EXHIBIT 2.1
WAIVER, RELEASE, DELEGATION AND AMENDMENT
TO
STOCK OPTION AND VOTING AGREEMENT
This Waiver, Release, Delegation and Amendment to Stock Option and Voting
Agreement ("WAIVER AND AMENDMENT"), dated as of July 31, 2002, is made between
Xxxxxx X. Xxxxxxxxxx ("GRANTOR"), as Grantor under the "Original Agreement" (as
such term is defined herein), Xxxxxxxx X. Xxxxxxxxxx ("Agent"), as Agent of the
Stockholders under the Original Agreement, MFLP, L.P., RPM Capital, LLC, AIM
Capital, LLC, S&S Investors, LLC ("S&S"), and Xxxxx Xxxxxxxxxx (Xxxxxxxx X.
Xxxxxxxxxx, MFLP, L.P., RPM Capital, LLC, AIM Capital, LLC, S&S and Xxxxx
Xxxxxxxxxx collectively the "STOCKHOLDERS"), and Xxxxxxx Xxxxxxxxxx, as
guarantor with respect to certain obligations ("GUARANTOR") (Grantor,
Stockholders and Guarantor collectively the "Original Parties") and Fog Cutter
Capital Group Inc., a Maryland corporation (the "COMPANY"), and amends the Stock
Option and Voting Agreement, dated as of October 16, 2001 ("ORIGINAL
AGREEMENT"), among the Original Parties, as set forth herein. Capitalized terms
used but not otherwise defined herein shall have the meanings given them in the
Original Agreement.
AGREEMENT
1. WAIVER OF TRANSFER OF SUBJECT SHARES.
Grantor hereby waives any and all restrictions and prohibitions imposed by
the Original Agreement (including but not limited to any restrictions imposed by
Section 7 of the Original Agreement) on the transfer from S&S to Xxxxx
Xxxxxxxxxx of 419,500 shares of the "Subject Shares" (as such term is defined in
the Original Agreement) currently owned by S&S.
2. RELEASE OF OBLIGATIONS UPON DELEGATION.
Agent, on behalf of itself and each of the Stockholders, hereby agrees
that, in connection with the delegation of the obligations of Grantor under
Section 1 of the Original Agreement to the Company pursuant to Sections 3 and 4
hereunder and as contemplated by Section 9(i) of the Original Agreement (the
"Delegation of Obligations") and the acceptance by the Company of the Delegation
of Obligations pursuant hereto, Grantor and Guarantor are hereby released from
any and all further obligations, whether past, present or future, that they may
have pursuant to Section 1 of the Original Agreement, subject to the condition
subsequent of receipt by the Agent, no later than ten business days after the
date hereof, of (i) resolutions of the Board of Directors of the Company
authorizing the Company's acceptance of the Delegation of Obligations (the
"Delegation Resolutions"), accompanied by a Certificate of the Secretary of the
Company certifying that such Delegation Resolutions are true and correct copies
of the Delegation Resolutions duly adopted by the Board of Directors of the
Company which Delegation Resolutions have not been amended, modified or
superseded and are in full force and effect as of the date of such Certificate
and which Delegation Resolutions are the only resolutions adopted
by the Board of Directors or any committee thereof relating to the Delegation of
Obligations and (ii) a Certificate from the Secretary of the Company certifying
that the minutes of the meeting of the Board of Directors of the Company at
which resolutions were adopted approving the acceptance by the Company of the
Delegation of Obligations were approved at a subsequent meeting of the Board of
Directors of the Company with a copy of such minutes attached to such
Certificate from the Secretary of the Company as an exhibit, in each case in
such form as may be reasonably acceptable to the Agent (the documents described
in clauses (i) and (ii) hereof shall collectively be referred to herein as the
"Evidence of Delegation and Acceptance"). The foregoing sentence
notwithstanding, prior to the delivery to and acceptance by the Agent of the
Evidence of Delegation and Acceptance, such release of Grantor and Guarantor as
set forth in this Section 2 shall be valid only if, and to the extent that, the
Company's acceptance and assumption of the Delegation of Obligations from
Grantor are and remain legally valid and binding upon Company. If the Evidence
of Delegation and Acceptance has not been delivered to and accepted by Agent on
or prior to the tenth business day after the date hereof, then the release of
Grantor and Guarantor as set forth in this Section 2 shall automatically be
void.
3. ASSIGNMENT AND DELEGATION BY GRANTOR.
Grantor hereby assigns, sells, transfers and sets over (collectively, the
"Assignment") to the Company all of Grantor's legal, beneficial and other right,
title, benefit, privileges and interests in and to, and obligations under,
Section 1 of the Original Agreement, as amended by this Waiver and Amendment,
including, without limitation, the right to receive and the obligation to pay
for Purchased Shares.
4. ACCEPTANCE OF DELEGATION BY COMPANY.
The Company hereby accepts the Assignment, and assumes and agrees to
observe, perform, pay and otherwise discharge when due each of the obligations
of Grantor under Section 1 of the Original Agreement, as amended hereby (the
"Assumed Liabilities"), including, without limitation, the obligation to pay the
Option Price Per Share for the Purchased Shares but expressly excluding any
liability of Grantor for any breach of the representations, warranties and
covenants of Grantor set forth in Section 4 of the Original Agreement. Except as
set forth in the previous sentence, the Company expressly does not, and will not
be deemed to, assume hereunder or otherwise by reason of the transactions
contemplated hereby or by the Original Agreement any liabilities, obligations or
commitments of, or arising out of actions taken, services rendered, goods sold
or contracts entered into by, Grantor of any nature whatsoever.
5. AMENDMENT OF ORIGINAL AGREEMENT.
Grantor and Agent, on behalf of each of the Stockholders, hereby amend the
Original Agreement, effective as of July 31, 2002, as follows:
A. Section 9(i) of the Original Agreement is amended by adding the
following sentence immediately prior to the last sentence of such section:
"The obligations of Guarantor under the Note(s) pursuant to the guarantee
and pledge described in Sections 1(h)(i) and (ii) shall terminate and be
of no further force or effect upon the delegation of Grantor's obligations
under Section 1 hereof to the Company pursuant to this Section 9(i) (the
"Delegation of Obligations") and acceptance by the Company of the
Delegation of Obligations, subject to the condition subsequent of receipt
by the Agent, no later than ten business days after the date of such
delegation, of (i) resolutions of the Board of Directors of the Company
authorizing the Company's acceptance of the Delegation of Obligations (the
"Delegation Resolutions"), accompanied by a Certificate of the Secretary
of the Company certifying that such Delegation Resolutions are true and
correct copies of the Delegation Resolutions duly adopted by the Board of
Directors of the Company which Delegation Resolutions have not been
amended, modified or superseded and are in full force and effect as of the
date of such Certificate and which Delegation Resolutions are the only
resolutions adopted by the Board of Directors or any committee thereof
relating to the Delegation of Obligations and (ii) a Certificate from the
Secretary of the Company certifying that the minutes of the meeting of the
Board of Directors of the Company at which resolutions were adopted
approving the acceptance by the Company of the Delegation of Obligations
were approved at a subsequent meeting of the Board of Directors of the
Company, in each case in such form as may be reasonably acceptable to the
Agent(the documents described in clauses (i) and (ii) hereof shall
collectively be referred to herein collectively as the "Evidence of
Delegation and Acceptance"). The foregoing sentence notwithstanding, prior
to the delivery to and acceptance by the Agent of the Evidence of
Delegation and Acceptance, such release of Grantor and Guarantor as set
forth in this Section 9(i) shall be valid only if, and to the extent that,
the Company's acceptance and assumption of the Delegation of Obligations
from Grantor are and shall remain legally valid and binding upon Company."
B. Schedule 1 of the Original Agreement is amended by increasing the
Subject Shares for Xxxxx Xxxxxxxxxx from "17,158" to "436,658"; and
C. Schedule 1 of the Original Agreement is amended by decreasing the
Subject Shares for S&S from "519,500" to "100,000".
6. REPRESENTATIONS AND WARRANTIES OF GRANTOR AND COMPANY.
A. The Company hereby represents and warrants to the Agent and each
of the Stockholders as follows:
(i). Company has been duly incorporated and is validly existing
and in good standing under the laws of the State of Maryland.
(ii). Company has the corporate power and authority to execute,
deliver and perform all of its obligations under this Waiver and Amendment and
the Original Agreement as amended by this Waiver and Amendment (collectively the
"Subject Agreements"). The execution and delivery of this Waiver and Amendment,
the acceptance of the Delegation of
Obligations and the performance of the obligations so delegated have been duly
authorized by requisite corporate action on the part of Company.
(iii). When duly executed and delivered by Company, the Subject
Agreements will constitute the valid and binding obligation of Company,
enforceable against Company in accordance with their terms.
(iv). The execution and delivery by Company of the Waiver and
Amendment, acceptance of the Delegation of Obligations and performance by
Company of its obligations under the Subject Agreements, in accordance with
their terms, do not (i) conflict with the Articles of Incorporation or Bylaws of
Company, (ii) constitute a material violation of or a default under any
contract, commitment, agreement, arrangement or restriction of any kind to which
Company is a party or by which Company is bound (collectively the "Applicable
Commitments") or (iii) cause the creation of any security interest or lien upon
any of the property of the Company pursuant to any Applicable Commitments.
(v). None of the execution and delivery by Company of the Waiver and
Amendment, the performance by Company of its obligations under the Subject
Agreements or the compliance by Company with the terms and provisions of the
Subject Agreements, will contravene any applicable law.
(vi). No consent, approval, license, authorization or validation of,
or filing, recording or registration with, the State of Maryland or any federal,
executive, legislative, judicial, administrative or regulatory body pursuant to
any applicable law which has not been obtained or taken and is not in full force
and effect is required to authorize or is required in connection with the
execution and delivery of the Waiver and Amendment by Company nor the
performance by Company of its obligations under the Subject Agreements.
(vii). Company is not currently insolvent nor will the execution and
delivery by Company of the Waiver and Amendment, the performance by Company of
its obligations under the Subject Agreements nor the compliance by Company with
the terms and provisions thereof, cause the Company to become insolvent.
B. Each of the Stockholders hereby represents and warrants to the Company
each of the representations and warranties contained in Section 3 of the
Original Agreement, as if they were made as of the date hereof.
C. Grantor hereby represents and warrants to the Company, the Agent and
each of the Stockholders (i) each of the representations and warranties
contained in Section 4(a) through (c) of the Original Agreement, as if they were
made as of the date hereof and (ii) that Grantor continues to be bound by and
shall observe, perform, pay and otherwise discharge when due each of the
obligations of Grantor set forth in the Original Agreement, except such
obligations as set forth in Section 1 of the Original Agreement as are released
in accordance with the terms hereof.
7. LEGAL FEES.
The Company hereby agrees to promptly reimburse Agent for all reasonable
fees and costs for legal services incurred by Agent in connection with this
Waiver and Amendment.
8. SEVERABILITY.
In the event that any part of this Waiver and Amendment is declared by any
court or other judicial or administrative body to be null, void or
unenforceable, such provision shall survive to the extent it is not so declared,
and all of the other provisions of this Waiver and Amendment shall remain in
full force and effect.
9. NO FURTHER MODIFICATION OF ORIGINAL AGREEMENT.
Except for the specific waivers and modifications to the Original
Agreement as set forth in this Waiver and Amendment, all other terms and
conditions of the Original Agreement, as amended, remain in full force and
effect and nothing contained herein will itself change, amend, extend or alter
(nor should it be deemed or construed as changing, amending, extending or
altering) the terms or conditions of the Original Agreement or the Assumed
Obligations in any manner whatsoever. In the event of any conflict between the
provisions of this Waiver and Amendment and the Original Agreement, the
provisions of this Waiver and Amendment shall govern.
10. COUNTERPARTS.
This Waiver and Amendment may be executed in counterparts, each of which
shall be deemed an original and both of which together shall constitute one
instrument.
IN WITNESS WHEREOF, the Grantor, Guarantor and Agent (on behalf of the
Stockholders) have executed this Waiver and Amendment as of the date first
written above.
GRANTOR AGENT, on behalf of each
of the Stockholders
/s/ Xxxxxx X. Xxxxxxxxxx /s/ Xxxxxxxx X. Xxxxxxxxxx
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Xxxxxx X. Xxxxxxxxxx Xxxxxxxx X. Xxxxxxxxxx
GUARANTOR FOG CUTTER CAPITAL GROUP INC.
/s/ Xxxxxxx Xxxxxxxxxx /s/ R. Xxxxx Xxxxxxxxx
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Xxxxxxx Xxxxxxxxxx By: R. Xxxxx Xxxxxxxxx
Title: Senior Vice President and
Chief Financial Officer
