EXHIBIT 2.11
CONTRIBUTION AND ASSUMPTION AGREEMENT, dated as of November 24, 2003, by
and between Instinet Group Incorporated, a Delaware corporation ("IGI"), and
Instinet, LLC, a Delaware limited liability company ("ILLC").
WHEREAS, IGI and certain other direct and indirect subsidiaries of IGI are
engaging in an internal restructuring (the "Restructuring") pursuant to
resolutions of the Board of Directors of IGI dated October 7, 2003;
WHEREAS, ILLC is a wholly-owned subsidiary of IGI;
WHEREAS, as part of the Restructuring, IGI desires to contribute to ILLC as
a contribution to capital, and ILLC desires to acquire from IGI, the assets
listed on Schedule 1 hereto (the "Transferred Assets");
WHEREAS, in connection with the acquisition of the Transferred Assets, IGI
also desires to transfer to ILLC, and ILLC desires to accept, the employment of
the employees listed on Schedule 2 (the "Transferred Employees") to ILLC;
NOW, THEREFORE, in consideration of the foregoing and the respective
premises, mutual covenants and agreements of IGI and ILLC, and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, and subject to the terms and conditions hereof, IGI and ILLC agree
as follows:
ARTICLE I
DEFINITIONS
1.1. Definitions. For the purpose of this Agreement the following terms
shall have the following meanings:
"Action" means any demand, action, suit, countersuit, arbitration, inquiry,
proceeding or investigation by or before any federal, state, local, foreign or
international Authority or any arbitration or mediation tribunal.
"Agreement" means this Contribution and Assumption Agreement, including all
of the Schedules hereto.
"Assumed Liabilities" has the meaning set forth in Section 2.3.
"Authority" means any governmental, judicial, legislative, executive,
administrative, or regulatory authority of the United States, or of any state,
local or foreign government, or any government of any possession or territory of
the United States, or any subdivision, agency, commission, office or authority
of any of the foregoing, or any Self-Regulatory Organization.
"Consents" means any consents, waivers, approvals or authorizations from,
or notification requirements to, any third parties or any Authority or any
reports or other filings to be made to, or registrations or permits or
authorizations to be obtained from, any Authority.
"Effective Time" means 1:26 AM EST, December 1, 2003.
"IGI" has the meaning set forth in the preamble.
"ILLC" has the meaning set forth in the preamble.
"Indemnified Party" has the meaning set forth in Section 4.4(a).
"Indemnifying Party" has the meaning set forth in Section 4.4(a).
"Instinet" has the meaning set forth in the recitals.
"Liabilities" means any and all losses, claims, charges, debts, demands,
Actions, causes of action, suits, damages, obligations, payments, costs and
expenses, sums of money, accounts, reckonings, indemnities, and similar
obligations, exonerations, covenants, contracts, controversies, agreements,
promises, doings, omissions, variances, guarantees, make whole agreements and
similar obligations, and other liabilities, including all contractual
obligations, whether absolute or contingent, matured or unmatured, liquidated or
unliquidated, accrued or unaccrued, known or unknown, whenever arising, and
including those arising under any law, rule, regulation, Action, threatened or
contemplated Action (including the costs and expenses of demands, assessments,
judgments, settlements and compromises relating thereto and attorneys' fees and
any and all costs and expenses whatsoever reasonably incurred in investigating,
preparing or defending against any such Actions or threatened or contemplated
Actions), order or consent decree of any Authority or any award of any
arbitrator or mediator of any kind, and those arising under any contract,
commitment or undertaking, including those arising under this Agreement, whether
or not recorded or reflected or required to be recorded or reflected on the
books and records or financial statements of any Person.
"Person" means an individual, a general or limited partnership, a
corporation, a trust, a joint venture, an unincorporated organization, a limited
liability entity, any other entity and any Authority.
"Restructuring" has the meaning set forth in the recitals.
"Self Regulatory Organization" has the meaning set forth in section
3(a)(26) of the Securities Exchange Act of 1934, and the rules and regulations
promulgated thereunder, as amended.
"Transferred Assets" has the meaning set forth in the recitals.
"Transferred Employees" has the meaning set forth in the recitals.
1.2. Interpretation. In this Agreement and in the Schedules hereto:
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(a) unless otherwise specified, references to Articles, Sections, clauses
and Schedules are references to Articles, Sections and clauses of, and Schedules
to, this Agreement;
(b) the headings in this Agreement are for reference only and shall not
control or affect the meaning or construction of any of the provisions hereof;
(c) references to any document or agreement, including this Agreement,
shall be deemed to include references to such document or agreement as amended,
supplemented or replaced from time to time in accordance with its terms and
(where applicable) subject to compliance with the requirements set forth
therein; and
(d) references to any party to this Agreement or any other document or
agreement shall include its successors and permitted assigns.
ARTICLE II
TRANSFER OF ASSETS AND ASSUMPTION OF LIABILITIES
2.1. Transfer of Assets and Assumption of Liabilities. Subject to the
receipt of all Consents, approvals or authorizations of any Authority, or any
other Person, necessary to consummate the transactions contemplated herein, upon
the terms and subject to the conditions set forth in this Agreement, as of the
Effective Time, (a) IGI shall hereby contribute, assign, transfer, convey and
deliver to ILLC on an as-is, where-is basis, and ILLC shall hereby accept from
IGI, all of IGI's right, title and interest in and to the Transferred Assets,
and (b) ILLC shall hereby assume and agree faithfully to perform and fulfill all
the Assumed Liabilities in accordance with their respective terms.
2.2 Transfer of Employees. As of the Effective Time, IGI shall hereby
transfer to ILLC, and ILLC shall hereby accept, the employment of the
Transferred Employees. For the avoidance of doubt, the transfer of employment of
the Transferred Employees shall not constitute a termination of employment for
purposes of any compensation or benefit plan, program, policy, agreement or
other arrangement and, after the Effective Time, subject to the terms of any
agreement between any Transferred Employee, on the one hand, and ILLC and its
affiliates, on the other hand, the employment of any such Transferred Employees
shall be at-will and terminable at any time for any or no reason whatsoever.
2.3. Assumed Liabilities. "Assumed Liabilities" shall mean all of the
Liabilities relating to or arising out of the Transferred Assets and Transferred
Employees and business activity related to such Transferred Assets and
Transferred Employees, from and after the Effective Time.
ARTICLE III
COVENANTS
3.1. Documents Relating to Transfers of Assets and Assumption of
Liabilities. In furtherance of the contribution, assignment, transfer and
conveyance of the Transferred Assets, the transfer of employment of the
Transferred Employees and the assumption of the Assumed
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Liabilities as set forth in Sections 2.1 and 2.2, as of the Effective Time, (a)
IGI shall execute and deliver such bills of sale, certificates of title,
assignments of contracts and other instruments of transfer, conveyance and
assignment as and to the extent necessary to evidence the contribution,
transfer, conveyance and assignment of all of IGI's right, title and interest in
and to the Transferred Assets to ILLC, and the transfer of employment of the
Transferred Employees, and (b) ILLC shall execute and deliver to IGI such bills
of sale, certificates of title, assumptions of contracts and other instruments
of assumption as and to the extent necessary to evidence the valid and effective
contribution, transfer, conveyance and assignment of the Transferred Assets and
the transfer of employment of the Transferred Employees to, and assumption of
the Assumed Liabilities by, ILLC.
3.2. Further Assurances. (a) In addition to the actions specifically
provided for elsewhere in this Agreement, each party shall use its reasonable
best efforts from the date hereof to take, or cause to be taken, all actions,
and to do, or cause to be done, all things, reasonably necessary, proper or
advisable under applicable laws, regulations and agreements to consummate and
make effective the transactions contemplated by this Agreement.
(b) Without limiting the foregoing, on and after the date hereof, each
party shall cooperate with the other party, and without any further
consideration, to execute and deliver, or use its reasonable best efforts to
cause to be executed and delivered, all instruments, including instruments of
conveyance, assignment and transfer, and to make all filings with any Authority,
and to obtain all Consents under any permit, license, agreement, indenture or
other instrument, and to take all such other actions as such party may
reasonably be requested by the other party from time to time, consistent with
the terms of this Agreement in order to effectuate the provisions and purposes
of this Agreement and the transfer of the Transferred Assets, ythe transfer of
employment of the Transferred Employees, and the assignment and assumption of
the Assumed Liabilities and the other transactions contemplated hereby. Without
limiting the foregoing, each party will, at the reasonable request of the other
party, take such other actions as may be reasonably necessary to vest in such
other party good and marketable title to the Transferred Assets if and to the
extent it is practicable to do so.
3.3. Delayed Transfers. To the extent that any Transferred Asset or Assumed
Liability that would otherwise be assigned to, or assumed by, ILLC at the
Effective Time pursuant to Section 2.1 is not capable of being assigned or
assumed without obtaining a Consent, which Consent has not been received on or
prior to the Effective Time, any such Transferred Asset or Assumed Liability
will be assigned or assumed on the date the requisite Consent is received and
until such time, IGI shall be deemed to have assigned to ILLC hereby the
economic benefit received by IGI from and after the Effective Time with respect
to the applicable rights and/or interests under such Transferred Assets and
shall hold such Transferred Asset in trust for ILLC, and ILLC shall have been
deemed to have assumed the economic detriment incurred by IGI from and after the
Effective Time with respect to the Assumed Liabilities, except to the extent
that any such deemed transfer or assumption itself requires a Consent, which
Consent has not been received on or prior to the Effective Time; provided that
in the event such Consent is not received prior to the first anniversary of this
Agreement, such Transferred Asset or Assumed Liability shall not be assigned or
assumed by ILLC pursuant to the terms of this Agreement and shall be deemed not
to be a Transferred Asset or an Assumed Liability.
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ARTICLE IV
INDEMNIFICATION
4.1. Indemnification By ILLC. ILLC shall indemnify, defend and hold
harmless IGI and its directors, officers and employees, and each of the heirs,
executors, successors and assigns of any of the foregoing, from and against any
and all Liabilities relating to, arising out of or resulting from any of the
following items (without duplication):
(a) the failure of ILLC or any other Person to pay, perform or otherwise
promptly discharge any Assumed Liability in accordance with its terms, whether
prior to or after the date hereof; and
(b) the breach of any representation, warranty, covenant or agreement by
ILLC contained in this Agreement.
4.2. Indemnification By IGI. IGI shall indemnify, defend and hold harmless
ILLC and its directors, officers and employees, and each of the heirs,
executors, successors and assigns of any of the foregoing, from and against any
and all Liabilities relating to, arising out of or resulting from the breach of
any representation, warranty, covenant or agreement by IGI contained in this
Agreement.
4.3. Consequential Damages. Except as provided in the following sentence,
in no event shall any indemnity pursuant to Section 4.1 or Section 4.2 include
any incidental, consequential, indirect, special or punitive damages. However,
any indemnity pursuant to Section 4.1 or Section 4.2 shall include any such
incidental, consequential, indirect, special or punitive damages recovered by
any third party pursuant to a claim against an Indemnified Party.
4.4. Defense of Claims. All rights of a party to indemnification under this
Article IV shall be asserted and resolved as follows:
(a) Promptly after receipt by a party entitled to indemnification under
Section 4.1 or Section 4.2 (an "Indemnified Party") of notice of any pending or
threatened claim, such Indemnified Party shall give notice to the party to whom
the Indemnified Party is entitled to look for indemnification (the "Indemnifying
Party") of the commencement thereof; provided that the failure so to notify the
Indemnifying Party shall not relieve it of any liability that it may have to the
Indemnified Party hereunder, except to the extent that the Indemnifying Party
demonstrates that it is actually prejudiced thereby.
(b) In case any claim shall be brought against an Indemnified Party and it
shall give notice to the Indemnifying Party of the commencement thereof, the
Indemnifying Party shall be entitled to participate therein and, if it so
desires, to assume the defense thereof with counsel reasonably satisfactory to
the Indemnified Party and, after notice from the Indemnifying Party to the
Indemnified Party of its election to assume the defense thereof, except as
provided below, the Indemnifying Party shall not be liable to such Indemnified
Party under this Article IV for any fees of other counsel or any other expenses,
in each case subsequently incurred by such Indemnified Party in connection with
the defense thereof, other than reasonable out-of-pocket costs of investigation.
Notwithstanding an Indemnifying Party's election to
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assume the defense of a claim, the Indemnified Party shall have the right to
employ separate counsel and to participate in the defense of such claim, and the
Indemnifying Party shall bear the reasonable fees, costs and expenses of such
separate counsel, if (i) the use of counsel chosen by the Indemnifying Party to
represent the Indemnified Party would present, in the advice of counsel, such
counsel with a conflict of interest, (ii) the actual or potential defendants in,
or targets of, any such claim include both the Indemnifying Party and the
Indemnified Party, and the Indemnified Party shall have reasonably concluded,
upon the advice of counsel, that there may be legal defenses available to it
which are different from or additional to those available to the Indemnifying
Party (in which case the Indemnifying Party shall not have the right to assume
the defense of such claim on the Indemnified Party's behalf), (iii) the
Indemnifying Party shall not have employed counsel reasonably satisfactory to
the Indemnified Party to represent the Indemnified Party within a reasonable
time after notice of the institution of such claim, or (iv) the Indemnifying
Party shall authorize the Indemnified Party to employ separate counsel at the
Indemnifying Party's expense. If an Indemnifying Party assumes the defense of a
claim, no compromise or settlement thereof may be effected by the Indemnifying
Party without the Indemnified Party's written consent unless (i) there is no
finding or admission of any violation of law and no effect or any other claims
that may be made against the Indemnified Party and (ii) the relief provided
shall be paid in full or otherwise satisfied by the Indemnifying Party.
(c) In the event any Indemnified Party should have a claim against any
Indemnifying Party hereunder which does not involve a claim being asserted by a
third party, the Indemnified Party shall as promptly as is practical notify the
Indemnifying Party of such claim, describing such claim, the amount thereof (if
known) and the method of computation of the amount of the claim, all with
reasonable particularity. The failure to give any such notice shall not relieve
the Indemnifying Party of its obligations hereunder except to the extent that
such failure results in actual prejudice to the Indemnifying Party. Upon the
giving of such written notice as aforesaid, the Indemnified Party shall have the
right to commence legal proceedings for the enforcement of its rights under
Section 4.1 or Section 4.2.
4.5. Survival of Indemnities. The rights and obligations of each party
under this Article IV shall survive the closing of the transactions contemplated
hereby and the sale or other transfer by any party of any assets or businesses
or the assignment by it of any Liabilities.
ARTICLE V
MISCELLANEOUS
5.1. Counterparts; Entire Agreement; Corporate Power.
(a) This Agreement may be executed in one or more counterparts, all of
which shall be considered one and the same agreement, and shall become effective
when one or more counterparts have been signed by each of the parties and
delivered to the other party.
(b) This Agreement and the Schedules hereto contain the entire agreement
between the parties with respect to the subject matter hereof and supersede all
previous agreements and understandings with respect to such subject matter.
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(c) Each of IGI and ILLC represents on behalf of itself to the other as
follows:
(i) each such Person has the requisite corporate or other power and
authority and has taken all corporate or other action necessary in order to
execute, deliver and perform this Agreement and to consummate the
transactions contemplated hereby; and
(ii) this Agreement has been duly executed and delivered by it and
constitutes a valid and binding agreement of it enforceable in accordance
with the terms hereof, subject to bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium or other similar laws relating to
the enforcement of creditors' rights generally and by general principles of
equity.
5.2. Governing Law. This Agreement shall be construed in accordance with
and governed by the laws of the State of New York, irrespective of the choice of
laws principles of the State of New York.
5.3. Submission to Jurisdiction. Each party hereby irrevocably agrees that
any legal action or proceeding against it arising out of this Agreement or the
transactions contemplated hereby shall be brought only in the State of New York
in and for the County of New York or the U.S. District Court for the Southern
District of New York.
5.4. Assignability. This Agreement shall be binding upon and inure to the
benefit of the parties and their respective successors and assigns; provided
that no party may assign its respective rights or delegate its respective
obligations under this Agreement without the express prior written consent of
the other party hereto.
5.5. No Third Party Beneficiaries. Except as provided in Article IV, there
are no third party beneficiaries of this Agreement and the provisions of this
Agreement are solely for the benefit of the parties and are not intended to
confer upon any Person except the parties any rights or remedies hereunder.
5.6. Notices. Any and all notices or other communications permitted or
required to be delivered or given under this Agreement shall be in writing and
signed by the party giving such notice or other communication and shall be sent
by telecopy or similar means of simultaneous transmission and receipt or shall
be delivered personally, or sent by registered or certified mail, postage
prepaid and addressed as follows:
If to IGI, to: Instinet Group Incorporated
0 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxx Xxxxxxx, Esq.
Fax: (000) 000-0000
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If to ILLC, to: Instinet, LLC
c/o Instinet Group Incorporated
0 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxx Xxxxxxx, Esq.
Fax: (000) 000-0000
In the case of personal delivery, the date of personal delivery or, in the case
of telecopy or similar means of simultaneous transmission and receipt, the date
of transmission or, in the case of mailing, the date of receipt, as the case may
be, shall be the date of the delivery or giving of such notice. Any party may,
by notice to the other party, change the address to which such notices are to be
given.
5.7. Severability. If any provision of this Agreement or the application
thereof to any Person or circumstance is determined by a court of competent
jurisdiction to be invalid, void or unenforceable, the remaining provisions
hereof, or the application of such provision to Persons or circumstances or in
jurisdictions other than those as to which it has been held invalid or
unenforceable, shall remain in full force and effect and shall in no way be
affected, impaired or invalidated thereby, so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
adverse to any party. Upon such determination, the parties shall negotiate in
good faith in an effort to agree upon such a suitable and equitable provision to
effect the original intent of the parties.
5.8. Waivers of Default. Waiver by any party of any default by the other
party of any provision of this Agreement shall not be deemed a waiver by the
waiving party of any subsequent or other default, nor shall it prejudice the
rights of the other party.
5.9. Amendments. No provisions of this Agreement shall be deemed waived,
amended, supplemented or modified by any party, unless such waiver, amendment,
supplement or modification is in writing and signed by the authorized
representative of the party against whom it is sought to enforce such waiver,
amendment, supplement or modification.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
by their duly authorized representatives.
INSTINET GROUP INCORPORATED
By: /s/ Xxxx Xxxx
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Name: Xxxx Xxxx
Title: Executive Vice President
INSTINET, LLC
By: /s/ Xxxx Xxx
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Name: Xxxx Xxx
Title: Chief Financial Officer
[Signature Page to Contribution and Assumption Agreement]
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Schedule 1
Schedule 1 (b) - Other Assets transferred from IGI to ILLC
Schedule 1 (c ) - Contracts transferred from IGI to ILLC
Schedule 2
Employees transferred from IGI to ILLC
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