EXHIBIT 10.18
OWNERSHIP INTEREST TRANSFER AGREEMENT
THIS OWNERSHIP INTEREST TRANSFER AGREEMENT (this "Agreement") is effective as of
the 31st day of May 2002 ("Effective Date"), by and among ▇▇▇▇▇▇ Holdings LLC,
an Illinois limited liability company ("Holdings"), and ▇▇▇▇▇▇ Associates, Inc.,
a Delaware corporation ("Associates, Inc.").
Whereas, Holdings owns all of the outstanding equity ownership interests of
▇▇▇▇▇▇ Associates LLC, an Illinois limited liability company (the "Associates
LLC"); and
Whereas, pursuant to the terms and conditions set forth herein, Holdings desires
to transfer to Associates, Inc., and Associates, Inc. desires to accept from
Holdings, all of the outstanding equity ownership interests of Associates LLC
(the "Associates LLC Interests").
Now, therefore, in consideration of the foregoing and the mutual covenants,
agreements and warranties herein contained, it is agreed that Holdings shall
transfer and assign the Associates LLC Interests to Associates, Inc., and the
parties shall take the other actions described herein, all upon the terms and
conditions hereinafter set forth.
ARTICLE I
TRANSFER OF ASSOCIATES LLC INTERESTS
1.1 Transfer of Associates LLC Interests. Subject to the terms
and conditions set forth in this Agreement, Holdings hereby agrees to assign,
transfer, convey and deliver to Associates, Inc. all right, title and interest
in and to the Associates LLC Interests, and Associates, Inc. agree to accept
such transfer and conveyance from Holdings.
1.2 Consideration. In consideration for the transfer of the
Associates LLC Interests, and the consummation of the other transactions
contemplated by this Agreement, Associates, Inc. hereby issues 70,819,520 shares
of class B common stock, par value $0.01 per share (the "Shares") to Holdings.
1.3 Member of Associates LLC. Upon the effectiveness of the
transactions contemplated in this Agreement and the execution and delivery by
Holdings of the assignment of the Associates LLC Interests in the form of
Exhibit A, Associates, Inc. shall become the sole member of Associates LLC.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF HOLDINGS
Holdings represents and warrants to Associates, Inc. as of the date
hereof as follows:
2.1 Due Organization. Associates LLC is a limited liability company
duly organized, validly existing and in good standing under the laws of the
State of Illinois, with all requisite corporate power and authority to own,
lease and operate its properties and to carry on its business as now being
conducted.
2.2 Capitalization. The Associates LLC Interests are validly issued,
fully paid and non assessable. The Associates LLC Interests are not
certificated. Except for the Associates LLC Interests, there are no shares of
capital stock or other equity interests of Associates LLC reserved for issuance,
or any outstanding subscriptions, options, warrants, conversion or other rights
or other agreements granting
1
to any Person any interest in or right to any shares of the capital stock or any
other equity interests of Associates LLC or any interest convertible into
capital stock or other equity interest, or other agreements or commitments by
which Associates LLC is obligated to issue additional shares of capital stock or
other equity interests or securities convertible into, exchangeable for or
evidencing the right to subscribe for any shares of capital stock or other
equity interests, or any equity appreciation or similar rights; or requiring
Associates LLC to repurchase, reacquire or redeem any of its equity interests.
2.3 Ownership of Associates LLC Interests. Holdings owns all right,
title and interest in and to the Associates LLC Interests, free and clear of any
pledge, security interest, lien, mortgage, trust deed, lease or sublease
(collectively, "Encumbrances").
2.4 Due Authorization. Holdings has all requisite legal standing,
power and authority to enter into and perform this Agreement and the other
agreements and documents contemplated by this Agreement and to carry out the
transactions contemplated by this Agreement and such other agreements. This
Agreement has been duly and validly executed and delivered by Holdings and
constitutes the legal, valid and binding obligation of Holdings, enforceable in
accordance with its terms, except as such enforceability may be limited by
applicable bankruptcy, insolvency, moratorium, reorganization or similar laws
from time to time which affect creditor's rights generally, and by general
equitable principles (regardless of whether such enforceability is considered in
a proceeding at law or in equity).
2.5 No Conflicts; No Consents. The execution, delivery and
performance of this Agreement and all other agreements and documents
contemplated by this Agreement (and the consummation of the transactions
contemplated by this Agreement and such other agreements or documents) by
Holdings do not, (a) require any notice to, filing with, authorization of,
exemption by, or the consent of the government of the United States of America,
or any state or local government or any political subdivision thereof, and any
entity exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government ("Governmental Authority") or any other
third party which has not been obtained and is currently in effect, or (b)
violate, conflict with, require the consent under, or result in a breach of, or
constitute a default (or an event which, with or without notice or lapse of time
or both, would constitute a default) under, or permit cancellation of, or result
in the creation of any Encumbrances upon the Associates LLC Interests under, any
of the terms, conditions, or provisions of any contract to which Holdings or
Associates LLC is a party, or by which the Associates LLC Interests are bound
except for such consents and approvals which have been obtained and are
currently in effect.
2.6 Investment Representations. Holdings understands that the Shares
have not been registered under the Securities Act of 1933, as amended (the
"Securities Act"). Holdings also understand the Shares are being offered and
sold pursuant to an exemption from registration contained in the Securities Act
based in part upon Holdings' representations contained in the Agreement.
Holdings hereby represents and warrants as follows:
(a) Holdings represents that it is an accredited investor
within the meaning of Regulation D of the Securities Act; and
(b) Holdings is acquiring the Shares for its own account
for investment only and not with a view towards their distribution.
2
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF ASSOCIATES, INC.
Associates, Inc. represents and warrants to Holdings as of the date
hereof as follows:
3.1 Due Authority. Associates, Inc. has all requisite legal
standing, power and authority to enter into and perform this Agreement and the
other agreements and documents contemplated by this Agreement and to carry out
the transactions contemplated by this Agreement and such other agreements. This
Agreement has been duly and validly executed and delivered by Associates, Inc.
and constitutes the legal, valid and binding obligation of Associates, Inc.,
enforceable in accordance with its terms, except as such enforceability may be
limited by applicable bankruptcy, insolvency, moratorium, reorganization or
similar laws from time to time which affect creditor's rights generally, and by
general equitable principles (regardless of whether such enforceability is
considered in a proceeding at law or in equity).
3.2 No Conflicts; No Consents. The execution, delivery and
performance of this Agreement and all other agreements and documents
contemplated by this Agreement does not, (and the consummation of the
transactions contemplated by this Agreement and such other agreements or
documents) by Associates do not, (a) require any notice to, filing with,
authorization of, exemption by, or consent of any Governmental Authority or any
other third party; or (b) violate any provisions of the Certificate of
Incorporation or By-laws of Associates, Inc. or violate any provision of or
result in the acceleration of any obligation or the creation of any Encumbrances
under any contract to which Associates, Inc. is a party or by which it or any of
its properties is bound.
3.3 Class B Common Stock. The Shares have been duly authorized and
validly issued and are fully-paid and non-assessable.
ARTICLE IV
INDEMNIFICATION
4.1 Indemnification by Holdings. Holdings shall indemnify
Associates, Inc. and its officers, employees, agents, subsidiaries and
affiliates against, and agrees to hold each of them harmless from, any and all
liabilities, losses, costs, damages, penalties or expenses (including reasonable
attorneys' fees and expenses and costs of investigation and litigation)
(collectively, "Losses") suffered by any of them arising out of or relating to
any breach of, or inaccuracy in, any representation or warranty or any failure
to perform any covenant made by Holdings pursuant to this Agreement.
4.2 Indemnification by Associates, Inc. Associates, Inc. shall
indemnify Holdings and its officers, members, employees, agents, subsidiaries
and affiliates against, and agrees to hold each of them harmless from, any and
all Losses suffered by Holdings arising out of or relating to any breach of, or
inaccuracy in, any representation or warranty or any failure to perform any
covenant made by Associates, Inc. pursuant to this Agreement.
ARTICLE V
MISCELLANEOUS
5.1 Further Assurances. Each party will, at the reasonable request
of any other party hereto, execute and deliver to such other party all such
further instruments, assignments, assurances and other documents, and take such
actions as such other party may reasonably request in connection with the
carrying out of this Agreement and the consummation of the transactions
contemplated hereby.
3
5.2 Amendment. This Agreement may be amended, modified or
supplemented but only in writing signed by all of the parties hereto.
5.3 Waivers. The failure of a party hereto at any time or times to
require performance of any provision hereof shall in no manner affect its right
at a later time to enforce the same. No waiver by a party of any condition or of
any breach of any term, covenant, representation or warranty contained in this
Agreement shall be effective unless in writing, and no waiver in any one or more
instances shall be deemed to be a further or continuing waiver of any such
condition or breach in other instances or a waiver of any other condition or
breach of any other term, covenant, representation or warranty.
5.4 Counterparts. This Agreement may be executed in counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
5.5 Headings. The headings preceding the text of Articles and
Sections of this Agreement and the Exhibits and Schedules hereto, if any, are
for convenience only and shall not be deemed part of this Agreement.
5.6 Applicable Law. This Agreement shall be governed by and
construed and enforced in accordance with the internal laws of the State of
Illinois, without regard to conflict of law principles.
5.7 Assignment. This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective heirs, personal
representatives, successors and permitted assigns. No party hereto may assign
its rights or delegate its duties hereunder to another person or entity without
the written consent of the other party first having been obtained and any
attempted assignment or delegation without such consent will be null and void.
5.8 Severability. If any provision of this Agreement is or becomes
invalid, illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein shall not be
affected thereby.
5.9 Entire Understanding. This Agreement, the Exhibits and Schedules
hereto, if any, and the other documents contemplated hereby and thereby set
forth the entire agreement and understanding of the parties hereto in respect to
the transactions contemplated hereby and supersede all prior agreements,
arrangements and understandings relating to the subject matter hereof and are
not intended to confer upon any other person any rights or remedies hereunder.
*****
4
IN WITNESS WHEREOF, the parties hereto have caused this Ownership Interest
Transfer Agreement to be executed and delivered as of the date first above
written.
▇▇▇▇▇▇ Holdings LLC
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Chairman of the Executive Committee
and Authorized Representative
▇▇▇▇▇▇ Associates, Inc.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Chief Executive Officer
5
Exhibit A
ASSIGNMENT OF MEMBERSHIP INTEREST
FOR VALUE RECEIVED, the undersigned does hereby transfer and assign to
▇▇▇▇▇▇ ASSOCIATES, INC. one hundred percent (100%) of the membership interests
of ▇▇▇▇▇▇ ASSOCIATES LLC (the "LLC"), and does hereby irrevocably authorize the
LLC to transfer said interest on the books of the limited liability company to
▇▇▇▇▇▇ Associates, Inc..
Dated as of May 31, 2002
▇▇▇▇▇▇ HOLDINGS LLC
By:_________________________________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Chairman of the Executive Committee and Authorized Representative
1