCS Ventures is an "accredited investor" as defined by Rule 501
under the Securities Act, and is capable of evaluating the merits and risks of
an investment in MG Colorado Holdings and has the capacity to protect its own
interests.
(b) MSCS Ventures understands that the MG Colorado Holdings Stock is
not presently registered under the Securities Act.
(c) MSCS Ventures is acquiring the MG Colorado Holdings Stock for
investment purposes and not with a view to distribution or resale, nor with the
intention of selling, transferring or otherwise disposing of all or any part
thereof for any particular price, or at any particular time, or upon the
happening of any particular event or circumstances, except selling,
transferring, or disposing the MG Colorado Holdings Stock in full compliance
with this Agreement and the Stockholders Agreement, all applicable provisions of
the Securities Act, the rules and regulations promulgated by the SEC thereunder,
and applicable state securities laws; and that such Contributing Party
understands that an investment in the MG Colorado Holdings Stock is not a liquid
investment.
(d) MSCS Ventures acknowledges that the MG Colorado Holdings Stock
must be held indefinitely unless subsequently registered under the Securities
Act or unless an exemption from such registration is available.
4.6 No Misrepresentations. The representations, warranties and statements
made by MSCS Ventures in or pursuant to this Agreement are true, complete and
correct in all material respects and do not contain any untrue statement of a
material fact or omit to state any material fact necessary to make any such
representation, warranty or statement, under the circumstances in which it is
made, not misleading.
14
4.7 No Violation. Neither the execution or delivery of the MSCS Ventures
Documents nor the consummation of the transactions contemplated thereby, will
conflict with or result in the breach of any term or provision of, require
consent or violate or constitute a default under (or an event that with notice
or the lapse of time or both would constitute a breach or default) or relieve
any third party of any obligation to MSCS Ventures or give any third party the
right to terminate or accelerate any obligation under, any charter provision,
bylaw, contract, agreement, Permit or any Law to which MSCS Ventures is a party
or by which any its assets are in any way bound or obligated.
4.8. No Consents. No consent, approval, order or authorization of, or
registration, qualification, designation, declaration or filing with, any
governmental or regulatory body, or third party, is required on the part of MSCS
Ventures in connection with the transactions contemplated by this Agreement.
ARTICLE V: REPRESENTATIONS AND WARRANTIES OF X'XXXXX AND XXXXX
X'Xxxxx and Xxxxx, severally, as applicable, and not jointly, hereby
represent and warrant to MG Colorado Holdings and to each of the other
Contributing Parties as follows:
5.1 Authority.
(a) X'Xxxxx has all requisite power and authority to execute, deliver
and perform under this Agreement and the other agreements, certificates and
instruments to be executed by X'Xxxxx in connection with or pursuant to this
Agreement (collectively, the "X'Xxxxx Documents"). This Agreement has been, and
at the Closing the other X'Xxxxx Documents will be, duly executed and delivered
by X'Xxxxx. This Agreement is, and, upon execution and delivery by X'Xxxxx at
the Closing, each of the other X'Xxxxx Documents will be, a legal, valid and
binding agreement of X'Xxxxx, enforceable against X'Xxxxx in accordance with its
terms, except as such enforceability may be limited by applicable bankruptcy,
insolvency, fraudulent conveyance or similar laws affecting the enforcement of
creditors' rights generally and subject to general principles of equity
(regardless of whether enforcement is sought in a proceeding at law or in
equity).
(b) Xxxxx has all requisite power and authority to execute, deliver
and perform under this Agreement and the other agreements, certificates and
instruments to be executed by Xxxxx in connection with or pursuant to this
Agreement (collectively, the "Xxxxx Documents"). This Agreement has been, and at
the Closing the other Xxxxx Documents will be, duly executed and delivered by
Xxxxx. This Agreement is, and, upon execution and delivery by Xxxxx at the
Closing, each of the other Xxxxx Documents will be, a legal, valid and binding
agreement of Xxxxx, enforceable against Xxxxx in accordance with its terms,
except as such enforceability may be limited by applicable bankruptcy,
insolvency, fraudulent conveyance or similar laws affecting the enforcement of
creditors' rights generally and subject to general principles of equity
(regardless of whether enforcement is sought in a proceeding at law or in
equity).
15
5.2 Title.
(a) The X'Xxxxx C Interests constitute fifty percent (50%) of the
Class C membership interests of MSCS. Other than rights arising under the
Pre-Amendment Operating Agreement, there are no outstanding options, warrants,
convertible or exchangeable securities or other rights, agreements, arrangements
or commitments obligating X'Xxxxx, directly or indirectly, to issue, sell,
purchase, acquire or otherwise transfer or deliver any X'Xxxxx C Interests, or
any agreement, document, instrument or obligation convertible or exchangeable
therefor. There are no voting trusts, proxies or other agreements or
understandings to which X'Xxxxx is a party or by which X'Xxxxx is bound with
respect to the voting of any X'Xxxxx C Interests (other than the Pre-Amendment
Operating Agreement). None of the X'Xxxxx C Interests were acquired in violation
of the Securities Act.
(b) The Xxxxx C Interests constitute fifty percent (50%) of the Class
C membership interests of MSCS. Other than rights arising under the
Pre-Amendment Operating Agreement, there are no outstanding options, warrants,
convertible or exchangeable securities or other rights, agreements, arrangements
or commitments obligating Xxxxx, directly or indirectly, to issue, sell,
purchase, acquire or otherwise transfer or deliver any Xxxxx C Interests, or any
agreement, document, instrument or obligation convertible or exchangeable
therefor. There are no voting trusts, proxies or other agreements or
understandings to which Xxxxx is a party or by which Xxxxx is bound with respect
to the voting of any Xxxxx C Interests (other than the Pre-Amendment Operating
Agreement). None of the Xxxxx C Interests were acquired in violation of the
Securities Act.
5.3 No Liens.
(a) X'Xxxxx owns the X'Xxxxx C Interests free and clear of any Lien,
other than those arising under the Pre-Amendment Operating Agreement. Upon the
delivery of the X'Xxxxx C Interests to MG Colorado Holdings hereunder, MG
Colorado Holdings will acquire the X'Xxxxx C Interests, free and clear of any
Lien and subject to no legal or equitable restrictions of any kind other than as
set forth in the Amended Operating Agreement.
(b) Xxxxx owns the Xxxxx C Interests free and clear of any Lien, other
than those arising under the Pre-Amendment Operating Agreement. Upon the
delivery of the Xxxxx C Interests to MG Colorado Holdings hereunder, MG Colorado
Holdings will acquire the Xxxxx C Interests, free and clear of any Lien and
subject to no legal or equitable restrictions of any kind other than as set
forth in the Amended Operating Agreement.
5.4 Compliance with Securities Laws.
(a) Such Contributing Party is an "accredited investor" as defined by
Rule 501 under the Securities Act, and that such Contributing Party is capable
of evaluating the merits and risks of such Contributing Party's investment in MG
Colorado Holdings and has the capacity to protect its own interests.
(b) Such Contributing Party understands that the MG Colorado Holdings
Stock is not presently registered under the Securities Act.
16
(c) Such Contributing Party is acquiring the MG Colorado Holdings
Stock for investment purposes and not with a view to distribution or resale, nor
with the intention of selling, transferring or otherwise disposing of all or any
part thereof for any particular price, or at any particular time, or upon the
happening of any particular event or circumstances, except selling,
transferring, or disposing the MG Colorado Holdings Stock in full compliance
with the Stockholders Agreement, all applicable provisions of the Securities
Act, the rules and regulations promulgated by the SEC thereunder, and applicable
state securities laws; and that such Contributing Party understands that an
investment in the MG Colorado Holdings Stock is not a liquid investment.
(d) Such Contributing Party acknowledges that the MG Colorado Holdings
Stock must be held indefinitely unless subsequently registered under the
Securities Act or unless an exemption from such registration is available.
5.5 No Misrepresentations.
(a) The representations, warranties and statements made by X'Xxxxx in
or pursuant to this Agreement are true, complete and correct in all material
respects and do not contain any untrue statement of a material fact or omit to
state any material fact necessary to make any such representation, warranty or
statement, under the circumstances in which it is made, not misleading.
(b) The representations, warranties and statements made by Xxxxx in or
pursuant to this Agreement are true, complete and correct in all material
respects and do not contain any untrue statement of a material fact or omit to
state any material fact necessary to make any such representation, warranty or
statement, under the circumstances in which it is made, not misleading.
ARTICLE VI: REPRESENTATIONS AND WARRANTIES OF MG COLORADO HOLDINGS
MG Colorado Holdings represents and warrants to the Contributing Parties as
follows:
6.1 Organization. MG Colorado Holdings is a corporation duly organized,
validly existing and in good standing under the laws of Delaware. MG Colorado
Holdings is duly authorized, qualified or licensed to do business and is in good
standing in Delaware, which is the only jurisdiction in which its assets are
located or in which its business or operations as presently conducted make such
qualification necessary. MG Colorado Holdings is not required to be qualified to
do business in any other jurisdiction.
6.2 Authority. MG Colorado Holdings has all requisite power and authority
to execute, deliver and perform under this Agreement and the other agreements,
certificates and instruments to be executed by MG Colorado Holdings in
connection with or pursuant to this Agreement (collectively, the "MG Colorado
Holdings Documents"). The execution, delivery and performance by MG Colorado
Holdings of this Agreement and the other MG Colorado Holdings Documents have
been duly authorized by all necessary action on the part of MG Colorado
Holdings. This Agreement has been, and at the Closing and the Trust Operations
17
Closing, the other MG Colorado Holdings Documents will be, duly executed and
delivered by MG Colorado Holdings. This Agreement is, and, upon execution and
delivery by MG Colorado Holdings at the Closing and the Trust Operations
Closing, each of the other MG Colorado Holdings Documents will be, a legal,
valid and binding agreement of MG Colorado Holdings, enforceable against MG
Colorado Holdings in accordance with its terms, except as such enforceability
may be limited by applicable bankruptcy, insolvency, fraudulent conveyance or
similar laws affecting the enforcement of creditors' rights generally and
subject to general principles of equity (regardless of whether enforcement is
sought in a proceeding of law or in equity).
6.3 Title.
(i) Other than as described in sub-section (ii) below and the issuance
of MG Colorado Holdings Stock to the Contributing Parties as contemplated
herein, there are no outstanding options, warrants, convertible or exchangeable
securities or other rights, agreements, arrangements or commitments obligating
MG Colorado Holdings, directly or indirectly, to issue, sell, purchase, acquire
or otherwise transfer or deliver any MG Colorado Holdings Stock, or any
agreement, document, instrument or obligation convertible or exchangeable
therefor.
(ii) In connection with the Reorganization, it is anticipated that MG
Colorado Holdings will issue options to acquire three hundred forty-four
thousand four hundred seventy-eight (344,478) shares of MG Colorado Holdings
Stock in consideration for the cancellation of the options to purchase up to
nine hundred ninety-three (993) shares of Optech common stock currently
outstanding. Such issuance shall be exempt from the restrictive provisions of
the Stockholders Agreement. The MG Colorado Holdings Stock Option Agreements are
attached hereto as Exhibit FF.
6.4 No Liens. Upon the delivery of the MG Colorado Holdings Stock to
the Contributing Parties hereunder, the Contributing Parties will acquire the MG
Colorado Holdings Stock, free and clear of any Lien and subject to no legal or
equitable restrictions of any kind, other than those restrictions on transfer
imposed by the Securities Act and by the Stockholders Agreement.
6.5 No Misrepresentations. The representations, warranties and statements
made by MG Colorado Holdings in or pursuant to this Agreement are true, complete
and correct in all material respects and do not contain any untrue statement of
a material fact or omit to state any material fact necessary to make any such
representation, warranty or statement, under the circumstances in which it is
made, not misleading.
6.6 Capitalization. The authorized capital stock of MG Colorado Holdings
as of the date hereof and the projected capitalization and respective ownership
percentages of the Contributing Parties, upon the Closing of the Reorganization,
are as set forth on Exhibit A hereto.
6.7 Compliance with Securities Laws. Assuming the accuracy of the
information provided by and the representations and warranties of the
18
Contributing Parties, the issuance of the MG Colorado Holdings Stock in the
Reorganization is exempt from registration under the Securities Act.
6.8 No Violation. Neither the execution or delivery of the MG Colorado
Holdings Documents nor the consummation of the transactions contemplated
thereby, including without limitation the contribution of the Trust Operations
to MG Colorado Holdings and the subsequent contribution of the Trust Operations
to the Trust Entity, will conflict with or result in the breach of any term or
provision of, require consent or violate or constitute a default under (or an
event that with notice or the lapse of time or both would constitute a breach or
default) or relieve any third party of any obligation to MG Colorado Holdings or
give any third party the right to terminate or accelerate any obligation under,
any charter provision, bylaw, contract, agreement, Permit (as defined in Section
7.9) or any Law to which MG Colorado Holdings or the Trust Entity is a party or
by which any their respective assets is in any way bound or obligated.
6.9. No Consents. Other than the Trust Operations Approvals, no consent,
approval, order or authorization of, or registration, qualification,
designation, declaration or filing with, any governmental or regulatory body, of
third party, is required on the part of MG Colorado Holdings or the Trust Entity
in connection with the contribution of the Trust Operations by Matrix Capital
Bank to MG Colorado Holdings or any of the other transactions contemplated by
this Agreement.
ARTICLE VII: REPRESENTATIONS AND WARRANTIES OF MATRIX CAPITAL BANK
Matrix Capital Bank hereby represents and warrants to MG Colorado Holdings
and to each of the Contributing Parties as follows (all references to the Trust
Operations refer to the Trust Operations from such time as such Trust Operations
commenced and through the Trust Operations Closing Date):
7.1 Organization. Matrix Capital Bank is a federal savings bank duly
organized and validly existing under the laws of the United States of America
and has full power to own its assets and to conduct its business as presently
conducted. Matrix Capital Bank is exempt from qualification to do business in
any state.
7.2 Authority. Matrix Capital Bank has all requisite power and authority
to execute, deliver and perform its obligations under this Agreement and the
other agreements, certificates and instruments to be executed by Matrix Capital
Bank in connection with or pursuant to this Agreement (collectively, the "Matrix
Capital Bank Documents"). The execution, delivery and performance by Matrix
Capital Bank of this Agreement and the other Matrix Capital Bank Documents have
been duly authorized by all necessary action on the part of Matrix Capital Bank.
This Agreement has been, and at the Closing and the Trust Operations Closing,
the other Matrix Capital Bank Documents will be, duly executed and delivered by
Matrix Capital Bank. This Agreement is, and, upon execution and delivery by
Matrix Capital Bank at the Closing and the Trust Operations Closing, each of the
other Matrix Capital Bank Documents will be, a legal, valid and binding
agreement of Matrix Capital Bank, enforceable against Matrix Capital Bank in
accordance with its terms, except as such enforceability may be limited by
applicable bankruptcy, insolvency, fraudulent conveyance or similar laws
affecting the enforcement of creditor's rights generally and subject to general
19
principles of equity (regardless of whether enforcement is sought in a
proceeding at law or in equity).
7.3 Title to the Trust Operations. Except for the Assumed Obligations and
as set forth in Schedule 7.3, Matrix Capital Bank owns the Trust Operations and
the Trust Operations are not subject to any mortgage, encumbrance or Lien of any
kind except minor encumbrances, which do not materially interfere with the
conduct of the Trust Operations. Upon the Contribution of the Trust Operations
to MG Colorado Holdings, MG Colorado Holdings will own the Trust Operations free
and clear of any Lien and subject to no legal or equitable restrictions of any
kind, except for the Assumed Obligations.
7.4 No Options or Rights. There are not outstanding options or rights to
acquire any interests in or any of the assets of the Trust Operations.
7.5 No Violation. Except as described in Schedule 7.5, neither the
execution or delivery of the Matrix Capital Bank Documents nor the consummation
of the transactions contemplated thereby, including without limitation the
contribution of the Trust Operations to MG Colorado Holdings, will conflict with
or result in the breach of any term or provision of, require consent or violate
or constitute a default under (or an event that with notice or the lapse of time
or both would constitute a breach or default), or result in the creation of any
Lien on any of the assets of the Trust Operations, or relieve any third party of
any obligation to the Trust Operations or give any third party the right to
terminate or accelerate any obligation under, any charter provision, bylaw,
contract, agreement, Permit or Law to which either Matrix Capital Bank or the
Trust Operations is a party or by which any asset of the Trust Operations is in
any way bound or obligated.
7.6 Governmental Consents. Except as set forth on Schedule 7.6, no
consent, approval, order or authorization of, or registration, qualification,
designation, declaration or filing with, any governmental or regulatory body is
required on the part of either of Matrix Capital Bank or the Trust Operations in
connection with the contribution of the Trust Operations by Matrix Capital Bank
to MG Colorado Holdings or any of the other transactions contemplated by this
Agreement.
7.7 Litigation. Except as described in Schedule 7.7, there are currently
no pending or, to the Knowledge of Matrix Capital Bank, threatened lawsuits,
administrative proceedings, arbitrations, reviews or formal or informal
complaints or investigations ("Litigation") by any individual, corporation,
partnership, customer, affiliate, governmental or regulatory body or other
entity (each, a "Person") relating to the Trust Operations, or any of its
employees or agent (in their capacities as such) or to which any assets of the
Trust Operations are subject or relating to the transactions contemplated by
this Agreement or the consummation thereof, nor, to the Knowledge of the Matrix
Capital Bank, is there any basis therefor. The Trust Operations are not subject
to or bound by any currently existing judgment, order, writ, injunction or
decree.
7.8 Compliance with Laws. In connection with the Trust Operations, Matrix
Capital Bank is currently complying with and has at all times complied with each
applicable statute, law, ordinance, decree, order, rule or regulation of any
governmental or regulatory body, including, without limitation, all federal,
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state and local laws and regulations and any regulations of the Office of Thrift
Supervision ("OTS"), except for such failure to so comply as would not have,
alone or in the aggregate, a material adverse effect on the financial position
or results of operations of the Trust Operations. In connection with the Trust
Operations, Matrix Capital Bank has established controls and procedures to
assure ongoing compliance with all applicable laws and regulations.
7.9 Permits. Matrix Capital Bank owns or possesses from each appropriate
governmental or regulatory body all applicable permits, licenses,
authorizations, approvals, quality certifications, franchises or rights
(collectively, "Permits") issued by any governmental or regulatory body
necessary to conduct the Trust Operations. Each of such Permits is described in
Schedule 7.9. No loss or expiration of any such Permit is pending or, to the
Knowledge of the Matrix Capital Bank, threatened, other than expiration in
accordance with the terms thereof of Permits that may be renewed in the ordinary
course of business without lapse. There has been no violation of any of the
rules or regulations of any governmental or regulatory body, which might impact
on the effectiveness of any Permit.
7.10 Employee Matters. Set forth on Schedule 7.10 is complete information
regarding all current employees of Matrix Capital Bank who are involved with the
Trust Operations, including date of employment, current title and compensation,
the date and amount of the last increase in compensation for each such employee
and whether such employee is a party to a written employment contract with
Matrix Capital Bank. Except as set forth on Schedule 7.10, in connection with
the Trust Operations, Matrix Capital Bank has no collective bargaining, union or
labor agreements, contracts or other arrangements with any group of employees,
labor union or employee representative and, to the Knowledge of the Matrix
Capital Bank, there is no organization effort currently being made or threatened
by or on behalf of any labor union with respect to employees of Matrix Capital
Bank involved with the Trust Operations. Matrix Capital Bank is in compliance
with all provisions of each applicable collective bargaining agreement, and no
complaint alleging any violation of such provisions has been filed or, to the
Knowledge of Matrix Capital Bank, is threatened to be filed with or by any
governmental or regulatory body. The Trust Operations have not experienced and,
to the Knowledge of the Matrix Capital Bank, there is no basis for, any strike,
material labor trouble, work stoppage, slow down or other interference with or
impairment of the Trust Operations.
7.11 Employee Benefit Plans.
(a) For purposes hereof the term "Employee Benefit Plan" means (i) any
"employee benefit plan" or "plan" within the meaning of Section 3(3) of the
Employee Retirement Income Security Securities Act of 1974, as amended
("ERISA"), and (ii) all material plans or policies providing for "fringe
benefits" (including but not limited to vacation, paid holidays, personal leave,
employee discounts, educational benefits or similar programs), and each other
bonus, incentive compensation, deferred compensation, profit sharing, stock,
severance, retirement, health, life, disability, group insurance, employment,
stock option, stock purchase, stock appreciation right, performance share,
supplemental unemployment, layoff, consulting, or any other similar plan,
agreement, policy or understanding (whether written or oral, qualified or
nonqualified, currently effective or terminated), and any trust, escrow or other
agreement related thereto, which (x) is or has been established, maintained or
contributed to by the Matrix Capital Bank or any other corporation or trade or
business under common control with Matrix Capital Bank (an "ERISA Affiliate") as
21
determined under Section 414(b), (c), (m) or (o) of the Code, or with respect to
which Matrix Capital Bank has or may have any Liability, or (y) provides
benefits, or describes policies or procedures applicable, to any director,
officer, employee, former director, officer, employee or dependent thereof of
Matrix Capital Bank who is involved with the Trust Operations, regardless of
whether funded. Employee Benefit Plan also includes any written or oral
representations made to any director, officer, employee or former director,
officer or employee of Matrix Capital Bank, involved with the Trust Operations,
promising or guaranteeing any employer payment or funding for the continuation
of medical, dental, life or disability coverage for any period of time beyond
the end of the current plan year (except to the extent of coverage required
under Code Section 4980B).
(b) Each Employee Benefit Plan has been operated in compliance in all
material respects with ERISA, applicable tax qualification requirements and all
other applicable Laws.
(c) MG Colorado Holdings will not assume any Employee Benefit Plans of
Matrix Capital Bank or take on any Liability relating to any Employee Benefit
Plans of Matrix Capital Bank except as expressly stated in this Agreement. To
the extent any Employee Benefit Plan is assumed by MG Colorado Holdings
hereunder, MG Colorado Holdings expressly reserves the right to subsequently
terminate such plan, where allowed by law.
(d) No Lien has been filed by any Person and no Lien exists by
operation of Law or otherwise on the assets of the Trust Operations relating to,
or as a result of, the operation or maintenance of any Employee Benefit Plan,
and Matrix Capital Bank has no Knowledge of the existence of facts or
circumstances that would result in the imposition of such a Lien.
(e) Neither the execution and delivery of this Agreement nor the
consummation of the transactions contemplated hereby will (i) except as
expressly contemplated by this Agreement, result in any payment becoming due to
any director or any employee of Matrix Capital Bank; (ii) increase any benefits
otherwise payable under any Employee Benefit Plan; (iii) result in any
acceleration of the time of payment or vesting of any benefits under any
Employee Benefit Plan; or (iv) result, separately or in the aggregate, in an
"excess parachute payment" within the meaning of Section 280G of the Code.
(f) No amounts payable under any Employee Benefit Plan or other
agreement or arrangement will fail to be deductible for United States federal
income Tax purposes by virtue of Section 162(m) of the Code.
7.12 Material Agreements.
(a) Schedule 7.12(a) lists each agreement (including all amendments
thereto) relating to the Trust Operations or to which Matrix Capital Bank is a
party regarding the Trust Operations or by which the Trust Operations or any of
their respective assets are subject or related (collectively, the "Material
Agreements"), including, without limitation, the following: (i) agreements
pursuant to which the Trust Operations sells or distributes any services or
products, (ii) all clearing and execution arrangements and all other
arrangements relating to the ability of Matrix Capital Bank to execute and clear
financial transactions (and Matrix Capital Bank represents that all provisions
relating to the rights of the other party to terminate such agreements are
22
contained in such agreements), (iii) real estate leases, (iv) agreements
evidencing, securing or otherwise relating to any indebtedness for borrowed
money in connection with the Trust Operations, (v) capital or operating leases
or conditional sales agreements relating to vehicles, equipment or other assets
of the Trust Operations, (vi) agreements pursuant to which assets relating to
the Trust Operations may be acquired from a third party, (vii) employment,
consulting, non-competition, separation, collective bargaining, union or labor
agreements or arrangements affecting the Trust Operations, and (viii) agreements
affecting the Trust Operations with or for the benefit of any shareholder,
director, officer or employee of Matrix Capital Bank, involved with the Trust
Operations, or any Affiliate or immediate family member thereof.
(b) Matrix Capital Bank has delivered to MG Colorado Holdings a copy
of each written Material Agreement. There are no oral Material Agreements.
Except as described in Schedule 7.12(b): (i) each Material Agreement is valid,
binding and in full force and effect and enforceable in accordance with its
terms, except as such enforceability may be limited by applicable bankruptcy,
insolvency, fraudulent conveyance or similar laws affecting the enforcement of
creditor's rights generally and subject to general principles of equity
(regardless of whether enforcement is sought in a proceeding of law or in
equity), (ii) Matrix Capital Bank has performed in all material respects all of
its obligations under every Material Agreement to which it is a party with
respect to the Trust Operations, and there exists no breach or default (or event
that with notice or lapse of time would constitute a breach or default) on the
part of Matrix Capital Bank or, to the Knowledge of Matrix Capital Bank, on the
part of any other Person under any Material Agreement, (iii) there has been no
termination or notice of default or, to the Knowledge of Matrix Capital Bank,
any threatened termination or notice of default under any Material Agreement;
and (iv) to the Knowledge of Matrix Capital Bank, no party to a Material
Agreement intends to alter its relationship with the Trust Operations as a
result of or in connection with the transactions contemplated by this Agreement.
7.13 Management Reports. In connection with MG Colorado Holdings' due
diligence review of the Trust Operations, Matrix Capital Bank has furnished MG
Colorado Holdings with detailed financial statements related to the business of
the Trust Operations for the periods beginning on July 1, 2002 and ending on
September 30, 2004 (the "Management Reports"). The Management Reports, including
any notes thereto, and any supporting schedules and reports included therein
present fairly the financial position as of the dates indicated, and results of
operations for the periods specified of the Trust Operations. The Trust
Operations have no indebtedness or liabilities, contingent or otherwise, except
as included on the Management Reports or as otherwise set forth on Schedule 7.13
hereto.
7.14 Tax Liability / Witholding. Other than as disclosed on Schedule 7.14
hereto, the Trust Operations have not received any notice of underpayment,
delinquency or late filing from the IRS or any state taxing authorities.
7.15 Customers.
(a) Set forth in Schedule 7.15(a)(i) is a complete list of each
customer of Matrix Capital Bank with respect to the Trust Operations that
accounted for more than $5,000 of revenues for the period ended October 31, 2004
(the "Material Customers"). To the Knowledge of Matrix Capital Bank, other than
as set forth on Schedule 7.15(a)(ii) none of the Material Customers has
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threatened to, or notified Matrix Capital Bank of any intention to, terminate or
materially alter its relationship with the Trust Operations, and none is
expected to terminate its account by mere virtue of the transactions
contemplated herein. Except as set forth on Schedule 7.14(a), there has been no
material change in pricing or pricing structure (other than ordinary course
changes made as a result of changes in commodity prices) with any Material
Customer and there has been no material dispute with a Material Customer, in
each case since October 31, 2004.
(b) Set forth in Schedule 7.15(b) is a schedule of xxxxxxxx and sales
revenue by services for the period beginning on January 1, 2004 and ending on
October 31, 2004. The information presented therein present fairly the xxxxxxxx
and sales revenues as of the dates indicated.
7.16 Intellectual Property Rights. Set forth in Schedule 7.16 is a
complete list of all registered and unregistered patents, trademarks, service
marks and trade names, and registered copyrights, and applications for and
licenses (to or from Matrix Capital Bank) with respect to any of the foregoing,
and all computer software and software licenses (other than commercial
"shrink-wrap" software and software licenses), proprietary information, trade
secrets, material and manufacturing specifications, drawings and designs owned
by Matrix Capital Bank in connection with the Trust Operations or with respect
to which Matrix Capital Bank has any license or use rights in connection to the
Trust Operations (collectively, "Intellectual Property"). Schedule 7.16
identifies all Intellectual Property that is owned by Matrix Capital Bank in
connection with the Trust Operations. Matrix Capital Bank has the right to use
all Intellectual Property utilized by the Trust Operations or necessary in
connection with the operation of the Trust Operations without infringing on or
otherwise acting adversely to the rights or claimed rights of any Person, and,
except for payments made in the ordinary course in connection with licensing
arrangements, Matrix Capital Bank is not obligated to pay any royalty or other
consideration to any Person in connection with the use of any such Intellectual
Property. To the Knowledge of Matrix Capital Bank, no Person is infringing the
rights of any of its Intellectual Property, with respect to the Trust
Operations.
7.17 Illegal Payments. None of Matrix Capital Bank, or any director,
officer, employee or agent of Matrix Capital Bank or immediate family member of
any of the foregoing has: (a) used any of Matrix Capital Bank's funds for
unlawful contributions, gifts, entertainment or other unlawful expenses relating
to political activity; (b) made any payment in violation of applicable Law to
any foreign or domestic government official or employee or to any foreign or
domestic political party or campaign; (c) failed to comply with any provision of
the (i) Bank Secrecy Act, as amended, (ii) the Money Laundering Control Act of
1986, as amended, (iii) the Foreign Corrupt Practices Act, or (iv) the Uniting
and Strengthening of America by Providing Appropriate Tools Required to
Intercept and Obstruct Terrorism (USA PATRIOT ACT) Act of 2001, and/or the rules
and regulations promulgated under any such law, or any successor law, except for
such failures to comply as would not, individually or in the aggregate have a
material adverse effect on the financial position or results of operations of
Matrix Capital Bank or (d) made any other payment in violation of applicable
Law.
7.18 Insurance. Matrix Capital Bank's insurance policies are issued by
insurers of recognized responsibility and insure Matrix Capital Bank and the
24
assets of the Trust Operations against such losses and risks, and in such
amounts, as are customary in the case of corporations of established reputation
engaged in the same or similar businesses and similarly situated.
7.19 Creditors; Bankruptcy, etc. Matrix Capital Bank is not a party to
any proceeding as a debtor in any court under Title 11 of the United States
Bankruptcy Code or any other insolvency or debtors' relief act, whether state or
federal, or for the appointment of a trustee, receiver, liquidator, assignee,
sequestrator or other similar official of Matrix Capital Bank or for any part of
any of its assets or property.
7.20 No Misrepresentations. The representations, warranties and
statements made by Matrix Capital Bank in or pursuant to this Agreement are
true, complete and correct in all material respects and do not contain any
untrue statement of a material fact or omit to state any material fact necessary
to make any such representation, warranty or statement, under the circumstances
in which it is made, not misleading.
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ARTICLE VIII: COVENANTS AND ADDITIONAL AGREEMENTS
8.1 Conduct of the Trust Operations Business. Prior to the Trust
Operations Closing, unless MG Colorado Holdings otherwise consents in writing,
Matrix Capital Bank will:
(a) operate the Trust Operations in the ordinary course of
business and consistent with past practice and use its commercially reasonable
efforts to preserve the goodwill of the Trust Operations and of its officers,
employees, customers, suppliers, governmental and other regulatory bodies and
others having business dealings with the Trust Operations;
(b) use its commercially reasonable efforts to preserve intact the
business organization of the Trust Operations, keep available the services of
the Trust Operations' present officers and key employees, consultants, advisors
and managers and maintain satisfactory relationships with customers, agents,
suppliers and other Persons having business relationships with the Trust
Operations;
(c) except as specifically contemplated by this Agreement, not engage
in any transaction, within the Trust Operations, outside the ordinary course of
business, including without limitation by making any material expenditure,
investment or commitment, incurring any debt or entering into any material
agreement or arrangement of any kind;
(d) maintain all insurance policies and all Permits that are required
for the Trust Operations to carry on its businesses;
(e) maintain books of account and records in the usual, regular and
ordinary manner and consistent with past practice;
(f) not authorize or make any new expenditure with respect to the
Trust Operations, other than expenditures in the ordinary course that do not
exceed twenty-five thousand dollars ($25,000) individually, or one hundred
thousand dollars ($100,000) in the aggregate;
(g) not make any tax election or consent to the extension of time for
the assessment or collection of any Tax with respect to the Acquired Assets;
(h) not enter into any collective bargaining agreement that pertains
to employees associated with the Trust Operations; and
(i) not take or willfully omit to take any action that would result in
a breach (as of the Trust Operations Closing) of the representations and
warranties set forth in this Agreement.
8.2 Access and Information. Matrix Capital Bank will permit MG Colorado
Holdings and its representatives to have reasonable access to the Trust
Operations' managers, employees, agents, assets and properties and all relevant
books, records and documents of or relating to the Trust Operations and the
assets of the Trust Operations (but excluding the Excluded Books and Records)
during normal business hours and, with the exception of the Excluded Books and
Records, will furnish to MG Colorado Holdings such information, financial
records and other documents relating to the Trust Operations as MG Colorado
Holdings may reasonably request. Matrix Capital Bank will permit MG Colorado
Holdings and its representatives reasonable access to the Matrix Capital Bank's
27
accountants, auditors and customers for consultation or verification of any
information obtained by MG Colorado Holdings and will use commercially
reasonable efforts to cause such Persons to cooperate with MG Colorado Holdings
and its representatives in such consultations and in verifying such information.
8.3 Supplemental Disclosure. The Contributing Parties will promptly
supplement or amend each of the Schedules hereto with respect to any matter that
arises or is discovered after the date of their delivery, if existing or known
at the date of such delivery, would have been required to be set forth or listed
in the Schedules hereto; provided that, for purposes of determining whether a
breach exists with respect to any of the representations and warranties
hereunder, any such supplemental or amended disclosure after the date hereof
will not be deemed to have been disclosed to any Contributing Party unless such
Contributing Party otherwise expressly consents in writing. Notwithstanding the
foregoing, Matrix Capital Bank shall deliver the Schedules called for by Section
1.6 and Article VII hereof (A) initially on the date of execution of this
Agreement and (B) as updated within five (5) business days following the TO
Month End. MG Colorado Holdings shall have five (5) business days following
delivery of such updated Schedules by Matrix Capital Bank to either accept or
reject the updated Schedules delivered pursuant to (B) above.
8.4 Permits and Filings.
(a) Matrix Capital Bank will take commercially reasonable measures to
assist MG Colorado Holdings in the preparation and submission of all necessary
applications to obtain regulatory approval (as well as any necessary
post-application follow-up) for the formation of the Trust Entity and the
contribution of the Trust Operations to MG Colorado Holdings. Matrix Capital
Bank will continue to file all necessary forms and reports to assure that the
Trust Operations remain in compliance with all regulations up to and including
the achievement of regulatory approval for the contribution of the Trust
Operations to MG Colorado Holdings. MG Colorado Holdings will take, and will
cause Trust Entity to take, all actions necessary in order to obtain regulatory
approval for the formation and operation of the Trust Entity and the
contribution of the Trust Operations to MG Colorado Holdings and subsequently to
the Trust Entity.
(b) Matrix Capital Bank will furnish MG Colorado Holdings with all
information concerning Matrix Capital Bank that is reasonably required for
inclusion in any application or filing made by MG Colorado Holdings to any
governmental or regulatory body in connection with the transactions contemplated
by this Agreement, except for the Excluded Books and Records.
8.5 Fulfillment of Conditions by the Contributing Parties. The
Contributing Parties agree not to take any action that would cause the
conditions on the obligations of the parties to effect the transactions
contemplated hereby not to be fulfilled, including without limitation by taking
or causing to be taken any action that would cause the representations and
warranties made by the Contributing Parties herein not to be true and correct as
of the Trust Operations Closing. The Contributing Parties will cause to be
fulfilled the conditions precedent to MG Colorado Holdings' obligations to
consummate the transactions contemplated hereby that are dependent on the
actions of the Contributing Parties, including, but not limited to the
27
obtainment of all necessary regulatory approvals and third-party consents for
the transfer of the Trust Operations to MG Colorado Holdings.
8.6 Fulfillment of Conditions by MG Colorado Holdings. MG Colorado
Holdings agrees not to take any action that would cause the conditions on the
obligations of the parties to effect the transactions contemplated hereby not to
be fulfilled, including without limitation by taking or causing to be taken any
action that would cause the representations and warranties made by MG Colorado
Holdings herein not to be true and correct as of the Closing.
8.7 Confidentiality. Other than required by law (including regulatory
requirements applicable to any Contributing Party or any parent thereof), no
press releases shall be issued by any party hereto, nor shall the terms of this
Agreement be disclosed, to any third parties without the consent of all the
other parties hereunder. No party hereunder will reveal or publicize any of the
terms of this Agreement to any person or entity without the prior approval of
the other parties hereto, except as required by law (including regulatory
requirements applicable to any Contributing Party or any parent thereof).
8.8 Transaction Costs. MG Colorado Holdings will pay all transaction
costs and expenses (including legal, accounting and other professional fees)
that it incurs in connection with the negotiation, execution and performance of
this Agreement and the transactions contemplated hereby. Except for X'Xxxxx and
Xxxxx whose transaction costs and expenses up to a maximum of twelve thousand
five hundred dollars ($12,500) each will be paid by MG Colorado Holdings, the
Contributing Parties will pay all transaction costs and expenses (including
legal, accounting and other professional fees) that they incur in connection
with the negotiation, execution and performance of this Agreement and the
transactions contemplated hereby and the employment agreements of Xxxxx and
X'Xxxxx, as applicable.
8.9 No-Shop Provisions.
(a) Each of the Contributing Parties hereby covenants and agrees that,
from the date of execution of this Agreement until the earlier of (A) the
Closing (and with respect to the Trust Operations, the Trust Operations Closing)
or (B) the Expiration Date: (i) it will not, and will not permit any of its
Affiliates to, directly or indirectly (through agents or otherwise), initiate,
solicit or encourage (including by way of furnishing information or assistance),
or take any other action to facilitate, any inquiries or the making of any
proposal relating to, or that may reasonably be expected to lead to, any
Competing Transaction (as defined below), or enter into discussions or negotiate
with any Person in furtherance of such inquiries or to obtain a Competing
Transaction, or endorse or agree to endorse any Competing Transaction, or
authorize or permit any employees of any of the Parties hereto or any investment
banker, financial advisor, attorney, accountant or other representative retained
by any of the Contributing Parties to take any such action (except pursuant to
rights set forth in the Pre-Amendment Operating Agreement), and (ii) each
Contributing Party will promptly notify each other Contributing Party of all
relevant terms of any such inquiries and proposals received by it or any of its
Affiliates or by any of its officers, directors, investment bankers, financial
advisors, attorneys, accountants or other representatives relating to any such
matters, and if such inquiry or proposal is in writing, the relevant
Contributing Party will promptly deliver or cause to be delivered to each other
Contributing Party a copy of such inquiry or proposal.
28
(b) For purposes of this Agreement, "Competing Transaction," with
respect to the Trust Operations, means any of the following (other than the
transactions contemplated by this Agreement) involving specifically the Trust
Operations and the Acquired Assets: (i) any merger, consolidation, share
exchange, business combination or similar transaction; (ii) any sale, lease,
exchange, mortgage, pledge, transfer or other disposition of the relevant assets
of the Trust Operations (other than transactions entered into in the ordinary
course of business and consistent with past practice); or (iii) any offer, sale
or other transfer of any equity interest in the Trust Operations
(c) For purposes of this Agreement, "Competing Transaction," with
respect to the other Contributions, means any of the following (other than the
transactions contemplated by this Agreement) involving the other Contributions:
(i) any merger, consolidation, share exchange, business combination or similar
transaction; (ii) any sale, lease, exchange, mortgage, pledge, transfer or other
disposition of the relevant assets being contributed pursuant to this Agreement
(other than transactions entered into in the ordinary course of business and
consistent with past practice); or (iii) any offer, sale or other transfer of
any equity interest in the Contributions, through the date of the Closing.
8.10 Nondisclosure.
(a) Each Contributing Party acknowledges and covenants that: (i) all
customer, prospect and marketing lists, sales data, Intellectual Property and
other confidential information of the Trust Operations (collectively, the
"Confidential Information") are valuable assets constituting part of the assets
of the Trust Operations and, following the Trust Operations Closing, will be
owned exclusively by MG Colorado Holdings (except for the Excluded Assets and
the Excluded Books and Records, which shall remain assets of Matrix Capital Bank
and shall, to the extent required by law or regulation, not be considered
Confidential Information for purposes of this Section 8.10), (ii) the
Confidential Information will be kept strictly confidential by each Contributing
Party and its respective representatives and will not, without the prior written
consent of MG Colorado Holdings, be disclosed in any manner whatsoever in whole
or in part (except to the extent that that disclosure is required by applicable
law, regulation or government proceeding, or, subject to compliance with the
terms hereof, a Contributing Party is served with a request for interrogatories,
information or documents or served with a subpoena or similar process compelling
the discovery of the Confidential Information) and will not be used by any
Contributing Party or its representatives, directly or indirectly, for any
purpose other than evaluating the Reorganization, (iii) without the prior
written consent of MG Colorado Holdings, and unless such Confidential
Information is a matter of public record, no Contributing Party or its
representatives will disclose to any other Contributing Person the fact that the
Confidential Information has been made available, or that investigations,
discussions or negotiations are taking place concerning the Reorganization,
including the status thereof, except as required by law, rule, regulation or as
contemplated below, and (iv) upon MG Colorado Holdings' written request at any
time, the Confidential Information obtained by each party, and, if applicable,
any copies thereof or evaluation materials will either be destroyed by such
Contributing Party or returned to MG Colorado Holdings immediately
(notwithstanding the return or destruction of Confidential Information, each
Contributing Party will continue to be bound by the terms of this Agreement).
29
(b) If any Contributing Party in possession of Confidential
Information is requested or becomes legally compelled in any judicial or
administrative proceeding or by any governmental or regulatory authority (by
oral questions, interrogatories request for information or documents, subpoena,
criminal or civil investigative demand or similar process) to disclose any of
the Confidential Information, prior to such disclosure, such Contributing Party
will provide MG Colorado Holdings with prompt written notice, where possible, so
that MG Colorado Holdings may seek (with such Contributing Party's cooperation,
if so requested by MG Colorado Holdings), a protective order or other
appropriate actions to limit or narrow the request; provided that the
requirement to so cooperate shall not require any Contributing Party to become a
party to, or actively participate in, any such action by MG Colorado Holdings
except to the extent that such actions by MG Colorado Holdings are legally
required in order for such order or other remedy to be obtained.
(c) The following information shall not be subject to this Section
8.10: (i) information which, at the time of disclosure or thereafter, is
generally available to and known by the public (other than as a result of a
disclosure, directly or indirectly, by a Contributing Party), (ii) information
which was available to the Contributing Party on a non-confidential basis from a
source other than a Party hereto or its advisors, provided that such source, to
the knowledge of the Contributing Party, is not and was not directly or
indirectly bound by a confidentiality agreement with any Party hereto, or (iii)
information which has been independently acquired or developed by a Contributing
Party without violating any of its obligations under this Agreement.
8.11 Releases by Contributing Parties.
(a) Effective upon the Closing, each of the Contributing Parties, for
itself and its successors and assigns, hereby fully and unconditionally releases
and forever discharges and holds harmless MG Colorado Holdings, and its
directors, officers, managers, affiliates, employees, agents, successors and
assigns (the "MGCH Released Parties") from any and all claims, demands, losses,
costs, expenses (including reasonable attorneys' fees and expenses),
obligations, liabilities and/or damages of every kind and nature whatsoever,
whether now existing, known or unknown, that such Contributing Party may now
have or may hereafter claim to have against MG Colorado Holdings or any of its
directors, officers, managers, affiliates, employees, agents, successors or
assigns; provided, that the foregoing release is not intended to release and
does not release or affect any obligations or liabilities of any of the MGCH
Released Parties to the Contributing Parties and their respective successors and
assigns (i) arising under this Agreement or any other agreement or document
executed in connection herewith, including without limitation each of the
exhibit documents or agreements executed as part of the transactions
contemplated by this Agreement, (ii) with respect to payments, fees or costs
that are due or may be due to a Contributing Party for the performance of
services, or the provision of products, by a Contributing Party on or before the
Closing Date pursuant to an agreement or contract between the parties in
question, and (iii) arising after the Closing Date pursuant to any of the
agreements, contracts or items listed in Sections 1(b), 1(c), 1(d), and 1(e) of
Exhibit GG.
(b) Effective upon the Closing, Optech, for itself and its successors
and assigns, hereby fully and unconditionally releases and forever discharges
and holds harmless Matrix Capital Bank, and its directors, officers, managers,
affiliates, employees, agents, successors and assigns (the "MCB Released
30
Parties") from any and all claims, demands, losses, costs, expenses (including
reasonable attorneys' fees and expenses), obligations, liabilities and/or
damages of every kind and nature whatsoever, whether now existing, known or
unknown that Optech or its successors or assigns may now have or may hereafter
claim to have against any or all of the MCB Released Parties; provided, that the
foregoing release is not intended to release and does not release or affect any
obligations or liabilities of any of the MCB Released Parties to Optech and its
successors and assigns (i) arising under this Agreement or any other agreement
or document executed in connection herewith, including without limitation each
of the exhibit documents or agreements executed as part of the transactions
contemplated by this Agreement, (ii) with respect to payments, fees or costs
that are due or may be due to Optech or its successors or assigns for the
performance of services, or the provision of products, by Optech or its
successors or assigns on or before the Closing Date pursuant to an agreement or
contract between the parties in question, and (iii) arising after the Closing
Date pursuant to any of the agreements, contracts or items listed in Sections
1(b), 1(c), 1(d), and 1(e) of Exhibit GG.
(c) Effective upon the Closing, Matrix Capital Bank for itself and its
successors and assigns, hereby fully and unconditionally releases and forever
discharges and holds harmless Optech, and its directors, officers, managers,
affiliates, employees, agents, successors and assigns (the "Optech Released
Parties") from any and all claims, demands, losses, costs, expenses (including
reasonable attorneys' fees and expenses), obligations, liabilities and/or
damages of every kind and nature whatsoever, whether now existing, known or
unknown that Matrix Capital Bank or its successors or assigns may now have or
may hereafter claim to have against any or all of the Optech Released Parties;
provided, that the foregoing release is not intended to release and does not
release or affect any obligations or liabilities of any of the Optech Released
Parties to Matrix Capital Bank and its successors and assigns (i) arising under
this Agreement or any other agreement or document executed in connection
herewith, including without limitation each of the exhibit documents or
agreements executed as part of the transactions contemplated by this Agreement,
(ii) with respect to payments, fees or costs that are due or may be due to
Matrix Capital Bank or its successors or assigns for the performance of
services, or the provision of products, by Matrix Capital Bank or its successors
or assigns on or before the Closing Date pursuant to an agreement or contract
between the parties in question, and (iii) arising after the Closing Date
pursuant to any of the agreements, contracts or items listed in Sections 1(b),
1(c), 1(d), and 1(e) of Exhibit GG.
8.12 Employees and Employee Benefits. From and after the Trust Operations
Closing Date, MG Colorado Holdings will have sole discretion over the hiring,
promotion, retention, termination and other terms and conditions of the
employment of the employees of the Trust Operations who become employees of MG
Colorado Holdings or the Trust Entity.
8.13 MSCS Pre-Amendment Operating Agreement: The Contributing Parties
acknowledge that the Reorganization and related transactions contemplated herein
are to be effectuated outside the scope of the existing Amended and Restated
Operating Agreement of MSCS, dated as of September 2, 1999 (as amended through
the date immediately prior to the Closing Date, the "Pre-Amendment Operating
Agreement"). The Contributing Parties hereby waive any rights they may have
under the Pre-Amendment Operating Agreement arising from the Reorganization and
the related transactions contemplated herein. Attached hereto as Exhibit E is
the form of the Second Amended and Restated Operating Agreement of MSCS, which
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is to be executed by Optech and MG Colorado Holdings at the Closing (the
"Amended Operating Agreement").
8.14 License Agreement. Pursuant to a license agreement dated as of
September 9, 1999 by and between Optech and MSCS (as amended to date, the
"License Agreement"), Optech has granted MSCS a non-exclusive license for the
use of certain of its software products. The parties acknowledge that the
License Agreement will remain in place and will not be affected by the
Reorganization. In connection with the Reorganization, the parties thereto will,
at Closing, further amend the License Agreement to reflect the Reorganization. A
form of the Second Amendment to License Agreement is attached hereto as Exhibit
CC.
8.15 Administrative Services Agreement. Reference is made to that certain
Administrative Services Agreement (the "Administrative Services Agreement")
between MSCS and Matrix Capital Bank, dated as of October 1, 2003, and that
certain Payment Agreement between MSCS and Matrix Bancorp dated as of October 1,
2003 (the "Payment Agreement"). In connection with the Reorganization, at the
Closing, the respective parties thereto, as applicable, will enter into a
Termination of Payment Agreement, terminating the Payment Agreement (the
"Termination of Payment Agreement"), and an Amended and Restated Administrative
Services Agreement, which provides for an amendment and restatement of the
Administrative Services Agreement (the "Amended and Restated Administrative
Services Agreement"). Forms of the Amended and Restated Administrative Services
Agreement and the Termination of Payment Agreement are attached hereto as
Exhibit F and Exhibit G respectively.
8.16 NSCC Clearing: Reference is made to the two NSCC Clearing
Agreements, the first dated as of September 2, 1999 between MSCS and Matrix
Capital Bank, as amended by an amendment dated as of August 31, 2001 (the "MSCS
NSCC Clearing Agrement"), and the second dated as of August 31, 2001 between
MSCS Financial Services ("MSCSFS") and Matrix Capital Bank (the "MSCSFS NSCC
Clearing Agreement"). In connection with the Reorganization, at the Closing, the
respective parties thereto, as applicable will enter into Termination and
Transfer Amendments with respect to the MSCS NSCC Clearing Agreement and the
MSCSFS NSCC Clearing Agreement (the "Termination and Transfer Amendments") Forms
of the Termination and Transfer Amendments are attached hereto as Exhibit H and
Exhibit I respectively.
8.17 Interim Services Agreement: In connection with the Reorganization,
at the Closing, Matrix Bancorp and MG Colorado Holdings will enter into an
interim services agreement (the "Interim Services Agreement"), which will
facilitate the smooth transition of the restructuring effected by the
Reorganization, the form of which is attached hereto as Exhibit J.
8.18 Banking Services Agreement. In connection with the Reorganization,
at the Closing Matrix Capital Bank and MG Colorado Holdings will enter into a
Banking Services Agreement, a form of which is attached hereto as Exhibit K.
8.19 Office Leases: In connection with the Reorganization, at Closing:
(i) Matrix Bancorp will cause Matrix Tower Holdings, LLC ("Matrix Tower") to
execute (a) the First Lease Modification Agreement between Matrix Tower and
MSCS, a form of which is attached hereto as Exhibit DD and (b) the Lease
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Termination Agreement between Matrix Tower and Matrix Capital Bank, a form of
which is attached hereto as Exhibit EE (the "Lease Termination Agreement") and
(ii) Matrix Capital Bank will execute the Lease Termination Agreement.
8.20 Other Agreements: Exhibit GG hereto lists all historical agreements
and outstanding obligations between the Parties hereto and indicates which of
such agreements and obligations will continue after the consummation of the
Reorganization and the transactions contemplated herein and which agreements and
obligations will be canceled (the "Canceled Agreements"). The Parties hereto
hereby cancel the Canceled Agreements, each cancellation effective as of the
date indicated on Exhibit GG.
8.21 Innovest: MG Colorado Holdings shall cause Innovest to consent
unconditionally to the assignment by Matrix Capital Bank of the Innovest license
agreement identified in Schedule 1.6(d).
ARTICLE IX: CLOSING CONDITIONS
9.1 Conditions to Obligations of MG Colorado Holdings, Bluff Point, and
Optech Stockholders with Respect to the Closing. The obligations of MG Colorado
Holdings, Bluff Point, and the Optech Stockholders under this Agreement with
respect to the Closing are subject to the satisfaction at or prior to the
Closing of the following conditions, but compliance with any of such conditions
may be waived by MG Colorado Holdings:
(a) All representations and warranties of MSCS Ventures, Matrix
Capital Bank, Matrix Bancorp, Xxxxx, and X'Xxxxx contained in this Agreement are
true and correct in all material respects (if qualified by materiality) or in
all respects (if not qualified by materiality) at and as of the Closing with the
same effect as though such representations and warranties were made at and as of
the Closing.
(b) MSCS Ventures, Matrix Capital Bank, Matrix Bancorp, Xxxxx and
X'Xxxxx have performed and complied with all the covenants and agreements
required by this Agreement to be performed or complied with by them at or prior
to the Closing, including without limitation the delivery of all items required
to be delivered by them pursuant to Section 1.3.
(c) Matrix Capital Bank will have contributed the Trust Operations to
MG Colorado Holdings (as more fully described in Section 1.6 hereto) or, if
(i)the Trust Operations Approvals have not yet been received and (ii) the other
conditions to the Trust Operations Closing set forth in Section 9.2 hereof have
not been met or waived, then Matrix Capital Bank and MG Colorado Holdings will
have executed all documents reasonably necessary to effect such contribution,
upon the receipt of such approvals identified in (i) and the satisfaction or
waiver of the conditions identified in (ii), to MG Colorado Holdings in exchange
for seventy-five thousand (75,000) shares of MG Colorado Holdings Stock, or, in
the alternate, to effect the release from escrow of such shares upon the
Expiration Date. Such seventy-five thousand (75,000) shares of MG Colorado
Holdings Stock shall be held in escrow pursuant to Section 1.3(e).
(d) As of the Closing Date, there is no pending or threatened
litigation by any Person seeking to enjoin any aspect of the operation of the
Trust Operations or the consummation of the transactions contemplated by this
Agreement.
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(e) X'Xxxxx has delivered to MG Colorado Holdings and each
Contributing Party a certificate substantially in the form attached as Exhibit M
to this Agreement.
(f) Xxx has delivered to MG Colorado Holdings and each Contributing
Party a certificate substantially in the form attached as Exhibit N to this
Agreement.
(g) Matrix Bancorp has delivered to MG Colorado Holdings and each
Contributing Party a secretary's certificate substantially in the form attached
as Exhibit O to this Agreement.
(h) Matrix Capital Bank has delivered to MG Colorado Holdings and each
Contributing Party a secretary's certificate substantially in the form attached
as Exhibit P to this Agreement.
(i) Xxxxx has delivered to MG Colorado Holdings and each Contributing
Party a certificate substantially in the form attached as Exhibit S to this
Agreement.
(j) MSCS Ventures has delivered to MG Colorado Holdings and each
Contributing Party a secretary's certificate substantially in the form attached
as Exhibit T to this Agreement.
(k) MSCS Ventures has delivered to MG Colorado Holdings and each
Contributing Party a legal opinion substantially in the form attached as Exhibit
X to this Agreement
(l) Waivers of all rights under the Pre-Amendment Operating Agreement
have been signed by MSCS Ventures, X'Xxxxx, Xxx and Xxxxx.
(m) The Stockholders Agreement has been signed by MSCS Ventures,
X'Xxxxx, Xxxxx and Xxx.
(n) Matrix Capital Bank has executed the Amended and Restated
Administrative Services Agreement and the Termination of Payment Agreement,
forms of which are attached hereto as Exhibit F and Exhibit G respectively.
(o) Matrix Capital Bank has executed the Termination and Transfer
Amendment, a form of which is attached hereto as Exhibit H.
(p) Matrix Capital Bank has executed the Termination and Transfer
Amendment, a form of which is attached hereto as Exhibit I.
(q) Matrix Bancorp has executed the Interim Services Agreement, a form
of which is attached hereto as Exhibit J.
(r) Matrix Capital Bank has executed the Banking Services Agreement, a
form of which is attached hereto as Exhibit K.
(s) The NASD has approved the application by MSCSFS of a change of
ownership and control.
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(t) Matrix Capital Bank has executed the Escrow Agreement, a form
of which is attached hereto as Exhibit BB.
(u) MSCS has executed the License Agreement, a form of which is
attached hereto as Exhibit CC.
(v) Matrix Tower has executed the Lease Modification Agreement, a form
of which is attached hereto as Exhibit DD.
(w) Matrix Tower and Matrix Capital Bank have executed the Lease
Termination Agreement a form of which is attached hereto as Exhibit EE.
9.2 Conditions to Obligations of MG Colorado Holdings with Respect to the
Trust Operations Closing. The obligations of MG Colorado Holdings under this
Agreement with respect to the Trust Operations Closing are subject to the
satisfaction at or prior to the Trust Operations Closing of the following
conditions, but compliance with any of such conditions may be waived by MG
Colorado Holdings:
(a) Subject to Section 1.6 (last paragraph) and Section 8.3 (last two
sentences), all representations and warranties of Matrix Capital Bank contained
in this Agreement are true and correct in all material respects (if qualified by
materiality) or in all respects (if not qualified by materiality) at and as of
the Trust Operations Closing with the same effect as though such representations
and warranties were made at and as of the Trust Operations Closing.
(b) Matrix Capital Bank has performed and complied with all the
covenants and agreements required by this Agreement to be performed or complied
with by it at or prior to the Trust Operations Closing, including without
limitation the delivery of all items required to be delivered by Matrix Capital
Bank pursuant to Section 1.6.
(c) Each and every of the Trust Operations Approvals shall have been
received, in form and substance reasonably satisfactory to MG Colorado Holdings.
(d) As of the Trust Operations Closing Date, there is no pending or
threatened litigation by any Person seeking to enjoin any aspect of the
operation of the Trust Operations or the consummation of the transactions
contemplated at the Trust Operations Closing.
(e) Matrix Capital Bank has delivered to MG Colorado Holdings and each
Contributing Party a legal opinion substantially in the form attached as Exhibit
V to this Agreement.
(f) Matrix Capital Bank has delivered evidence reasonably satisfactory
to MG Colorado Holdings that any Liens on the Acquired Assets have been
released.
(g) The updated Schedules called for by Section 1.6 and Section 8.3
shall have been accepted by MG Colorado Holdings in writing.
9.3 Conditions to Obligations of MSCS Ventures, Matrix Capital Bank and
Matrix Bancorp with Respect to the Closing. The obligations of MSCS Ventures,
35
Matrix Capital Bank and Matrix Bancorp under this Agreement with respect to the
Closing are subject to the satisfaction at or prior to the Closing of the
following conditions, but compliance with any of such conditions may be waived
by Matrix Bancorp:
(a) All representations and warranties of MG Colorado Holdings and
each Contributing Party contained in this Agreement are true and correct in all
material respects (if qualified by materiality) or in all respects (if not
qualified by materiality) at and as of the Closing with the same effect as
though such representations and warranties were made at and as of the Closing.
(b) MG Colorado Holdings and each Contributing Party have performed
and complied with all the covenants and agreements required by this Agreement to
be performed or complied with by them at or prior to the Closing, including
without limitation the delivery of all items required to be delivered by them
pursuant to Section 1.3.
(c) X'Xxxxx has delivered to MG Colorado Holdings and each
Contributing Party a certificate substantially in the form attached as Exhibit M
to this Agreement.
(d) Xxx has delivered to MG Colorado Holdings and each Contributing
Party a certificate substantially in the form attached as Exhibit N to this
Agreement.
(e) MG Partnership and Bluff Point have delivered to MG Colorado
Holdings and each Contributing Party certificates substantially in the forms
attached hereto as Exhibit R and Exhibit S to this Agreement.
(f) Xxxxx has delivered to MG Colorado Holdings and each Contributing
Party a certificate substantially in the form attached as Exhibit S to this
Agreement.
(g) MG Colorado Holdings has delivered to the Contributing Parties a
certificate of the secretary of MG Colorado Holdings, substantially in the form
of Exhibit Q to this Agreement.
(h) Optech has delivered to MG Colorado Holdings and each Contributing
Party a secretary's certificate substantially in the form attached as Exhibit U
to this Agreement.
(i) Bluff Point and MG Partnership have delivered to MG Colorado
Holdings and each Contributing Party legal opinions substantially in the forms
attached as Exhibit AA and Exhibit Z to this Agreement.
(j) MG Colorado Holdings has delivered to each Contributing Party a
legal opinion substantially in the form attached as Exhibit W to this Agreement.
(k) The Amended Operating Agreement, a form of which is attached as
Exhibit E to this Agreement has been signed by Optech and MG Colorado Holdings.
(l) Waivers of all rights under the Pre-Amendment Operating Agreement
have been signed by Optech, X'Xxxxx, Xxxxx and Xxx.
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(m) The Stockholders Agreement has been executed by MG Colorado
Holdings and all MG Colorado Holdings Stockholders.
(n) MSCS has executed the Amended and Restated Administrative Services
Agreement and Termination of Payment Agreement, forms of which are attached
hereto as Exhibit F and Exhibit G respectively.
(o) MSCS has executed the Termination and Transfer Amendment, a form
of which is attached hereto as Exhibit H.
(p) MSCS Financial Services LLC has executed the Termination and
Transfer Amendment, a form of which is attached hereto as Exhibit I.
(q) MG Colorado Holdings has executed the Interim Services Agreement,
a form of which is attached hereto as Exhibit J.
(r) MG Colorado Holdings has executed the Banking Services Agreement,
a form of which is attached hereto as Exhibit K.
(s) Trust Entity and MG Colorado Holdings shall have applied for all
necessary contractual, governmental and regulatory consents, orders or
authorizations for the transfer by Matrix Capital Bank of the Trust Operations
to MG Colorado Holdings and subsequently from MG Colorado Holdings to Trust
Entity.
(t) The NASD has approved the application by MSCFS of a change of
ownership and control.
(u) MG Colorado Holdings and EGS have executed the Escrow Agreement, a
form of which is attached hereto as Exhibit BB.
9.4 Conditions to Obligations of Matrix Capital Bank with Respect to the
Trust Operations Closing. The obligations of Matrix Capital Bank under this
Agreement with respect to the Trust Operations Closing are subject to the
satisfaction at or prior to the Trust Operations Closing of the following
conditions, but compliance with any of such conditions may be waived by Matrix
Capital Bank:
(a) All representations and warranties of MG Colorado Holdings
contained in this Agreement are true and correct in all material respects (if
qualified by materiality) or in all respects (if not qualified by materiality)
at and as of the Trust Operations Closing with the same effect as though such
representations and warranties were made at and as of the Trust Operations
Closing.
(b) MG Colorado Holdings has performed and complied with all the
covenants and agreements required by this Agreement to be performed or complied
with by it at or prior to the Trust Operations Closing, including without
limitation the delivery of all items required to be delivered by Matrix Capital
Bank pursuant to Section 1.6.
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(c) Each and every of the Trust Operations Approvals shall have been
received, in form and substance reasonably satisfactory to Matrix Capital Bank.
(d) As of the Trust Operations Closing Date, there is no pending or
threatened litigation by any Person seeking to enjoin any aspect of the
operation of the Trust Operations or the consummation of the transactions
contemplated at the Trust Operations Closing.
(e) MG Colorado Holdings and Trust Entity shall have executed and
delivered to Matrix Capital Bank an executed assignment agreement satisfactory
to Matrix Capital Bank.
(f) MG Colorado Holdings has delivered to Matrix Capital Bank a legal
opinion substantially in the form of Exhibit W hereto.
(g) The updated Schedules called for by Section 1.6 and Section 8.3
shall have been accepted by MG Colorado Holdings in writing.
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ARTICLE X: INDEMNIFICATION
10.1 Indemnification. Notwithstanding any investigation by MG Colorado
Holdings or any Contributing Party, MG Colorado Holdings and each Contributing
Party, and their respective representatives, severally and not jointly, in
accordance with their particular Contributions (the "Indemnifying Parties"),
will as stated below indemnify and hold each other Party, their respective
subsidiaries and Affiliates and their respective directors, officers, employees
and agents (the "Indemnified Parties") harmless from any and all liabilities,
obligations, claims, contingencies, damages, costs and expenses, including all
court costs, litigation expenses and reasonable attorneys' fees (individually a
"Loss," and collectively, "Losses"), that any Party may suffer or incur as a
result of or relating to:
(a) with respect to a Contributing Party and/or MG Colorado Holdings,
the breach of any representation or warranty made by such Party in this
Agreement or pursuant hereto or any allegation by a third party that would
constitute such a breach;
(b) with respect to a Contributing Party and/or MG Colorado Holdings,
the breach of any covenant or agreement made by such Party in this Agreement or
pursuant hereto or any allegation by a third party that would constitute such a
breach;
(c) with respect to a Contributing Party and/or MG Colorado Holdings,
all taxes and any related fees or penalties allocable to such Contributing Party
for any taxable period (or any portion thereof) ending on or before the Closing
Date or the Trust Operations Closing Date, as applicable;
(d) (i) with respect to Matrix Capital Bank, all costs of defending,
or complying with any regulatory actions or proceedings relating to activities
of the Trust Operations (other than the applications for regulatory approval of
the transfer of the Trust Operations contemplated herein) prior to the date such
Trust Operations are actually transferred to MG Colorado Holdings and (ii) with
respect to MG Colorado Holdings and Trust Entity, all costs of defending, or
complying with any regulatory actions or proceedings relating to activities of
the Trust Operations (other than the applications for regulatory approval of the
transfer of the Trust Operations contemplated herein) after the date such Trust
Operations are actually transferred to MG Colorado Holdings or the Trust Entity;
(e) (i) with respect to Matrix Capital Bank, any Claim (as defined in
Section 10.3) commenced by any third party relating to actions or omissions of
Matrix Capital Bank in connection with its operation of the Trust Operations
prior to the Trust Operations Closing Date; and (ii) with respect to MG Colorado
Holdings and Trust Entity, any Claim commenced by any third party relating to
actions or omissions of MG Colorado Holdings or Trust Entity in connection with
their operation of the Trust Operations after the Trust Operations Closing Date;
(f) with respect to MG Colorado Holdings and Trust Entity, the failure
by MG Colorado Holding and/or Trust Entity to discharge and pay timely the
Assumed Obligations.
(g) with respect to Matrix Capital Bank, any Claim arising out of or
relating to the Excluded Assets.
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Notwithstanding anything in this Agreement to the contrary, each
Contributing Party's liability under this Agreement shall be limited to the
amount of such Party's respective Contribution (as valued herein); provided,
however, that the potential liability of Matrix Bancorp and Matrix Capital Bank
for Claims and Losses relating to the activities of the Trust Operations prior
to Closing and/or its contribution of the Trust Operations to MG Colorado
Holdings shall be limited to an aggregate of seven hundred and fifty thousand
dollars ($750,000) for all such Claims and Losses.
10.2 Survival.
(a) The Parties' representations and warranties and indemnification
obligations made in or pursuant to this Agreement and the certificates attached
as Exhibit M through Exhibit U hereto will survive the consummation of the
transactions contemplated hereby until the date that is the second anniversary
of the earlier of (i) the Expiration Date and (ii)(A) with respect to the
representations and warranties given my Matrix Capital Bank pursuant to Article
VII hereof the Trust Operations Closing Date, or (B) with respect to all other
representations and obligations of the Contributing Parties and MG Colorado
Holdings, the Closing Date; provided, that those related to taxes shall survive
as long as the applicable statute of limitations and an additional six (6)
months. Any representation or warranty the violation of which is made the basis
of a claim for indemnification pursuant to Section 10.1(a) will survive until
such claim is finally resolved if an Indemnified Party notifies an Indemnifying
Party of such claim in reasonable detail prior to the date on which such
representation or warranty would otherwise expire hereunder. Without limiting
the foregoing, no claim for indemnification pursuant to Section 10.1(a) based on
the breach or alleged breach of a representation or warranty may be asserted by
an Indemnified Party after the date on which such representation or warranty
expires hereunder.
(b) The covenants and agreements of the Indemnified Parties and of the
Indemnifying Parties made in or pursuant to this Agreement will survive the
consummation of the transactions contemplated hereby to the extent identified in
the various covenants and agreements in question.
10.3 Notice. Any Indemnified Party entitled to receive indemnification
under this Article X agrees to give prompt written notice to the Indemnifying
Parties upon the occurrence of any indemnifiable Loss or the assertion of any
claim or the commencement of any action or proceeding in respect of which such a
Loss may reasonably be expected to occur (a "Claim"), but the Indemnified
Party's failure to give such notice will not affect the obligations of the
Indemnifying Party under this Article X except to the extent that the
Indemnifying Party is materially prejudiced thereby. Such written notice will
include a reference to the event or events forming the basis of such Loss or
Claim and the amount involved, unless such amount is uncertain or contingent, in
which event the Indemnified Party will give a later written notice when the
amount becomes fixed.
10.4 Defense of Claims.
(a) The Indemnifying Party may elect to assume and control the defense
of any Claim, including the employment of counsel reasonably satisfactory to the
Indemnified Party and the payment of expenses related thereto, if: (i) the
Indemnifying Party acknowledges its obligation to indemnify the Indemnified
40
Party for any Losses resulting from such Claim; (ii) the Claim does not seek to
impose any Liability on the Indemnified Party other than money damages; and
(iii) the Claim does not relate to the Indemnified Party's relationship with any
customer or employee.
(b) If the conditions of Section 10.4(a) are satisfied and the
Indemnifying Party elects to assume and control the defense of a Claim, then:
(i) the Indemnifying Party will not be liable for any settlement of such Claim
effected without its consent, which consent will not be unreasonably withheld;
(ii) the Indemnifying Party may settle such Claim without the consent of the
Indemnified Party; and (iii) the Indemnified Party may employ separate counsel
and participate in the defense thereof, but the Indemnified Party will be
responsible for the fees and expenses of such counsel unless: (A) the
Indemnifying Party has failed to adequately assume and actively conduct the
defense of such Claim or to employ counsel with respect thereto; or (B) in the
reasonable opinion of the Indemnified Party, a conflict of interest exists
between the interests of the Indemnified Party and the Indemnifying Party that
requires representation by separate counsel, in which case the fees and expenses
of such separate counsel will be paid by the Indemnifying Party.
(c) If the conditions of Section 10.4(a) are not satisfied, the
Indemnified Party may assume the exclusive right to defend, compromise, or
settle such Claim, but the Indemnifying Party will not be bound by any
determination of a Claim so defended or any compromise or settlement effected
without its consent (which may not be unreasonably withheld).
The sole recourse and remedy of the Contributing Parties and MG
Colorado Holdings for any inaccuracy in or breach of, or any breach of any
obligations with respect to, or any other claims with respect to, any
representation or warranty or alleged representation or warranty by or on behalf
of any other Contributing Party contained in or made pursuant to this Agreement
or any other certificate, schedule, exhibit, instrument, or document delivered
pursuant hereto or thereto, shall be under the provisions of and to the extent
provided in this Article X. Each of the Contributing Parties and MG Colorado
Holdings shall comply with this Article X and will not assert any such
inaccuracy, breach or claim or seek any recourse or remedy in respect thereof
other than under the provisions of this Article X.
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ARTICLE XI: NON-COMPETITION AGREEMENT
11.1 Non-Competition.
(a) Non-Competition. In consideration of the Reorganization, each of
MSCS Ventures, Matrix Capital Bank, Matrix Bancorp, Bluff Point, Optech, and the
Optech Stockholders (each a "Bound Party"), severally and not jointly, covenants
to MG Colorado Holdings that, for a period of four (4) years from the Closing
Date (the "Non-Competition Period"), neither it nor any subsidiary (including,
but not limited to, with respect to Matrix Bancorp, Sterling Trust Company, a
Texas corporation) or Affiliate of such Bound Party will, directly or indirectly
(in any capacity, including as a stockholder, partner, member, investor, lender
(other than ordinary course lending and other normal and customary banking
relationships, such as depositary relationships, in the case of Matrix Capital
Bank), principal, director, officer, employee, consultant or agent of any other
Person: (i) engage in, or have any financial interest in any Person other than
MG Colorado Holdings that engages in, the business of developing, processing,
marketing, distributing or selling a Competing Product or Service (each
individually and collectively referred to as a "Competing Business") in the
United States of America (the "Territory"), (ii) employ, or recruit or solicit,
influence, or attempt to solicit or influence, any customer or any potential
customer of MG Colorado Holdings within the Territory, or any Person that is, or
within the 12-month period preceding the date of such activity was, a purchaser
of any product or service from MG Colorado Holdings to purchase a Competing
Product or Service from any Person other than MG Colorado Holdings or its
Affiliates, or (iii) solicit for employment, any Person who is an employee of MG
Colorado Holdings, Optech, MSCS or the Trust Entity. As used in this Agreement,
a "Competing Product or Service" means: (i) the provision of automated mutual
fund clearing and settlement services, through the National Securities Clearing
Corporation (the "NSCC"), by a Bound Party on behalf of itself or on behalf of
outside customers, including, but not limited to, financial institutions, trust
companies, broker-dealers, and third party administrators (the "NSCC Services"),
(ii) obtaining or retaining membership with NSCC (other than "Settling Bank Only
Member" status), or (iii) the provision of custodial and trust services to
outside third party administrators or record keepers in connection with the NSCC
Services. Notwithstanding anything herein to the contrary, the non-competition
provisions of this Article XI shall not be applicable to (i) Innovest Systems,
LLC ("Innovest") and the interests of any Bound Party in Innovest, with respect
to any business activities that MSCS is not engaged in as of the date of this
Agreement, or (ii) the use by Innovest Systems, LLC of software or other
products pursuant to transactions entered into between Innovest Systems, LLC and
Optech prior to the date of this Agreement.
In consideration of the Reorganization, MG Colorado Holdings hereby
covenants to Matrix Bancorp, MSCS Ventures and Matrix Capital Bank that, for a
period of four (4) years from the Closing Date, neither it nor any subsidiary or
Affiliate will, directly or indirectly, solicit for employment, any Person who
is any employee of Matrix Bancorp, Matrix Capital Bank, MSCS Ventures or any of
their respective subsidiaries or Affiliates (other than employees of the Trust
Operations).
(b) Termination upon Change in Control. If the majority of the capital
stock of any Bound Party is acquired by an entity that was providing a Competing
Product or Service prior to such acquisition, such Bound Party shall be released
42
from the provisions of this Article XI, to the extent that such acquiring party
is providing such Competing Product or Service; provided, however, that in the
event that Matrix Bancorp or any of its associated Bound Parties is released
from this Article XI pursuant to the foregoing provision, MG Colorado Holdings
will have the option, immediately upon notification of such release, to
terminate the Amended and Restated Administrative Services Agreement, a form of
which is attached hereto as Exhibit F.
(b) Exception. It will not be a violation of the restrictive covenant
set forth in Section 11.1(a) for any Bound Party or any Affiliate of such Bound
Party to invest in the publicly-traded equity securities of a Competing Business
constituting less than five percent (5%) of the outstanding securities of such
class.
(c) Equitable Relief. Each Bound Party acknowledges and agrees that MG
Colorado Holdings would be irreparably harmed by any violation of the
restrictive covenant set forth in Section 11.1(a) and that, in addition to all
other rights and remedies available to MG Colorado Holdings at law or in equity,
MG Colorado Holdings will be entitled to injunctive and other equitable relief
to prevent or enjoin any such violation. If any Bound Party, or any Affiliate of
a Bound Party, violates Section 11.1(a), the period of time during which the
provisions thereof are applicable will automatically be extended for a period of
time equal to the time that such violation began until such violation
permanently ceases.
(d) Representations. Each Bound Party represents to MG Colorado
Holdings that it is willing and able to engage in businesses that are not
restricted pursuant to this Section 11.1 and that enforcement of the restrictive
covenant set forth in this Section 11.1 will not be unduly burdensome to such
Bound Party. Each Bound Party acknowledges that its agreement to the restrictive
covenant set forth in this Section 11.1 is a material inducement and condition
to MG Colorado Holdings' willingness to enter into this Agreement, to consummate
the transactions contemplated hereby and to perform its obligations hereunder.
Each Bound Party acknowledges and agrees that the restrictive covenant and
remedies set forth in this Section 11.1 are reasonable as to time, geographic
area and scope of activity and do not impose a greater restraint than is
necessary to protect the goodwill and legitimate business interests of MG
Colorado Holdings and its Affiliates.
(e) Court Modification. Notwithstanding the foregoing, if the
restrictive covenant set forth in this Section 11.1 is found by a court of
competent jurisdiction to contain limitations as to time, geographic area or
scope of activity that are not reasonable or not necessary to protect the
goodwill or legitimate business interests of MG Colorado Holdings and its
Affiliates, then such court is hereby authorized and directed to reform such
provisions to the minimum extent necessary to cause the limitations contained in
this Section 11.1 as to time, geographical area and scope of activity to be
reasonable and to impose a restraint that is not greater than necessary to
protect the goodwill and legitimate business interests of MG Colorado Holdings
and its Affiliates.
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ARTICLE XII: MISCELLANEOUS
12.1 Notices. All notices required hereunder or pertaining hereto shall
be in writing and shall be deemed delivered and effective upon either (a) five
(5) days after deposit in the U.S. mail, postage prepaid, (b) personal delivery,
(c) electronic confirmation of a telecopy transmission received in its entirety
at the applicable telecopy number indicated below, after which the notice will
be sent within two (2) business days by recognized express courier service, as
specified in (d) below, or (d) the earliest of delivery, refusal of the
addressee to accept delivery or failure of delivery after at least one attempt
during normal business hours, in each case as such events are recorded in the
ordinary business records of the delivery service, which will be by recognized
express courier service (such as United Parcel Service), with all charges
prepaid or charged to the sender's account, to the applicable address set forth
below or at such other address as shall be specified in writing in accordance
with this paragraph:
if to MG Colorado Holdings, Optech or Xxx: with copies to:
00 Xxxxxxx Xxxxx Xxxxxxxx Xxxxxxxx & Schole LLP
Xxx Xxxx, Xxx Xxxx 00000 000 Xxxxxxxxx Xxxxxx
Attention: Mr. Let Xxx Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxxxx, Esq.
Telecopy: (000) 000-0000
if to MG Partnership or Bluff Point: with copies to:
00 Xxxxxxx Xxxxx Xxxxxxxx Xxxxxxxx & Schole LLP
Xxx Xxxx, Xxx Xxxx 00000 000 Xxxxxxxxx Xxxxxx
Attention: Xx. Xxxx X. Xxxxxxxx Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxxxx, Esq.
Telecopy: (000) 000-0000
If to X'Xxxxx:
000 00xx Xxxxxx, 0xx xxxxx
Xxxxxx, XX 00000
Attention: Mr. R. Xxxxxxx X'Xxxxx
If to Xxxxx:
000 00xx Xxxxxx, 0xx xxxxx
Xxxxxx, XX 00000
Attention: Mr. Xxxx Xxxxx
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If to MSCS Ventures, Matrix Bancorp or with copies to:
Matrix Capital Bank:
000 00xx Xxxxxx, Xxxxx 0000 000 00xx Xxxxxx, Xxxxx 0000
Xxxxxx, XX 00000 Xxxxxx, XX 00000
Attention: Xx. Xxxxxxx X. Xxxxxxx Attention: Xxxxx XxXxxxxxx
12.2 Attorneys' Fees and Costs. If attorneys' fees or other costs are
incurred to secure performance of any obligations hereunder, or to establish
damages for the breach thereof or to obtain any other appropriate relief,
whether by way of prosecution or defense, the prevailing party will be entitled
to recover reasonable attorneys' fees and costs incurred in connection
therewith.
12.3 Brokers. Each Party to this Agreement represents to the other
Parties that it has not incurred and will not incur any liability for brokers'
or finders' fees or agents' commissions in connection with this Agreement or the
transactions contemplated hereby.
12.4 Counterparts. This Agreement may be executed in one or more
counterparts (including by facsimile) for the convenience of the Parties hereto,
each of which will be deemed an original, but all of which together will
constitute one and the same instrument.
12.5 Interpretation. The article and section headings contained in this
Agreement are solely for the purpose of reference, are not part of the agreement
of the Parties and will not in any way affect the meaning or interpretation of
this Agreement.
12.6 Assignment. This Agreement and the rights, interests and obligations
hereunder may not be assigned or delegated by any Party hereto without the prior
written consent of the other Parties, which consent will not be unreasonably
withheld; provided that MG Colorado Holdings may assign its rights and
obligations under this Agreement with respect to the Trust Operations or
Acquired Assets to Trust Entity or any of the direct or indirect parent entities
or subsidiaries of MG Colorado Holdings, or any successor to its business;
provided, that any Party accepting an assignment pursuant to this Section 12.6
must assume all obligations hereunder, and further provided that an assignment
whose purpose is to circumvent the assigning Party's obligations hereunder or to
prevent any other Party from realizing it rights hereunder shall be void. This
Agreement is not intended to confer any rights or benefits on any Person other
than the Parties hereto, except to the extent specifically provided in Section
8.11.
12.7 Severability. In the event that any provision of this Agreement is
held invalid, illegal or unenforceable, such provision shall remain in full
force and effect to the fullest extent permitted by law, and the validity,
legality and enforceability of the remaining provisions hereof shall not in any
way be effected or impaired thereby.
12.8 Entire Agreement, Amendment. This Agreement and the related
documents contained as Exhibits and Schedules hereto or expressly contemplated
hereby contain the entire understanding of the parties relating to the subject
45
matter hereof and supersede all prior written or oral and all contemporaneous
oral agreements and understandings relating to the subject matter hereof. All
statements of the Contributing Parties contained in any schedule, certificate or
other writing required under this Agreement to be delivered in connection with
the transactions contemplated hereby will constitute representations and
warranties of the Contributing Parties under this Agreement. The Exhibits,
Schedules and the recitals to this Agreement are hereby incorporated by
reference into and made a part of this Agreement for all purposes. This
Agreement may be amended, supplemented or modified, and any provision hereof may
be waived, only by written instrument making specific reference to this
Agreement signed by all of the Parties hereto.
12.9 Specific Performance, Remedies Not Exclusive. The Parties hereby
acknowledge and agree that the failure of any Party to perform its agreements
and covenants hereunder, including its failure to take all required actions on
its part necessary to consummate the transactions contemplated hereby, will
cause irreparable injury to the other Parties for which damages, even if
available, will not be an adequate remedy. Accordingly, each Party hereby
consents to the issuance of injunctive relief by any court of competent
jurisdiction to compel performance of such Party's obligations and to the
granting by any court of the remedy of specific performance of its obligations
hereunder. Unless otherwise expressly stated in this Agreement, no right or
remedy described or provided in this Agreement is intended to be exclusive or to
preclude a Party from pursuing other rights and remedies to the extent available
under this Agreement, at law or in equity.
12.10 GOVERNING LAW. THIS AGREEMENT WILL BE GOVERNED BY AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH THE SUBSTANTIVE LAWS OF THE STATE OF NEW YORK,
WITHOUT GIVING EFFECT TO ANY CONFLICTS OF LAW RULE OR PRINCIPLE THAT MIGHT
RESULT IN THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION.
12.11 Drafting. Neither this Agreement nor any provision contained in
this Agreement will be interpreted in favor of or against any Party hereto
because such party or its legal counsel drafted this Agreement or such
provision.
12.12 Usage. Whenever the plural form of a word is used in this
Agreement, that word will include the singular form of that word. Whenever the
singular form of a word is used in this Agreement, that word will include the
plural form of that word. The term "or" will not be interpreted as excluding any
of the items described. The term "include" or any derivative of such term does
not mean that the items following such term are the only types of such items.
12.13 Certain Definitions. For purposes of this Agreement:
(a) the term "Affiliate" means, with respect to a specified Person,
any other Person or member of a group of Persons acting together that, directly
or indirectly, through one or more intermediaries, controls, or is controlled by
or is under common control with, the specified Person.
(b) the term "control" (including the terms "controlling," "controlled
by" and "under common control with") means the possession, direct or indirect,
46
of the power to direct or cause the direction of the management and policies of
a Person, whether through the ownership of voting securities, by contract or
otherwise.
(c) the terms "Knowledge" and "known" and words of similar import mean
that each Party hereto will be deemed to have "Knowledge" of a particular
matter, and the particular matter will be deemed to be "known" by such
Contributing Party, if such Contributing Party has actual knowledge of such
matter or would reasonably be expected to have knowledge of such matter
following reasonable inquiry of the appropriate employees and agents of such
Contributing Party.
12.14 Forum. Each of the Parties hereto hereby irrevocably submits to the
jurisdiction of the state or federal courts located in the State of New York in
any action, suit or proceeding brought against any other party hereto under or
in connection with this Agreement, and hereby irrevocably waives, to the fullest
extent each of them may effectively do so, any defense based on improper
jurisdiction or venue including, without limitation, defenses based on forum non
conveniens.
[THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
MG COLORADO HOLDINGS, INC.
By:
Name:
Title:
OPTECH SYSTEMS, INC.
By:
Name:
Title:
THE CONTRIBUTING PARTIES:
XXXXXXXXX/XXXXXXXX FAMILY BLUFF POINT ASSOCIATES CORP.
LIMITED PARTNERSHIP
By: By:
Name: Name:
Title:......... Title:
MATRIX BANCORP, INC. MATRIX CAPITAL BANK
By: By:
Name: Name:
Title: Title:
48
MSCS VENTURES, INC.
By:
Name: /s/ Let Xxx
Title: Let Xxx
/s/ R. Xxxxxxx X'Xxxxx /s/ Xxxx X. Xxxxx
R. Xxxxxxx X'Xxxxx Xxxx X. Xxxxx
49
