UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event
reported): June 3, 2009
COWEN GROUP, INC.
(Exact name of
registrant as specified in its charter)
Delaware
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000-52048
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84-170296
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(State
or other jurisdiction
of incorporation)
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(Commission
File Number)
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(IRS
Employer
Identification No.)
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1221 Avenue of the Americas
New York, New York 10020
(Address of principal executive offices) (Zip Code)
Registrants telephone number, including area
code: (646) 562-1000
Check the appropriate box
below if the Form 8-K filing is intended to simultaneously satisfy the
filing obligation of the registrants under any of the following provisions:
x Written communications pursuant to Rule 425 under
the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under
the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under
the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under
the Exchange Act (17 CFR 240.13e-4(c))
ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.
Transaction Agreement and
Agreement and Plan of Merger
On June 3, 2009,
Cowen Group, Inc., which we refer to as the Company, LexingtonPark Parent
Corp., which we refer to as New Parent, Lexington Merger Corp., which we refer
to as Merger Sub, Park Exchange LLC, which we refer to as Exchange Sub, and
Ramius LLC, which we refer to as Ramius, signed a Transaction Agreement and
Agreement and Plan of Merger, which we refer to as the Transaction Agreement.
Under the terms of and
subject to the conditions contained in the Transaction Agreement, the Company
and Ramius have jointly formed and own New Parent, which will become the parent
of both the Company and Exchange Sub; Merger Sub will merge into the Company (we
refer to this as the Merger), with the Company being the surviving corporation
and a direct wholly-owned subsidiary of New Parent; and Exchange Sub will
acquire substantially all of the assets and assume substantially all of the
liabilities of Ramius (we refer to this as the Asset Exchange, and we refer to both
the Asset Exchange and the Merger together as the Transactions). After the Transactions are completed, New
Parent will change its name to Cowen Group, Inc. The Board of Directors of the Company has unanimously
approved the Transactions, and Ramius has entered into voting agreements with
certain Company stockholders that require those stockholders to vote their
shares in favor of the Transactions.
When the Transactions are consummated, Ramius will
receive 37,536,826 shares of New Parent Class A Common Stock, as total consideration
for the Asset Exchange. Each share of
Company Common Stock issued and outstanding immediately prior to the consummation
of the Transactions will be converted into a right to receive one share of New
Parent Class A Common Stock. In connection with the Transactions, New Parent will
also purchase from an affiliate of a third party investor in Ramius the fifty
percent interest in the Ramius Fund of Funds business not currently owned by
Ramius, in exchange for 2,713,882 shares of New Parent Class A Common
Stock and approximately $10.3 million of additional consideration, which may be
paid either in debt or in cash as provided in the agreement between the
parties, which we refer to as the FOF Asset Exchange Agreement. The FOF Asset Exchange Agreement is attached
as Exhibit 10.1.
Mr. Peter A. Cohen will
serve as Chairman and Chief Executive Officer of New Parent and Mr. John
E. Toffolon, Jr. will serve as Lead Director of the Board of Directors of
New Parent. New Parent will have a board
with ten directors: four directors will be designated by the Company, five
directors will be designated by Ramius, and one director will be designated by a
third party investor in Ramius.
The Transaction Agreement
contains customary representations and warranties of the Company and Ramius and
agreements of the Company and Ramius to conduct their businesses in the
ordinary course and to not engage in certain transactions until the
Transactions are completed. The
Transaction Agreement also includes an agreement that the Company and Ramius
will not solicit proposals for alternative business combination transactions,
or enter into discussions or agreements or provide confidential information relating
to alternative business combination transactions (subject to exceptions with
respect to the Company).
The Company and Ramius
will not close the Transactions unless the stockholders of the Company approve
the Transactions. In addition, the
Company and Ramius will not close the Transactions unless each of the following
other closing conditions are satisfied or waived:
· the SEC has declared New Parents
registration statement relating to the New Parent Class A Common Stock to
be effective;
· NASDAQ has approved the listing of the New
Parent Class A Common Stock shares;
· the parties have received necessary regulatory
approvals or applicable waiting periods have expired;
· each parties representations and
warranties are accurate subject to the materiality standard in the Transaction
Agreement and each party has complied in all material respects with their obligations
under the Transaction Agreement;
· there are no any injunctions or laws which
make the consummation of the Transactions illegal;
· the parties have satisfied the closing conditions
in the FOF Asset Exchange Agreement;
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· New Parent has executed a registration
rights agreement granting registration rights to Ramius, a third-party investor
in Ramius, and affiliates of the third-party investor; and
· the Company has received a favorable tax
opinion from its legal counsel.
The Company and Ramius can
terminate the Transaction Agreement by mutual agreement, or if:
· there has been a final, non-appealable
denial of required regulatory approvals;
· the parties have failed to consummate the
Transactions by December 31, 2009;
· there has been an uncured breach of the
Transaction Agreement by the other party; or
· the Companys stockholders do not approve
the Transactions.
In addition, Ramius also has
the right to terminate the Transaction Agreement if:
· the Board of Directors of the Company does
not recommend the approval and adoption of the Transaction Agreement to its
stockholders, or if the Board changes its recommendation;
· the Company doesnt call a stockholders
meeting to vote on the Transactions; or
· the Company violates the provisions of
the Transaction Agreement which prevent soliciting, discussing, or agreeing to
an alternative business combination transaction.
Under qualifying
terminations, the Company is required to pay Ramius a termination fee of $3,500,000
and/or Ramiuss expenses up to $750,000.
The foregoing description
of the terms of the Transaction Agreement is not complete and is qualified in
its entirety by reference to the Transaction Agreement, a copy of which is
attached as Exhibit 2.1 hereto and incorporated herein by reference.
The representations and warranties of each party set
forth in the Transaction Agreement have been made solely for the benefit of the
other parties to the Transaction Agreement. In addition, such representations and
warranties (i) have been qualified by confidential disclosures made to the
other parties in connection with the Transaction Agreement; (ii) will not
survive consummation of the Transactions other than the agreement to take any
necessary post-closing actions; (iii) are generally subject to a material
adverse effect standard, as defined in the Transaction Agreement, which may
differ from what may be viewed as material by investors; and (iv) may have
been included in the Transaction Agreement for the purpose of allocating risk
between the parties rather than establishing matters as facts. Accordingly, the Transaction Agreement is
included with this filing only to provide investors with information regarding
the terms of the Transaction Agreement, and not to provide investors with any
other factual information regarding the parties or their respective businesses.
The Transaction Agreement should not be
read alone, but should instead be read in conjunction with the other
information regarding the companies and the Transactions that will be contained
in, or incorporated by reference into, the proxy statement/prospectus that the
Company will be filing in connection with the Transactions, as well as in the
Forms 10-K, Forms 10-Q and other filings that the Company may make with the SEC.
Cautionary Notice Regarding
Forward-Looking Statements
This document may contain
forward-looking statements including statements relating to the market
opportunity and future business prospects of the Company. Such statements are subject to certain risks
and uncertainties that could cause actual results to differ materially from
those expressed or implied in the forward-looking statements. Consequently, all forward-looking statements
made in this document are qualified by those risks, uncertainties and other
factors.
These factors include,
but are not limited to, (1) the occurrence of any event, change or other
circumstances that could give rise to the termination of the Transaction
Agreement; (2) the outcome of any legal proceedings that may be instituted
against the Company and others following announcement of the Transaction
Agreement and transactions contemplated therein; (3) the inability to
complete the transactions contemplated by the Transaction Agreement due to the
failure to obtain Company stockholder approval; (4) the inability to
obtain necessary
3
regulatory approvals
required to complete the transactions contemplated by the Transaction
Agreement; (5) the risk that the proposed transactions disrupt current
plans and operations and the potential difficulties in employee retention as a
result of the announcement and consummation of the transactions described
herein; (6) the ability to recognize the anticipated benefits of the
combination of the Company and Ramius, including potential cost savings and the
ability to expand into new business lines; and (7) the possibility that
the Company may be adversely affected by other economic, business and/or
competitive factors.
Actual results may differ
materially and reported results should not be considered an indication of
future performance. Please reference the
Companys SEC filings, which are available at the Companys website, for a
detailed description of factors that could cause actual results to differ
materially from those expressed or implied in such forward-looking statements.
Certain statements in this
document relate to future results that are forward-looking statements as
defined in the Private Securities Litigation Reform Act of 1995. Except for the ongoing obligations of the Company
to disclose material information under the federal securities laws, the Company
does not undertake any obligation to release any revisions to any
forward-looking statements, to report events or to report the occurrence of
unanticipated events, unless required by law.
Additional Information About the
Transactions
In connection with the
proposed transactions, the Company will file relevant materials with the SEC,
including a registration statement on Form S-4 that will include a proxy
statement of the Company that also constitutes a prospectus of the
Company. The Company will mail the final
proxy statement/prospectus to its stockholders. Investors and security holders are urged to
read these documents (if and when they become available) and any other relevant
documents filed with the SEC and/or incorporated by reference in those
documents, as well as any amendments or supplements to those documents, because
they will contain important information about the Company and the proposed
transactions.
Investors and security
holders may obtain these documents (and any other documents filed by the
Company with the SEC) free of charge at the SECs website at www.sec.gov. In addition, the documents filed with the SEC
by the Company may be obtained free of charge by directing such request to:
Investor Relations, 1221 Avenue of the Americas, New York, NY 10020 or from the
Companys Investor Relations page on its corporate website at
www.cowen.com.
The directors, executive
officers, certain other members of management and employees of the Company may
be deemed to be participants in the solicitation of proxies in favor of the
proposed transactions from the stockholders of the Company. Information regarding the persons who may,
under the rules of the SEC, be considered participants in the solicitation
of the stockholders in connection with the proposed transactions will be set
forth in the proxy statement/prospectus when it is filed with the SEC. Information about the executive officers and
directors of the Company is set forth in the proxy statement for the Companys
2008 Annual Meeting of Stockholders filed with the SEC on April 30, 2008
and the Companys Amendment No. 1 to its Annual Report on Form 10-K/A
filed on April 28, 2009.
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.
(d) Exhibits
The following
exhibits are filed herewith:
Exhibit No.
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Description of Exhibit
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2.1
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Transaction Agreement
and Agreement and Plan of Merger, dated June 3, 2009, by and among Cowen
Group, Inc., LexingtonPark Parent Corp., Lexington Merger Corp., Park
Exchange LLC and Ramius LLC.
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4
10.1
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Asset Exchange
Agreement, dated as of June 3, 2009, entered into by and among Ramius
LLC, HVB Alternative Advisors, LLC, Bayerische Hypo- und Vereinsbank AG,
Cowen Group, Inc., LexingtonPark Parent Corp. and Lexington Merger Corp.
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SIGNATURES
Pursuant to the
requirements of the Securities Exchange Act of 1934, the registrant has duly
caused this report to be signed on its behalf by the undersigned hereunto duly
authorized.
Date: June 5, 2009
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COWEN
GROUP, INC.
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By:
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/s/ Christopher A.
White
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Name: Christopher A.
White
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Title: Vice President
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6
EXHIBIT INDEX
Exhibit No.
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Description of Exhibit
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2.1
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Transaction Agreement
and Agreement and Plan of Merger, dated June 3, 2009, by and among Cowen
Group, Inc., LexingtonPark Parent Corp., Lexington Merger Corp., Park
Exchange LLC and Ramius LLC.
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10.1
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Asset Exchange
Agreement, dated as of June 3, 2009, entered into by and among Ramius
LLC, HVB Alternative Advisors, LLC, Bayerische Hypo- und Vereinsbank AG,
Cowen Group, Inc., LexingtonPark Parent Corp. and Lexington Merger Corp.
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7
Exhibit 2.1
EXECUTION COPY
TRANSACTION AGREEMENT and
AGREEMENT AND PLAN OF
MERGER,
by and among
COWEN GROUP, INC.,
LEXINGTONPARK PARENT CORP.,
LEXINGTON MERGER CORP.,
PARK EXCHANGE LLC,
and
RAMIUS LLC
DATED AS OF JUNE 3, 2009
TABLE OF CONTENTS
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Page
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ARTICLE I
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THE
TRANSACTIONS
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2
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1.1
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Formation of New Parent;
Merger Sub and Exchange Sub
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2
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1.2
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The Transactions
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2
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1.3
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Effective Time of the
Cowen Merger; Closing of the Ramius Asset Exchange
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3
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1.4
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Effects of the Cowen
Merger
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3
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1.5
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Closing
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3
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1.6
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Cowen Surviving
Corporation Constituent Documents
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3
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1.7
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Directors, Managers and
Officers
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4
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1.8
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Actions of Cowen and
Ramius
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4
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ARTICLE II
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CONVERSION
OF SECURITIES
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4
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2.1
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Effect on Capital Stock of
Cowen and Merger Sub
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4
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2.2
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Effect on New Parent
Class A Common Stock
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5
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2.3
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Cowen Stock Options and
Other Equity-Based Awards
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5
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ARTICLE III
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DELIVERY
OF MERGER CONSIDERATION
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6
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3.1
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Exchange Procedures
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6
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3.2
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No Further Ownership
Rights in Cowen Common Stock
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7
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3.3
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Lost Certificates
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7
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3.4
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Withholding Rights
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7
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3.5
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Stock Transfer Books
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7
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ARTICLE IV
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REPRESENTATIONS
AND WARRANTIES OF COWEN
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7
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4.1
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Corporate Organization
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8
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4.2
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Capitalization
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8
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4.3
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Authority; No Violation
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9
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4.4
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Consents and Approvals
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10
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4.5
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SEC Reports
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11
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4.6
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Financial Statements
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11
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4.7
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Brokers Fees
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12
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4.8
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Absence of Certain Changes
or Events
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12
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4.9
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Legal Proceedings
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13
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4.10
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Taxes and Tax Returns
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13
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4.11
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Employee Matters
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14
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4.12
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Certain Contracts
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17
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4.13
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Property
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19
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4.14
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Intellectual Property
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19
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4.15
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Insurance
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19
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4.16
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Compliance with Laws;
Permits
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20
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4.17
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CHRP
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22
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4.18
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Risk Management
Instruments
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23
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4.19
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State Takeover Laws
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24
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4.20
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Interested Party
Transactions
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24
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4.21
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Reorganization
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24
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4.22
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Opinion
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24
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4.23
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Cowen Information
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24
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4.24
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No Other Representations
and Warranties
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24
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ARTICLE V
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REPRESENTATIONS
AND WARRANTIES OF RAMIUS
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25
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5.1
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Corporate Organization
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25
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5.2
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Ownership of Subsidiaries
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25
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5.3
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Authority; No Violation
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26
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5.4
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Consents and Approvals
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26
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5.5
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Reports
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27
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5.6
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Financial Statements
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27
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5.7
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Brokers Fees
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28
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5.8
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Absence of Certain Changes
or Events
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28
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5.9
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Legal Proceedings
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28
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5.10
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Taxes and Tax Returns
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29
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5.11
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Employee Matters
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30
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5.12
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Certain Contracts
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32
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5.13
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Property
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34
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5.14
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Intellectual Property
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5.15
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Insurance
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35
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5.16
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Compliance with Laws;
Permits
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5.17
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Investment Agreements and
the Funds
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38
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5.18
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Risk Management
Instruments
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5.19
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Interested Party
Transactions
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40
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5.20
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Reorganization
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5.21
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Ramius Information
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5.22
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No Other Representations
and Warranties
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40
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ARTICLE VI
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COVENANTS
RELATING TO CONDUCT OF BUSINESS
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40
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6.1
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Conduct of Businesses
Prior to the Effective Time
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40
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6.2
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Cowen and Ramius
Forbearances
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41
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ARTICLE VII
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ADDITIONAL
AGREEMENTS
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44
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7.1
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Regulatory Matters
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44
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7.2
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Access to Information
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45
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7.3
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Stockholder Approval
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46
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7.4
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Further Assurances;
Additional Agreements
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47
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7.5
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NASDAQ Listing
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47
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7.6
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Employee Matters
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47
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7.7
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Indemnification; Directors
and Officers Insurance
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49
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7.8
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Exemption from Liability
Under Section 16(b)
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50
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ii
7.9
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Governance; Name Change
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50
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7.10
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No Solicitation
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51
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7.11
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Transaction Litigation
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55
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7.12
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Registration Rights
Agreement
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55
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7.13
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Assignment of Assigned
Contracts and Warranties
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55
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7.14
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Payment of Assumed
Liabilities
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55
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7.15
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FoF Asset Exchange
Agreement
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56
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7.16
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Tax Matters
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56
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7.17
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Investment Company Act
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56
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7.18
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Payment of Award
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56
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ARTICLE VIII
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CONDITIONS
PRECEDENT
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56
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8.1
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Conditions to Each Partys
Obligation to Effect the Transactions
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56
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8.2
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Conditions to Obligations
of Ramius
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57
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8.3
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Conditions to Obligations
of Cowen
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58
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ARTICLE IX
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TERMINATION
AND AMENDMENT
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59
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9.1
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Termination
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59
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9.2
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Effect of Termination
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60
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9.3
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Fees and Expenses
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61
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9.4
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Amendment
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61
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9.5
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Extension; Waiver
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61
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ARTICLE X
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GENERAL
PROVISIONS
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62
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10.1
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Definitions
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62
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10.2
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Nonsurvival of
Representations, Warranties and Agreements
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71
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10.3
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Notices
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71
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10.4
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Interpretation; Knowledge
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72
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10.5
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Disclosure Schedules
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72
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10.6
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Counterparts
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73
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10.7
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Entire Agreement
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73
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10.8
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Severability
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73
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10.9
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Governing Law;
Jurisdiction
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73
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10.10
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WAIVER OF JURY TRIAL
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73
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10.11
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Publicity
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73
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10.12
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Enforcement
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74
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10.13
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Assignment; Third Party
Beneficiaries
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74
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Index of Exhibits and
Schedules
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Cowen Disclosure Schedule
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Ramius Disclosure Schedule
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iii
Schedule A:
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Directors of Merger Sub
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Schedule B:
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Appointees to Board of
Directors of New Parent
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Schedule C:
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Officers of New Parent
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Exhibit A:
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New Parent Charter
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Exhibit B:
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New Parent By-Laws
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Exhibit C:
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Bill of Sale
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Exhibit D:
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Charter of Cowen Surviving Corporation
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Exhibit E:
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By-Laws of Cowen Surviving Corporation
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Exhibit F:
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Form of Registration
Rights Agreement
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Exhibit G:
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Form of Tax Opinion
of Wachtell, Lipton, Rosen & Katz
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iv
TRANSACTION
AGREEMENT AND AGREEMENT AND PLAN OF MERGER
TRANSACTION AGREEMENT AND AGREEMENT AND PLAN OF MERGER, dated as of June 3,
2009 (this Agreement), by and among COWEN GROUP, INC., a Delaware
corporation (Cowen), LEXINGTONPARK PARENT CORP., a Delaware
corporation (New Parent), LEXINGTON MERGER CORP., a Delaware
corporation and direct wholly owned subsidiary of New Parent (Merger Sub),
PARK EXCHANGE LLC, a Delaware limited liability company and direct wholly owned
subsidiary of New Parent (Exchange Sub), and RAMIUS LLC, a Delaware
limited liability company (Ramius).
W I T N E S S E T H:
WHEREAS, the Boards of Directors of Cowen, New
Parent and Merger Sub, the Managing Member of Ramius and the Board of Managers
of Exchange Sub have determined that it is in the best interests of their
respective companies and their stockholders or membership interest holders, as
applicable, to consummate the strategic business combination transaction;
WHEREAS, to effect such
business combination transaction, upon the terms and subject to the conditions
set forth herein, (i) Merger Sub will merge with and into Cowen with Cowen
continuing as the surviving corporation (the Cowen Merger) and (ii) Exchange
Sub will acquire substantially all of the assets and assume the Assumed
Liabilities of Ramius (the Ramius Asset Exchange and together with the
Cowen Merger, the Transactions);
WHEREAS, as a condition to
Ramius entering into this Agreement, concurrently with the execution and
delivery of this Agreement, Ramius is entering into a Voting Agreement with
certain stockholders of Cowen (the Voting Agreement) pursuant to
which, among other things, each of those stockholders has agreed, subject to
the terms thereof, to vote all shares of Cowen Common Stock owned by such
stockholder in accordance with the terms of the Voting Agreement;
WHEREAS, upon consummation of the Transactions, (i) Cowen
will become a direct wholly owned subsidiary of New Parent, which has been
formed by Cowen and Ramius solely for the purpose of the transactions
contemplated by this Agreement, (ii) Exchange Sub will become the owner of
substantially all of the assets and substantially all of the liabilities of
Ramius and will remain a wholly owned subsidiary of New Parent and (iii) New
Parent will change its name to Cowen Group, Inc.; and
WHEREAS, for U.S. federal income
tax purposes, it is intended that the Cowen Merger shall qualify as a reorganization
within the meaning of Section 368(a) of the Internal Revenue Code of
1986, as amended (the Code) and that the Transactions, taken together,
shall qualify as an exchange described in Section 351 of the Code.
NOW, THEREFORE, in consideration of the mutual
covenants, representations, warranties and agreements contained in this
Agreement, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, and intending to be legally bound
hereby, the parties agree as follows:
ARTICLE I
THE TRANSACTIONS
1.1 Formation of
New Parent; Merger Sub and Exchange Sub.
(a) New Parent. Cowen and Ramius have caused New Parent to be
organized under the laws of the State of Delaware and each owns 50% of the
capital stock of New Parent. The authorized
capital stock of New Parent consists of 250,000,000 shares of Class A
voting common stock, par value $.01 per share (the New Parent Class A
Common Stock), of which one share has been issued to Cowen and one share
has been issued to Ramius, and 250,000,000 shares of Class B voting common
stock, par value $.01 per share (the New Parent Class B Common Stock),
of which no shares have been issued and 10,000,000 shares of undesignated
preferred stock, par value $.01 per share, of which no shares have been
issued. Cowen and Ramius shall take, and
shall cause New Parent to take, all requisite action to cause the certificate
of incorporation of New Parent to be in the form of Exhibit A (the New
Parent Charter) and the by-laws of the New Parent to be in the form of Exhibit B
(the New Parent By-Laws), in each case, at the Effective Time.
(b) Merger Sub and
Exchange Sub. Cowen and
Ramius have caused New Parent to organize, and New Parent has organized, Merger
Sub and Exchange Sub under the laws of the State of Delaware. The authorized capital stock of Merger Sub
consists of 100 shares of common stock, par value $.01 per share (the Merger
Sub Common Stock), all of which are validly issued, fully paid and
nonassessable, and are owned by New Parent free and clear of any Liens. The authorized membership interests of
Exchange Sub consists of 100 units (the Exchange Sub Membership Interests),
all of which are validly issued and are owned by New Parent free and clear of
any Liens.
1.2 The
Transactions.
(a) The Cowen
Merger. Upon the terms and subject to
the conditions hereof, in accordance with the DGCL, at the Effective Time
Merger Sub shall merge with and into Cowen, with Cowen continuing as the
surviving corporation in the Cowen Merger (the Cowen Surviving Corporation)
and the separate corporate existence of Merger Sub shall cease. As a result of the Cowen Merger, Cowen will
become a direct wholly owned subsidiary of New Parent.
(b) The Ramius
Asset Exchange. Upon the
terms and subject to the conditions hereof, Ramius shall exchange, assign,
transfer, convey and deliver to Exchange Sub, and Exchange Sub shall acquire
from Ramius, as of immediately prior to the Closing, all of Ramiuss rights,
title and interest in and to all assets of Ramius, whether real or personal,
tangible or intangible, including the Assigned Contracts and Ramiuss equity
interests in each of the entities set forth in Section 1.2(b) of
the Ramius Disclosure Schedule, other than the Excluded Assets (the Acquired
Assets), in exchange for the issuance to Ramius of 37,536,826 shares of
New Parent Class A Common Stock (the Asset Exchange Consideration),
and the assumption by Exchange Sub of all liabilities and obligations of
Ramius, including any indebtedness, obligation and other liability (whether
absolute, accrued, matured, contingent (or based upon any
2
contingency), known or unknown, fixed or otherwise, or whether due or
to become due), including any fine, penalty, judgment, award or settlement
respecting any judicial, administrative or arbitration proceeding, damage,
loss, claim or demand with respect to any Law (except for the Excluded
Liabilities) (such liabilities, the Assumed Liabilities).
1.3 Effective Time
of the Cowen Merger; Closing of the Ramius Asset Exchange.
(a) As soon as
practicable on the Closing Date, Cowen shall file with the Secretary of State
of the State of Delaware (the Delaware Secretary) a certificate of
merger with respect to the Cowen Merger (the Cowen Certificate of Merger),
which Cowen Certificate of Merger shall be in such form as is required by, and
executed and acknowledged in accordance with, the DGCL. The Cowen Merger shall become effective at
such date and time as Cowen and Ramius shall agree and shall be specified in
the Cowen Certificate of Merger; provided that (i) such date and
time shall be after the time of filing of the Cowen Certificate of Merger and (ii) the
Cowen Merger shall become effective at the same date and time as the closing of
the Ramius Asset Exchange. As used in
this Agreement, the term Effective Time shall mean the date and time
when the Transactions become effective.
(b) On the Closing
Date, (i) each of Ramius and Exchange Sub shall execute and deliver to such
other party a Bill of Sale and Assignment and Assumption Agreement
substantially in the form attached hereto as Exhibit C (the Bill
of Sale) and (ii) New Parent shall issue to Ramius the Asset Exchange
Consideration consisting of shares of New Parent Class A Common Stock that
shall be validly issued, fully paid and non-assessable.
1.4 Effects of the
Cowen Merger. At and
after the Effective Time, the Cowen Merger shall have the effects set forth in
the applicable provisions of the DGCL.
1.5 Closing. Upon the terms and subject to the conditions
set forth in Article VIII and the termination rights set forth in Article IX,
the closing of the transactions contemplated by this Agreement (the Closing)
will take place at the offices of Willkie Farr & Gallagher LLP, 787
Seventh Avenue, New York, New York, 10019 at 10:00 A.M. on the third
Business Day following the satisfaction or waiver (subject to applicable Law)
of the conditions (excluding conditions that, by their nature, cannot be
satisfied until the Closing Date but subject to the satisfaction or waiver of
such conditions) set forth in Article VIII, unless this Agreement
has been theretofore terminated pursuant to its terms or unless another place,
time or date is agreed to in writing by Cowen and Ramius (the date of the
Closing, the Closing Date).
1.6 Cowen Surviving
Corporation Constituent Documents. At the Effective Time, by virtue of the Cowen
Merger, the certificate of incorporation of Cowen shall be amended to read in
its entirety as set forth in Exhibit D, and, as so amended, shall
be the certificate of incorporation of the Cowen Surviving Corporation, from
and after the Effective Time, until thereafter changed or amended as provided
therein and/or in accordance with applicable Law. The Cowen Board of Directors shall take all
action necessary so that, at the Effective Time, the by-laws of Cowen shall be
amended to read in their entirety as set forth in Exhibit E, and as
so amended, such by-laws shall be the by-laws of the Cowen Surviving Corporation,
from and after the Effective Time, until thereafter changed or amended as
provided therein, in the certificate of incorporation of the Cowen Surviving
Corporation and/or in accordance with applicable Law.
3
1.7 Directors,
Managers and Officers.
(a) The directors
and officers of New Parent at the Effective Time shall be as set forth in Section 7.9
hereof.
(b) The directors
of Merger Sub immediately prior to the Effective Time shall be the directors of
the Cowen Surviving Corporation and the officers of Cowen immediately prior to
the Effective Time shall be the officers of the Cowen Surviving Corporation, in
each case, until their respective successors are duly elected and qualified.
(c) New Parent
shall cause the officers of Ramius immediately prior to the Effective Time to
be appointed as the officers of Exchange Sub, in each case, until their
respective successors are duly elected and qualified.
(d) Cowen shall
cause the persons set forth on Schedule A to be appointed directors of
Merger Sub, effective as of immediately prior to the Effective Time.
1.8 Actions of
Cowen and Ramius. Cowen and
Ramius, as the holders of all the outstanding shares of New Parent Class A
Common Stock, have approved this Agreement and the transactions contemplated
hereby and shall cause New Parent, as the sole stockholder of Merger Sub and as
the sole member of Exchange Sub, to approve and adopt this Agreement. Each of Cowen and Ramius shall take all
actions necessary to cause New Parent, Merger Sub and Exchange Sub to take any
actions necessary in order to consummate the Transactions and the other
transactions contemplated hereby.
ARTICLE II
CONVERSION OF SECURITIES
2.1 Effect on
Capital Stock of Cowen and Merger Sub. At the Effective Time, by virtue of the Cowen
Merger and without any further action on the part of Cowen, New Parent, Merger
Sub, Exchange Sub, Ramius or any holder of any shares of Cowen Common Stock or
Ramius Percentage Interests:
(a) All shares of Cowen
Common Stock that are held by Cowen as treasury stock or that are owned by New
Parent, Cowen, Merger Sub or Exchange Sub immediately prior to the Effective
Time shall cease to be outstanding and shall be cancelled and retired and shall
cease to exist and no consideration shall be delivered in exchange therefor.
(b) Subject to Section 2.1(a),
each outstanding share of Cowen Common Stock issued and outstanding immediately
prior to the Effective Time shall be converted into the right to receive one
fully paid and nonassessable share of New Parent Class A Common Stock (the
Cowen Merger Consideration).
All shares of New Parent Class A Common Stock issued pursuant to
this Section 2.1(b) shall be duly authorized and validly
issued and free of preemptive rights, with no personal liability attaching to
the ownership thereof.
(c) All of the
shares of Cowen Common Stock converted into the right to receive New Parent Class A
Common Stock pursuant to this Section 2.1 shall cease to be
outstanding
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and shall be cancelled and retired and shall cease to exist and, as of
the Effective Time, the holders of Cowen Common Stock shall be deemed to have
received shares of New Parent Class A Common Stock (without the requirement for the surrender
of any certificate previously representing any such shares of Cowen Common
Stock or issuance of new certificates representing New Parent Class A
Common Stock), with each
certificate representing shares of Cowen Common Stock prior to the Effective
Time being deemed to represent automatically an equivalent number of shares of
New Parent Class A Common Stock.
(d) Each share of
Merger Sub Common Stock issued and outstanding immediately prior to the
Effective Time shall be converted into one share of common stock of the Cowen
Surviving Corporation.
2.2 Effect on New
Parent Class A Common Stock. At the Effective Time, each share of the
capital stock of New Parent issued and outstanding immediately prior to the
Effective Time shall remain outstanding.
Immediately following the Effective Time, shares of the capital stock of
New Parent owned by the Cowen Surviving Corporation or Exchange Sub shall be
cancelled by New Parent without payment therefor.
2.3 Cowen Stock
Options and Other Equity-Based Awards.
(a) As of the
Effective Time, by virtue of the Cowen Merger and without any action on the
part of the holders thereof, each option to purchase shares of Cowen Common
Stock granted under the Cowen Group, Inc. 2007 Equity and Incentive Plan
and the Cowen Group, Inc. 2006 Equity Incentive Plan (collectively, the Cowen
Stock Plans) or otherwise that is outstanding immediately prior to the
Effective Time (collectively, the Cowen Stock Options) shall vest in
full and be converted into an option (the New Parent Stock Options) to
purchase, the number of whole shares of New Parent Class A Common Stock
that is equal to the number of shares of Cowen Common Stock subject to such
Cowen Stock Option immediately prior to the Effective Time, at an exercise
price per share of New Parent Class A Common Stock equal to the exercise
price for each such share of Cowen Common Stock subject to such Cowen Stock
Option immediately prior to the Effective Time, and otherwise on the same terms
and conditions as applied to each such Cowen Stock Option immediately prior to
the Effective Time (but taking into account any changes thereto, including
accelerated vesting thereof, provided for in the Cowen Stock Plans, in any
award agreement or in such Cowen Stock Option by reason of this Agreement or
the transactions contemplated hereby).
(b) As of the
Effective Time, each restricted share of Cowen Common Stock granted under a
Cowen Stock Plan or otherwise that is outstanding immediately prior to the
Effective Time (collectively, the Cowen Restricted Shares) shall, by
virtue of the Cowen Merger and without any action on the part of the holder
thereof, vest in full and be converted into the right to receive the Cowen
Merger Consideration as provided in Section 2.1(b).
(c) As of the
Effective Time, each restricted share unit with respect to shares of Cowen
Common Stock granted under a Cowen Stock Plan or otherwise that is outstanding
immediately prior to the Effective Time (collectively, the Cowen RSUs)
shall, by virtue of the Cowen Merger and without any action on the part of the
holder thereof, vest in full and be converted into a restricted share unit with
respect to the number of shares of New Parent Class A
5
Common Stock that is equal to the number of shares of Cowen Common
Stock subject to the Cowen RSU immediately prior to the Effective Time (a New
Parent RSU), and otherwise on the same terms and conditions as applied to
each such Cowen RSU immediately prior to the Effective Time (but taking into
account any changes thereto, including accelerated vesting thereof and deferral
provisions, provided for in the Cowen Stock Plans, in any award agreement or in
such Cowen RSU by reason of this Agreement or the transactions contemplated
hereby). The obligations in respect of
the New Parent RSUs shall be payable or distributable in accordance with the
terms of the agreement, plan or arrangement relating to such New Parent RSUs.
(d) As of the
Effective Time, New Parent shall assume the obligations and succeed to the
rights of Cowen under the Cowen Stock Plans with respect to the Cowen Stock
Options (as converted into New Parent Stock Options) and the Cowen RSUs (as
converted into New Parent RSUs).
(e) New Parent
shall reserve for issuance a number of shares of New Parent Class A Common
Stock at least equal to the number of shares of New Parent Class A Common
Stock that will be subject to New Parent Stock Options and New Parent RSUs as a
result of the actions contemplated by this Section 2.3. As of the Effective Time, New Parent shall
file a registration statement on Form S-8 (or any successor form, or if Form S-8
is not available, other appropriate forms) with respect to the shares of New
Parent Class A Common Stock subject to such New Parent Stock Options and
New Parent RSUs and shall maintain the effectiveness of such registration
statement or registration statements (and maintain the current status of the
prospectus or prospectuses contained therein) for so long as such New Parent
Stock Options and New Parent RSUs remain outstanding.
(f) Prior to the
Effective Time, Cowen, the Board of Directors of Cowen and the Compensation
Committee of the Board of Directors of Cowen, as applicable, shall adopt
resolutions to effectuate the provisions of this Section 2.3.
ARTICLE III
DELIVERY OF MERGER CONSIDERATION
3.1 Exchange
Procedures.
(a) On the Closing
Date, New Parent shall deliver to Ramius or its nominee a duly executed and
validly issued stock certificate in the name of Ramius representing the Asset
Exchange Consideration.
(b) Each
certificate representing shares of Cowen Common Stock prior to the Effective
Time (a Cowen Certificate) (and each uncertificated share of Cowen
Common Stock in book-entry form, if any, prior to the Effective Time) shall be
deemed to represent an equivalent number of shares of New Parent Class A
Common Stock without any action on the part of the holder thereof, provided,
however, that if an exchange of Cowen Certificates for new certificates
is required by Law or applicable rule or regulation, or is requested by
any holder
6
thereof, the parties will cause New Parent to arrange for such exchange
on a one-share-for-one-share basis.
3.2 No Further Ownership
Rights in Cowen Common Stock. All shares of New Parent Class A Common
Stock issued upon conversion of the Cowen Common Stock in accordance with the
terms of this Article III shall be deemed to have been issued or
paid in full satisfaction of all rights pertaining to the shares of Cowen
Common Stock.
3.3 Lost
Certificates. If any
Cowen Certificate shall have been lost, stolen or destroyed, upon the making of
an affidavit of that fact by the Person claiming such Cowen Certificate to be
lost, stolen or destroyed and, if required by New Parent, the posting by such
Person of a bond in such reasonable amount as New Parent may direct as
indemnity against any claim that may be made against it with respect to such
Cowen Certificate, New Parent will deliver in exchange for such lost, stolen or
destroyed Cowen Certificate, the Cowen Merger Consideration with respect to the
Cowen Common Stock formerly represented thereby, and unpaid dividends and
distributions on shares of New Parent Class A Common Stock deliverable in
respect thereof, pursuant to this Agreement.
3.4 Withholding
Rights. New Parent shall be entitled
to deduct and withhold from the Cowen Merger Consideration otherwise payable
pursuant to this Agreement such amounts as it is required to deduct and
withhold with respect to the making of such payment under the Code, or any
provision of state, local or foreign Tax Law.
To the extent that amounts are so withheld or paid over to or deposited
with the relevant Governmental Entity by New Parent, such withheld amounts
shall be treated for all purposes of this Agreement as having been paid to the
Person in respect of which such deduction and withholding was made by New
Parent.
3.5 Stock Transfer
Books. The stock transfer books of
Cowen shall be closed immediately upon the Effective Time, and there shall be
no further registration of transfers of shares of Cowen Common Stock thereafter
on the records of Cowen. On or after the
Effective Time, any Cowen Certificates presented to New Parent, the Cowen Surviving
Corporation for any reason shall be converted into the right to receive the
Cowen Merger Consideration with respect to the shares of Cowen Common Stock
formerly represented thereby.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF COWEN
Except (i) as disclosed in any report, schedule, form or other
document filed with, or furnished to, the SEC by Cowen and publicly available
prior to the date of this Agreement (excluding, in each case, any disclosures
set forth in any risk factor section and in any section relating to
forward-looking statements to the extent that they are cautionary, predictive
or forward-looking in nature), or (ii) as disclosed in the disclosure
schedule provided by Cowen (the Cowen Disclosure Schedule) delivered
by Cowen to Ramius prior to the execution of this Agreement, Cowen hereby
represents and warrants to Ramius as follows:
7
4.1 Corporate Organization.
(a) Cowen is a corporation duly
incorporated, validly existing and in good standing under the laws of the State
of Delaware. Cowen has the requisite
corporate power and authority to own or lease all of its properties and assets
and to carry on its business as it is now being conducted, and is duly licensed
or qualified to do business in each jurisdiction in which the nature of the
business conducted by it or the character or location of the properties and
assets owned or leased by it makes such licensing or qualification
necessary. True, complete and correct
copies of the Restated Certificate of Incorporation of Cowen (the Cowen
Charter), and the Amended and Restated By-Laws of Cowen (the Cowen
By-Laws), as in effect as of the date of this Agreement, have previously
been made available to Ramius.
(b) Each Subsidiary of Cowen (i) is
duly incorporated or duly formed, as applicable to each such Subsidiary, and
validly existing and in good standing under the Laws of its jurisdiction of
organization, (ii) has the requisite corporate power and authority or
other power and authority to own or lease all of its properties and assets and
to carry on its business as it is now being conducted and (iii) is duly
licensed or qualified to do business in each jurisdiction in which the nature
of the business conducted by it or the character or location of the properties
and assets owned or leased by it makes such licensing or qualification
necessary, except where the failure to be so qualified would not, individually
or in the aggregate, have a Material Adverse Effect on Cowen.
(c) The minute books of Cowen previously
made available to Ramius contain true, complete and correct records of all
meetings and other corporate actions held or taken since July 12, 2006 of
its stockholders and Board of Directors and each committee of its Board of
Directors.
4.2 Capitalization. (a) The authorized capital stock of
Cowen consists of 100,000,000 shares of common stock, par value $0.01 per share
(the Cowen Common Stock), of which, as of June 1, 2009 (the Cowen
Capitalization Date), 15,092,088 shares were issued and outstanding, and
10,000,000 shares of preferred stock, par value $0.01 per share (the Cowen
Preferred Stock), of which, as of the Cowen Capitalization Date, no shares
were issued and outstanding. As of the Cowen Capitalization Date, Cowen held no
shares of Cowen Common Stock in its treasury.
As of the Cowen Capitalization Date, no shares of Cowen Common Stock or
Cowen Preferred Stock were reserved for issuance except for 1,085,328 shares of
Cowen Common Stock reserved for issuance in connection with existing awards
under employee benefit, stock option and dividend reinvestment and stock
purchase plans and 1,063,513 shares of Cowen Common Stock reserved for issuance
in connection with future awards that have not yet been made under employee
benefit, stock option and dividend reinvestment and stock purchase plans. All of the issued and outstanding shares of
Cowen Common Stock have been duly authorized and validly issued and are fully
paid, nonassessable and free of preemptive rights, with no personal liability
attaching to the ownership thereof and have not been issued in violation of any
applicable Law or any Contract of Cowen.
As of the date of this Agreement, no bonds, debentures, notes or other
indebtedness having the right to vote on any matters on which shareholders of
Cowen may vote (Voting Debt) are issued or outstanding. As of the date of this Agreement, except
pursuant to this Agreement, and other than as set forth in Section 4.2(a) of
the Cowen Disclosure Schedule, Cowen does not have and is not bound by any
outstanding subscriptions, options, warrants, calls, rights, commitments or
agreements of any character calling for the purchase or issuance of, or the
payment of any
8
amount based on, any shares of Cowen Common Stock,
Cowen Preferred Stock, Voting Debt or any other equity securities of Cowen or
any securities representing the right to purchase or otherwise receive any
shares of Cowen Common Stock, Cowen Preferred Stock, Voting Debt or other
equity securities of Cowen. As of the
date of this Agreement, except pursuant to this Agreement or pursuant to the
Cowen Benefit Plans and Cowen Stock Plans, and other than as set forth in Section 4.2(a) of
the Cowen Disclosure Schedule, there are no contractual obligations of Cowen or
any of its Subsidiaries (I) to repurchase, redeem or otherwise acquire any
shares of capital stock of Cowen or any equity security of Cowen or its
Subsidiaries or any securities representing the right to purchase or otherwise
receive any shares of capital stock or any other equity security of Cowen or
its Subsidiaries or (II) pursuant to which Cowen or any of its
Subsidiaries is or could be required to register shares of Cowen capital stock
or other securities under the Securities Act.
(b) Cowen has provided Ramius with a
true, complete and correct list of the aggregate number of shares of Cowen
Common Stock subject to Cowen Stock Options, Cowen Restricted Shares and Cowen
RSUs that were outstanding as of the Cowen Capitalization Date, the names of
the holders and the weighted average exercise price for the Cowen Stock
Options. Other than the Cowen Stock Options,
Cowen Restricted Shares and Cowen RSUs that are outstanding as of the Cowen
Capitalization Date, no other subscriptions, options, warrants, calls, rights,
commitments or agreements of character calling for the purchase or issuance of,
or the payment of any amount based on, any shares of Cowen Common Stock, Cowen
Preferred Stock, Voting Debt or other equity securities of Cowen are
outstanding as of the Cowen Capitalization Date. Since the Cowen Capitalization
Date through the date hereof, Cowen has not (i) issued or repurchased any
shares of Cowen Common Stock, Cowen Preferred Stock, Voting Debt or other
equity securities of Cowen, other than the issuance of shares of Cowen Common
Stock in connection with the exercise of Cowen Stock Options or settlement of
the Cowen RSUs granted under the Cowen Stock Plans that were outstanding on the
Cowen Capitalization Date or (ii) issued or awarded any options, stock
appreciation rights, restricted shares, restricted stock units, deferred equity
units, awards based on the value of Cowen capital stock or any other
equity-based awards under any of the Cowen Stock Plans.
(c) All of the issued and outstanding
shares of capital stock or other equity ownership interests of each Subsidiary
of Cowen are owned by Cowen, directly or indirectly, free and clear of any
Liens, and all of such shares or equity ownership interests are duly authorized
and validly issued and are fully paid, nonassessable and free of preemptive
rights. No Subsidiary of Cowen has or is
bound by any outstanding subscriptions, options, warrants, calls, commitments
or agreements of any character calling for the purchase or issuance of any
shares of capital stock or any other equity security of such Subsidiary or any
securities representing the right to purchase or otherwise receive any shares
of capital stock or any other equity security of such Subsidiary. Except as set forth in Section 4.2(a) of
the Cowen Disclosure Schedule, Cowen does not have any Subsidiaries and does
not own any capital stock or other equity or voting securities or other rights
convertible or exchangeable into or exercisable for equity or voting
securities, or any other rights, in any other Person.
4.3 Authority; No Violation. (a) Cowen has full corporate power and
authority to execute and deliver this Agreement and the Registration Rights
Agreement and to consummate the transactions contemplated hereby and
thereby. The execution and delivery of
this Agreement
9
and the Registration Rights Agreement and the
consummation of the transactions contemplated hereby and thereby have been duly
and validly approved by the Board of Directors of Cowen. The Board of Directors of Cowen has
determined that this Agreement is advisable and in the best interests of Cowen
and its stockholders and has directed that this Agreement be submitted to Cowens
stockholders for approval and adoption at a duly held meeting of such
stockholders and has adopted a resolution to the foregoing effect. Except for the approval and adoption of this
Agreement by the affirmative vote of the holders of a majority of the
outstanding shares of Cowen Common Stock entitled to vote at such meeting, no
other corporate proceedings on the part of Cowen are necessary to approve this
Agreement or to consummate the transactions contemplated hereby. Each of this Agreement and the Registration
Rights Agreement has been duly and validly executed and delivered by Cowen and
(assuming, with respect to this Agreement, due authorization, execution and
delivery by Ramius, New Parent, Merger Sub and Exchange Sub) constitutes the
valid and binding obligations of Cowen, enforceable against Cowen in accordance
with its terms (except as may be limited by bankruptcy, insolvency, fraudulent
transfer, moratorium, reorganization or similar Laws of general applicability
relating to or affecting the rights of creditors generally and subject to
general principles of equity (the Bankruptcy and Equity Exception)).
(b) Neither the execution and delivery of
this Agreement by Cowen, nor the consummation by Cowen of the transactions
contemplated hereby, nor compliance by Cowen with any of the terms or
provisions of this Agreement, will conflict with, or result in any violation of
or default (without notice or lapse of time or both) under, or give rise to a
right of termination, cancellation, acceleration of any obligation or to loss
of a material benefit under, or give rise to any obligation of Cowen, any of
its Subsidiaries or CHRP to make any payment under, or to the increased,
additional, accelerated or guarantees rights or entitlements of any Person
under, or result in the creation of any Liens upon any of the properties or
assets of Cowen or its Subsidiaries under, any provisions of (i) Cowen
Charter or Cowen By-Laws; (ii) any Contract or material Permit to which
Cowen, any of its Subsidiaries or CHRP is a party; (iii) any judgment,
order, injunction or decree of any Governmental Entity applicable to Cowen, any
of its Subsidiaries or CHRP or any of their respective properties or assets; or
(iv) any applicable Law, except in the case of clauses (ii), (iii) or
(iv) for violations, defaults, rights or losses that would not reasonably
be expected to have a Material Adverse Effect on Cowen.
(c) Cowen hereby acknowledges that each
of the representations and warranties of New Parent contained in Article V
of the FoF Asset Exchange Agreement are true and correct.
4.4 Consents and Approvals. Except for (i) filings of applications
and notices with, and receipt of consents, authorizations, approvals,
exemptions or nonobjections from, the SEC, non-U.S. and state securities
authorities, FINRA, the United Kingdom Financial Services Authority (the FSA),
the Securities and Futures Commission of Hong Kong and other SROs, (ii) the
filing of a notification and report form under the HSR Act and the termination
or expiration of applicable waiting periods under the HSR Act, (iii) the
filing with the SEC of the proxy statement in a definitive form relating to the
meeting of Cowens stockholders to be held in connection with this Agreement
and the transactions contemplated by this Agreement (the Proxy Statement)
and of a registration statement on Form S-4 (the Form S-4)
in which the Proxy Statement will be included as a prospectus, and declaration
of effectiveness of the Form S-4, (iv) the filing of the Certificate
of Merger pursuant to the DGCL, (v) any consents,
10
authorizations, approvals, filings or exemptions in
connection with compliance with the rules of the NASDAQ, (vi) such
filings and approvals as are required to be made or obtained under the
Securities Laws in connection with the issuance of the shares of New Parent Class A
Common Stock pursuant to this Agreement
and (vii) such other consents, approvals, filings and registrations the
failure of which to obtain or make would not reasonably be expected to have a
Material Adverse Effect on Cowen, no consents or approvals of or filings or
registrations with or notice to any Regulatory Agency or Governmental Entity or
any other Person are necessary in connection with (A) the execution and
delivery by Cowen of this Agreement and (B) the consummation by Cowen of
the transactions contemplated by this Agreement.
4.5 SEC Reports. Cowen has previously made available to Ramius
an accurate and complete copy of each final registration statement, prospectus,
report, schedule and definitive proxy statement filed with or furnished to the
SEC by Cowen or any of its Subsidiaries pursuant to the Securities Act or the
Exchange Act on or after July 12, 2006 (the Cowen SEC Reports). No such Cowen SEC Report, at the time filed
or furnished (and, in the case of registration statements and proxy statements,
on the dates of effectiveness and the dates of the relevant meetings,
respectively), contained any untrue statement of a material fact or omitted to
state any material fact required to be stated therein or necessary in order to
make the statements made therein, in light of the circumstances in which they
were made, not misleading, except that information as of a later date (but
before the date of this Agreement) shall be deemed to modify information as of
an earlier date. As of their respective
dates, all Cowen SEC Reports complied as to form in all material respects with
the published rules and regulations of the SEC with respect thereto. No executive officer of Cowen has failed in
any respect to make the certifications required of him or her under Section 302
or 906 of the Sarbanes-Oxley Act.
4.6 Financial Statements.
(a) The financial statements of Cowen and
its Subsidiaries included (or incorporated by reference) in the Cowen SEC
Reports (including the related notes, where applicable) (i) have been
prepared from, and are in accordance with, the books and records of Cowen and
its Subsidiaries, (ii) fairly present in all material respects the
consolidated results of operations, cash flows, changes in stockholders equity
and consolidated financial position of Cowen and its Subsidiaries for the
respective fiscal periods or as of the respective dates therein set forth
(subject in the case of unaudited statements to recurring year-end audit
adjustments normal in nature and amount), (iii) complied as to form, as of
their respective dates of filing with the SEC, in all material respects with
applicable accounting requirements and with the published rules and
regulations of the SEC with respect thereto, and (iv) have been prepared
in accordance with U.S. generally accepted accounting principles (GAAP)
consistently applied during the periods involved, except, in each case, as
indicated in such statements or in the notes thereto. The books and records of Cowen and its
Subsidiaries have been, and are being, maintained in all material respects in
accordance with GAAP and any other applicable legal and accounting
requirements.
(b) Neither Cowen nor any of its
Subsidiaries has any material liability or obligation of any nature whatsoever
(whether absolute, accrued, contingent, determined, determinable or otherwise
and whether due or to become due) except for (i) those liabilities that
are reflected or reserved against on the consolidated balance sheet of Cowen
included in its Annual Report on Form 10-K for the fiscal year ended December 31,
2008 (including any notes thereto) and (ii)
11
liabilities incurred in the Ordinary Course of
Business since December 31, 2008 or in connection with this Agreement and
the transactions contemplated hereby.
(c) The records, systems, controls, data
and information of Cowen and its Subsidiaries are recorded, stored, maintained
and operated under means (including any electronic, mechanical or photographic
process, whether computerized or not) that are under the exclusive ownership
and direct control of Cowen or its Subsidiaries or accountants (including all
means of access thereto and therefrom), except for any non-exclusive ownership
and non-direct control that would not reasonably be expected to have a Material
Adverse Effect on the system of internal accounting controls described below in
this Section 4.6(c). Cowen (x) has
implemented and maintains disclosure controls and procedures (as defined in Rule 13a-15(e) of
the Exchange Act) to ensure that material information relating to Cowen,
including its consolidated Subsidiaries, is made known to the chief executive
officer and the chief financial officer of Cowen by others within those
entities, and (y) has disclosed, based on its most recent evaluation prior
to the date hereof, to Cowens outside auditors and the audit committee of
Cowens Board of Directors (i) any significant deficiencies and material
weaknesses in the design or operation of internal controls over financial
reporting (as defined in Rule 13a-15(f) of the Exchange Act) which
are reasonably likely to adversely affect Cowens ability to record, process,
summarize and report financial information and (ii) any fraud, whether or
not material, that involves management or other employees who have a significant
role in Cowens internal controls over financial reporting. Each of these disclosures were made in
writing by management to Cowens auditors and audit committee, a copy of which
has previously been made available to Ramius.
As of the date hereof, there is no reason to believe that Cowens
outside auditors, chief executive officer and chief financial officer will not
be able to give the certifications and attestations required pursuant to the rules and
regulations adopted pursuant to Section 404 of the Sarbanes-Oxley Act,
without qualification, when next due.
(d) Since December 31, 2008, neither
Cowen nor any of its Subsidiaries nor, to the knowledge of Cowen, any director,
officer, employee, auditor, accountant or representative of Cowen or any of its
Subsidiaries has received or otherwise had or obtained knowledge of any
material complaint, allegation, assertion or claim, whether written or oral,
regarding the accounting or auditing practices, procedures, methodologies or
methods of Cowen or any of its Subsidiaries or their respective internal
accounting controls, including any material complaint, allegation, assertion or
claim that Cowen or any of its Subsidiaries has engaged in questionable
accounting or auditing practices.
4.7 Brokers Fees. Neither Cowen nor any of its Subsidiaries nor
any of their respective officers, directors, employees or agents has utilized
any broker, finder or financial advisor or incurred any liability for any
brokers fees, commissions or finders fees in connection with the Transactions
or any other transactions contemplated by this Agreement, other than Sandler ONeill &
Partners, and pursuant to a letter agreement, true, complete and correct copies
of which have been previously delivered to Ramius.
4.8 Absence of Certain Changes or
Events. (a) Since December 31,
2008, no event or events have occurred that have had or would reasonably be
expected to have, either individually or in the aggregate, a Material Adverse
Effect on Cowen.
12
(b) Since December 31, 2008 through
and including the date of this Agreement, except as set forth on Section 4.8(b) of
the Cowen Disclosure Schedule, Cowen and its Subsidiaries have carried on their
respective businesses in all material respects in the Ordinary Course of
Business and none of Cowen or any Subsidiary has taken any action that, if
taken after the date of this Agreement, would constitute a breach of any of the
covenants set forth in Section 6.2(e) or Section 6.2(i).
4.9 Legal Proceedings.
(a) Except as set forth on Section 4.9
of the Cowen Disclosure Schedule and except as has not had and would not
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect on Cowen, neither Cowen, any of its Subsidiaries nor CHRP is a
party to any, and there are no pending or, to Cowens knowledge, threatened,
legal, administrative, arbitral or other proceedings, claims, actions, suits or
governmental or regulatory investigations of any nature by or against Cowen,
any of its Subsidiaries or CHRP or, to the knowledge of Cowen, any of its or
its Subsidiaries or CHRPs key employees with respect to its business, or to
which any of their assets are subject.
(b) There is no judgment, settlement
agreement, order, injunction, decree or regulatory restriction imposed upon
Cowen, any of its Subsidiaries or CHRP or the assets of Cowen or any of its
Subsidiaries or CHRP (or that, upon consummation of the Transactions, would
apply to Ramius or any of its Subsidiaries).
4.10 Taxes and Tax Returns. Each of Cowen and its Subsidiaries has (i) duly
and timely filed (including all applicable extensions) all federal income Tax
Returns and other material Tax Returns required to be filed by it (all such Tax
Returns being accurate and complete in all material respects) and (ii) has
paid all Taxes due and owing by Cowen or any of its Subsidiaries (whether or
not shown on any Tax Return). Neither
Cowen nor any of its Subsidiaries currently is the beneficiary of any extension
of time within which to file any material Tax Return. None of the federal, state and local income
Tax Returns for periods beginning after July 12, 2006 of Cowen and its
Subsidiaries have been examined by the IRS or other relevant taxing
authority. No written claim has ever
been made by an authority in a jurisdiction where Cowen or any of its
Subsidiaries does not file Tax Returns that Cowen or any of its Subsidiaries is
or may be subject to taxation by that jurisdiction. There are no material Liens for Taxes (other
than Taxes not yet due and payable) upon any of the assets of Cowen or any of
its Subsidiaries. Each of Cowen and its
Subsidiaries have withheld and paid all material Taxes required to have been
withheld and paid in connection with any amounts paid or owing to any employee,
independent contractor, creditor, stockholder, or other third party. Neither Cowen nor any of its Subsidiaries has
received from any foreign, federal, state, or local taxing authority (including
jurisdictions where Cowen or its Subsidiaries have not filed Tax Returns) any (i) notice
indicating an intent to open an audit or other review, (ii) request for
information related to Tax matters, or (iii) notice of deficiency or
proposed adjustment for any amount of Tax proposed, asserted, or assessed by
any taxing authority against Cowen or any of its Subsidiaries. Neither Cowen nor any of its Subsidiaries has
waived any statute of limitations in respect of material Taxes or agreed to any
extension of time with respect to a material Tax assessment or deficiency. Neither Cowen nor any of its Subsidiaries (A) has
been a member of an affiliated group filing a consolidated federal income Tax
Return (other than a group the common parent of
13
which is Cowen) or (B) has any liability for a
material amount of Taxes of any person (other than Cowen and any of its
Subsidiaries) under Regulation Section 1.1502-6 (or any similar provision
of state, local, or foreign law), as a transferee or successor, by contract, or
otherwise. Any material liabilities for
Taxes not yet due and payable, or which are being contested in good faith by
appropriate proceedings, with respect to Cowen and any of its Subsidiaries (A) did
not, as of December 31, 2008, exceed the reserve and provision for Tax
liabilities set forth on the face of the consolidated balance sheet of Cowen
included in its Annual Report on Form 10-K for the fiscal year ended December 31,
2008 and (B) do not exceed that reserve and provision as adjusted for Tax
liabilities incurred in the Ordinary Course of Business through the Closing
Date. Neither Cowen nor any of its
Subsidiaries has a permanent establishment outside of the national jurisdiction
in which it was formed. Except as set
forth in Section 4.10 of the Cowen Disclosure Schedule, each
Subsidiary of Cowen has since the date of its formation been properly
classified for U.S. Federal income tax purposes as either a partnership or
disregarded entity and not as an association taxable as a corporation, or a publicly
traded partnership within the meaning of Section 7704(b) of the Code
that is treated as a corporation for U.S. federal income tax purposes under Section 7704(a) of
the Code, and neither Cowen nor any of its Subsidiaries has taken a position
inconsistent with such treatment with regard to any Tax. There are no material disputes pending, or
written claims asserted, for Taxes or assessments upon Cowen or any of its
Subsidiaries for which Cowen does not have reserves that are adequate under GAAP. Neither Cowen nor any of its Subsidiaries is
a party to or is bound by any Tax sharing agreement or arrangement (other than
such an agreement or arrangement exclusively between or among Cowen and its
Subsidiaries). Within the past two (2) years
(or otherwise as part of a plan (or series of related transactions) within
the meaning of Section 355(e) of the Code of which the Transactions
are also a part), neither Cowen nor any of its Subsidiaries has been a distributing
corporation or a controlled corporation in a distribution intended to
qualify under Section 355(a) of the Code. Neither Cowen nor any of its Subsidiaries has
participated in a listed transaction within the meaning of Treasury
Regulation Section 1.6011-4(b)(2) subsequent to such transaction
becoming listed. The parties agree and
acknowledge that the foregoing representations and warranties shall not apply
with respect to any Tax Returns or Taxes that are the responsibility of SG
Americas, Inc. (SGAI) pursuant to the Tax Matters Agreement,
dated as of July 12, 2006 among SGAI, SG Americas Securities Holdings, Inc.,
Cowen and Company LLC, and Cowen.
4.11 Employee Matters.
(a) Section 4.11(a) of
the Cowen Disclosure Schedule sets forth a true, complete and correct list of
each material employee benefit plan as defined in Section 3(3) of
ERISA, whether or not subject to ERISA, and each material employment,
consulting, bonus, incentive or deferred compensation, vacation, stock option
or other equity-based, severance, termination, retention, change of control,
profit-sharing, fringe benefit or other similar plan, program, agreement or
commitment, whether written or unwritten, for the benefit of any employee,
former employee, director or former director of Cowen or any of its Subsidiaries
entered into, maintained or contributed to by Cowen or any of its Subsidiaries
or to which Cowen or any of its Subsidiaries is obligated to contribute, or
with respect to which Cowen or any of its Subsidiaries has any liability,
direct or indirect, contingent or otherwise (including any liability arising
out of an indemnification, guarantee, hold harmless or similar agreement) or
otherwise providing benefits to any current, former or future employee, officer
or director of Cowen or any of its
14
Subsidiaries or to any beneficiary or dependent
thereof (such plans, programs, agreements and commitments, herein referred to
as the Cowen Benefit Plans).
(b) With respect to each Cowen Benefit
Plan, Cowen has delivered or made available to Ramius a true, correct and
complete copy of: (i) each writing
constituting a part of such Plan; (ii) the most recent Annual Report (Form 5500
Series) and accompanying schedule, if any; (iii) the current summary plan
description and any material modifications thereto, if any (in each case,
whether or not required to be furnished under ERISA); (iv) the most recent
annual financial report, if any; (v) the most recent actuarial report, if
any; and (vi) the most recent determination letter from the IRS, if any.
(c) Each Cowen Benefit Plan intended to
be qualified within the meaning of Section 401(a) of the Code has
received a favorable determination letter from the IRS, or has pending an
application for such determination from the IRS with respect to those
provisions for which the remedial amendment period under Section 401(b) of
the Code has not expired, and, to the knowledge of Cowen, there is not any
reason why any such determination letter should be revoked. Each of the Cowen Benefit Plans has been
operated and administered in accordance with applicable Law, including, but not
limited to, ERISA, the Code and in each case the regulations thereunder.
(d) No Cowen Benefit Plan provides
benefits, including, without limitation, death or medical benefits (whether or
not insured), with respect to current or former employees or directors of Cowen
or any of its Subsidiaries beyond their retirement or other termination of
service, other than (1) coverage mandated by applicable Law or (2) death
benefits or retirement benefits under any employee pension plan (as such term
is defined in Section 3(2) of ERISA).
Except as could not be reasonably expected to result in a material
liability to Cowen or any of its Subsidiaries, neither Cowen nor any of its
Subsidiaries has engaged in a transaction in connection with which Cowen or any
of its Subsidiaries reasonably could be subject to either a civil penalty
assessed pursuant to Section 409 or 502(i) of ERISA or a tax imposed
pursuant to Section 4975 or 4976 of the Code. Except as could not be reasonably expected to
result in a material liability to Cowen or any of its Subsidiaries, no
Controlled Group Liability has been incurred by Cowen, any of its Subsidiaries
or any of their respective ERISA Affiliates that has not been satisfied in
full, and, to the knowledge of Cowen, no condition exists that presents a risk
to Cowen, any of its Subsidiaries or any of their respective ERISA Affiliates
of incurring any such liability. Except
as could not be reasonably expected to result in a material liability to Cowen
or any of its Subsidiaries, all contributions required to be made to any Cowen
Benefit Plan by applicable Law or by any plan document or other contractual
undertaking, and all premiums due or payable with respect to insurance policies
funding any Cowen Benefit Plan, for any period through the date hereof have
been timely made or paid in full or, to the extent not required to be made or
paid on or before the date hereof have been fully accrued in accordance with
generally accepted accounting principles.
(e) No Cowen Benefit Plan is subject to
Title IV of ERISA or Section 302 of ERISA or Section 412 or 4971 of
the Code. Neither Cowen, any of its
Subsidiaries nor any of their respective ERISA Affiliates contributes (or has
contributed in the six (6) years prior to the date hereof) to a multiemployer
pension plan (as such term is defined in Section 3(37) of ERISA)
15
or a plan that has two or more contributing sponsors
at least two of whom are not under common control, within the meaning of Section 4063
of ERISA.
(f) There are no pending, threatened or
anticipated claims (other than routine claims for benefits) by, on behalf of or
against any of the Cowen Benefit Plans or any trusts related thereto or
fiduciaries thereof which could reasonably be expected to result in a material
liability of Cowen or any of its Subsidiaries.
(g) Neither the execution or delivery of
this Agreement nor the consummation of the transactions contemplated by this
Agreement will, either alone or in conjunction with any other event, (i) result
in any material payment or benefit becoming due or payable, or required to be
provided, to any director, employee or independent contractor of Cowen or any
of its Subsidiaries or to such individuals in the aggregate, (ii) materially
increase the amount or value of any benefit or compensation otherwise payable
or required to be provided to any such director, employee or independent
contractor, (iii) result in the acceleration of the time of payment, vesting
or funding of any such benefit or compensation, (iv) result in any
material limitation on the right of Cowen or any of its Subsidiaries to amend,
merge or, terminate any Cowen Benefit Plan or related trust or (v) fail to
be deductible by reason of Section 280G of the Code.
(h) All Cowen Benefit Plans subject to
the laws of any jurisdiction outside of the United States (i) have been
maintained in accordance with all applicable requirements, (ii) if they
are intended to qualify for special tax treatment meet all requirements for
such treatment, and (iii) if they are intended to be funded and/or
book-reserved are fully funded and/or book reserved, as appropriate, based upon
reasonable actuarial assumptions.
(i) No labor organization or group of
employees of Cowen or any of its Subsidiaries has made a pending demand for
recognition or certification, and there are no representation or certification
proceedings or petitions seeking a representation proceeding presently pending
or threatened to be brought or filed, with the National Labor Relations Board
or any other labor relations tribunal or authority. There are no organizing activities, strikes,
work stoppages, slowdowns, lockouts, material arbitrations or material
grievances, or other material labor disputes pending or threatened against or
involving Cowen or any of its Subsidiaries.
Except as could not be reasonably expected to result in a material
liability to Cowen or any of its Subsidiaries, each of the Cowen and its
Subsidiaries is in compliance in all material respects with all applicable Laws
and collective bargaining agreements respecting employment and employment
practices, terms and conditions of employment, wages and hours and occupational
safety and health.
(j) Each Cowen Benefit Plan that is a nonqualified
deferred compensation plan within the meaning of Section 409A(d)(1) of
the Code and any award thereunder, in each case that is subject to Section 409A
of the Code, has been operated in compliance in all material respects with Section 409A
of the Code since July 12, 2006, based upon a good faith, reasonable
interpretation of (A) Section 409A of the Code and (B)(1) the
proposed and final Treasury Regulations issued thereunder, where applicable,
and (2) Internal Revenue Service Notice 2005-1, all subsequent Internal
Revenue Service Notices, and other interim guidance on Section 409A of the
Code, where applicable.
16
(k) All grants of Cowen Stock Options,
Cowen Restricted Shares and Cowen RSUs and any other grants of stock options or
other equity interests were validly issued and properly approved by the Cowen
Board of Directors or a committee thereof (and all required approvals, if any,
by the stockholders of Cowen have been obtained) in accordance with all
applicable Law and, to the knowledge of Cowen, no such grants involved any backdating
or similar practices with respect to the effective date of grant. The per share exercise price of each Cowen
Stock Option was not less than the fair market value of the Cowen Common Stock
on the applicable grant date (as determined in a manner consistent with
Treasury Regulation §1.409A-1(b)(5)(iv)) and each such grant was properly accounted
for in all material respects in accordance with GAAP in the financial
statements (including the related notes) of Cowen and disclosed in Cowens
filings with the SEC in accordance with the Exchange Act and other applicable
Securities Laws. No modifications have
been made to any Cowen Stock Options after the applicable date of grant.
4.12 Certain Contracts. (a) Section 4.12(a) of
the Cowen Disclosure Schedule sets forth all of the following Contracts in
existence to which Cowen or its Subsidiaries is a party or by which it is bound as of the date hereof
(collectively, the Cowen Contracts):
(i) Any Contract that is a material
contract (as such term is defined in Item 601(b)(10) of Regulation S-K of
the SEC);
(ii) Contracts for the sale of assets or
rights of Cowen or its Subsidiaries other than in the Ordinary Course of
Business or for the grant to any Person of any preferential rights to purchase
any of its assets;
(iii) Contracts for joint-ventures,
strategic alliances or partnerships or other similar entities;
(iv) Any non-competition, non-solicitation
or exclusive dealing agreement, or any other agreement or obligation that
purports to limit or restrict in any respect (A) the ability of Cowen, its
Subsidiaries or other Affiliates or, following the Closing, New Parent or its
Affiliates, to solicit customers or employees or (B) the manner in which,
or the localities in which, all or any portion of the business of Cowen or its
Subsidiaries or, following the Closing, New Parent or its Affiliates, conducts
business;
(v) Contracts relating to the acquisition
by Cowen or its Subsidiaries of any operating business or the capital stock or
assets of any other Person;
(vi) Contracts or instruments relating to
the incurrence, assumption or guarantee of any indebtedness or imposing a Lien
on any of its assets;
(vii) Contracts where Cowen or any of its
Subsidiaries is the lessee or sublessee of, or is granted a similar occupancy
interest in, any real property or pursuant to which Cowen or any of its Subsidiaries
grants to any Person a leasehold or subleasehold, or similar occupancy
interest, in any real property;
17
(viii) Contracts for the provision of goods or
services or License Agreements, in each case involving fees, royalties,
payments or other consideration in excess of $500,000 annually based on 2008
expenditures;
(ix) Contracts that grant any right of
first refusal or right of first offer or similar right or that purport to limit
the ability of Cowen or any of its Subsidiaries to own, operate, sell,
transfer, pledge or otherwise dispose of any assets or business;
(x) Contracts that obligate Cowen or any
of its Subsidiaries to cap fees, share fees or other payments, share expenses,
waive fees or to reimburse or assume any or all fees or expenses thereunder
that would be material to Cowen or any of its Subsidiaries;
(xi) Contracts requiring Cowen or any of
its Subsidiaries (A) to co-invest with any other Person, (B) to
provide seed capital or similar investment, or (C) to invest in any
investment product, in each case in an amount in excess of $1,000,000
individually or $5,000,000 in the aggregate;
(xii) Contracts (the Former Parent
Contracts) between Cowen or any of its Subsidiaries and Former Parent;
(xiii) Contracts that bind or purport to bind,
any controlling Affiliates of Cowen;
(xiv) Contracts (or groups of related
Contracts) that involve the expenditure of more than $500,000 annually based on
2008 expenditures;
(xv) soft dollar arrangements that involve
the expenditure of more than $150,000 annually or $300,000 in the aggregate;
(xvi) Contracts providing for the payment to
Cowen or any of its Subsidiaries of a retainer or similar fee of more than
$150,000 annually or $300,000 in the aggregate;
(xvii) Contracts relating to the sale of Cowen
Asset Management, LLC (the CAM Sale Contracts); and
(xviii) Contracts pursuant to which Cowen or any
of its Subsidiaries (or any of their predecessor companies) has any ongoing
indemnification obligations, retained liabilities or earnouts, in each case,
with respect to the sale of any assets, rights or businesses.
(b) (i) Each Cowen Contract is valid
and binding on Cowen or its applicable Subsidiary and, to the knowledge of
Cowen, on the other party thereto, enforceable against it in accordance with
its terms (subject to the Bankruptcy and Equity Exception), and is in full
force and effect and has not been modified or amended except pursuant to an
amendment set forth on Section 4.12 of the Cowen Disclosure
Schedule, (ii) Cowen and each of its Subsidiaries, as applicable, and, to
Cowens knowledge, each other party thereto has duly performed all obligations
required to be performed by it to date under each Cowen Contract and (iii) no
event or condition exists that constitutes or, after notice or lapse of time or
both, would constitute, a material breach, violation or default on the part of
Cowen or any of its Subsidiaries or, to Cowens knowledge, any other party
thereto under any such Cowen Contract.
There are no
18
material disputes pending or, to Cowens knowledge,
threatened, and no material amounts due or owing remain unpaid, with respect to
any Cowen Contract.
(c) True, complete and correct copies of
all of the Former Parent Contracts have been delivered or made available to
Ramius. The Former Parent Contracts
contain all of the ongoing agreements and obligations between Cowen and Former
Parent. The Former Parent Contracts are
in full force and effect. Cowen is not
and, to the knowledge of Cowen, Former Parent is not in breach or default of
any of its obligations under any of the Former Parent Contracts. Except as set forth on Section 4.12(c) of
the Cowen Disclosure Schedule, there are no ongoing claims or disputes between
Cowen and Former Parent under any of the Former Parent Contracts.
4.13 Property. As of the date hereof, none of Cowen or any of
its Subsidiaries, owns, and has never owned, any real property. All real property leased or subleased or in
which another similar occupancy interest is held by Cowen or any of its
Subsidiaries, as tenant, subtenant or occupant, or which Cowen or any of its
Subsidiaries have granted, as landlord or sublandlord, a leasehold,
subleasehold or other similar interest, is listed in Section 4.12(a)(vii) of
the Cowen Disclosure Schedule, and true and correct copies of all leases,
subleases and other such agreements (including amendments, modifications and
supplements thereto) have been provided to Ramius, and Cowen and its
Subsidiaries, as applicable, have good and valid leasehold title to their
respective leased and subleased real property, free and clear of any Liens
(other than Permitted Liens).
4.14 Intellectual Property.
(a) Section 4.14(a) of
the Cowen Disclosure Schedule contains all Cowen IP. Except as would not reasonably be expected to
have a Material Adverse Effect on Cowen, Cowen and its Subsidiaries
collectively own all right, title and interest in, or have the valid right to
use, all of the Cowen IP, free and clear of any Liens, and there are no
obligations to, covenants to or restrictions from third parties affecting Cowens
or its applicable Subsidiarys use, enforcement, transfer or licensing of the
Owned Cowen IP.
(b) The Owned Cowen IP and Licensed Cowen
IP constitute all the Intellectual Property necessary and sufficient to conduct
the businesses of Cowen and its Subsidiaries as they are currently conducted,
as they have been conducted since January 1, 2008.
(c) The Owned Cowen IP and, to the
knowledge of Cowen, Licensed Cowen IP, are valid, subsisting and enforceable.
(d) Neither Cowen nor any of its
Subsidiaries has infringed, misappropriated or otherwise violated any
Intellectual Property of any third party.
(e) No Owned Cowen IP or Licensed Cowen
IP is being used or enforced in a manner that would result in the abandonment,
cancellation or unenforceability of such Intellectual Property. To the knowledge of Cowen, no third party has
infringed, misappropriated or otherwise violated any Owned Cowen IP.
4.15 Insurance. Cowen and its Subsidiaries maintain (or Cowen
maintains on behalf of its Subsidiaries) such workers compensation, comprehensive
property and casualty, liability,
19
errors and omissions, directors and officers,
fidelity and other insurance sufficient to operate their business as currently
conducted and as they may be required to maintain under applicable Law. Cowen and its Subsidiaries have complied in
all material respects with the terms and provisions of such policies and bonds.
4.16 Compliance with Laws; Permits.
(a) Each of Cowen and its Subsidiaries
and CHRP has been since July 12, 2006 and is in compliance in all material
respects with all Laws of any Governmental Entity and the rules and
regulations of any Regulatory Agency that are applicable to its respective
business, operations, or assets. Cowen
and each of its Subsidiaries have timely filed all material reports (other than
SEC Reports, which are covered in Section 4.5 above),
registrations, statements and certifications, together with any amendments
required to be made with respect thereto, that they were required to file since
July 12, 2006 with Regulatory Agencies and with each other applicable
Governmental Entity, and all other reports and statements required to be filed
by them since July 12, 2006, including any report or statement required to
be filed pursuant to the Laws, rules or regulations of the United States,
any state, any non-U.S. entity, or any Regulatory Agency or other Governmental
Entity, and have paid all fees and assessments due and payable in connection
therewith. Except as set forth in Section 4.16(a) of
the Cowen Disclosure Schedule, no Regulatory Agency or other Governmental
Entity has initiated since July 12, 2006 and on or prior to the date of
this Agreement or has pending as of the date of this Agreement any proceeding,
enforcement action or, to the knowledge of Cowen, investigation into the
business, disclosures or operations of Cowen, any of its Subsidiaries or
CHRP. Except for ordinary and usual
examinations conducted by a Regulatory Agency or other Governmental Entity in
the Ordinary Course of Business of Cowen and its Subsidiaries that have not
resulted or are not reasonably expected to result in a materially adverse
finding or claim against Cowen or any of its Subsidiaries, no Regulatory Agency
or other Governmental Entity has initiated since the date of this Agreement any
proceeding, enforcement action or, to the knowledge of Cowen, investigation
into the business, disclosures or operations of Cowen or any of its
Subsidiaries. Except as set forth in Section 4.16(a) of
the Cowen Disclosure Schedule, since July 12, 2006, no Regulatory Agency
or other Governmental Entity has resolved any proceeding, enforcement action
or, to the knowledge of Cowen, investigation into the business, disclosures or
operations of Cowen, any of its Subsidiaries or CHRP. There is no unresolved, or, to Cowens
knowledge, threatened criticism, comment, exception or stop order by any
Regulatory Agency or other Governmental Entity with respect to any report or
statement relating to any examinations or inspections of Cowen, any of its
Subsidiaries or CHRP. Except as set
forth in Section 4.16(a) of the Cowen Disclosure Schedule,
since July 12, 2006, there have been no formal or informal inquiries by,
or disagreements or disputes with, any Regulatory Agency or other Governmental
Entity with respect to the business, operations, policies or procedures of
Cowen, any of its Subsidiaries or CHRP (other than normal examinations
conducted by a Regulatory Agency or other Governmental Entity in Cowens
Ordinary Course of Business).
(b) Neither Cowen nor any of its
Subsidiaries is subject to any cease-and-desist or other order or formal or
informal enforcement action issued by, or is a party to any written agreement,
consent agreement or memorandum of understanding with, or is a party to any
commitment letter or similar undertaking to, or is subject to any order or
directive by, or has been ordered to pay any civil money penalty by, or has
been since July 12, 2006 a recipient of
20
any supervisory letter from, or since July 12,
2006 has adopted any policies, procedures or board resolutions at the request
or suggestion of, any Regulatory Agency or other Governmental Entity that
currently restricts or affects in any material respect the conduct of its
business (or to Cowens knowledge that, upon consummation of the Transactions,
would restrict in any material respect the conduct of the business of Ramius or
any of its Subsidiaries), or that in any material manner relates to its risk
management or compliance policies, its internal controls, its management or its
business, other than those of general application that apply to similarly
situated companies or their Subsidiaries (each item in this sentence, a Cowen
Regulatory Agreement), nor has Cowen, any of its Subsidiaries been advised
since July 12, 2006 by any Regulatory Agency or other Governmental Entity
that it is considering issuing, initiating, ordering, or requesting any such
Cowen Regulatory Agreement.
(c) Section 4.16(c) of
the Cowen Disclosure Schedule contains a list of all Permits which are required
for the operation of the business of Cowen and its Subsidiaries as presently
conducted, other than those the failure of which to possess is not material to
the operation of such business. Each of
Cowen and its Subsidiaries currently has all Permits which are required for the
operation of its business as presently conducted and as presently intended to
be conducted, other than those the failure of which to possess is not material
to the operation of such business. None
of Cowen or its Subsidiaries is in default or violation, and no event has
occurred which, with notice or the lapse of time or both, would constitute a
default or a violation, in any material respect of term, condition or provision
of any material Permit to which it is a party, to which its business is subject
or by which its properties or assets are bound, and to the knowledge of Cowen,
there are no facts or circumstances which could reasonably be expected to form
the basis for any such default or violation.
Each employee of Cowen or its Subsidiaries who is required to be
registered or licensed as a registered representative, investment advisor
representative, sales person or an equivalent person with any Governmental
Entity or SRO is fully registered or licensed as such and such registration is
in full force and effect.
(d) Cowen is not (taking into account any
applicable exemption) ineligible under Section 9(a) or 9(b) of
the Investment Company Act to serve in a capacity described therein. There is no proceeding or investigation
pending and served on Cowen or, to the knowledge of Cowen, pending and not so
served or threatened by any Governmental Entity, which would result in the
ineligibility of Cowen to serve in any such capacities.
(e) Cowen is not (taking into account any
applicable exemption) ineligible under Section 203(f) of the Advisers
Act to serve as a person associated with an investment adviser. There is no proceeding or investigation
pending and served on Cowen or, to the knowledge of Cowen, pending and not so
served or threatened by any Governmental Entity, which would result in the
ineligibility under such Section 203(f) of Cowen to serve as a person
associated with an investment adviser.
(f) With respect to Cowen and each
Subsidiary that acts as a broker or dealer within the meaning of the Exchange
Act, (i) such person is not (taking into account any applicable exemption)
ineligible pursuant to Section 15(b)(4) of the Exchange Act to act as
a broker or dealer, (ii) no person associated (as defined in Section 3(a)(18)
of the Exchange Act) with such person is (taking into account any applicable
exemption) ineligible under Section 15(b)(6) of the Exchange Act to
serve as a person associated with a broker or dealer and (iii) there is
no
21
proceeding or investigation pending and served on
Cowen or any Subsidiary or, to Cowens knowledge, pending and not so served or
threatened by any Governmental Entity, which would result in (A) the
ineligibility under such Section 15(b)(4) of such person to act as a
broker or dealer or (B) the ineligibility under such Section 15(b)(6) of
such person associated with such person to serve as a person associated
with a broker or dealer.
(g) None of Cowen or it Subsidiaries are (i) a
commodity pool operator, futures commission merchant, commodity trading
advisor, investment adviser, bank or real estate broker within the meaning of
any applicable Law; (ii) required to be registered, licensed or qualified
as a commodity pool operator, futures commission merchant, commodity trading
advisor, investment adviser, bank or real estate broker under any applicable
Law or (iii) subject to any liability or disability by reason of any
failure to be so registered, licensed or qualified if required by applicable
Law. Neither Cowen nor any of its
Subsidiaries has received written notice of any proceeding concerning any
failure to obtain any commodity pool operator, futures commission merchant,
commodity trading advisor, investment adviser, bank or real estate broker
registration, license or qualification.
(h) Each of Cowen and its Subsidiaries
has complied in all material respects, to the extent such Laws are applicable
to them, with (i) U.S. anti-money laundering and anti-terrorism financing
laws and the regulations administered by the U.S. Treasury Departments Office
of Foreign Assets Control, and has adequate measures in place to comply with
those laws, (ii) the
Foreign Corrupt Practices Act, (iii) the Trading with the Enemy Act and (iv) all
comparable provisions of non-U.S. Laws.
(i) Cowen and its Subsidiaries, to the
extent each is a financial institution (as defined in the GBA), have
complied, to the extent required, with the GBA and the rules and
regulations promulgated pursuant thereto, without limitation, Regulation S-P
issued by the SEC and the privacy rules issued by the Federal Trade
Commission (collectively, the Privacy Rules), and each such financial
institution has provided the privacy notices, in the form and to the extent
required by the GBA and the Privacy Rules, and has taken such other actions as
may be required thereunder.
(j) Cowen and its Subsidiaries have
appropriate policies and procedures in place with respect to information
barriers between departments.
(k) Cowen does not serve as a fiduciary
with respect to plan assets of any employee benefit plan subject to Title I
of ERISA (other than plans maintained for employees of Cowen and its Subsidiaries);
provided, that to the extent Cowen does act as a fiduciary with respect to plan
assets of any employee benefit plan subject to Title I of ERISA (other than
plans maintained for employees of Cowen and its subsidiaries), Cowen has
complied in all material respects with the requirements of Title I of ERISA and
Section 4975 of the Code.
4.17 CHRP.
(a) Cowen or its Subsidiaries has
performed in all material respects all of the obligations thereof under each
agreement relating to CHRP in accordance with its terms and all applicable
Laws.
22
(b) CHRP is duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
organization and has the requisite corporate, limited company, trust or
partnership power and authority to own its properties and to carry on its
business as it is now conducted, and is qualified to do business in each
jurisdiction where it is required to do so under applicable Law, except where
the failure to have such power, authority or qualification is not material to
its business. Except as set forth on Section 4.17(c) of
the Cowen Disclosure Schedule, CHRP is not and is not required to be registered
with the SEC or any other Governmental Entity as an investment company under
the Investment Company Act or any similar Law.
(c) All offering documents, subscription
agreements, administrative services agreements, distribution, solicitation or
placement agency agreements and solicitation agreements, as applicable, or any
similar written agreements, including all side letters or other
understandings, in any case pertaining to CHRP did not, to the knowledge of
Cowen, at any time such offering documents were made available to investors or
prospective investors in CHRP, contain any untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they
were made, not misleading. Section 4.17(c) of
the Cowen Disclosure Schedule sets forth true, complete and correct
descriptions of any side letters or similar understandings relating to CHRP
that reduce the management fees paid to Cowen or its applicable Subsidiary.
(d) The unaudited financial statements,
and where audited financial statements are available for CHRP, such audited
financial statements, of CHRP for its most recent fiscal year ended on or prior
to December 31, 2008 present fairly, in all material respects, the
consolidated financial position of CHRP in accordance with GAAP applied on a
consistent basis (except as otherwise noted therein) at the respective date of
such financial statements.
(e) No consents or approvals are required
under (i) applicable Law (including, for the absence of doubt, the
Advisers Act), or (ii) any Investment Advisory Agreement, from any Board
or Limited Partners of CHRP or any other applicable third-parties in order to (A) avoid
triggering a withdrawal right of any Limited Partner pursuant to the terms of
any agreements relating to CHRP or any side letters to any such agreements; and
(B) consummate the transactions contemplated by this Agreement so that
after the Closing Date, Cowen or its applicable Subsidiary may continue its
applicable management, advisory or sub-advisory relationships on terms that are
no less favorable to such Cowen entity than the terms of existing
relationships.
4.18 Risk Management Instruments. (a) All Derivative Transactions,
whether entered into for the account of Cowen or any of its Subsidiaries or for
the account of a customer of Cowen or any of its Subsidiaries, were entered
into in the Ordinary Course of Business and in accordance with applicable Laws,
rules, regulations and policies of any Regulatory Authority and in accordance with
the investment, securities, commodities, risk management and other policies,
practices and procedures employed by Cowen and its Subsidiaries, and with
counterparties believed at the time to be financially responsible and able to
understand (either alone or in consultation with their advisers) and to bear
the risks of such Derivative Transactions.
All of such Derivative Transactions are valid and binding obligations of
Cowen or one of its Subsidiaries enforceable against it in accordance with
their terms (subject to the Bankruptcy and
23
Equity Exception), and are in full force and
effect. Cowen and its Subsidiaries and,
to Cowens knowledge, all other parties thereto have duly performed their
obligations under the Derivative Transactions to the extent that such
obligations to perform have accrued and, to Cowens knowledge, there are no
breaches, violations or defaults or allegations or assertions of such by any
party thereunder.
4.19 State Takeover Laws. The Board of Directors of Cowen has
unanimously approved this Agreement and the transactions contemplated hereby as
required to render inapplicable to this Agreement and such transactions the
restrictions on business combinations set forth in Section 203 of the
DGCL or any other moratorium, control share, fair price, takeover or interested
stockholder law (any such laws, Takeover Statutes).
4.20 Interested Party Transactions. Except as set forth in the Cowen SEC
Documents or Section 4.20 of the Cowen Disclosure Schedule, no
event has occurred since January 1, 2007 that would be required to be
reported by Cowen pursuant to Item 404(a) of Regulation S-K promulgated by
the SEC.
4.21 Reorganization. As of the date of this Agreement, Cowen is
not aware of any fact or circumstance that could reasonably be expected to
prevent the Cowen Merger from qualifying as a reorganization within the
meaning of Section 368(a) of the Code.
4.22 Opinion. The Board of Directors of
Cowen has received the opinion of Sandler ONeill & Partners, to the
effect that, as of the date hereof, and based upon and subject to the factors
and assumptions set forth therein, the Merger Consideration is fair from a
financial point of view to the holders of Cowen Common Stock. Such opinion has
not been amended or rescinded as of the date of this Agreement.
4.23 Cowen Information. The information relating to Cowen and its
Subsidiaries that is provided by Cowen or its representatives for inclusion in
the Proxy Statement and Form S-4, or in any application, notification or
other document filed with any other Regulatory Agency or other Governmental
Entity in connection with the transactions contemplated by this Agreement, will
not contain any untrue statement of a material fact or omit to state a material
fact necessary to make the statements therein, in light of the circumstances in
which they are made, not misleading and will comply in all material respects
with the provisions of the Exchange Act and the rules and regulations thereunder;
provided that Cowen makes no representations or warranties as it relates to
any information provided by Ramius or its representatives to Cowen or its
representatives and contained in the Form S-4 or any other filings made
with any other Regulatory Agency or other Governmental Entity in connection
with the transactions contemplated by this Agreement.
4.24 No Other Representations and
Warranties. Except for the
representations and warranties contained in this Article IV, none
of Cowen, any Subsidiary of Cowen or any other Person on behalf of Cowen makes
any other express or implied representation or warranty in connection with the
transactions contemplated by this Agreement.
Without limiting the generality of the foregoing, no representations or
warranties are made with respect to any projections, forecasts, estimates,
budgets or information as to prospects with respect to Cowen and its
Subsidiaries that may have been made available to Ramius or any of its
representatives,
24
except as expressly set
forth in this Article IV or in any certificates to be delivered
pursuant to the terms set forth herein.
ARTICLE
V
REPRESENTATIONS
AND WARRANTIES OF RAMIUS
Except
as disclosed in the disclosure schedule delivered by Ramius to Cowen (the Ramius
Disclosure Schedule) prior to the execution of this Agreement, Ramius
hereby represents and warrants to Cowen as follows:
5.1 Corporate Organization. (a) Ramius is a limited liability
company duly formed, validly existing and in good standing under the laws of
the State of Delaware. Ramius has the
requisite limited company power and authority to own or lease all of its
properties and assets and to carry on its business as it is now being
conducted, and is duly licensed or qualified to do business in each
jurisdiction in which the nature of the business conducted by it or the
character or location of the properties and assets owned or leased by it makes
such licensing or qualification necessary.
A true, complete and correct copies of the Limited Liability Company
Agreement of Ramius and all amendments thereto (collectively, the Ramius
LLC Agreement), as in effect as of the date of this Agreement, has
previously been made available to Cowen.
(b) Each Subsidiary of Ramius (i) is
duly incorporated or duly formed, as applicable to each such Subsidiary, and
validly existing and in good standing under the laws of its jurisdiction of
organization, (ii) has the requisite corporate power and authority or
other power and authority to own or lease all of its properties and assets and
to carry on its business as it is now being conducted and (iii) is duly
qualified to do business in each jurisdiction in which the nature of the
business conducted by it or the character or location of the properties and
assets owned or leased by it makes such licensing or qualification necessary,
except where the failure to be so qualified would not, individually or in the
aggregate, have a Material Adverse Effect on Ramius.
5.2 Ownership of Subsidiaries. Except as set forth in Section 5.2
of the Ramius Disclosure Schedule, Ramius does not have any Subsidiaries and
does not own any capital stock or other equity or voting securities, or any
options, appreciation rights, phantom interests, warrants, calls, conversion
rights, preemptive rights, rights of first refusal, redemption rights, profit
participation, profit interests, repurchase rights, plans, tag-along or drag-along
or other similar rights, commitments, agreements, arrangements or undertakings,
in any other Person. Except as set forth
in Section 5.2 of the Ramius Disclosure Schedule, Ramius owns,
directly or indirectly, all of the issued and outstanding capital stock,
limited liability company or other ownership interests in each of its
Subsidiaries, free and clear of any Liens.
All of the issued and outstanding interests in the Subsidiaries of
Ramius have been duly authorized and validly issued and are fully paid and have
not been issued in violation of any Contract of Ramius or its
Subsidiaries. Section 5.2 of
the Ramius Disclosure Schedule sets forth a true and complete list as of the
date hereof of the holders of the awards under the Ramius LLC Phantom Interest
Program, the number of awards held be each such holder and the grant date of
each such award.
25
5.3 Authority; No Violation. (a) Ramius has the limited liability
company power and authority to execute and deliver this Agreement and to
consummate the transactions contemplated hereby. The execution and delivery of this Agreement
and the consummation of the transactions contemplated hereby have been duly and
validly approved by Ramius Members who, in the aggregate, own more than fifty
percent (50%) of the total Ramius Percentage Interests currently outstanding.
The Managing Member of Ramius has determined that this Agreement and the
transactions contemplated hereby are in the best interests of Ramius. No other corporate proceedings on the part of
Ramius are necessary to approve this Agreement or to consummate the
transactions contemplated hereby. This Agreement has been duly and validly
executed and delivered by Ramius and (assuming due authorization, execution and
delivery by Cowen, New Parent, Merger Sub and Exchange Sub) constitutes the
valid and binding obligation of Ramius, enforceable against Ramius in
accordance with its terms (subject to the Bankruptcy and Equity Exception).
(b) Neither the execution and delivery of
this Agreement by Ramius, nor the consummation by Ramius of the transactions
contemplated hereby, nor compliance by Ramius with any of the terms or
provisions of this Agreement, will conflict with, or result in any violation of
or default (without notice or lapse of time or both) under, or give rise to a
right of termination, cancellation, acceleration of any obligation or to loss
of a material benefit under, or give rise to any obligation of Ramius or its
Subsidiaries or any Fund to make any payment under, or to the increased,
additional, accelerated or guarantees rights or entitlements of any Person
under, or result in the creation of any Liens upon any of the properties or
assets of Ramius or its Subsidiaries or any Fund under, any provisions of (i) the
certificate of formation, the Ramius LLC Agreement or other organizational
documents of Ramius; (ii) except as set forth in Section 5.3(b) of
the Ramius Disclosure Schedule, any Contract (including giving any Person the
right to modify or terminate any obligation under any Management Agreement or
Third Party Management Agreement) or material Permit to which Ramius or its
Subsidiaries or any Fund is a party; (iii) any judgment, order, injunction
or decree of any Governmental Entity applicable to Ramius or its Subsidiaries
or any Fund or any of their respective properties or assets; or (iv) any
applicable Law, except in the case of clauses (ii), (iii) or (iv) for
violations, defaults, rights or losses that would not reasonably be expected to
have a Material Adverse Effect on Ramius.
5.4 Consents and Approvals. Except for (i) filings of applications
and notices with, and receipt of consents, authorizations, approvals,
exemptions or nonobjections from, the SEC, non-U.S. and state securities
authorities, FINRA, the CFTC, applicable securities, commodities and futures
exchanges, the FSA, the Financial Services Agency of Japan, the Securities and
Futures Commission in Hong Kong, the Commission for the Surveillance of the
Financial Sector in Luxembourg and other SROs, (ii) the filing of a
notification and report form under the HSR Act and the termination or
expiration of applicable waiting periods under the HSR Act, (iii) any
consents, authorizations, approvals, filings or exemptions in connection with
compliance with the rules of the NASDAQ, (iv) such filings and
approvals as are required to be made or obtained under the Securities Laws in
connection with the issuance of the shares of New Parent Class A
Common Stock pursuant to this Agreement
and (v) such other consents, approvals, filings and registrations the failure
of which to obtain or make would not reasonably be expected to have a Material
Adverse Effect on Ramius, no consents or approvals of or filings or
registrations with or notice to any Governmental Entity or any other Person are
necessary in connection with (A) the
26
execution and delivery by
Ramius of this Agreement and (B) the consummation by Ramius of the
transactions contemplated by this Agreement.
5.5 Reports. Except as set forth in Section 5.5
of the Ramius Disclosure Schedule, Ramius and each of its Subsidiaries have
timely filed all material reports, registration statements and proxy
statements, together with any amendments required to be made with respect
thereto, that they were required to file since January 1, 2006 with the
Regulatory Agencies and each other applicable Governmental Entity, and all
other reports and statements required to be filed by them since January 1,
2006, including any report or statement required to be filed pursuant to the
laws, rules or regulations of the United States, any state, any foreign
entity, or any Regulatory Agency or other Governmental Entity, and have paid
all fees and assessments due and payable in connection therewith.
5.6 Financial Statements.
(a) Ramius has previously made available
to Cowen copies of the following financial statements (the Ramius Financial
Statements), copies of which are attached as Section 5.6(a) of
the Ramius Disclosure Schedule: (i) audited
consolidated balance sheets of Ramius and its Subsidiaries for fiscal years
2007 and 2008 and the related consolidated statements of income for the fiscal
years 2006, 2007 and 2008, and (ii) the unaudited consolidated balance
sheet of Ramius and its Subsidiaries as of March 31, 2009 and the related
consolidated statement on income for the three months ended March 31,
2009. The Ramius Financial Statements (i) have
been prepared from, and are in accordance with, the books and records of Ramius
and its Subsidiaries; (ii) fairly present in all material respects the
consolidated results of operations and consolidated financial position of
Ramius and its Subsidiaries for the respective fiscal periods or as of the
respective dates therein set forth (subject in the case of unaudited statements
to recurring year-end audit adjustments normal in nature and amount); and (iii) have
been prepared in accordance with GAAP consistently applied during the periods
involved, except, in each case, as indicated in such statements or in the notes
thereto. The books and records of Ramius
and its Subsidiaries have been, and are being, maintained in all material
respects in accordance with GAAP and any other applicable legal and accounting
requirements.
(b) Neither Ramius nor any of its
Subsidiaries has any material liability or obligation of any nature whatsoever
(whether absolute, accrued, contingent or otherwise and whether due or to
become due), except for those liabilities that are reflected or reserved
against in the Ramius Financial Statements (including any notes thereto) and
for liabilities incurred in the Ordinary Course of Business since December 31,
2008 or in connection with this Agreement and the transactions contemplated
hereby.
(c) Except as set forth in Section 5.6(c) of
the Ramius Disclosure Schedule, the records, systems, controls, data and
information of Ramius and its Subsidiaries are recorded, stored, maintained and
operated under means (including any electronic, mechanical or photographic
process, whether computerized or not) that are under the exclusive ownership
and direct control of Ramius or its Subsidiaries or accountants (including all
means of access thereto and therefrom), except for any non-exclusive ownership
and non-direct control that would not reasonably be expected to have a Material
Adverse Effect on the system of internal accounting controls Ramius
maintains. Ramius maintains a system of
internal accounting controls sufficient
27
to provide reasonable assurances that transactions are
executed in accordance with managements general or specific authorization.
(d) Since December 31, 2008, neither
Ramius nor any of its Subsidiaries nor, to the knowledge of the officers of
Ramius, any member, manager, director, officer, employee, auditor, accountant
or representative of Ramius or any of its Subsidiaries has received or
otherwise had or obtained knowledge of any material complaint, allegation,
assertion or claim, whether written or oral, regarding the accounting or
auditing practices, procedures, methodologies or methods of Ramius or any of
its Subsidiaries or their respective internal accounting controls, including
any material complaint, allegation, assertion or claim that Ramius or any of
its Subsidiaries has engaged in questionable accounting or auditing practices.
5.7 Brokers Fees. Except as set forth in Section 5.7
of the Ramius Disclosure Schedule, neither Ramius nor any of its Subsidiaries
nor any of their respective managers, members, officers or directors has
employed any broker or finder or incurred any liability for any brokers fees,
commissions or finders fees in connection with the Transactions or related
transactions contemplated by this Agreement, other than Credit Suisse
Securities (USA), LLC, and pursuant to a letter agreement, true, complete and
correct copies of which have been previously delivered to Cowen.
5.8 Absence of Certain Changes or
Events.
(a) Since December 31, 2008, no
event or events have occurred that have had or would reasonably be expected to
have a Material Adverse Effect on Ramius.
(b) Since December 31, 2008 through
and including the date of this Agreement, except as set forth on Section 5.8(b) of
the Ramius Disclosure Schedule, Ramius and its Subsidiaries have carried on
their respective businesses in all material respects in the Ordinary Course of
Business and none of Ramius or any Subsidiary has taken any action that, if
taken after the date of this Agreement, would constitute a breach of any of the
covenants set forth in Section 6.2(e) or Section 6.2(i).
5.9 Legal Proceedings.
(a) Except as set forth on Section 5.9
of the Ramius Disclosure Schedule, and except as has not had and would not
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect on Ramius, neither Ramius nor any of its Subsidiaries nor any
Fund is a party to any, and there are no pending or, to Ramiuss knowledge,
threatened, legal, administrative, arbitral or other proceedings, claims,
actions or governmental or regulatory investigations of any nature by or
against Ramius or any of its Subsidiaries or any Fund or, to the knowledge of
Ramius, any of its or its Subsidiaries key employees with respect to its
business, or to which any of their assets are subject.
(b) There is no judgment, order,
injunction, decree or regulatory restriction imposed upon Ramius, any of its
Subsidiaries, any Fund, or the assets of Ramius or any of its Subsidiaries or
any Fund (or that, upon consummation of the Transactions, would apply to Cowen
or any of its Subsidiaries).
28
5.10 Taxes
and Tax Returns. Each of Ramius and
its Subsidiaries has (i) duly and timely filed (including all applicable
extensions) all federal income Tax Returns and other material Tax Returns
required to be filed by it (all such Tax Returns being accurate and complete in
all material respects) and (ii) has paid all Taxes due and owing by Ramius
or any of its Subsidiaries (whether or not shown on any Tax Return). Neither Ramius nor any of its Subsidiaries
currently is the beneficiary of any extension of time within which to file any
material Tax Return. None of the federal, state and local income
Tax Returns for periods beginning after January 1, 2005 of Ramius and its
Subsidiaries have been examined by the IRS or other relevant taxing
authority. No written claim has ever
been made by an authority in a jurisdiction where Ramius or any of its
Subsidiaries does not file Tax Returns that Ramius or any of its
Subsidiaries is or may be subject to taxation by that jurisdiction. There are no material Liens for Taxes (other
than Taxes not yet due and payable) upon any of the assets of Ramius or any of
its Subsidiaries. Each of Ramius and its
Subsidiaries have withheld and paid all material Taxes required to have been
withheld and paid in connection with any amounts paid or owing to any employee,
independent contractor, creditor, stockholder, or other third party. Neither Ramius nor any of its Subsidiaries
has received from any foreign, federal, state, or local taxing authority
(including jurisdictions where Ramius or its Subsidiaries have not filed Tax
Returns) any (i) notice indicating an intent to open an audit or other
review, (ii) request for information related to Tax matters, or (iii) notice
of deficiency or proposed adjustment for any amount of Tax proposed, asserted,
or assessed by any taxing authority against Ramius or any of its
Subsidiaries. Neither Ramius nor any of
its Subsidiaries has waived any statute of limitations in respect of material
Taxes or agreed to any extension of time with respect to a material Tax
assessment or deficiency. Neither Ramius
nor any of its Subsidiaries (A) has been a member of an affiliated group
filing a consolidated federal income Tax Return or (B) has any liability
for a material amount of Taxes of any person (other than Ramius and any of its
Subsidiaries) under Regulation Section 1.1502-6 (or any similar provision
of state, local, or foreign law), as a transferee or successor, by contract, or
otherwise. Any material liabilities for
Taxes not yet due and payable, or which are being contested in good faith by
appropriate proceedings, with respect to Ramius and any of its Subsidiaries (A) did
not, as of December 31, 2008, exceed the reserve and provision for Tax
liabilities set forth on the face of the Ramius Financial Statements and (B) do
not exceed that reserve and provision as adjusted for Tax liabilities incurred
in the Ordinary Course of Business through the Closing Date. Neither Ramius nor any of its Subsidiaries
has a permanent establishment outside of the national jurisdiction in which it
was formed. Except as set forth in Section 5.10
of the Ramius Disclosure Schedule, each Subsidiary of Ramius has since the date
of its formation been properly classified for U.S. Federal income tax purposes
as either a partnership or disregarded entity and not as an association taxable
as a corporation, or a publicly traded partnership within the meaning of Section 7704(b) of
the Code that is treated as a corporation for U.S. federal income tax purposes
under Section 7704(a) of the Code, and neither Ramius nor any of its
Subsidiaries has taken a position inconsistent with such treatment with regard
to any Tax. There are no material
disputes pending, or written claims asserted, for Taxes or assessments upon
Ramius or any of its Subsidiaries for which Ramius does not have reserves that
are adequate under GAAP. Neither Ramius
nor any of its Subsidiaries is a party to or is bound by any Tax sharing
agreement or arrangement (other than such an agreement or arrangement
exclusively between or among Ramius and its Subsidiaries). Within the past two (2) years (or
otherwise as part of a plan (or series of related transactions) within the
meaning of Section 355(e) of the Code of which the Transactions are
also a part), neither Ramius nor any
29
of its Subsidiaries has been a distributing
corporation or a controlled corporation in a distribution intended to
qualify under Section 355(a) of the Code. Neither Ramius nor any of its Subsidiaries
has participated in a listed transaction within the meaning of Treasury
Regulation Section 1.6011-4(b)(2) subsequent to such transaction
becoming listed.
5.11 Employee
Matters.
(a) Section 5.11(a) of
the Ramius Disclosure Schedule sets forth a true, complete and correct list of
each material employee benefit plan as defined in Section 3(3) of
ERISA, whether or not subject to ERISA, and each material employment,
consulting, bonus, incentive or deferred compensation, vacation, stock option or
other equity-based, severance, termination, retention, change of control,
profit-sharing, fringe benefit or other similar plan, program, agreement or
commitment, whether written or unwritten, for the benefit of any employee,
former employee, manager or former manager of Ramius or any of its Subsidiaries
entered into, maintained or contributed to by Ramius or any of its Subsidiaries
or to which Ramius or any of its Subsidiaries is obligated to contribute, or
with respect to which Ramius or any of its Subsidiaries has any liability,
direct or indirect, contingent or otherwise (including any liability arising
out of an indemnification, guarantee, hold harmless or similar agreement) or
otherwise providing benefits to any current, former or future employee, officer
or manager of Ramius or any of its Subsidiaries or to any beneficiary or dependent
thereof (such plans, programs, agreements and commitments, herein referred to
as the Ramius Benefit Plans).
(b) With
respect to each Ramius Benefit Plan, Ramius has delivered or made available to
Cowen a true, correct and complete copy of:
(i) each writing constituting a part of such Plan; (ii) the
most recent Annual Report (Form 5500 Series) and accompanying schedule, if
any; (iii) the current summary plan description and any material
modifications thereto, if any (in each case, whether or not required to be
furnished under ERISA); (iv) the most recent annual financial report, if
any; (v) the most recent actuarial report, if any; and (vi) the most
recent determination letter from the IRS, if any.
(c) Each
Ramius Benefit Plan intended to be qualified within the meaning of Section 401(a) of
the Code has received a favorable determination letter from the IRS, or has
pending an application for such determination from the IRS with respect to
those provisions for which the remedial amendment period under Section 401(b) of
the Code has not expired, and, to the knowledge of Ramius, there is not any
reason why any such determination letter should be revoked. Each of the Ramius Benefit Plans has been
operated and administered in accordance with applicable Law, including, but not
limited to, ERISA, the Code and in each case the regulations thereunder.
(d) No
Ramius Benefit Plan provides benefits, including, without limitation, death or
medical benefits (whether or not insured), with respect to current or former employees
or directors of Ramius or any of its Subsidiaries beyond their retirement or
other termination of service, other than (1) coverage mandated by
applicable Law or (2) death benefits or retirement benefits under any employee
pension plan (as such term is defined in Section 3(2) of
ERISA). Except as could not be
reasonably expected to result in a material liability to Ramius or any of its
Subsidiaries, neither Ramius nor any of its Subsidiaries has engaged in a
transaction in connection with which Ramius or any of its Subsidiaries
reasonably could be subject to either a
30
civil penalty assessed pursuant to Section 409
or 502(i) of ERISA or a tax imposed pursuant to Section 4975 or 4976
of the Code. Except as could not be
reasonably expected to result in a material liability to Ramius or any of its
Subsidiaries no Controlled Group Liability has been incurred by Ramius, any of
its Subsidiaries or any of their respective ERISA Affiliates that has not been
satisfied in full, and, to the knowledge of Ramius, no condition exists that
presents a risk to Ramius, any of its Subsidiaries or any of their respective
ERISA Affiliates of incurring any such liability. Except as could not be reasonably expected to
result in a material liability to Ramius or any of its Subsidiaries, all
contributions required to be made to any Ramius Benefit Plan by applicable Law
or by any plan document or other contractual undertaking, and all premiums due
or payable with respect to insurance policies funding any Ramius Benefit Plan,
for any period through the date hereof have been timely made or paid in full
or, to the extent not required to be made or paid on or before the date hereof
have been fully accrued in accordance with generally accepted accounting
principles.
(e) Section 5.11(e) of
the Ramius Disclosure Schedule identifies each Ramius Benefit Plan that is
subject to Title IV or Section 302 of ERISA or Section 412 or 4971 of
the Code (a Ramius Pension Plan).
With respect to each Ramius Pension Plan, the most recent actuarial
report prepared by such plans actuary with respect to such plan in accordance
with FASB No. 87 sets forth accurately the accrued benefit obligations of
such plan, determined using the actuarial methods, factors, and assumptions
contained in such report, and the fair market value of the assets of such plan,
each as of the date set forth in such report, and since the date of such report
there has been no material adverse change in the accrued benefit obligations or
the fair market value of the assets of such plan. Neither Ramius, any of its Subsidiaries nor
any of their respective ERISA Affiliates contributes (or has contributed in the
six years prior to the date hereof) to a multiemployer pension plan (as such
term is defined in Section 3(37) of ERISA) or a plan that has two or more
contributing sponsors at least two of whom are not under common control, within
the meaning of Section 4063 of ERISA.
(f) There
are no pending, threatened or anticipated claims (other than routine claims for
benefits) by, on behalf of or against any of the Ramius Benefit Plans or any
trusts related thereto or fiduciaries thereof which could reasonably be
expected to result in a material liability of Ramius or any of its Subsidiaries.
(g) Neither
the execution or delivery of this Agreement nor the consummation of the
transactions contemplated by this Agreement will, either alone or in
conjunction with any other event, (i) result in any material payment or
benefit becoming due or payable, or required to be provided, to any manager,
member, employee or independent contractor of Ramius or any of its Subsidiaries
or to such individuals in the aggregate, (ii) materially increase the
amount or value of any benefit or compensation otherwise payable or required to
be provided to any such manager, member, employee or independent contractor, (iii) result
in the acceleration of the time of payment, vesting or funding of any such
benefit or compensation, (iv) result in any material limitation on the
right of Ramius or any of its Subsidiaries to amend, merge or, terminate any
Ramius Benefit Plan or related trust or (v) fail to be deductible by
reason of Section 280G of the Code.
(h) All
Ramius Benefit Plans subject to the laws of any jurisdiction outside of the
United States (i) have been maintained in accordance with all applicable
requirements, (ii) if they
31
are intended to qualify for special tax
treatment meet all requirements for such treatment, and (iii) if they are
intended to be funded and/or book-reserved are fully funded and/or book
reserved, as appropriate, based upon reasonable actuarial assumptions.
(i) No
labor organization or group of employees of Ramius or any of its Subsidiaries
has made a pending demand for recognition or certification, and there are no
representation or certification proceedings or petitions seeking a representation
proceeding presently pending or threatened to be brought or filed, with the
National Labor Relations Board or any other labor relations tribunal or
authority. There are no organizing
activities, strikes, work stoppages, slowdowns, lockouts, material arbitrations
or material grievances, or other material labor disputes pending or threatened
against or involving Ramius or any of its Subsidiaries. Except as could not be reasonably expected to
result in a material liability to Ramius or any of its Subsidiaries, each of
Ramius and its Subsidiaries is in compliance in all material respects with all
applicable laws and collective bargaining agreements respecting employment and
employment practices, terms and conditions of employment, wages and hours and
occupational safety and health.
(j) Each
Ramius Benefit Plan that is a nonqualified deferred
compensation plan within the meaning of Section 409A(d)(1) of the Code and any
award thereunder, in each case that is subject to Section 409A of the
Code, has been operated in compliance in all material respects with Section 409A
of the Code since January 1, 2006, based upon a good faith, reasonable
interpretation of (A) Section 409A of the Code and (B)(1) the
proposed and final Treasury Regulations issued thereunder, where applicable,
and (2) Internal Revenue Service Notice 2005-1, all subsequent Internal
Revenue Service Notices, and other interim guidance on Section 409A of the
Code, where applicable.
5.12 Certain
Contracts. (a) Section 5.12(a) of
the Ramius Disclosure Schedule sets forth all of the following Contracts in
existence to which Ramius or any of its Subsidiaries is a party or by which it
is bound as of the date hereof (collectively, the Ramius Contracts):
(i) Contracts
for the sale of assets or rights of Ramius or its Subsidiaries other than in
the Ordinary Course of Business or for the grant to any Person of any
preferential rights to purchase any of its assets;
(ii) Contracts
for joint-ventures, strategic alliances or partnerships or other similar entities;
(iii) Any
non-competition, non-solicitation or exclusive dealing agreement, or any other
agreement or obligation that purports to limit or restrict in any respect (A) the
ability of Ramius or its Subsidiaries or other Affiliates or, following the
Closing, New Parent or its Affiliates, to solicit customers or employees or (B) the
manner in which, or the localities in which, all or any portion of the business
of Ramius or its Subsidiaries or, following the Closing, New Parent or its
Affiliates, conducts business;
(iv) Contracts
relating to the acquisition by Ramius or its Subsidiaries of any operating
business or the capital stock or assets of any other Person;
32
(v) Contracts
or instruments relating to the incurrence, assumption or guarantee of any
indebtedness or imposing a Lien on any of its assets;
(vi) Contracts
where Ramius or any of its Subsidiaries is the lessee or sublessee of, or is
granted a similar occupancy interest in, any real property or pursuant to which
Ramius or any of its Subsidiaries grant to any Person a leasehold or
subleasehold, or similar occupancy interest, in any real property;
(vii) Contracts
for the provision of goods or services or License Agreements, in each case
involving fees, royalties, payments or other consideration in excess of
$500,000 annually based on 2008 expenditures;
(viii) Management
Agreements that involve payments in excess of $500,000 annually;
(ix) Contracts
that grant any right of first refusal or right of first offer or similar right
or that purport to limit the ability of Ramius or any of its Subsidiaries to
own, operate, sell, transfer, pledge or otherwise dispose of any assets or
business;
(x) Contracts
the subject matter of which pertains to the solicitation or referral of Limited
Partners of the Funds or customers and Clients of Ramius, its Subsidiaries or
any Fund;
(xi) Contracts
that obligate Ramius or any of its Subsidiaries to conduct business on an
exclusive or preferential basis with any third party, in any case of the
preceding which is material;
(xii) Contracts
that obligate Ramius or any of its Subsidiaries to cap fees, share fees or
other payments, share expenses, waive fees or to reimburse or assume any or all
fees or expenses thereunder that would be material to Ramius or its
Subsidiaries;
(xiii) Contracts
requiring Ramius or any of its Subsidiaries (A) to co-invest with any
other Person, (B) to provide seed capital or similar investment, or (C) to
invest in any investment product, in each case in an amount in excess of
$1,000,000 individually or $5,000,000 in the aggregate;
(xiv) Contracts
(or groups of related Contracts) that involve the expenditure of more than
$500,000 annually based on 2008 expenditures;
(xv) soft
dollar arrangements that involve the expenditure of more than $150,000
annually or $300,000 in the aggregate;
(xvi) Contracts
pursuant to which Ramius or any of its Subsidiaries (or any of their
predecessor companies) has any ongoing indemnification obligations, retained
liabilities or earnouts, in each case, with respect to the sale of any assets,
rights or businesses;
(xvii) Third
Party Management Agreements; and
33
(xviii) Contracts
that grant any Person other than Ramius or its Subsidiaries any interest or
right to receive any fees, profits or losses (whether current or deferred) of,
or any other economic interest (including any carried interest) in, any of
Ramiuss Subsidiaries.
(b) (i) Each
Ramius Contract is valid and binding on Ramius or its applicable Subsidiary
and, to the knowledge of Ramius, the other party thereto, enforceable against
it and the other party thereto in accordance with its terms (subject to the
Bankruptcy and Equity Exception), and is in full force and effect, and has not
been modified or amended except pursuant to an amendment set forth on Section 5.12(a) of
the Ramius Disclosure Schedule, (ii) Ramius and each of its Subsidiaries
and/or Fund, as applicable, and, to Ramiuss knowledge, each other party
thereto has duly performed all obligations required to be performed by it to
date under each Ramius Contract and (iii) no event or condition exists
that constitutes or, after notice or lapse of time or both, will constitute, a
material breach, violation or default on the part of Ramius or any of its
Subsidiaries or any Fund or, to Ramiuss knowledge, any other party thereto
under any such Ramius Contract. There
are no material disputes pending or, to Ramiuss knowledge, threatened, and no
material amounts due or owing remain unpaid, with respect to any Ramius
Contract.
5.13 Property. As of the date hereof, none of Ramius or any
of its Subsidiaries owns, and has never owned, any real property. Any real property leased or subleased or in
which another similar occupancy interest is held by Ramius or any of its
Subsidiaries, as tenant, subtenant or occupant, or which Ramius or any of its
Subsidiaries has granted, as landlord or sublandlord, a leasehold, subleasehold
or other similar interest, is listed in Section 5.12(a) of the
Ramius Disclosure Schedule, and true and correct copies of all leases,
subleases and other such agreements (including amendments, modifications and
supplements thereto) have been provided to Cowen, and Ramius and its Subsidiaries,
as applicable, have good and valid leasehold title to their respective leased
and subleased real property, free and clear of any Liens (other than Permitted
Liens).
5.14 Intellectual
Property.
(a) Section 5.14(a) of
the Ramius Disclosure Schedule contains a list of all Ramius IP. Except as would not reasonably be expected to
have a Material Adverse Effect on Ramius, Ramius and its Subsidiaries
collectively own all right, title and interest in, or have the valid right to
use, all of the Ramius IP, free and clear of any Liens, and there are no
obligations to, covenants to or restrictions from third parties affecting
Ramiuss or its applicable Subsidiarys or Funds use, enforcement, transfer or
licensing of the Owned Ramius IP.
(b) The
Owned Ramius IP and Licensed Ramius IP constitute all the Intellectual Property
necessary and sufficient to conduct the businesses of Ramius, its Subsidiaries
and the Funds as they are currently conducted, as they have been conducted
since January 1, 2008.
(c) The
Owned Ramius IP and, to the knowledge of Ramius, Licensed Ramius IP, are valid,
subsisting and enforceable.
(d) Neither
Ramius nor any of its Subsidiaries nor any Fund has infringed, misappropriated
or otherwise violated any Intellectual Property of any third party.
34
(e) No
Owned Ramius IP or Licensed Ramius IP is being used or enforced in a manner
that would result in the abandonment, cancellation or unenforceability of such
Intellectual Property. To the knowledge
of Ramius, no third party has infringed, misappropriated or otherwise violated
any Owned Ramius IP.
5.15 Insurance. Ramius and its Subsidiaries maintain (or
Ramius maintains on behalf of its Subsidiaries) such workers compensation,
comprehensive property and casualty, liability, errors and omissions, directors
and officers, fidelity and other insurance sufficient to operate their
business as currently conducted as they may be required to maintain under
applicable law. Ramius and its Subsidiaries
have complied in all material respects with the terms and provisions of such
policies and bonds.
5.16 Compliance
with Laws; Permits.
(a) Each
of Ramius and its Subsidiaries and the Funds has been since January 1,
2006 and is in compliance in all material respects with all Laws of any
Governmental Entity and the rules and regulations of any SRO that are
applicable to its respective business, operations, or assets. Except as set forth in Section 5.16(a) of
the Ramius Disclosure Schedule, no Regulatory Agency or other Governmental
Entity has initiated since January 1, 2006 and on or prior to the date of
this Agreement or has pending as of the date of this Agreement any proceeding,
enforcement action or, to the knowledge of Ramius, investigation into the
business, disclosures or operations of Ramius, any of its Subsidiaries or any
Fund. Except for ordinary and usual
examinations conducted by a Regulatory Agency or other Governmental Entity in
the Ordinary Course of Business of Ramius and its Subsidiaries that have not
resulted and are not reasonably expected to result in a materially adverse
finding or claim against Ramius or any of its Subsidiaries, no Regulatory
Agency or other Governmental Entity has initiated since the date of this
Agreement any proceeding, enforcement action or, to the knowledge of Ramius,
investigation into the business, disclosures or operations of Ramius or any of
its Subsidiaries. Since January 1,
2006, no Regulatory Agency or other Governmental Entity has resolved any
proceeding, enforcement action or, to the knowledge of Ramius, investigation
into the business, disclosures or operations of Ramius, any of its Subsidiaries
or any Fund. There is no unresolved or,
to Ramiuss knowledge, threatened, criticism, comment or exception by any
Regulatory Agency or other Governmental Entity with respect to any report or
statement relating to any examinations or inspections of Ramius, any of its
Subsidiaries or any Fund. Since January 1,
2006 there has been no formal or informal inquiries by, or disagreements or
disputes with, any Regulatory Agency or other Governmental Entity with respect
to the business, operations, policies or procedures of Ramius, any of its
Subsidiaries or any Fund (other than normal examinations conducted by a Regulatory
Agency or other Governmental Entity in Ramiuss Ordinary Course of Business).
(b) Neither
Ramius nor any of its Subsidiaries nor any Fund is subject to any
cease-and-desist or other order or formal or informal enforcement action issued
by, or is a party to any written agreement, consent agreement or memorandum of
understanding with, or is a party to any commitment letter or similar
undertaking to, or is subject to any order or directive by, or has been since January 1,
2006 a recipient of any supervisory letter from, or has been ordered to pay any
civil money penalty by, or since January 1, 2006 has adopted any policies,
procedures or board resolutions at the request or suggestion of, any Regulatory
Agency or other Governmental
35
Entity that currently restricts or affects in
any material respect the conduct of its business or that in any material manner
relates to its risk management or compliance policies, its internal controls,
its management or its business, other than those of general application that
apply to similarly situated companies or their Subsidiaries (each item in this
sentence, a Ramius Regulatory Agreement), nor has Ramius, any of its
Subsidiaries nor any Fund been advised since January 1, 2006 by any
Regulatory Agency or other Governmental Entity that it is considering issuing,
initiating, ordering or requesting any such Ramius Regulatory Agreement.
(c) Section 5.16(c) of
the Ramius Disclosure Schedule contains a list of all Permits which are
required for the operation of the business of Ramius, its Subsidiaries as
presently conducted, other than those the failure of which to possess is not
material to the operation of such business.
Each of Ramius and its Subsidiaries currently has all Permits which are
required for the operation of its business as presently conducted and as
presently intended to be conducted, other than those the failure of which to
possess is not material to the operation of such business. None of Ramius or its Subsidiaries is in
default or violation, and no event has occurred which, with notice or the lapse
of time or both, would constitute a default or a violation, in any material
respect of any term, condition or provision of any material Permit to which it
is a party, to which its business is subject or by which its properties or
assets are bound, and to the knowledge of Ramius, there are no facts or
circumstances which could reasonably be expected to form the basis for any such
default or violation. Each employee of
Ramius or its Subsidiaries who is required to be registered or licensed as a
registered representative, investment advisor representative, sales person or
an equivalent person with any Governmental Entity or SRO is fully registered or
licensed as such and such registration is in full force and effect.
(d) With
respect to Ramius and each Subsidiary that serves in a capacity described in Section 9(a) or
9(b) of the Investment Company Act, (i) such person is not (taking into account any applicable exemption) ineligible under such Section 9(a) or 9(b) to serve in such capacity, (ii) no affiliated
person (as defined in Section 2(a)(3) of the Investment Company Act)
of such person is (taking into account any applicable exemption) ineligible
under Section 9(b) to serve as an affiliated person of such person
and (iii) there is no proceeding or investigation pending and served on
Ramius or any of its Subsidiaries or, to Ramiuss knowledge, pending and not so
served or threatened by any Governmental Entity, which would result in (A) the
ineligibility of such person to serve in such capacity under Section 9(a) or
9(b) or (B) the ineligibility under such Section 9(b) of
such affiliated person to serve as an affiliated person of such person.
(e) With
respect to Ramius and each Subsidiary that acts as an investment adviser within
the meaning of the Advisers Act, (i) such person is not (taking into
account any applicable exemption) ineligible pursuant to Section 203(e) of
the Advisers Act to act as an investment adviser, (ii) no person
associated (as defined in Section 202(a)(17) of the Advisers Act) with
such person is (taking into account any applicable exemption) ineligible under Section 203(f) of
the Advisers Act to serve as a person associated with an investment adviser, (iii) there
is no proceeding or investigation pending and served on Ramius or any of its
Subsidiaries or, to Ramiuss knowledge, pending and not so served or threatened
by any Governmental Entity, which would result in (A) the ineligibility
under such Section 203(e) of such person to act as an investment
adviser or (B) the ineligibility under such Section 203(f) of
such person associated with such person to serve as a person associated
with an investment adviser, (iv) each such entity has adopted and
implemented policies and procedures under Rule 206(4)-7 under the
36
Advisers Act and received the certification
of its chief compliance officer to this effect and (v) each such entity has
complied with all record keeping requirements under applicable Laws including Rule 204-2
under the Advisers Act (including with respect to any records in any written or
electronic format).
(f) With
respect to Ramius and each Subsidiary that acts as a broker or dealer within
the meaning of the Exchange Act, (i) such person is not (taking into
account any applicable exemption) ineligible pursuant to Section 15(b)(4) of
the Exchange Act to act as a broker or dealer, (ii) no person associated
(as defined in Section 3(a)(18) of the Exchange Act) with such person is
(taking into account any applicable exemption) ineligible under Section 15(b)(6) of
the Exchange Act to serve as a person associated with a broker or dealer and (iii) there
is no proceeding or investigation pending and served on Ramius or any
Subsidiary or, to Ramiuss knowledge, pending and not so served or threatened
by any Governmental Entity, which would result in (A) the ineligibility
under such Section 15(b)(4) of such person to act as a broker or
dealer or (B) the ineligibility under such Section 15(b)(6) of
such person associated with such person to serve as a person associated
with a broker or dealer.
(g) Except
as set forth on Section 5.16(g) of the Ramius Disclosure
Schedule, none of Ramius or it Subsidiaries are (i) a commodity pool
operator, futures commission merchant, commodity trading advisor, bank or real
estate broker within the meaning of any applicable Law; (ii) required to
be registered, licensed or qualified as a commodity pool operator, futures
commission merchant, commodity trading advisor, bank or real estate broker
under any applicable Law or (iii) subject to any liability or disability
by reason of any failure to be so registered, licensed or qualified if required
by applicable Law. Neither Ramius nor
any of its Subsidiaries has received written notice of any proceeding
concerning any failure to obtain any commodity pool operator, futures
commission merchant, commodity trading advisor, bank or real estate broker
registration, license or qualification.
(h) Except
as set forth on Section 5.16(h) of the Ramius Disclosure
Schedule, neither Ramius nor any of its Subsidiaries acts as an investment
adviser, sub-advisor, general partner, managing member, manager or sponsor to
any pooled investment vehicle which is registered or qualified for offer and
sale to members of the general public with any Governmental Entity.
(i) Each
of Ramius, its Subsidiaries and the Funds has complied in all material
respects, to the extent such Laws are applicable to them, with (i) U.S.
anti-money laundering and anti-terrorism financing laws and the regulations
administered by the U.S. Treasury Departments Office of Foreign Assets
Control, and has adequate measures in place to comply with those laws, (ii) the Foreign Corrupt
Practices Act, (iii) the Trading with the Enemy Act and (iv) all
comparable provisions of non-U.S. Laws.
(j) Ramius
and its Subsidiaries, to the extent each is a financial institution (as
defined in the GBA), have complied, to the extent required, with the GBA and
the Privacy Rules, and each such financial institution has provided the privacy
notices, in the form and to the extent required by the GBA and the Privacy
Rules, and has taken such other actions as may be required thereunder.
37
5.17 Investment
Agreements and the Funds.
(a) Ramius or its Subsidiaries has performed in all material respects all
of the obligations thereof under each Management Agreement and each Fund Agreement
in accordance with its terms and all applicable Laws.
(b) Section 5.17(b) of the Ramius Disclosure Schedule sets
forth: (i) a true, complete and
correct schedule setting forth the calculation of the management and
performance fees for each Fund
as of the Base Date; (ii) the fees payable to Ramius or its applicable
Subsidiary with respect to each Fund under the applicable Management Agreement and the amount of any
related fee (including relating to any revenue-sharing arrangement) paid by
Ramius or its applicable Subsidiary to any Person other than Ramius or its
applicable Subsidiary as of the Base Date and as of March 31, 2009; (iii) as
to each Fund, as of the Base Date and the date hereof, the terms of any fee
waivers, rebates, expense reimbursement (or assumption) arrangements,
unreimbursed payments being made by Ramius or its Subsidiaries to brokers,
dealers or other Persons with respect to the distribution of shares of a
Private Fund; and (iv) as to each Fund, as of the Base Date and as of the
date hereof, the rate and method of computation of any subadvisory fees payable
to any Person by Ramius or its Subsidiaries with respect to such Private Fund.
(c) Each Fund is duly organized, validly existing and in good standing
under the laws of the jurisdiction of its organization and has the requisite
corporate, limited company, trust or partnership power and authority to own its
properties and to carry on its business as it is now conducted, and is
qualified to do business in each jurisdiction where it is required to do so
under applicable Law, except where the failure to have such power, authority or
qualification is not material to its business.
Except as set forth on Section 5.17(c) of the Ramius
Disclosure Schedule, none of the Private Funds has been or is required to be
registered with the SEC or any other Governmental Entity as an investment
company under the Investment Company Act or any similar Law. Section 5.17(c) of the
Ramius Disclosure Schedule sets forth (i) true, complete and correct descriptions
of any side letters or similar understandings relating to Fund Agreements, (ii) a
true, complete and correct list of Limited Partners entitled to most favored
nation status and descriptions of such arrangements and (iii) a true,
complete and correct list of any Limited Partners that receive unusual services
and descriptions of such services; provided, however, that Section 5.17(e) of
the Ramius Disclosure Schedule need not set forth any letter or similar
understanding that does anything else other than reduce the management fees
paid to Ramius or its applicable Subsidiary.
(d) True,
correct and complete copies of the offering documents, subscription agreements,
administrative services agreements, distribution, solicitation or placement
agency agreements and solicitation agreements, as applicable, or any similar
written agreements, including all side letters or other understandings
relating to Fund Agreements, in any case pertaining to the Funds have been made
available to Cowen. Such offering
documents did not, at any time such offering documents were made available to
investors or prospective investors in the Funds, contain any untrue statement
of a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
(e) Except
as set forth of Section 5.17(e) of the Ramius Disclosure
Schedule, Ramius does not serve as a fiduciary with respect to plan assets
of any employee benefit plan subject to Title I of ERISA (other than plans
maintained for employees of Ramius and its Subsidiaries);
38
provided, that to the extent Ramius does act
as a fiduciary with respect to plan assets of any employee benefit plan
subject to Title I of ERISA (other than plans maintained for employees of
Ramius and its subsidiaries), Ramius has complied in all material respects with
the requirements of Title I of ERISA and Section 4975 of the Code.
(f) True,
correct and complete copies of the unaudited financial statements, and where
audited financial statements are available for any Fund, such audited financial
statements, of each of the Funds for its most recent fiscal year ended on or
prior to December 31, 2008 have been made available to Cowen. Each of such financial statements presents
fairly, in all material respects, the consolidated financial position of such
Fund in accordance with GAAP applied on a consistent basis (except as otherwise
noted therein) at the respective date of such financial statements.
(g) Ramius has maintained the soft dollar and brokerage allocation
policies set forth in Section 5.17(g) of the Ramius Disclosure
Schedule at the times set forth therein with respect to the allocation of trade
execution on behalf of accounts managed by Ramius or its Subsidiaries. Ramiuss and its Subsidiaries receipt of all
soft dollar brokerage and research services since January 1, 2006,
qualifies for the safe harbor afforded by Section 28(e) of the
Exchange Act and Ramius and its Subsidiaries have complied with all related
disclosure rules in all material respects.
To the knowledge of Ramius, Ramius and its Subsidiaries have satisfied
in all material respects its duty of best execution (as such term is
understood under the Advisers Act) for all Funds for whom it exercises trading
discretion since January 1, 2006.
(h) No
consents or approvals are required under (i) applicable Law (including,
for the absence of doubt, the Advisers Act), or (ii) any Investment
Advisory Agreement, from any Fund Board, any Limited Partners of any Fund or
any other applicable third-parties in order to (A) avoid triggering a
withdrawal right of any Limited Partner pursuant to the terms of any Fund
Agreement or any side letters to any Fund Agreement; and (B) consummate
the transactions contemplated by this Agreement so that after the Closing Date,
Ramius or its applicable Subsidiary may continue its applicable management,
advisory or sub-advisory relationships on terms that are no less favorable to
such Ramius entity than the terms of existing relationships.
5.18 Risk
Management Instruments. All
Derivative Transactions, whether entered into for the account of Ramius or any
of its Subsidiaries, were entered into in the Ordinary Course of Business and
in accordance with applicable laws, rules, regulations and policies of any
Regulatory Agency and in accordance with the investment, securities,
commodities, risk management and other policies, practices and procedures
employed by Ramius and its Subsidiaries, and with counterparties believed at
the time to be financially responsible and able to understand (either alone or
in consultation with their advisers) and to bear the risks of such Derivative
Transactions. All of such Derivative
Transactions are valid and binding obligations of Ramius or one of its
Subsidiaries enforceable against it in accordance with their terms (subject to
the Bankruptcy and Equity Exception), and are in full force and effect. Ramius and its Subsidiaries and, to Ramiuss
knowledge, all other parties thereto have duly performed their obligations
under the Derivative Transactions to the extent that such obligations to
perform have accrued and, to Ramiuss knowledge, there are no breaches,
violations or defaults or allegations or assertions of such by any party
thereunder.
39
5.19 Interested
Party Transactions. Except as set
forth on Section 5.19 of the Ramius Disclosure Schedule, none of
C4S & Co., LLC or its managing members (i) owns any direct or
indirect interest of any kind in, or controls or is a director or managing member
of any Person which is a supplier, advisory Client, landlord, tenant, creditor
or debtor of Ramius or its Subsidiaries or (b) is a participant in any
transaction to which Ramius or its Subsidiaries is a party or (ii) is a
party to any Contract with Ramius, in each case other than this Agreement and
the agreements contemplated in connection herewith. Except as set forth on Section 5.19
of the Ramius Disclosure Schedule, any such contracts are on commercially
reasonable terms no more favorable to such director or managing member than
what any third party negotiating on an arms-length basis would expect.
5.20 Reorganization. As of the date of this Agreement, Ramius is
not aware of any fact or circumstance that could reasonably be expected to
prevent the Cowen Merger from qualifying as a reorganization within the
meaning of Section 368(a) of the Code.
5.21 Ramius
Information. The information
relating to Ramius and its Subsidiaries and any Fund that is provided by Ramius
or its representatives for inclusion in the Proxy Statement and the Form S-4,
or in any application, notification or other document filed with any other
Regulatory Agency or other Governmental Entity in connection with the
transactions contemplated by this Agreement, will not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements therein, in light of the circumstances in which they are made,
not misleading and will comply in all material respects with the provisions of
the Exchange Act and the rules and regulations thereunder; provided
that Ramius makes no representations or warranties as it relates to any
information provided by Cowen or its representatives to Ramius or its
representatives and contained in the Form S-4 or any other filings made
with any other Regulatory Agency or other Governmental Entity in connection
with the transactions contemplated by this Agreement.
5.22 No
Other Representations and Warranties.
Except for the representations and warranties contained in this Article V,
none of Ramius, any Subsidiary of Ramius, or any other Person on behalf of
Ramius makes any other express or implied representation or warranty in
connection with the transactions contemplated by this Agreement. Without limiting the generality of the
foregoing, no representations or warranties are made with respect to any
projections, forecasts, estimates, budgets or information as to prospects with
respect to Ramius and its Subsidiaries that may have been made available to
Cowen or any of its representatives, except as expressly set forth in this Article V
or in any certificates to be delivered pursuant to the terms set forth herein.
ARTICLE VI
COVENANTS RELATING TO CONDUCT OF BUSINESS
6.1 Conduct
of Businesses Prior to the Effective Time. Except as expressly required by this Agreement
or with the prior written consent of the other party, during the period from
the date of this Agreement to the Effective Time, each of Cowen and Ramius
shall, and shall cause each of its respective Subsidiaries to, (a) conduct
its business in the ordinary and usual course in all material respects, (b) use
reasonable best efforts to maintain and preserve intact its business
40
organization and advantageous business
relationships and retain the services of its key officers and key employees and
(c) take no action that would reasonably be expected to adversely affect
or materially delay the ability of Cowen, Ramius, New Parent, Merger Sub or
Exchange Sub to obtain any necessary approvals of any Regulatory Agency or
other Governmental Entity or other Person required for the transactions
contemplated hereby or to perform its covenants and agreements under this
Agreement or to consummate the transactions contemplated hereby.
6.2 Cowen
and Ramius Forbearances. During the
period from the date of this Agreement to the Effective Time, except as set
forth in Section 6.2 of the Cowen Disclosure Schedule or Section 6.2
of the Ramius Disclosure Schedule, as applicable, or except as expressly
required by this Agreement, Cowen and Ramius shall not, and shall not permit
any of their Subsidiaries to, without the prior written consent of the other
party:
(a) other
than in the Ordinary Course of Business pursuant to the agreements in effect on
the date of this Agreement and in any event in an amount not to exceed $500,000
after the date hereof in the aggregate, incur any indebtedness (other than any
intercompany indebtedness or accommodations) for borrowed money, or assume, guarantee,
endorse or otherwise as an accommodation become responsible for the obligations
of any other Person;
(b) (i) except with respect to
Ramius, adjust, split, combine or reclassify any of its capital stock or
membership interests, as applicable;
(ii) except
for distributions by Ramius that are required pursuant to Section 4.01 of
the Ramius LLC Agreement (which distributions shall be calculated without
giving effect to the transactions contemplated by this Agreement) or pursuant
to any grant agreement evidencing an award under the Ramius LLC Employee
Ownership Program (the REOP) or the Ramius Fund of Funds Group LLC
Participation Program (the RAPP), make, declare or pay any dividend,
or make any other distribution on (other than dividends or distributions made
by a Subsidiary to its parent or otherwise required to be made by a
Subsidiary), or directly or indirectly redeem, purchase or otherwise acquire,
any shares of its capital stock or membership interests, as applicable, or any
securities or obligations convertible (whether currently convertible or
convertible only after the passage of time or the occurrence of certain events)
into or exchangeable for or representing the right to purchase or otherwise
receive any shares of its capital stock or membership interests, as applicable;
(iii) except
with respect to Ramius, grant any stock options, stock appreciation rights,
restricted shares, restricted stock units, deferred equity units, awards based
on the value of its capital stock or membership interests, as applicable, or
other equity-based award with respect to shares of capital stock or membership
interests, as applicable, under any stock plan or otherwise, or grant any
Person any right to acquire any shares of its capital stock or membership interests
or other equity interests, as applicable, provided that, notwithstanding the
foregoing, in no event shall Ramius or its Subsidiaries grant, award or amend
or commit to grant award or amend any awards under the Ramius LLC Phantom
Interest Program;
(iv) except
with respect to Ramius, issue any additional shares of capital stock,
membership interests, Voting Debt or other securities, except pursuant to the
exercise of Cowen
41
Stock Options or the settlement or vesting of
Cowen Restricted Shares or Cowen RSUs that are outstanding as of the date of
this Agreement or issuances by a Subsidiary to its parent company;
(c) except
as required under applicable Law or the terms of any Cowen Benefit Plan or
Ramius Benefit Plan that is described on the Cowen Disclosure Schedule or
Ramius Disclosure Schedule, as applicable, existing as of the date hereof, (i) materially
increase the compensation or benefits of any of the current or former members,
managers, directors, officers or employees (collectively, Employees)
of Cowen or its Subsidiaries or Ramius or its Subsidiaries, as applicable, (ii) pay
any amounts to Employees not required by any current plan or agreement (other
than base salary in the Ordinary Course of Business), (iii) become a party
to, establish, amend, commence participation in, make any adjustment, terminate
or commit itself to the adoption of any equity or equity-based compensation
plan, compensation (including any employee co-investment fund), severance,
pension, retirement, profit-sharing, welfare benefit, or other employee benefit
plan or agreement or employment agreement with or for the benefit of any
Employee (or newly hired employees), (iv) make any guarantees of
compensation or bonus to any Employee (or newly hired employees), or (v) accelerate
the vesting of any equity or equity-based compensation or other incentive
compensation under any Cowen Benefit Plan or Ramius Benefit Plan, as
applicable;
(d) sell,
transfer, pledge, lease, license, mortgage, encumber or otherwise dispose of
any material amount of its properties or assets (including pursuant to
securitizations) to any Person other than a Subsidiary (or by a Subsidiary to
its parent company) or cancel, release or assign any material amount of
indebtedness (other than intercompany indebtedness) to any such person or any
material claims held by any such person, in each case other than in the
Ordinary Course of Business or pursuant to disclosed contracts in force at the
date of this Agreement;
(e) enter
into any new line of business or change in any material respect its business or
operations, including any material change in the types, nature or composition
of its services;
(f) transfer
ownership, or grant any license or other material rights, to any person or
entity of or in respect of any material Cowen IP or material Ramius IP, as
applicable, other than grants of non-exclusive licenses pursuant to License
Agreements entered into in the Ordinary Course of Business;
(g) other
than pursuant to Contracts disclosed on the Cowen Disclosure Schedule or the
Ramius Disclosure Schedule, as applicable, make any material investment either
by purchase of stock or securities, contributions to capital, property
transfers, or purchase of any property or assets of any other Person, including
any investment in one or a series of transactions of more than $1,000,000 in
the aggregate;
(h) amend,
breach, terminate or allow to lapse any material Permit other than (i) amendments
required by applicable Law, or (ii) in the Ordinary Course of Business;
(i) restructure
or change its investment securities portfolio, its derivatives portfolio or its
interest rate exposure, through purchases, sales or otherwise, or the manner in
which the portfolio is classified or reported, in any material respect;
42
(j) except
with respect to Ramius and its Subsidiaries, form or make any investment in any
pooled investment vehicle (including each portfolio or series thereof, if any),
other than with respect to CHRP;
(k) take
any action, or knowingly fail to take any action, which action or failure to
act could be reasonably likely to prevent the Cowen Merger from qualifying as a
reorganization within the meaning of Section 368(a) of the Code;
(l) except
with respect to Ramius, amend its charter, by-laws, limited liability company
agreement or other constitutive documents or otherwise take any action to
exempt any Person (other than it or its Subsidiaries) or any action taken by
any Person or entity from any Takeover Statute or similarly restrictive
provisions of its organizational documents or terminate, amend or waive any
provisions of any confidentiality or standstill agreements in place with any
third parties;
(m) (i) amend
or otherwise modify, except in the Ordinary Course of Business, or knowingly
violate, in each case in any material respect, the terms of, any Cowen Contract
or Ramius Contract, as applicable, or (ii) create, renew or amend any
Contract or, except as may be required by applicable Law, other binding
obligation of it or its Subsidiaries containing (A) any material
restriction on the ability of it or its Subsidiaries to conduct its business as
it is presently being conducted or (B) any material restriction on the ability
of it or its Affiliates to engage in any type of activity or business;
(n) make
any capital expenditures in excess of $250,000;
(o) acquire
any business or Person that would be material to the operation of its business,
taken as a whole, by merger or consolidation, purchase of substantial assets or
equity interests, or by any other manner, in a single transaction or series of
related transactions, or enter into any Contract, letter of intent or similar
arrangement with respect to the foregoing (whether or not enforceable) with
respect to the foregoing;
(p) enter
into, materially amend or become subject to any joint venture, partnership,
strategic alliance, stockholders agreement, co-marketing, co-promotion, joint
development or similar arrangement, except in the Ordinary Course of Business;
(q) commence
or settle any material claim, action or proceeding;
(r) implement
or adopt any material change in its Tax financial accounting principles,
practices or methods, other than as may be required by applicable Law, GAAP or
regulatory guidelines;
(s) file
or amend any material Tax Return, make or change any material Tax election, or
settle or compromise any material Tax liability or Tax contest;
(t) (i) sell,
assign, transfer, lease or otherwise dispose of, or grant any interests in, any
material real property, or exercise or fail to exercise any renewal option
under any material lease or other similar occupancy agreement for real property
or (ii) acquire any interest in any additional real property;
43
(u) make
any change in any method of accounting or accounting practice except for any
such change required by reason of a concurrent change in GAAP or Law; or
(v) agree
to take, make any commitment to take, or adopt any resolutions of its board of
directors or managing member, as applicable, in support of, any of the actions
prohibited by this Section 6.2.
ARTICLE VII
ADDITIONAL AGREEMENTS
7.1 Regulatory
Matters. (a) Cowen shall
promptly prepare and file with the SEC the Form S-4, in which the Proxy
Statement will be included as a prospectus.
Cowen shall use its reasonable best efforts to have the Form S-4
declared effective under the Securities Act as promptly as practicable after
such filing, and Cowen shall thereafter mail or deliver the Proxy Statement to
its stockholders. Ramius shall furnish
all information concerning it, its Subsidiaries and the Funds (including,
without limitation, audited and unaudited financial statements and other
financial and business information regarding Ramius and its Subsidiaries), as
Cowen may reasonably request in connection with the preparation of the Proxy
Statement and Form S-4, except as may be prohibited by Law.
(b) The
parties shall cooperate with each other and use their respective reasonable
best efforts to promptly prepare and file all necessary documentation, to
effect all applications, notices, petitions and filings, to obtain as promptly
as practicable all permits, consents, approvals, clearances and authorizations
of all third parties and Governmental Entities that are necessary or advisable
to consummate the transactions contemplated by this Agreement (including the
Transactions), including, without limitation, the Cowen Requisite Regulatory
Approvals and the Ramius Requisite Regulatory Approvals, and to comply with the
terms and conditions of all such permits, consents, approvals, clearances and
authorizations of all such third parties or Governmental Entities. Cowen and Ramius and their respective counsel
shall (i) have the right to review in advance, and, to the extent
practicable, each will consult the other on, in each case subject to applicable
laws relating to the confidentiality of information, all the information
relating to Cowen or Ramius, as the case may be, and any of their respective
Subsidiaries or Funds, that appear in any filing made with, or written
materials submitted to, any third party or any Governmental Entity in
connection with the transactions contemplated by this Agreement, (ii) promptly
inform each other of any oral or written communication (or other correspondence
or memoranda) received from, or given to, any Governmental Entity, and (iii) furnish
each other with copies of all correspondence, filings and written
communications between them or their Subsidiaries or Affiliates, on the one
hand, and any Governmental Entity or its respective staff, on the other hand,
with respect to this Agreement or the Transactions. Except as expressly prohibited by an
Governmental Entity, Ramius and Cowen shall provide the other party and its
counsel with advance notice of and the opportunity to participate in any
discussion, telephone call or meeting with any Governmental Entity in respect
of any filing, investigation or other inquiry in connection with this Agreement
or the Transactions, and to participate in the preparation for such discussion,
telephone call or meeting. Ramius and
Cowen may, as each deems advisable and necessary, reasonably designate any competitively
sensitive material provided to the other under this Section 7.1(b) as
Outside Counsel Only Material.
44
Such materials and the information contained
therein shall be given only to the outside legal counsel of the recipient and
will not be disclosed by such outside counsel to employees, officers or
directors of the recipient unless express permission is obtained in advance
from the disclosing party or its legal counsel.
In exercising the foregoing rights, each of the parties shall act
reasonably and as promptly as practicable.
The parties shall consult with each other with respect to the obtaining
of all permits, consents, approvals, clearances and authorizations of all third
parties and Governmental Entities necessary or advisable to consummate the
transactions contemplated by this Agreement and each party will keep the other
apprised of the status of matters relating to completion of the transactions
contemplated by this Agreement.
(c) Each
of Ramius and Cowen shall, upon request, furnish to the other all information
concerning itself, its Subsidiaries, the Funds, directors, officers, managers,
members and stockholders and such other matters as may be reasonably necessary
or advisable in connection with the Proxy Statement, the Form S-4 or any
other statement, filing, notice or application made by or on behalf of Cowen,
Ramius or any of their respective Subsidiaries to any Governmental Entity in
connection with the Transactions and the other transactions contemplated by
this Agreement.
(d) Each
of Ramius and Cowen shall promptly advise the other upon receiving any
communication from any Governmental Entity the consent, approval or clearance
of which is required for consummation of the transactions contemplated by this
Agreement that causes such party to believe that there is a reasonable
likelihood that any Ramius Requisite Regulatory Approval or Cowen Requisite
Regulatory Approval, respectively, will not be obtained or that the receipt of
any such consent, approval or clearance may be materially delayed.
7.2 Access
to Information. (a) Upon
reasonable notice and subject to applicable Laws relating to the
confidentiality of information, each of Cowen and Ramius shall, and shall cause
each of its Subsidiaries to, afford to the officers, employees, accountants,
counsel, advisors, agents and other representatives of the other party,
reasonable access, during normal business hours during the period prior to the
Effective Time, to all its properties, books, contracts, commitments, records
and personnel, and, during such period, such party shall, and shall cause its
Subsidiaries to, make available to the other party all other information
concerning its business, properties and personnel as the other party may
reasonably request. Neither Cowen nor
Ramius, nor any of their Subsidiaries, shall be required to provide access to
or to disclose information where such access or disclosure would jeopardize the
attorney-client privilege of such party or its Subsidiaries or contravene any
law, rule, regulation, order, judgment, decree, fiduciary duty or binding
agreement entered into prior to the date of this Agreement. The parties shall make appropriate substitute
disclosure arrangements under circumstances in which the restrictions of the
preceding sentence apply.
(b) All
information and materials provided pursuant to this Agreement shall be subject
to the provisions of the Confidentiality Agreement entered into between the
parties as of March 25, 2009 (the Confidentiality Agreement).
(c) No
investigation by a party hereto or its representatives shall affect the
representations and warranties of the other party set forth in this Agreement.
45
(d) Between
the date hereof and until the earlier of the Closing Date and the termination
of this Agreement in accordance with its terms, Ramius shall cooperate with
Cowen in Cowens efforts to comply with applicable Laws affecting public
companies in the United States, including the Sarbanes Oxley Act, to the extent
that such compliance involves Ramius and its Subsidiaries or any Fund. In furtherance (and not in limitation) of the
foregoing, between the date of this Agreement and the Closing Date, Ramius
shall permit representatives of Cowen to meet with the officers of Ramius and
its Subsidiaries and Funds responsible for the Ramius Financial Statements and
internal controls to discuss such matters as reasonably necessary for Cowen to
be able to satisfy applicable obligations under the Sarbanes-Oxley Act following
the Closing.
7.3 Stockholder
Approval. Cowen shall call a meeting
of its stockholders (the Cowen Stockholder Meeting) to be held as soon
as reasonably practicable for the purpose of (i) obtaining the requisite
affirmative vote of the holders of Cowen Common Stock entitled to vote on the
adoption of this Agreement and in connection with the Transactions, including
the issuance of shares of New Parent Class A Common Stock (the Cowen
Stockholder Approval), on substantially the terms and conditions set forth
in this Agreement, and (ii) obtaining the requisite affirmative vote (the New
Parent Plan Approval) of the holders of Cowen Common Stock entitled to
vote on the approval of an equity compensation plan for employees of New Parent
and its subsidiaries (the New Parent Plan), and shall use its
reasonable best efforts to cause such meeting to occur as soon as reasonably
practicable. The Board of Directors of
Cowen shall use its reasonable best efforts to obtain from its stockholders (x) the
Cowen Stockholder Approval, on substantially the terms and conditions set forth
in this Agreement, required to consummate the issuance of New Parent Class A
Common Stock and other transactions contemplated by this Agreement and approve
the Plan, and shall recommend such approval except as is permitted by Section 7.10(c) hereto
and (y) the New Parent Plan Approval.
Cowen shall submit this Agreement to its stockholders at the Cowen
Stockholder Meeting even if its Board of Directors shall have withdrawn,
modified or qualified its recommendation.
The Board of Directors of Cowen has adopted resolutions approving the
Transactions and the issuance of New Parent Class A Common Stock, on
substantially the terms and conditions set forth in this Agreement, and
directing that the issuance of New Parent Class A Common Stock in the
Transactions, on such terms and conditions, be submitted to Cowens
stockholders for their consideration.
Notwithstanding the foregoing provisions of this Section 7.3,
if on a date for which the Cowen Stockholder Meeting is scheduled, Cowen has
not received proxies representing a sufficient number of shares of Cowen Common
Stock to obtain the Cowen Stockholder Approval, whether or not a quorum is
present, Cowen may for the sole purpose of soliciting additional proxies elect
to, or shall, if requested by Ramius, use its reasonable best efforts to
solicit additional proxies for the sole purpose of obtaining the Cowen
Stockholder Approval and, in connection therewith, shall make one or more
successive adjournments of the Cowen Stockholder Meeting to a date specified by
Cowen (if Cowen is electing to solicit additional proxies) or by Ramius (if
Ramius has requested that Cowen solicit additional proxies); provided
that, in either case, the Cowen Stockholder Meeting shall not be adjourned to a
date that is more than ten (10) days after the date for which the Cowen
Stockholder Meeting was originally scheduled (excluding any adjournments or
postponements required by applicable Law).
46
7.4 Further
Assurances; Additional Agreements.
Each of Cowen and Ramius shall use its reasonable best efforts to, and
to cause their respective Subsidiaries to, (i) take all actions necessary
or appropriate to consummate the transactions contemplated by this Agreement
and (ii) cause the fulfillment at the earliest practicable date of all of
the conditions to their respective obligations to consummate the transactions
contemplated by this Agreement. In
addition, at and after the Effective Time, the officers, directors and managers
of New Parent, the Cowen Surviving Corporation or Exchange Sub, as applicable,
shall be authorized to execute and deliver, in the name and on behalf of the
Cowen Surviving Corporation, Merger Sub or Cowen, or Exchange Sub or Ramius,
any deeds, bills of sale, assignments or assurances and to take and do, in the
name and on behalf of the Cowen Surviving Corporation, Merger Sub or Cowen, or
Exchange Sub or Ramius, any other actions and things necessary to vest, perfect
or confirm of record or otherwise in New Parent, the Cowen Surviving
Corporation or Exchange Sub any and all right, title and interest in, to and
under any of the rights, properties or assets acquired or to be acquired by New
Parent, the Cowen Surviving Corporation or Exchange Sub, as applicable, as a
result of, or in connection with, the Transactions.
7.5 NASDAQ
Listing. Cowen shall cause the
shares of New Parent Class A Common Stock to be issued in the Transactions
to be approved for listing on the NASDAQ, subject to official notice of
issuance, prior to the Effective Time.
7.6 Employee
Matters. (a) On or prior to
the Closing, Ramius shall take all action necessary to cause the employment of
each employee of Ramius and each Ramius Benefit Plan maintained by Ramius (and any related assets
and liabilities), other than the REOP and grant agreements evidencing awards
under the REOP and the portion of the Tapestry Interests under the RAAP (as
defined therein) representing a right to receive a Ramius Percentage Interest,
and in each case the liabilities with respect thereto (collectively, the Excluded
Ramius Benefits), to be transferred to Exchange Sub, each effective as of
and subject to the Closing. From and
after the Effective Time, the Cowen Benefit Plans and the Ramius Benefit Plans
(which, for purposes of this Section 7.6, shall include those plans
transferred to Exchange Sub pursuant to this Section 7.6(a)) in
effect as of the Effective Time shall remain in effect with respect to employees
and former employees of Cowen or Ramius and their respective Subsidiaries (the New
Parent Employees), respectively, covered by such plans at the Effective
Time, until such time as New Parent shall otherwise determine, subject to
applicable laws and the terms of such plans.
It is the intention of Cowen and Exchange Sub, to the extent permitted
by applicable Law, to develop new benefit plans, as soon as reasonably
practicable after the Effective Time, which, among other things, (i) treat
similarly situated employees on a substantially equivalent basis, taking into
account all relevant factors, including duties, geographic location, tenure,
qualifications and abilities and (ii) do not discriminate between the New
Parent Employees who were covered by Cowen Benefit Plans, on the one hand, and
those covered by Ramius Benefit Plans on the other, at the Effective Time. Notwithstanding the foregoing, for the period
commencing on the Effective Time and ending on the first anniversary of the
Effective Time (the Cowen Continuation Period), New Parent shall, or
shall cause one of its Subsidiaries to, provide compensation and employee
benefits to the New Parent Employees who were employed by Cowen or its
Subsidiaries prior to the Effective Time (the Cowen Covered Employees)
that are substantially comparable in the aggregate to those provided to the
Cowen Covered Employees immediately prior to the Effective Time; provided,
however, that in connection with implementing the foregoing, New Parent
shall not be precluded from substituting for any Cowen
47
Benefit Plan or plans, during the Cowen
Continuation Period, one or more New Plans (as defined in Section 7.6(b) hereof)
of substantially the same type. In
addition to, and not in contravention of the foregoing, Cowen Covered Employees
whose employment is terminated without cause during the Cowen Continuation
Period will be entitled to severance benefits in accordance with the Cowen
Severance Policy described on Section 7.6(a) of the Cowen
Disclosure Schedule. Nothing herein
shall prohibit any changes to the Cowen Benefit Plans or the Ramius Benefit
Plans that may be (i) required by applicable laws, (ii) necessary as
a technical matter to reflect the transactions contemplated hereby or (iii) required
for New Parent to provide for or permit investment in its securities.
(b) With
respect to any benefit plans in which any New Parent Employees who are
employees of Cowen or Exchange Sub (or their respective Subsidiaries) at the
Effective Time first become eligible to participate on or after the Effective
Time, and in which such New Parent Employees did not participate prior to the
Effective Time (the New Plans), New Parent shall (i) waive all
pre-existing conditions, exclusions and waiting periods with respect to
participation and coverage requirements applicable to the New Parent Employees
and their eligible dependents under any New Plans in which such employees may
be eligible to participate after the Effective Time, except to the extent such
preexisting conditions, exclusions or waiting periods would apply under the
analogous Cowen Benefit Plan or Ramius Benefit Plan, as the case may be; (ii) provide
each New Parent Employee and his or her eligible dependents with credit for any
co-payments and deductibles paid prior to the Effective Time under a Cowen
Benefit Plan or Ramius Benefit Plan (to the same extent that such credit was
given under the analogous Benefit Plan prior to the Effective Time) in
satisfying any applicable deductible or out-of-pocket requirements under any
New Plans in which such employees may be eligible to participate after the
Effective Time; and (iii) recognize (in addition to service with New
Parent or its Subsidiaries following the Effective Time) all service of the New
Parent Employees with Cowen or Ramius, respectively, and their respective
affiliates and predecessors, for purposes of eligibility to participate,
vesting credit, entitlement to benefits and levels of benefits in any New Plan
in which such employees may be eligible to participate after the Effective
Time, to the extent such service is taken into account under the applicable New
Plan, except to the extent that such crediting of would result in duplication
of benefits with respect to the same period of service and provided that no
prior service shall be recognized for purposes of benefit accrual under any
final average pay defined benefit plan.
(c) As
of the Effective Time, New Parent shall honor all Cowen Benefit Plans and
Ramius Benefit Plans (other than the
Excluded Ramius Benefits) in accordance with their terms. As of the Effective Time, New Parent shall
take all action necessary to effectuate the agreements set forth in Section 7.6(c) of
the Cowen Disclosure Schedule.
(d) New
Parent and Ramius hereby acknowledge that the transactions contemplated by this
Agreement constitute a change of control, change in control or term of
similar import within the meaning of the Cowen Benefit Plans, and Section 7.6(d)
of the Cowen Disclosure Schedule lists the material Cowen Benefit Plans
containing such term(s).
(e) Effective
as of the Closing, Exchange Sub shall assume all liability for making the cash
payments in satisfaction of the awards outstanding under the Ramius LLC Phantom
Interest Program as of the Closing that are held by employees of Ramius and its
Subsidiaries who
48
become employees of Exchange Sub or its
Affiliates as of the Closing and that vest immediately prior to the Closing as
may be provided by Ramius.
(f) Notwithstanding
anything in this Agreement to the contrary, no provision of this Agreement
shall be deemed to (i) guarantee employment for any period of time for, or
preclude the ability of either party to terminate, any New Parent Employee for
any reason, (ii) require New Parent to continue any Cowen Benefit Plan or
Ramius Benefit Plan or prevent the amendment, modification or termination
thereof after the Effective Time to the extent permitted by their terms and
applicable law, (iii) constitute an amendment to any Cowen Benefit Plan or
Ramius Benefit Plan, or (iv) provide any rights to any Employees, whether
as third-party beneficiaries or otherwise, to enforce any provision of this Section 7.6.
7.7 Indemnification;
Directors and Officers Insurance.
(a) In
the event of any threatened or actual claim, action, suit, proceeding or
investigation, arbitration, whether civil, criminal or administrative (a Claim),
including any such Claim in which any individual who is now, or has been at any
time prior to the date of this Agreement, or who becomes prior to the Effective
Time, a director or officer of Cowen or any of its Subsidiaries or an officer,
manager or managing member of Ramius or any of its Subsidiaries, including, without
limitation, C4S & Co., LLC and its members, or who is or was serving
at the request of Cowen or any of its Subsidiaries or at the request of Ramius
or its Subsidiaries as a director, manager or officer of another person (the Indemnified
Parties), is, or is threatened to be, made a party based in whole or in
part on, or arising in whole or in part out of, or pertaining to (i) the
fact that he or she is or was a director or officer of Cowen or any of its
Subsidiaries or any officer or manager of Ramius or any of its Subsidiaries
prior to the Effective Time or (ii) this Agreement or any of the
transactions contemplated by this Agreement, whether asserted or arising before
or after the Effective Time, the parties shall cooperate and use their
reasonable best efforts to defend against and respond thereto. All rights to indemnification and exculpation
from liabilities for acts or omissions occurring at or prior to the Effective
Time now existing in favor of any Indemnified Party as provided in their respective
certificates or articles of incorporation or by-laws (or comparable
organizational documents), and any indemnification agreements which are
existing as of the date hereof, shall survive the Transactions and shall
continue in full force and effect in accordance with their terms, and shall not
be amended, repealed or otherwise modified for a period of six (6) years
after the Effective Time in any manner that would adversely affect the rights
thereunder of such individuals for acts or omissions occurring at or prior to
the Effective Time or taken at the request of New Parent pursuant to Section 7.4,
it being understood that nothing in this sentence shall require any amendment
to the New Parent Charter or the New Parent By-Laws.
(b) From
and after the Effective Time, New Parent, the Cowen Surviving Corporation and
Exchange Sub shall to the fullest extent permitted by applicable law jointly
and severally, indemnify, defend and hold harmless, and provide advancement of
expenses to, each Indemnified Party against all losses, claims, damages, costs,
expenses, liabilities or judgments or amounts that are paid in settlement of or
in connection with any Claim based in whole or in part on or arising in whole
or in part out of the fact that such person is or was a director or officer of
Cowen or any of its Subsidiaries or a manager or officer of Ramius or any of
its Subsidiaries, as applicable, and pertaining to any matter existing or
occurring, or any acts or omissions occurring,
49
at or prior to the Effective Time, whether asserted or claimed prior
to, or at or after, the Effective Time (including matters, acts or omissions
occurring in connection with the approval of this Agreement and the
consummation of the transactions contemplated hereby) or taken at the request
of New Parent pursuant to Section 7.4.
(c) New Parent shall cause the
individuals serving as officers and directors of Cowen or any of its
Subsidiaries or officers and managers of Ramius or any of its Subsidiaries immediately
prior to the Effective Time to be covered for a period of six (6) years
from the Effective Time by the directors and officers liability insurance
policy maintained by Cowen or Ramius, as applicable (provided that New
Parent may substitute therefor policies of at least the same coverage and
amounts containing terms and conditions that are not less advantageous than
such policy) with respect to acts or omissions occurring prior to the Effective
Time that were committed by such officers and directors in their capacity as
such; provided that in no event shall New Parent be required to expend
annually in the aggregate an amount in excess of 200% of the annual premiums
currently paid by Cowen or Ramius, as applicable (which current amount is set
forth in Section 7.7(c) of the Cowen Disclosure Schedule and
the Ramius Disclosure Schedule) for such insurance (the Insurance Amount),
and provided further that if New Parent is unable to maintain
such policy (or such substitute policy) as a result of the preceding proviso,
New Parent shall obtain as much comparable insurance as is available for the
Insurance Amount. New Parents
obligations under this Section 7.7(c) may be satisfied by
Cowen purchasing a tail policy prior to the Closing from an insurer with substantially
the same or better credit rating as the current carriers for Cowens and Ramiuss
respective existing directors and officers insurance policies in effect as of
the date of this Agreement (collectively, the Existing Policies),
which (i) has an effective term of six (6) years from the Effective
Time, (ii) covers each Person covered by the Existing Policies for actions
and omissions occurring prior to the Effective Time, and (iii) contains
terms that are no less favorable in the aggregate than the Existing Policies.
(d) The provisions of this Section 7.7
shall survive the Effective Time and are intended to be for the benefit of, and
shall be enforceable by, each Indemnified Party and his or her heirs or
representatives.
7.8 Exemption from Liability
Under Section 16(b).
Prior to the Effective Time, Ramius and Cowen shall each take all such
steps as may be reasonably necessary or appropriate, and the parties shall
cooperate with each other as necessary, to cause any deemed disposition of
shares of Cowen Common Stock or conversion of any derivative securities in
respect of such shares of Cowen Common Stock or any deemed acquisition of
shares of New Parent Class A Common Stock by an individual who after the
Transactions is expected to be subject to Section 16(b) of the
Exchange Act with respect to New Parent, in each case in connection with the
consummation of the transactions contemplated by this Agreement, to be exempt
under Rule 16b-3 promulgated under the Exchange Act.
7.9 Governance; Name Change. (a) On or prior to the Effective Time,
Cowen and Ramius shall cause the number of directors that will comprise the
full Board of Directors of New Parent at the Effective Time to be expanded to
ten (10) directors. Of the members
of the Board of Directors of New Parent, four (4) directors shall be
individuals appointed by Cowen, three of whom shall be independent (within the
meaning of the rules and regulations promulgated by
50
NASDAQ) to New Parent, and six (6) directors shall be individuals
appointed by Ramius, three (3) of whom shall be independent (within the
meaning of the rules and regulations promulgated by NASDAQ) to New
Parent. The Cowen appointees and the
Ramius appointees are set forth on Schedule B hereto. No other directors or employees of Cowen or
Ramius shall be designated to serve on the Board of Directors of New Parent at
the Effective Time.
(b) On or prior to the Effective
Time, Cowen and Ramius shall take such actions as are necessary to cause,
effective as of the Effective Time, (i) Peter A. Cohen to be appointed as
Chairman of the Board of Directors and Chief Executive Officer of New Parent
and (ii) John E. Toffolon, Jr., to be appointed as Lead Director of
the Board of Directors of New Parent.
(c) On or prior to the Effective
Time, Cowen and Ramius shall take such actions as are necessary to cause the
persons indicated in Schedule C hereto to be elected or appointed to the
offices of New Parent specified in such Schedule as of the Effective Time.
(d) Immediately upon
consummation of the Transactions, (i) New Parent shall change its name to
Cowen Group, Inc., (ii) Exchange Sub shall change its name to Ramius
LLC and (iii) Ramius shall change its name to RCG LLC or another name
selected by Ramius that does not contain the word Ramius.
7.10 No Solicitation.
(a) No-Solicitation by Ramius.
(i) Unless and until Cowen
enters into or participates in any discussions or negotiations regarding an
Alternative Transaction or enters into a confidentiality agreement with any
third party with respect to an Alternative Transaction not resulting from or
arising out of a breach of Section 7.10, during the period from the
date hereof continuing through the Closing, Ramius shall not, and shall cause
its Subsidiaries and the respective Affiliates of Ramius and its Subsidiaries
and all of the managers, members, officers, directors, employees, agents,
representatives, consultants, financial advisors, attorneys, accountants or
other agents of Ramius or any Affiliate not to, directly or indirectly, (i) solicit,
initiate, encourage, facilitate (including by way of furnishing or providing
information) or take any other action facilitating or designed to facilitate
any inquiries or proposals regarding any merger, share exchange, consolidation,
sale of assets, sale of membership interests or capital stock or similar
transactions involving Ramius or any of its Subsidiaries that, if consummated,
would constitute an Alternative Transaction (any of the foregoing inquiries or
proposals, including the indication of any intention to propose any of the
foregoing, being referred to herein as a Ramius Alternative Proposal),
(ii) enter into or participate in any discussions or negotiations
regarding an Alternative Transaction or (iii) enter into any agreement
regarding any Alternative Transaction.
Ramius shall immediately cease, and cause its representatives and other
intermediaries to immediately cease, any and all existing activities, discussions
or negotiations with any parties conducted heretofore with respect to any of
the foregoing and shall demand the return or destruction of any information
previously provided with respect to such activities, discussions or
negotiations.
(ii) Ramius shall notify Cowen
promptly (but in no event later than 24 hours) after receipt of any Ramius
Alternative Proposal, or any material modification of or material
51
amendment to any Ramius Alternative Proposal, or any request for
nonpublic information relating to Ramius or any of its Subsidiaries or any Fund
or for access to the properties, books or records of Ramius or any of its
Subsidiaries or any Fund. Such notice to
Cowen shall be made orally and in writing, and shall indicate the identity of
the person making the Ramius Alternative Proposal or intending to make or
considering making a Ramius Alternative Proposal or requesting non-public
information or access to the books and records of Ramius or any of its
Subsidiaries or any Fund, and a copy of such Ramius Alternative Proposal (if in
writing) and summary of the material terms of any such Ramius Alternative
Proposal or modification or amendment to a Ramius Alternative Proposal. Ramius shall use its best efforts to keep
Cowen fully informed, on a timely basis, of any material changes in the status
and any material changes or modifications in the terms of any such Ramius
Alternative Proposal, indication or request.
(b) No Solicitation by Cowen.
(i) During the period from the date
hereof continuing through the Closing, Cowen shall not and shall cause its
Subsidiaries and the respective Affiliates of Cowen and its Subsidiaries and
all of the officers, directors, employees, agents, representatives,
consultants, financial advisors, attorneys, accountants or other agents of
Cowen or any Affiliate not to, directly or indirectly, (i) solicit,
initiate, encourage, facilitate (including by way of furnishing or providing
information) or take any other action facilitating or designed to facilitate
any inquiries or proposals regarding any merger, share exchange, consolidation,
sale of assets, sale of membership interests or capital stock or similar
transactions involving Cowen or any of its Subsidiaries that, if consummated,
would constitute an Alternative Transaction (any of the foregoing inquiries or
proposals, including the indication of any intention to propose any of the
foregoing, being referred to herein as a Cowen Alternative Proposal), (ii) enter
into or participate in any discussions or negotiations regarding an Alternative
Transaction or (iii) enter into any agreement regarding any Alternative
Transaction (other than a confidentiality agreement as permitted by Section 7.10(b)(iv)). Cowen shall immediately cease, and cause its
representatives and other intermediaries to immediately cease, any and all
existing activities, discussions or negotiations with any parties conducted
heretofore with respect to any of the foregoing and shall demand the return or
destruction of any information previously provided with respect to such
activities, discussion, or negotiations.
(ii) Cowen shall notify Ramius
promptly (but in no event later than 24 hours) after receipt of any Cowen
Alternative Proposal, or any material modification of or material amendment to
any Cowen Alternative Proposal, or any request for nonpublic information
relating to Cowen or any of its Subsidiaries or for access to the properties,
books or records of Cowen or any of its Subsidiaries. Such notice to Ramius shall be made orally
and in writing, and shall indicate the identity of the person making the Cowen
Alternative Proposal or intending to make or considering making a Cowen
Alternative Proposal or requesting non-public information or access to the
books and records of Cowen or any of its Subsidiaries, and a copy of such Cowen
Alternative Proposal (if in writing) and summary of the material terms of any
such Cowen Alternative Proposal or modification or amendment to a Cowen
Alternative Proposal. Cowen shall use
its best efforts to keep Ramius fully informed, on a timely basis, of any
material changes in the status and any material changes or modifications in the
terms of any such Cowen Alternative Proposal, indication or request. Cowen shall also provide Ramius 24 hours written
notice before it enters into any discussions or negotiations concerning any
Alternative Proposal
52
in accordance with Section 7.10(b)(iii) and shall keep
Ramius fully informed, on a timely basis, as to the material developments and
results of all such discussions or negotiations. Cowen shall not, and shall cause each of its
Subsidiaries not to, terminate, waive, amend or modify any provision of any
existing standstill or confidentiality agreement to which it or any of its
Subsidiaries is a party, and Cowen shall, and shall cause its Subsidiaries to,
enforce the provisions of any such agreement.
(iii) Except as expressly
permitted by this Section 7.10(b)(iii), neither the Board of
Directors of Cowen nor any committee thereof shall (i) withdraw, modify or
qualify, or propose publicly to withdraw, modify or qualify, the recommendation
by the Board of Directors of Cowen of this Agreement and/or the Transactions to
Cowens stockholders, or (ii) approve or recommend, or publicly propose to
approve or recommend, or fail to recommend against, any Cowen Alternative
Proposal (any of the actions described in clauses (i) or (ii), a Change
of Recommendation). Notwithstanding
the foregoing, the Board of Directors of Cowen may make a Change of
Recommendation prior to the receipt of the Cowen Stockholder Approval, if, and
only if, each of the following conditions is satisfied:
(1) it receives a
Cowen Alternative Proposal not solicited and not resulting from or arising out
of a breach of this Section 7.10 that constitutes a Superior
Proposal and such Superior Proposal has not been withdrawn;
(2) it determines
in good faith (after consultation with outside legal counsel), that in light of
a Superior Proposal the failure to effect such Change of Recommendation would
cause it to violate its fiduciary duties to Cowen stockholders under applicable
Law;
(3) Ramius has
received written notice from Cowen (a Change of Recommendation Notice)
at least five (5) Business Days prior to such Change of Recommendation,
which notice shall (1) state expressly that Cowen has received a Cowen
Alternative Proposal which the Board of Directors of Cowen has determined is a
Superior Proposal and that Cowen intends to effect a Change of Recommendation
and the manner in which it intends or may intend to do so and (2) include
the identity of the person making such Cowen Alternative Proposal and a copy
(if in writing) and summary of material terms of such Cowen Alternative
Proposal; provided that any material amendment to the terms of such
Cowen Alternative Proposal shall require a new Change of Recommendation Notice
and at least two (2) Business Days prior to such Change of Recommendation;
and
(4) during any such
notice period, Cowen and its advisors have negotiated in good faith with Ramius
(provided that Ramius desires to negotiate) to make adjustments in the terms
and conditions of this Agreement such that such Cowen Alternative Proposal
would no longer constitute a Superior Proposal.
53
(iv) Notwithstanding any other
provision contained herein, (i) Cowen and its Board of Directors may
comply with their disclosure obligations under Rules 14d-9 and 14e-2 under
the Exchange Act and (ii) prior to the receipt of the Cowen Stockholder
Approval, Cowen may, and may allow its Affiliates and Representatives to
furnish or cause to be furnished nonpublic information or data and participate
in such negotiations or discussions with any third party who has made a Cowen
Alternative Proposal not resulting from or arising out of a breach of this Section 7.10,
provided that Cowen and its Board of Directors concludes in good faith
that such Cowen Alternative Proposal is reasonably likely to result in a
Superior Proposal, provided further that any nonpublic
information to be provided shall be provided pursuant to a confidentiality
agreement entered into with such third party on terms no less favorable than
the Confidentiality Agreement. Cowen
shall promptly provide to Ramius any non-public information concerning Cowen
provided to any other Person in connection with any Cowen Alternative Proposal
that was not previously provided to Ramius.
The Board of Directors of Cowen shall promptly consider in good faith
(in consultation with its outside legal counsel and financial advisors) any
proposed alteration of the terms of this Agreement or the Transactions proposed
by Ramius in response to any Cowen Alternative Proposal.
(c) Definitions.
(i) Alternative Transaction
means, other than the transactions contemplated by this Agreement, any offer,
proposal or inquiry relating to, or any third party indication of interest in (i) any
acquisition or purchase, direct or indirect, of 15% or more of the consolidated
assets of a party or its Subsidiaries or 15% or more of any class of equity or
voting securities (including membership interests) of a party or its
Subsidiaries whose assets, individually, or in the aggregate, constitute more
than 15% of the consolidated assets of the party; (ii) any tender offer or
exchange offer that, if consummated, would result in such third party
beneficially owning 15% or more of any class of equity or voting securities
(including membership interests) of a party or its Subsidiaries whose assets,
individually or in the aggregate, constitute more than 15% of the consolidated
assets of the party, or (iii) a merger, consolidation, share exchange,
sale of interests, business combination, reorganization, recapitalization,
liquidation, dissolution or other similar transaction involving a party or its
Subsidiaries whose assets, individually or in the aggregate, constitute more
than 15% of the consolidated assets of a party.
(ii) Superior Proposal
means any proposal made by a third party (A) to acquire, directly or
indirectly, for consideration consisting of cash and/or securities, all or
substantially all of the outstanding shares of Cowen Common Stock or the
assets, net revenues or net income of Cowen and its Subsidiaries, taken as a
whole and (B) which is otherwise on terms which the Board of Directors of
Cowen determines in its reasonable good faith judgment (after consultation with
its financial advisor and outside legal counsel), taking into account, among
other things, all legal, financial, regulatory and other aspects of the
proposal (including any break-up fees, expense reimbursement provision and
financial terms, the anticipated timing, conditions and prospects for
completion of such transaction, including the prospects for obtaining regulatory
approvals and financing, and any third party approvals) and the person making
the proposal, that the proposal, (i) is more favorable, including from a
financial point of view, to Cowens stockholders than the Transactions and the
other transactions contemplated hereby and (ii) is reasonably likely to be
completed.
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7.11 Transaction Litigation. Cowen shall control the defense against any
litigation brought by stockholders of Cowen against Cowen and/or its directors
relating to the Transactions and the other transactions contemplated by this
Agreement; provided, however, that Cowen shall give Ramius the
opportunity to participate in the defense or settlement of any such stockholder
litigation, and no such settlement shall be agreed to without the prior written
consent of Ramius. Ramius shall control
the defense against any litigation brought by members of Ramius against Ramius
and/or its Managing Member relating to the Transactions and the other
transactions contemplated by this Agreement; provided, however,
that Ramius shall give Cowen the opportunity to participate in the defense or
settlement of any such stockholder litigation, and no such settlement shall be
agreed to without the prior written consent of Cowen. Each of Cowen and Ramius shall cooperate,
shall cause its respective Subsidiaries to cooperate, and shall use its
reasonable best efforts to cause its directors, officers, managers, members,
employees, agents, legal counsel, financial advisors, independent auditors and
other advisors and representatives to cooperate in the defense of any such
stockholder or member litigation.
7.12 Registration Rights
Agreement. Cowen and
Ramius shall cause New Parent to execute and deliver to Ramius the Registration
Rights Agreement, at or prior to Closing.
7.13 Assignment of Assigned
Contracts and Warranties. At
the Closing and effective as of the Closing Date, Ramius shall assign to
Exchange Sub all of its rights under the Assigned Contracts. Notwithstanding the foregoing, no Assigned
Contract shall be assigned contrary to law or the terms of such Contract and,
with respect to Assigned Contracts that cannot be assigned to Exchange Sub at
the Closing Date, the performance obligations of Ramius thereunder shall, unless
not permitted by such Assigned Contract, be deemed to be subleased or
subcontracted to Exchange Sub until such Assigned Contract has been
assigned. Each of Cowen and Exchange Sub
shall, and New Parent shall cause Exchange Sub to, assist Ramius in obtaining
any necessary approvals to such subleases and subcontracts. Ramius shall use its commercially reasonable
efforts to obtain all necessary consents and Cowen agrees to cooperate with
Ramius in its efforts to obtain (including the submission of financial and/or
other information concerning New Parent, Exchange Sub and Cowen and the
execution and delivery of any agreements, documents or instruments reasonably
requested by a third party), the consent of any third party to the assignment
or transfer of the Assigned Contracts in all cases in which consent is required
for assignment or transfer. Each of
Cowen and Exchange Sub shall, and New Parent shall cause Exchange Sub to, take
all reasonably necessary actions to perform and complete all Assigned Contracts
in accordance with their terms if neither assignment, subleasing nor
subcontracting is permitted by the other party, and Ramius shall pay over to
Exchange Sub any amounts received by Ramius after the Closing Date as a result
of performance by Exchange Sub of such Assigned Contracts. To the extent that Ramius performs under any
Assigned Contract following the Closing, New Parent shall cause Exchange Sub to
reimburse Ramius for any costs Ramius incurs as a result thereof.
7.14 Payment of Assumed Liabilities. Exchange Sub shall, and New Parent shall
cause Exchange Sub to, promptly pay the Assumed Liabilities when the same
become due, except to the extent that any such liability is being disputed in
good faith and has been appropriately reserved for on the books and records of
Exchange Sub.
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7.15 FoF Asset Exchange Agreement.
(a) New Parent shall, and each
of Ramius and Cowen shall cause New Parent to, fulfill its obligations under
the FoF Asset Exchange Agreement in all respects, including the issuance at
Closing of shares of New Parent Class A Common Stock and the JV Note in
accordance with terms of the FoF Asset Exchange Agreement.
(b) Cowen shall not take any
action, or fail to take any action, that would cause the representations and
warranties of New Parent in Article V of the FoF Asset Exchange Agreement
not to be true and correct in all material respects at Closing.
7.16 Tax Matters. Following the date hereof and prior to the
Effective Time, the parties shall work together in good faith, shall consult
with one another, and shall (consistent with their obligations under Section 6.2(k) hereof)
use their respective reasonable best efforts (including by taking certain
actions or refraining from taking certain actions, in each case, as reasonably
requested by Ramius and at Ramiuss sole cost and expense, provided that
compliance with such requests shall not (x) significantly interfere with
or impede Cowens Ordinary Course of Business or (y) impose any
significant costs, expenses or liabilities on Cowen or its Subsidiaries which
costs, expenses or liabilities are not fully indemnified by Ramius) to cause
the Transactions, taken together, to qualify as an exchange described in Section 351
of the Code. At the request of Ramius,
to allow Ramius to obtain a tax opinion that the Transactions, taken together,
qualify as an exchange described in Section 351 of the Code, Cowen shall
provide a certificate of an officer of Cowen containing representations as to
certain factual matters (which representations are consistent with the state of
facts existing as of the date of such certificate), as the same may reasonably
be requested by Willkie Farr & Gallagher LLP.
7.17 Investment Company Act. Each of Ramius and Cowen shall use its
reasonable best efforts to ensure that, as of the Closing, New Parent shall not
be required to register as an investment company for purposes of the
Investment Company Act.
7.18 Payment of Award. Promptly following the receipt by Ramius of
any final, binding and non-appealable award with respect to the matter set
forth in Section 7.18 of the Ramius Disclosure Schedule, Ramius
shall pay to New Parent the amount of such award up to a maximum of $7,000,000
in the aggregate.
ARTICLE VIII
CONDITIONS PRECEDENT
8.1 Conditions to Each Partys
Obligation to Effect the Transactions. The respective obligations of the parties to
effect the Transactions shall be subject to the satisfaction at or prior to the
Effective Time of the following conditions:
(a) Stockholder Approval. The Cowen Stockholder Approval shall have
been obtained.
(b) NASDAQ Listing. The shares of New Parent Class A Common
Stock to be issued (i) to the holders of Cowen Common Stock and to Ramius
upon consummation of the Transactions and (ii) to HVB pursuant to the FoF
Asset Exchange Agreement shall have been authorized for listing on the NASDAQ,
subject to official notice of issuance.
56
(c) HSR Act. (i) Any waiting periods (and any
extension thereof) applicable to the Transactions and the other transactions
contemplated by this Agreement, including, without limitation, the acquisition
of the shares of New Parent Class A Common Stock to be received by Ramius,
under the HSR Act shall have been terminated or shall have expired, and (ii) all
other approvals required under other antitrust or competition laws shall have
been obtained.
(d) Form S-4. The Form S-4 shall have become effective
under the Securities Act and no stop order suspending the effectiveness of the Form S-4
shall have been issued and no proceedings for that purpose shall have been
initiated or threatened by the SEC.
(e) No Injunctions or
Restraints; Illegality. No
order, injunction or decree issued by any court or agency of competent
jurisdiction or other law preventing or making illegal the consummation of the
Transactions or any of the other transactions contemplated by this Agreement
shall be in effect.
(f) FoF Asset Exchange. All of the conditions precedent to the
consummation of the transactions contemplated by the FoF Asset Exchange
Agreement (other than the closing of the Transactions and other than
conditions that, by their nature, are intended to be satisfied at the closing) shall have
been satisfied.
8.2 Conditions to Obligations of
Ramius. The obligation of Ramius to
effect the Transactions is also subject to the satisfaction, or waiver by
Ramius, at or prior to the Effective Time, of the following conditions:
(a) Representations and
Warranties. The
representations and warranties of Cowen set forth in this Agreement shall be
true and correct in all respects (without regard to any materiality qualifiers
therein) as of the date hereof and as of the Effective Time as though made on
and as of the Effective Time, other than representations and warranties that
speak as of another specific date or time prior to the date hereof (which need
only be true and correct as of such date or time); provided, however,
that for purposes of determining satisfaction of this condition, such
representations and warranties (other than the representations and warranties
contained in Section 4.2(a), (b), and (c) and which shall be true and correct in all
material respects) shall be deemed to be true and correct in all respects
unless the failure or failures of such representations and warranties to be so
true and correct, individually or in the aggregate, would have a Material
Adverse Effect on Cowen. Ramius shall
have received a certificate signed on behalf of Cowen by the Chief Executive
Officer or the Chief Financial Officer of Cowen to the foregoing effect.
(b) Performance of Obligations
of Cowen. Cowen shall
have performed in all material respects all obligations required to be
performed by it under Articles VI and VII of this Agreement at or
prior to the Effective Time; and Ramius shall have received a certificate
signed on behalf of Cowen by the Chief Executive Officer or the Chief Financial
Officer of Cowen to such effect.
(c) Regulatory Approvals. All approvals set forth in Section 5.4
required to consummate the transactions contemplated by this Agreement,
including the Transactions, shall have been obtained and shall remain in full
force and effect and all statutory waiting periods in
57
respect thereof shall have expired (all such approvals and the
expiration of all such waiting periods being referred as the Ramius
Requisite Regulatory Approvals).
(d) Registration Rights
Agreement. Cowen and
Ramius shall have caused New Parent to execute the Registration Rights
Agreement in the form attached hereto as Exhibit F (the Registration
Rights Agreement).
(e) Certificate of Cowen. Ramius shall have received a copy of the
certificate of an officer of Cowen described in the last sentence of Section 8.3(c) of
this Agreement.
8.3 Conditions to Obligations of
Cowen. The obligation of Cowen to
effect the Transactions is also subject to the satisfaction or waiver by Cowen
at or prior to the Effective Time of the following conditions:
(a) Representations and
Warranties. The
representations and warranties of Ramius set forth in this Agreement shall be
true and correct in all respects (without regard to any materiality qualifiers
therein) as of the date hereof and as of the Effective Time as though made on
and as of the Effective Time, other than representations and warranties that
speak as of another specific date or time prior to the date hereof (which need
only be true and correct as of such date or time); provided, however,
that for purposes of determining satisfaction of this condition, such
representations and warranties (other than the representations and warranties
contained in Section 5.2, which shall be true and correct in all
material respects) shall be deemed to be true and correct in all respects
unless the failure or failures of such representations and warranties to be so
true and correct, individually or in the aggregate, would have a Material
Adverse Effect on Ramius. Cowen shall
have received a certificate signed on behalf of Ramius by its managing member
to the foregoing effect.
(b) Performance of Obligations
of Ramius. Ramius
shall have performed in all material respects all obligations required to be
performed by it under Articles VI and VII of this Agreement at or
prior to the Effective Time, and Cowen shall have received a certificate signed
on behalf of Ramius by the managing member of Ramius to such effect.
(c) Federal Tax Opinion. Cowen shall have received the opinion of its
counsel, Wachtell, Lipton, Rosen & Katz, substantially in the form set
forth in Exhibit G, dated the Closing Date, substantially to the
effect that, on the basis of facts, representations and assumptions set forth
in such opinion that are consistent with the state of facts existing at the
Effective Time, the Cowen Merger will qualify as a reorganization within the
meaning of Section 368(a) of
the Code. In rendering such opinion,
counsel may require and rely upon customary representations contained in
certificates of officers of Cowen and Ramius.
(d) Regulatory Approvals. All approvals set forth in Section 4.4
required to consummate the transactions contemplated by this Agreement,
including the Transactions, shall have been obtained and shall remain in full
force and effect and all statutory waiting periods in respect thereof shall
have expired (all such approvals and the expiration of all such waiting periods
being referred as the Cowen Requisite Regulatory Approvals).
58
ARTICLE IX
TERMINATION AND AMENDMENT
9.1 Termination. This Agreement may be terminated at any time
prior to the Effective Time, whether before or after approval by the
stockholders of Cowen of the matters presented to them in connection with the
Transactions:
(a) by mutual consent of Cowen
and Ramius in a written instrument authorized by the Board of Directors of
Cowen and the Managing Member of Ramius;
(b) by either Cowen or Ramius,
if any Governmental Entity that must grant a Ramius Requisite Regulatory
Approval or a Cowen Requisite Regulatory Approval has denied approval of the
Transactions and such denial has become final and nonappealable or any
Governmental Entity of competent jurisdiction shall have issued a final and
nonappealable order, injunction or decree permanently enjoining or otherwise
prohibiting or making illegal the consummation of the transactions contemplated
by this Agreement;
(c) by either Cowen or Ramius,
if the Transactions shall not have been consummated on or before December 31,
2009 unless the failure of the Closing to occur by such date shall be due to
the failure of the party seeking to terminate this Agreement to perform or
observe the covenants and agreements of such party set forth in this Agreement;
(d) by either Cowen or Ramius (provided
that the terminating party is not then in material breach of any
representation, warranty, covenant or other agreement contained herein), if
there shall have been a breach of any of the covenants or agreements or any of
the representations or warranties set forth in this Agreement on the part of
Cowen, in the case of a termination by Ramius, or Ramius, in the case of a
termination by Cowen, which breach, either individually or in the aggregate,
would result in, the failure of the conditions set forth in Section 8.2
or 8.3, as the case may be, and which is not cured within the earlier to
occur of (i) thirty (30) days following written notice to the party
committing such breach or by its nature or timing cannot be cured within such
time period, and (ii) the nine (9) month anniversary of the date of
this Agreement;
(e) by Ramius, if (i) the
Board of Directors of Cowen shall have (A) failed to recommend in the
Proxy Statement the approval and adoption of this Agreement; (B) made any
Change of Recommendation or (C) resolved to do any of the foregoing; (ii) Cowen
has materially breached its obligations under this Agreement by reason of a
failure to call the Cowen Stockholder Meeting in accordance with Section 7.3;
or (iii) Cowen has materially breached any of its obligations under the
first sentence of Section 7.10(b); and
(f) by either Cowen or Ramius,
if the Cowen Stockholder Approval required by Section 8.1(a) shall
not have been obtained at the Cowen Stockholder Meeting (or any adjournment or
postponement thereof in accordance with Section 7.3 of this
Agreement).
The party desiring to terminate this Agreement
pursuant to clause (b), (c), (d), (e) or (f) of this Section 9.1
shall give written notice of such termination to the other party in
59
accordance with Section 10.3,
specifying the provision or provisions hereof pursuant to which such
termination is effected.
9.2 Effect of Termination.
(a) In the event of termination
of this Agreement by either Cowen or Ramius as provided in Section 9.1,
this Agreement shall forthwith become void and have no effect, and none of
Cowen, Ramius, any of their respective Subsidiaries or any of the officers,
directors, members or managers of any of them shall have any liability of any
nature whatsoever under this Agreement, or in connection with the transactions
contemplated by this Agreement, except that (i) Cowen shall not be
relieved of any of its obligations pursuant to Section 9.2(b); (ii) Sections
7.2(b), 9.2, 9.3 and Article X shall survive any
termination of this Agreement; and (iii) neither Cowen nor Ramius shall be
relieved or released from any liabilities or damages arising out of its willful
breach of any provision of this Agreement.
(b) Cowen shall pay Ramius, by
wire transfer of immediately available funds, the sum of $3,500,000 (the Termination
Fee) and/or the Ramius Expenses if this Agreement is terminated as
follows:
(i) if Ramius shall terminate
this Agreement pursuant to Section 9.1(e) hereof, then Cowen
shall pay the Termination Fee and the Ramius Expenses on the Business Day
following such termination;
(ii) if either party shall
terminate this Agreement pursuant to Section 9.1(f), then (x) Cowen
shall pay to Ramius an amount equal to one-half (1/2) of the Ramius Expenses on
the Business Day following delivery to Cowen of written notice of the amount of
such Ramius Expenses or (y) if at any time after the date of this
Agreement and at or before the date of the Cowen Stockholder Meeting, a Cowen
Alternative Proposal shall have been publicly announced or disclosed, then (A) Cowen
shall pay the Ramius Expenses (less any amounts paid pursuant to clause (x)) on
the Business Day following delivery to Cowen of written notice of the amount of
such Ramius Expenses, and (B) if within twelve (12) months of the date of
such termination of this Agreement, Cowen or any of its Subsidiaries executes
any definitive agreement with respect to, or consummates any Alternative
Transaction, then Cowen shall pay the Termination Fee to Ramius upon the date
of such execution or consummation of the Alternative Transaction. For purposes of this Section 9.2(b)(ii) only,
Alternative Transaction shall have the meaning as set forth in Section 7.10(c)(i) hereof,
provided, however, that where the number 15 is used in such
definition, the number 50 shall be substituted therefor; and
(iii) if either party shall
terminate this Agreement pursuant to Section 9.1(c) and at any
time after the date of this Agreement and at or before the date of the Cowen
Stockholder Meeting a Cowen Alternative Proposal shall have been publicly
announced or disclosed, then Cowen shall pay the Ramius Expenses on the
Business Day following delivery to Cowen of written notice of the amount of such
Ramius Expenses, and if within twelve (12) months of the date of such
termination of this Agreement, Cowen or any of its Subsidiaries executes any
definitive agreement with respect to, or consummates any Alternative
Transaction, then Cowen shall pay the Termination Fee to Ramius upon the date
of such execution or consummation of the Alternative Transaction. For purposes of this Section 9.2(b)(iii) only,
60
Alternative Transaction shall have the meaning as set forth in Section 7.10(c)(i) hereof,
provided, however, that where the number 15 is used in such
definition, the number 50 shall be substituted therefor.
(c) The parties agree that for
terminations of this Agreement pursuant to Sections 9.1(e) and (f) hereof,
the remedy set forth in Section 9.2(b) shall be the exclusive
remedy of Ramius (other than with respect to any damages caused by the willful
breach of any provision of this Agreement).
In no event shall Cowen be required to pay the Termination Fee to Ramius
more than once.
(d) Cowen acknowledges that the
agreements contained in this Section 9.2 are an integral part of
the transactions contemplated by this Agreement and are not a penalty, and
that, without these agreements, Ramius would not enter into this
Agreement. If Cowen fails to pay
promptly any amounts due pursuant to this Section 9.2, Cowen will
also pay to Ramius interest on the unpaid amount due under this Section 9.2,
accruing from its due date, at an interest rate per annum equal to two
percentage points in excess of the LIBOR.
9.3 Fees and Expenses. Except as otherwise provided in Section 9.2
and with respect to (i) costs and expenses of printing and mailing the
Proxy Statement and all filing and other fees paid to the SEC in connection
with the Transactions, and (ii) any fees incurred in connection with the
filings required under the HSR Act, which shall be borne equally by Cowen and
Ramius, all fees and expenses incurred in connection with the Transactions,
this Agreement, and the other transactions contemplated by this Agreement shall
be paid by the party incurring such fees or expenses, whether or not the
Transactions are consummated.
9.4 Amendment. This Agreement may be amended by the parties,
by action taken or authorized by their respective Board of Directors or
Managing Member, as the case may be, at any time before or after approval of
the matters presented in connection with the Transactions by the stockholders
of Cowen; provided, however, that after any approval of the transactions
contemplated by this Agreement by the stockholders of Cowen, there may not be,
without further approval of such stockholders, any amendment of this Agreement
that requires further approval under applicable law. This Agreement may not be amended except by
an instrument in writing signed on behalf of each of the parties.
9.5 Extension; Waiver. At any time prior to the Effective Time, the
parties, by action taken or authorized by their respective Board of Directors
or Managing Member, as the case may be, may, to the extent legally allowed, (a) extend
the time for the performance of any of the obligations or other acts of the
other party, (b) waive any inaccuracies in the representations and
warranties contained in this Agreement or (c) waive compliance with any of
the agreements or conditions contained in this Agreement. Any agreement on the part of a party to any
such extension or waiver shall be valid only if set forth in a written
instrument signed on behalf of such party, but such extension or waiver or
failure to insist on strict compliance with an obligation, covenant, agreement
or condition shall not operate as a waiver of, or estoppel with respect to, any
subsequent or other failure.
61
ARTICLE X
GENERAL PROVISIONS
10.1 Definitions. (a) For all purposes of this Agreement
(other than as otherwise defined or specified in any Exhibit or Schedule),
the following terms shall have the respective meanings set forth below in this Section 10.1
(such definitions to apply to both the singular and plural forms of the terms
herein defined):
Advisers Act shall mean the Investment
Advisers Act of 1940, as amended, and the rules and regulations
promulgated thereunder by the SEC.
Affiliate means, with respect to any Person, any other
Person that, directly or indirectly through one or more intermediaries,
controls, or is controlled by, or is in common control with, such Person, and
the term control (including the terms controlled by and under common control with)
means the possession, directly or indirectly, of the power to direct or cause
the direction of the management and policies of such Person, whether through
ownership of voting securities, by contract or otherwise; provided,
that, for purposes of this Agreement none of Unicredit SpA, Bank Austria AG or
Bayerische Hypo-und Vereinsbank AG nor any of their respective controlled
affiliates shall be deemed to be Affiliates of Ramius.
Assigned Contract shall mean any Contract entered into prior
to the Closing to which Ramius is a party (other than the Transaction
Documents).
Base Date means December 31, 2008.
Business Day means any day of the year on which national
banking institutions in New York are open to the public for conducting business
and are not required or authorized to close.
CEA means the Commodity Exchange Act, as amended, and the rules and
regulations promulgated thereunder by the CFTC.
CFTC means the Commodity Futures Trading Commission.
CHRP means Cowen Healthcare Royalty Partners, L.P.
Client of a Person means any other Person to which such
Person or any of its Subsidiaries or Affiliates provides investment management
or investment advisory services, including any sub-advisory services, relating
to securities or other financial instruments, commodities, real estate or any
other type of asset, pursuant to an Investment Advisory Agreement.
Contract means any contract, agreement, indenture, note,
bond, loan, instrument, lease, license, commitment or other arrangement or
agreement, whether written or oral.
62
Controlled Group Liability means any and all liabilities (i) under
Title IV of ERISA, (ii) under Section 302 of ERISA, (iii) under
Sections 412 and 4971 of the Code, (iv) as a result of a failure to comply
with the continuation coverage requirements of Section 601 et seq. of
ERISA and section 4980B of the Code and (v) under corresponding or similar
provisions of foreign laws or regulations, other than such liabilities that
arise in the ordinary course solely out of the Cowen Benefit Plans or Ramius
Employee Benefits Plans, as applicable.
Copyrights means all works of authorship (whether
copyrightable or not), copyrights and proprietary rights in copyrighted works
including writings, other works of authorship, and databases (or other
collections of information, data, works or other materials).
Cowen IP means all material Intellectual Property owned,
used, held for use or exploited by Cowen or any of its Subsidiaries.
Derivative Transactions means any swap transaction, option,
warrant, forward purchase or sale transaction, futures transaction, cap
transaction, floor transaction or collar transaction relating to one or more
currencies, commodities, bonds, equity securities, loans, servicing rights,
interest rates, prices, values, or other financial or non-financial assets,
credit-related events or conditions or any indexes, or any other similar
transaction or combination of any of these transactions, including
collateralized mortgage obligations or other similar instruments or any debt or
equity instruments evidencing or embedding any such types of transactions, and
any related credit support, collateral or other similar arrangements related to
such transactions; provided, that for the avoidance of doubt, the term Derivative
Transactions shall not include any Cowen Stock Option.
DGCL means the Delaware General Corporation Law.
ERISA means the Employee Retirement Income Security Act of
1974, as amended.
ERISA Affiliate means any entity if it would have ever been
considered a single employer with Cowen or Ramius, as applicable, under ERISA Section 4001(b) or
part of the same controlled group as Cowen or Ramius, as applicable, for
purposes of ERISA Section 302(d)(8)(C) or Code Sections 414(b) or
(c) or a member of an affiliated service group for purposes of Code Section 414(m).
Exchange Act means the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder by the SEC.
Excluded Assets means: (i) $500,000 in cash, (ii) the
assets set forth on Section 10.1(a) of the Ramius Disclosure
Schedule and (iii) all rights, title and interest in the Ramius
Transaction Documents (including the documents and the instruments referred to
therein).
Excluded Liabilities means the liabilities set forth on Section 10.1(b) of
the Ramius Disclosure Schedule.
FINRA means the Financial Industry Regulatory Authority.
63
FoF Asset Exchange Agreement shall mean that certain Asset
Exchange Agreement by and among Ramius, HVB Alternative Advisors LLC (HVB),
Bayerische Hypo- und Vereinsbank AG, Cowen, New Parent and Merger Sub, dated as
of the date hereof.
Former Parent means Société Générale and any of its
Subsidiaries or Affiliates.
Fund Agreement means with respect to any Fund that is (i) a
corporation, the certificate or articles of incorporation and by-laws (or
equivalent or comparable constitutive documents with respect to a non-U.S.
jurisdiction); (ii) a limited liability company, the operating agreement; (iii) a
limited partnership, the limited partnership agreement (or equivalent or
comparable constitutive documents with respect to a non-U.S. jurisdiction); (iv) a
business trust, the declaration of trust and by-laws and (v) any other
entity, the constitutive documents that are equivalent to the foregoing.
Fund Board means the board of directors or trustees of any
advisory board of a Private Fund.
Funds means each Private Fund.
GBA means the Gramm-Leach-Bliley Act.
Governmental Entity means any nation, state, territory,
province, county, city or other unit or subdivision thereof or any entity,
authority, agency, department, board, commission, instrumentality, court or
other judicial body authorized on behalf of any of the foregoing to exercise
legislative, judicial, regulatory or administrative functions of or pertaining
to government, and any SRO.
HSR Act means the Hart-Scott-Rodino Antitrust Improvements
Act of 1976, as amended, and the rules and regulations promulgated
thereunder.
Intellectual Property means collectively, all intellectual
property and other similar proprietary rights in any jurisdiction throughout
the world, whether owned, used or held for use under license, whether
registered or unregistered, including such rights in and to: (i) Trademarks;
(ii) Patents and inventions, invention disclosures, discoveries and
improvements, whether or not patentable; (iii) Trade Secrets; (iv) Copyrights;
(v) Software; (vi) designs and industrial designs; (vii) Internet
domain names; (viii) rights of publicity and other rights to use the names
and likeness of individuals; (ix) moral rights; and (x) claims,
causes of action and defenses relating to the past, present and future
enforcement of any of the foregoing; in each case of (i) to (ix) above,
including any registrations of, applications to register, and renewals and
extensions of, any of the foregoing with or by any Governmental Entity in any
jurisdiction.
Investment Advisory Agreement means an agreement under
which Ramius or any of its Subsidiaries acts as an investment adviser or
sub-adviser to, or manages any investment or trading account of, any Client.
Investment Company Act means the Investment
Company Act of 1940, as amended.
64
IRS means the Internal Revenue Service.
JV Note means that certain Promissory Note by and between
of Exchange Sub and Bayerische Hypo- und Vereinsbank AG, to be entered into at
the closing of the transactions contemplated by the FoF Asset Exchange
Agreement.
Law means any foreign, federal, state, or local law,
statute, code, ordinance, rule, regulation or other requirement.
License Agreement means any legally binding contract,
whether written or oral, and any amendments thereto (including license
agreements, sub-license agreements, research agreements, development
agreements, distribution agreements, consent to use agreements, customer or
Client contracts, coexistence, non assertion or settlement agreements),
pursuant to which any interest in, or any right to use or exploit any
Intellectual Property has been granted.
Licensed Cowen IP means the Intellectual Property owned by
a third party that Cowen or any of its Subsidiaries has a right to use or
exploit by virtue of a License Agreement.
Licensed Ramius IP means the Intellectual Property owned by
a third party that Ramius or any of its Subsidiaries or any Fund has a right to
use or exploit by virtue of a License Agreement.
Liens means any and all liens, pledges, mortgages, deeds of
trust, security interests, claims, leases, charges, options, rights of first
refusal, easements, servitudes, proxies, voting trusts or agreements, transfer
restriction under any shareholder or similar agreements, encumbrances and other
restrictions or limitations whatsoever.
Limited Partners means the limited
partners of a Fund (or comparable investors of any Fund not structured as a
limited partnership).
Management Agreement means a management, advisory or
sub-advisory agreement between Ramius, its Subsidiaries or any Affiliate of
Ramius on the one hand, and any Fund on the other hand.
Material Adverse Effect means, with respect to Ramius or
Cowen, as the case may be, any event, change, circumstance or development which
has or is reasonably likely to have a material adverse effect on (i) the
financial condition, results of operations or business of such party and its
Subsidiaries taken as a whole; provided, however, that, with
respect to clause (i), the term Material Adverse Effect shall not include any
effects resulting from (A) changes, after the date hereof, in GAAP or
regulatory accounting requirements applicable generally to companies in the
industries in which such party and its Subsidiaries operate, (B) changes,
after the date hereof, in laws, rules, regulations or the interpretation of
laws, rules or regulations by Governmental Entities of general
applicability to companies in the industries in which such party and its
Subsidiaries operate, (C) actions or omissions taken with the prior
written consent of the other party or expressly required by this Agreement, (D) changes
in global, national or regional political conditions (including acts of
terrorism or war) or general business, economic or market conditions, including
changes generally in prevailing interest rates, currency exchange rates,
65
credit
markets and price levels or trading volumes in the United States or foreign
securities markets, in each case generally affecting the industries in which
such party or its Subsidiaries operate and including changes to any previously
correctly applied asset marks resulting therefrom, (E) the execution of
this Agreement or the public disclosure of this Agreement or the transactions
contemplated hereby, including losses of employees to the extent resulting
therefrom, (F) failure, in and of itself, to meet earnings projections,
but not including any underlying causes thereof, (G) changes in the trading price of a partys
common stock, in and of itself, but not including any underlying causes or (H) in
the case of Ramius and its Subsidiaries, withdrawals from the Funds that are
consistent with withdrawals from the Funds over the past twelve months, except, with
respect to clauses (A), (B) and (D), to the extent that the effects of
such change are materially and disproportionately adverse to the financial
condition, results of operations or business of such party and its
Subsidiaries, taken as a whole, as compared to other companies in the industry
in which such party and its Subsidiaries operate or (ii) the ability of
such party to timely consummate the transactions contemplated by this
Agreement.
NASDAQ means the National Association of Securities Dealers
Automated Quotations, as operated by the Nasdaq Stock Market, Inc.
NFA means the National Futures Association.
Ordinary Course of Business means, with respect to any
Person, the ordinary and usual course of business of such Person consistent
with its past practice through the date hereof.
OTS means the Office of Thrift Supervision.
Owned Cowen IP means the Intellectual Property that is
owned by Cowen or any of its Subsidiaries.
Owned Ramius IP means the Intellectual Property that is
owned by Ramius or any of its Subsidiaries or any Fund.
Patents means all patents and patent applications, and any
and all divisions, continuations, continuations-in-part, reissues, continuing
patent applications, provisional patent applications, re-examinations, and
extensions thereof, any counterparts claiming priority therefrom, utility
models, patents of importation/confirmation, certificates of invention,
certificates of registration and like rights.
Permits means any approvals, authorizations, consents,
licenses, permits or certificates of a Governmental Entity.
Permitted Liens means (i) all statutory liens for
current Taxes, assessments or other governmental charges not yet delinquent or
the amount or validity of which is being contested in good faith by appropriate
proceedings, provided an appropriate reserve has been established therefor; (ii) mechanics,
carriers, workers, repairers, and similar Liens arising or incurred in the
Ordinary Course of Business that are not material to the business, operations
and financial condition of the property so encumbered and that are not
resulting from a breach, default, violation by Cowen or any of its
Subsidiaries, or Ramius or any of its Subsidiaries, as the
66
case
may be, of any Contract or Law; (iii) statutory Liens of landlords with
respect to leased real property; and (iv) Liens not securing or
representing a monetary obligation and which, individually or in the aggregate,
do not detract or impair in any material respect from the continued use in the
ordinary course of business as currently conducted or contemplated by Ramius or
Cowen or any of their respective Subsidiaries, as applicable, of any property
subject to such Liens.
Person means any individual, corporation, limited liability
company, partnership, firm, joint venture, association, joint-stock company,
trust, unincorporated organization, Governmental Entity or other entity.
Private Fund means any pooled investment vehicle for which
Ramius or its Subsidiaries acts as investment advisor, investment sub-advisor,
general partner, managing member, manager or sponsor that is not registered as
a Public Fund with any Governmental Entity.
Public Fund means any pooled investment vehicle (including
each portfolio or series thereof, if any) which is registered or qualified for
offer and sale to members of the general public with any Governmental Entity.
Ramius Expenses shall mean all of Ramiuss actual and reasonably
documented out-of-pocket fees and expenses (including fees and expenses of
counsel, accountants, financial advisors or consultants and commitment and
funding fees) incurred by Ramius and its Affiliates on or prior to the
termination of this Agreement in connection with the transactions contemplated
by this Agreement, but in no event shall the Ramius Expenses exceed $750,000.
Ramius IP means all material Intellectual Property owned,
used, held for use or exploited by Ramius or any of its Subsidiaries.
Ramius Member means each of the Persons listed on Schedule
A hereto.
Ramius Percentage Interest shall have the meaning given in Section 3.06
of the Ramius LLC Agreement.
Ramius Transaction Documents shall mean this Agreement, the
Confidentiality Agreement, the Registration Rights Agreement and the FoF Asset
Exchange Agreement.
Regulatory Agencies means (i) FINRA, (ii) the
SEC, (iii) the OTS, (iv) NASDAQ, (v) any non-U.S. regulatory
authority and (vi) any SRO.
Sarbanes-Oxley Act means the Sarbanes-Oxley Act of 2002.
SEC means the United States Securities and Exchange
Commission.
Securities Act means the Securities Act of 1933, as
amended.
67
Securities Laws means the Securities Act; the Exchange Act;
the Investment Company Act; the Advisers Act; blue sky laws of any state or
territory of the United States; the CEA; and the rules and regulations of
FINRA and the comparable laws, rules and regulations in effect in any
other country.
Software means all software, including data files, source
code, object code, firmware, mask works, application programming interfaces,
computerized databases and other software-related specifications and
documentation.
SRO means FINRA, the NFA, each nation securities or
commodities or futures exchange in the United States and each other commission,
board, agency or body, whether United States or foreign, that is charged with
the supervision or regulation or brokers, dealers, securities underwriting or
trading, stock exchanges, commodities or future exchanges, insurance companies
or agents, investment companies, investment advisors, commodity pool operators
or commodity trading advisors.
Subsidiary means, when used with respect to either party,
any corporation, partnership, limited liability company or other organization,
whether incorporated or unincorporated, with respect to which such party owns,
directly or indirectly, fifty percent (50%) or more of the equity interests or
such party has the power to elect fifty percent (50%) or more of the directors
or equivalent governing persons, and, for the absence of doubt, when used with
respect to Cowen, shall also include Cowen Healthcare Royalty GP, LLC; provided,
that for purposes of this Agreement, no Fund shall be deemed to be a Subsidiary
of Ramius.
Tax or Taxes means
all federal, state, local, and foreign income, excise, gross receipts, gross
income, ad valorem, profits, gains, property, capital, sales,
transfer, use, payroll, employment, severance, withholding, duties,
intangibles, franchise, backup withholding, value added and other taxes,
charges, levies or like assessments together with all penalties and additions
to tax and interest thereon.
Tax Return means a report, return or other information
(including any amendments) required to be supplied to a governmental entity
with respect to Taxes including, where permitted or required, combined or
consolidated returns for any group of entities that includes Cowen or any of
its Subsidiaries, or Ramius or any of its Subsidiaries, as the case may be.
Third Party Management Agreement means a management,
advisory or sub-advisory agreement among Ramius, its Subsidiaries or its
Affiliates, on the one hand, and any third party other than Ramius (including
any Fund), its Subsidiaries or Affiliates, on the other hand, in each case with
respect to assets under management in excess of $5,000,000.
Trademarks means all trademarks, service marks, brand
names, certification marks, trade dress, logos, trade names and corporate names
and other indications of origin, and the goodwill associated with any of the
foregoing.
Trade Secrets means all trade secrets (including, those
trade secrets defined in the Uniform Trade Secrets Act and under corresponding
foreign statutory law and common law),
68
business,
technical and know-how information, non-public information, and confidential
information and rights to limit the use or disclosure thereof by any Person.
(b) Terms Defined Elsewhere in
Agreement. For
purposes of this Agreement, the following terms have the meanings set forth in
the sections indicated:
|
Section
|
|
|
Acquired
Assets
|
1.2(b)
|
Agreement
|
Preamble
|
Alternative
Transaction
|
7.10(c)(i)
|
Asset
Exchange Consideration
|
1.2(b)
|
Assumed
Liabilities
|
1.2(b)
|
Bankruptcy
and Equity Exception
|
4.3(a)
|
Bill
of Sale
|
1.3(b)
|
CAM
Sale Contracts
|
4.12(a)(xviii)
|
Change
of Recommendation
|
7.10(b)(iii)
|
Change
of Recommendation Notice
|
7.10(b)(iii)(3)
|
Claim
|
7.7(a)
|
Closing
|
1.5
|
Closing
Date
|
1.5
|
Code
|
Recitals
|
Confidentiality
Agreement
|
7.2(b)
|
Cowen
|
Preamble
|
Cowen
Alternative Proposal
|
7.10(b)(i)
|
Cowen
Benefit Plans
|
4.11(a)
|
Cowen
By-Laws
|
4.1(a)
|
Cowen
Capitalization Date
|
4.2(a)
|
Cowen Certificate
|
3.1(b)
|
Cowen
Certificate of Merger
|
1.3(a)
|
Cowen
Charter
|
4.1(a)
|
Cowen
Common Stock
|
4.2(a)
|
Cowen
Continuation Period
|
7.6(a)
|
Cowen
Contract
|
4.12(a)
|
Cowen
Covered Employees
|
7.6(a)
|
Cowen Disclosure
Schedule
|
Art. IV
|
Cowen Merger
|
Recitals
|
Cowen
Merger Consideration
|
2.1(b)
|
Cowen
Preferred Stock
|
4.2(a)
|
Cowen
Regulatory Agreement
|
4.16(b)
|
Cowen
Requisite Regulatory Approvals
|
8.3(d)
|
Cowen Restricted Shares
|
2.3(b)
|
Cowen
RSUs
|
2.3(c)
|
Cowen
SEC Reports
|
4.5
|
Cowen
Stockholder Approval
|
7.3
|
Cowen
Stockholder Meeting
|
7.3
|
Cowen Stock Options
|
2.3(a)
|
69
Cowen Stock Plans
|
2.3(a)
|
Cowen
Surviving Corporation
|
1.2(a)
|
Delaware
Secretary
|
1.3(a)
|
Effective
Time
|
1.3(a)
|
Employees
|
6.2(c)
|
Exchange Sub
|
Preamble
|
Exchange Sub Membership
Interests
|
1.1(b)
|
Excluded
Ramius Benefits
|
7.6(a)
|
Existing
Policies
|
7.7(c)
|
Form S-4
|
4.4
|
Former
Parent Contracts
|
4.12(a)(xii)
|
GAAP
|
4.6(a)
|
HVB
|
10.1
|
Indemnified
Parties
|
7.7(a)
|
Insurance
Amount
|
7.7(c)
|
Merger Sub
|
Preamble
|
Merger Sub Common Stock
|
1.1(b)
|
New Parent
|
Preamble
|
New Parent By-Laws
|
1.1(a)
|
New Parent Charter
|
1.1(a)
|
New Parent Class A
Common Stock
|
1.1(a)
|
New Parent Class B
Common Stock
|
1.1(a)
|
New Parent Employees
|
7.6(a)
|
New Parent Plan
|
7.3
|
New Parent Plan
Approval
|
7.3
|
New Parent RSU
|
2.3(c)
|
New Parent Stock
Options
|
2.3(a)
|
New Plans
|
7.6(b)
|
Privacy
Rules
|
4.16(i)
|
Proxy
Statement
|
4.4
|
RAAP
|
6.2(b)(ii)
|
Ramius
|
Preamble
|
Ramius
Alternative Proposal
|
7.10(a)(i)
|
Ramius Asset Exchange
|
Recitals
|
Ramius
Benefit Plans
|
5.11(a)
|
Ramius
Contract
|
5.12(a)
|
Ramius
Disclosure Schedule
|
Art. V
|
Ramius
Financial Statements
|
5.6(a)
|
Ramius
LLC Agreement
|
5.1(a)
|
Ramius
Regulatory Agreement
|
5.16(b)
|
Ramius
Requisite Regulatory Approvals
|
8.2(c)
|
REOP
|
6.2(b)(ii)
|
SGAI
|
4.10
|
Superior
Proposal
|
7.10(c)(ii)
|
Takeover
Statutes
|
4.19
|
Termination
Fee
|
9.2(b)
|
70
Transactions
|
Recitals
|
Voting
Agreement
|
Recitals
|
Voting
Debt
|
4.2(a)
|
10.2 Nonsurvival of
Representations, Warranties and Agreements. None of the representations, warranties,
covenants and agreements set forth in this Agreement or in any instrument
delivered pursuant to this Agreement shall survive the Effective Time, except
for Section 7.4 and for those other covenants and agreements
contained in this Agreement that by their terms apply or are to be performed in
whole or in part after the Effective Time.
10.3 Notices. All notices and other communications in
connection with this Agreement shall be in writing and shall be deemed given if
(a) delivered personally, on the date of such delivery, (b) upon
confirmation of receipt when transmitted via facsimile (but only if followed by
transmittal by national overnight courier or by hand for delivery on the next
Business Day), or (c) on receipt after dispatch by registered or certified
mail (return receipt requested), postage prepaid, or (d) on the next
Business Day if delivered by a national overnight courier (with confirmation),
addressed, in each case, as follows:
(a) if to Cowen,
to:
Cowen Group, Inc.
1221 Avenue of Americas
New York, NY 10020
Attention:
|
J. Kevin McCarthy, Esq.
|
|
General Counsel
|
|
Facsimile:
|
(646) 562-1936
|
|
|
|
|
|
with a copy to:
|
|
|
|
|
Wachtell, Lipton, Rosen & Katz
|
|
51 West 52nd St.
|
|
|
New York, NY 10019
|
|
|
|
|
Attention:
|
Edward Herlihy, Esq.
|
|
|
David E. Shapiro, Esq.
|
|
Fax:
|
(212) 403-2000
|
|
(b) if to Ramius,
to:
Ramius LLC
|
|
|
599 Lexington Avenue, 20th Floor
|
|
New York, NY
10022
|
|
|
|
|
Attention:
|
Owen S. Littman, Esq.
|
|
|
General Counsel
|
|
Facsimile:
|
(212) 845-7986
|
|
71
|
with a copy to:
|
|
|
|
Willkie Farr & Gallagher LLP
|
|
The Equitable Center
|
|
787 Seventh Avenue
|
|
New York, NY 10019
|
|
Attention:
|
David K. Boston, Esq.
|
|
Lawrence D.
Weltman, Esq.
|
|
Laura L.
Delanoy, Esq.
|
Fax:
|
(212) 728-8111
|
10.4 Interpretation; Knowledge. When a reference is made in this Agreement to
Articles, Sections, Exhibits or Schedules, such reference shall be to an Article or
Section of or Exhibit or Schedule to this Agreement unless otherwise
indicated. The table of contents and
headings contained in this Agreement are for reference purposes only and shall
not affect in any way the meaning or interpretation of this Agreement. Whenever the words include, includes or including
are used in this Agreement, they shall be deemed to be followed by the words without
limitation. Words defined in the
singular have the parallel meaning in the plural and vice versa. Words of one gender shall be construed to
apply to each gender and the neutral gender.
The term party: refers to a party to this Agreement and the term parties
refers to the parties to this Agreement.
This Agreement shall not be interpreted or construed to require any
person to take any action, or fail to take any action, if to do so would
violate any applicable law. The parties hereto
acknowledge that each party hereto has reviewed, and has had an opportunity to
have its counsel review, this Agreement and that any rule of construction
to the effect that any ambiguities are to be resolved against the drafting
party, or any similar rule operating against the drafter of an agreement,
shall not be applicable to the construction or interpretation of this
Agreement. The phrases known or knowledge
mean, with respect to either party to this Agreement, the actual knowledge of,
in the case of Cowen, the individuals set forth on Section 10.4 of
the Cowen Disclosure Schedule, and in the case of Ramius, the individuals set
forth on Section 10.4 of the Ramius Disclosure Schedule.
10.5 Disclosure Schedules. The statements in the Cowen Disclosure
Schedule and the Ramius Disclosure Schedule relate to the provisions in the
section of this Agreement to which they expressly relate; provided, however,
that any information set forth in one section of the Cowen Disclosure Schedule
or the Ramius Disclosure Schedule, as the case may be, shall also be deemed to
apply to each other section to which its relevance is reasonably apparent. In the Cowen Disclosure Schedule and the
Ramius Disclosure Schedule, (a) all capitalized terms used but not defined
therein shall have the meanings assigned to them in the Agreement; (b) the
section numbers correspond to the section numbers in this Agreement; (c) inclusion
of any item in a disclosure letter (i) does not represent an admission
that such item represents a material exception or material fact, event or
circumstance or that such item has had or would be reasonably likely to have a
Material Adverse Effect on Cowen or Ramius, as applicable; (ii) does not
represent a determination that such item did not arise in the Ordinary Course
of Business; and (iii) shall not constitute, or be deemed to be, an
admission to any third party concerning such item. The Cowen Disclosure Schedule and the Ramius
Disclosure Schedule, as well as all other schedules and all exhibits hereto,
shall be deemed part of this Agreement and included in any reference to this
Agreement.
72
10.6 Counterparts. This Agreement may be executed in two or more
counterparts, all of which shall be considered one and the same agreement and
shall become effective when counterparts have been signed by each of the
parties and delivered to the other party, it being understood that each party
need not sign the same counterpart.
10.7 Entire Agreement. This Agreement (including the documents and
the instruments referred to in this Agreement), together with the
Confidentiality Agreement, constitutes the entire agreement and supersedes all
prior agreements and understandings, both written and oral, between the parties
with respect to the subject matter of this Agreement, other than the
Confidentiality Agreement.
10.8 Severability. Any term or provision of this Agreement which
is invalid or unenforceable in any jurisdiction shall, as to that jurisdiction,
be ineffective to the extent of such invalidity or unenforceability and, unless
the effect of such invalidity or unenforceability would prevent the parties
from realizing the major portion of the economic benefits of the Transactions
that they currently anticipate obtaining therefrom, shall not render invalid or
unenforceable the remaining terms and provisions of this Agreement in any other
jurisdiction. If any provision of this
Agreement is so broad as to be unenforceable, the provision shall be
interpreted to be only so broad as is enforceable.
10.9 Governing Law; Jurisdiction. This Agreement shall be governed and
construed in accordance with the internal laws of the State of Delaware
applicable to contracts made and wholly performed within such state, without
regard to any applicable conflicts of law principles. The parties hereto agree
that any suit, action or proceeding brought by either party to enforce any
provision of, or based on any matter arising out of or in connection with, this
Agreement or the transactions contemplated hereby shall be brought in any
federal or state court located in the State of Delaware. Each of the parties
hereto submits to the jurisdiction of any such court in any suit, action or
proceeding seeking to enforce any provision of, or based on any matter arising
out of, or in connection with, this Agreement or the transactions contemplated
hereby and hereby irrevocably waives the benefit of jurisdiction derived from
present or future domicile or otherwise in such action or proceeding. Each party hereto irrevocably waives, to the
fullest extent permitted by law, any objection that it may now or hereafter
have to the laying of the venue of any such suit, action or proceeding in any
such court or that any such suit, action or proceeding brought in any such
court has been brought in an inconvenient forum.
10.10 WAIVER OF JURY TRIAL. EACH OF THE PARTIES HEREBY WAIVES TRIAL BY
JURY IN ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY, IN ANY MATTERS (WHETHER
SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF, RELATED TO,
OR CONNECTED WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
10.11 Publicity. Neither Cowen nor Ramius shall, and neither
Cowen nor Ramius shall permit any of its Subsidiaries to, issue or cause the
publication of any press release or other public announcement with respect to,
or otherwise make any public statement concerning, the transactions
contemplated by this Agreement without the prior consent of Ramius, in the case
of a proposed announcement or statement by Cowen, or Cowen, in the case of a
proposed announcement or statement by Ramius; provided, however,
that either party may, without the
73
prior consent of the other
party (but after prior consultation with the other party to the extent
practicable under the circumstances) issue or cause the publication of any
press release or other public announcement to the extent required by law or by
the rules and regulations of the NASDAQ or other Regulatory Agency.
10.12 Enforcement. The parties agree that irreparable damage
would occur in the event that any of the provisions of this Agreement were not
performed in accordance with their specific terms on a timely basis or were
otherwise breached. It is accordingly
agreed that the parties shall be entitled to an injunction or other equitable
relief to prevent breaches of this Agreement and to enforce specifically the
terms and provisions of this Agreement in any court identified in the Section 10.9
hereto, this being in addition to any other remedy to which they are entitled
at law or in equity (except as limited by Section 9.2(c) hereof).
10.13 Assignment; Third Party
Beneficiaries. Neither
this Agreement nor any of the rights, interests or obligations under this
Agreement shall be assigned by either of the parties (whether by operation of
law or otherwise) without the prior written consent of the other party. Subject to the preceding sentence, this
Agreement shall be binding upon, inure to the benefit of and be enforceable by
each of the parties and their respective successors and assigns. Except as otherwise specifically provided in Section 7.7,
this Agreement (including the documents and instruments referred to in this
Agreement) is not intended to and does not confer upon any person other than
the parties hereto any rights or remedies under this Agreement.
Remainder of Page Intentionally
Left Blank
74
IN
WITNESS WHEREOF, Cowen, New Parent, Merger Sub, Exchange Sub and Ramius have
caused this Agreement to be executed by their respective officers thereunto
duly authorized as of the date first above written.
|
COWEN GROUP, INC.
|
|
|
|
|
|
By:
|
/s/ David M. Malcolm
|
|
|
Name:
|
David M. Malcolm
|
|
|
Title:
|
President and Chief Executive Officer
|
|
|
|
LEXINGTONPARK PARENT CORP.
|
|
|
|
|
|
By:
|
/s/ Christopher A. White
|
|
|
Name:
|
Christopher A. White
|
|
|
Title:
|
Vice President
|
|
|
|
|
|
|
By:
|
/s/ Jeffrey M. Solomon
|
|
|
Name:
|
Jeffrey M. Solomon
|
|
|
Title:
|
President
|
|
|
|
LEXINGTON MERGER CORP.
|
|
|
|
|
|
By:
|
/s/ Christopher A. White
|
|
|
Name:
|
Christopher A. White
|
|
|
Title:
|
Vice President
|
|
|
|
|
|
|
By:
|
/s/ Jeffrey M. Solomon
|
|
|
Name:
|
Jeffrey M. Solomon
|
|
|
Title:
|
President
|
|
PARK EXCHANGE LLC
|
|
|
|
|
|
By:
|
/s/ Christopher A. White
|
|
|
Name:
|
Christopher A. White
|
|
|
Title:
|
Manager
|
|
|
|
|
|
|
By:
|
/s/ Jeffrey M. Solomon
|
|
|
Name:
|
Jeffrey M. Solomon
|
|
|
Title:
|
Manager
|
|
|
|
|
|
|
RAMIUS LLC
|
|
|
|
By:
|
C4S & Co., L.L.C., its managing member
|
|
|
|
By:
|
/s/ Peter A. Cohen
|
|
|
Name:
|
Peter A. Cohen
|
|
|
Title:
|
Managing Member
|
[Signature Page to Transaction Agreement]
Exhibit 10.1
Execution Version
ASSET EXCHANGE AGREEMENT
This Asset Exchange
Agreement (the Agreement),
dated as of June 3, 2009, is entered into by and among RAMIUS, LLC (Ramius),
a Delaware limited liability company,
HVB ALTERNATIVE ADVISORS LLC (Transferor), a Delaware limited
liability company and an indirect wholly-owned subsidiary of HVB AG, BAYERISCHE
HYPO- UND VEREINSBANK AG (HVB AG), a German corporation, COWEN GROUP INC., a Delaware corporation,
and following, the consummation of the transactions contemplated by the
Transaction Agreement, the successor to JV Acquiror (Cowen),
LEXINGTONPARK PARENT CORP., a Delaware corporation (New Parent),
LEXINGTON MERGER CORP., a Delaware corporation and direct wholly-owned
subsidiary of New Parent (JV Acquiror and, together with New Parent,
collectively the New Parent Parties).
RECITALS
WHEREAS, Transferor is a member of Ramius Fund of Funds Group LLC (the JV),
a Delaware limited liability company, and as such owns an interest therein (the
JV Interest) which interest comprises all of the HVB Sharing
Percentage (as defined in the JV LLC Agreement);
WHEREAS, Ramius has entered into a Transaction Agreement and Agreement
and Plan of Merger, dated the date hereof (as the same be hereafter amended in
accordance with its terms, the Transaction Agreement) with, among
other parties thereto, the New Parent Parties providing for, among other
things, an acquisition of substantially all of the assets (including Ramiuss
interest in the JV) and liabilities of Ramius (the Ramius Asset Exchange)
by Park
Exchange LLC, a Delaware limited liability company and a direct wholly-owned
subsidiary of New Parent, in exchange for shares of Class A Common
Stock, $0.01 par value per share, of New Parent (the Class A Common
Stock);
WHEREAS, the parties hereto desire that, at the closing under the
Transaction Agreement, subject to the satisfaction or waiver of the conditions
precedent set forth herein, Transferor transfer to JV Acquiror, and JV Acquiror
acquire from the Transferor, the JV Interest (the JV Interest Exchange)
and New Parent, on behalf of JV Acquiror, shall deliver to Transferor the
Exchange Consideration (as defined below);
WHEREAS, the parties hereto desire that, as a result of the JV Interest
Exchange, certain provisions of the Amended and Restated Limited Liability
Company Agreement, dated as of December 31, 2004 (the JV LLC Agreement)
be terminated as to Transferor but that other agreements between Transferor and
its Affiliates on the one hand and Ramius and its Affiliates on the other be
continued;
WHEREAS, Subsidiaries (including UniCredit, the UniCredit Parties)
of UniCredit SpA, the parent of Transferor (UniCredit), and certain
Affiliates of Ramius (including Ramius, the Ramius Parties), in each
case that are parties to the Ramius Revolving Credit Agreement, the Ramius
Investment Management Agreement, the JV Secured Revolving Credit Agreement and
the JV Investment Management Agreement have entered into certain
agreements amending such agreements, including the AuM Amendment
Agreements (together, the Amendments); and
WHEREAS, for U.S. federal income tax purposes, the parties intend that
the JV Interest Exchange be treated as a taxable exchange in which gain or loss
is recognized.
NOW, THEREFORE, the
parties, in consideration of their mutual promises and intending to be legally
bound, agree as follows:
ARTICLE I.
DEFINITIONS AND USAGE
Section 1.1. Definitions. For purposes of this Agreement, the following
terms and variations thereof have the meanings specified or referred to in this
Section 1.1:
Acquirors as
defined in the caption to this Agreement.
Adjusted Number of
Shares as defined in Section 2.1(a).
Affiliate means
, with respect to any Person, any other Person that, directly or
indirectly through one or more intermediaries, controls, or is controlled by,
or is under common control with, such Person, and the term control (including
the terms controlled by and under common control with) means the possession,
directly or indirectly, of the power to direct or cause the direction of the
management and policies of such Person, whether through ownership of voting
securities, by contract or otherwise; provided, that, for purposes of
this Agreement no UniCredit Party nor any of their respective controlled
affiliates shall be deemed to be Affiliates of Ramius and none of Ramius or any
of its Subsidiaries shall be deemed to be Affiliates of any UniCredit Party.
Agreement as defined in the
caption to this Agreement.
Amendments as
defined in the Recitals, such term to include the Ramius Security Agreement (as
defined therein).
Ancillary Agreements
means the Amendments, the Assignment, the Fourth Amended and Restated Ramius
LLC Agreement, the Joinder Agreement, the Registration Rights Agreement and, to
the extent applicable, the JV Note and the JV Note Security Agreement.
Assignment as defined in Section 2.3(a)(i).
AuM Amendment
Agreements means that certain Second Amendment to the Investment Reporting
Agreement by and between HVB AG and Ramius HVB Partners, LLC and that certain
Amendment to the Amended and Restated Investment Management Agreement by and
between Bank Austria Cayman Islands Limited and Ramius, each dated as of the
date hereof.
Base Number of Shares
as defined in Section 2.1(a).
2
BHC Act the
Bank Holding Company Act of 1956, as amended.
Breach any breach of, or any
inaccuracy in, any representation or warranty or any breach of, or failure to
perform or comply with, any covenant or obligation, in or of this Agreement or
any other Contract, or any event which with the passing of time or the giving
of notice, or both, would constitute such a breach, inaccuracy or failure.
Change of Control
the occurrence of any merger, consolidation, tender offer, or
any other transaction resulting in the stockholders of New Parent immediately
before such transaction owning less than a majority of the aggregate voting
power of the resultant entity or any sale of all or substantially all of the
assets of New Parent;
Class A Common
Stock as defined in the Recitals.
Class B Common
Stock means Class B Common Stock, par value $0.01 per share, of New
Parent.
Closing as defined in Section 2.2.
Code means the
Internal Revenue Code of 1986, as amended.
Common Stock
means the Common Stock of New Parent.
Common Stock
Consideration as defined in Section 2.1(a).
Contract any contract, lease
or other agreement (whether written or oral).
Cowen as
defined in the caption to this Agreement.
Debt Consideration
as defined in Section 2.1(a).
Encumbrance any lien, option,
pledge, security interest, mortgage, right of way, easement, encroachment,
servitude, right of first option, right of first refusal or similar
restriction; provided that, in respect of the
JV Interest, such term shall not include restrictions pursuant to the JV LLC
Agreement or state or federal securities laws, and in respect of the Exchange Consideration,
such term shall not include restrictions pursuant to federal or state
securities laws.
Exchange Act means the Securities Exchange Act of 1934, as amended,
and the rules and regulations promulgated thereunder by the SEC.
Exchange Consideration
as defined in the Recitals.
Governing Documents with
respect to any particular entity, (a) if a corporation, the articles or
certificate of incorporation and the bylaws; (b) if a general partnership,
the partnership agreement and any statement of partnership; (c) if a
limited partnership, the limited
partnership agreement and the certificate of limited partnership; (d) if a
limited liability company, the certificate of formation and operating
agreement; (e) if another
3
type of Person, any other
charter or similar document adopted or filed in connection with the creation,
formation or organization of the Person; (f) all equityholders
agreements, voting agreements, voting trust agreements or other similar
agreements or documents relating to the organization, management or operation
of any Person; and (g) any amendment or supplement to any of the
foregoing.
Governmental Authorization any
consent, license, registration or permit issued, granted, given or otherwise
made available by or under the authority of any Governmental Body or pursuant
to any Law.
Governmental
Body any international, federal,
state, local, municipal, foreign or other governmental or quasi-governmental
authority of any nature (including any agency, branch, department, board,
commission, court, tribunal or other entity exercising governmental or
quasi-governmental powers) or exercising, or entitled or purporting to
exercise, any administrative, executive, judicial, legislative, police,
regulatory or taxing authority or power.
HVB AG as
defined in the caption to this Agreement.
HVB Solicitation
Agreement means that certain Solicitation Agreement, dated
as of December 31, 2004, by and between Ramius HVB Partners, LLC and HVB
AG.
Insider Trading Policy
means that certain Insider Trading Policy of New Parent attached as Exhibit B
hereto.
Joinder Agreement
the Joinder Agreement to the JV LLC Agreement in the form of Exhibit A
hereto.
JV as defined in
the Recitals.
JV Acquiror as
defined in the caption to this Agreement.
JV Funds means
investment funds managed by the JV or its Subsidiaries.
JV Interest as
defined in the Recitals.
JV Interest Exchange
as defined in the Recitals.
JV Investment
Management Agreement means the Investment Reporting Agreement, dated as
of July 29, 2005 between the JV and HVB AG, as thereafter amended
(including the date hereof).
JV LLC Agreement as defined in
the Recitals.
JV Note means
the promissory note, in a principal amount equal to the JV Principal Amount, in
the form attached as Exhibit C hereto.
JV Note Security
Agreement means the security agreement in a form substantially identical
to the Security Agreement attached to the Secured Revolving
Credit
4
Agreement dated as of June 3, 2009, by and among Ramius, as
borrower, and Bayerische Hypo-und Vereinsbank AG, New York Branch as
administrative agent, issuing bank and lender, to be executed and delivered at Closing pursuant to the JV Note
if the New Parent Revolver Execution does not occur.
JV Principal Amount
means $10,370,032, as such amount shall be adjusted if required pursuant to Section
2.1(b).
JV Secured Revolving
Loan Agreements means those agreements listed on Schedule 1.1-A hereto.
Law means
any foreign, federal, state, or local law, statute, code, ordinance, rule,
regulation or other requirement.
Lender means
Bayerische Hypo -un Vereinsbank AG, New York Branch.
Liability with respect to any
Person, any liability or obligation of such Person of any kind, character or
description, whether known or unknown, absolute or contingent, accrued or
unaccrued, disputed or undisputed, liquidated or unliquidated, secured or
unsecured, joint or several, due or to become due, vested or unvested,
executory, determined, determinable or otherwise, and whether or not the same
is required to be accrued on the financial statements of such Person.
Lock-up Termination
Event means any of the following: (a) a material
breach by Ramius of any of the following agreements: the Ramius Revolving
Credit Agreement (or any replacement facility provided by the Lender), the JV
Secured Revolving Credit Agreement, this Agreement, the Investment Reporting Agreement by
and between HVB AG and Ramius HVB Partners, LLC, as amended, the Ramius
Investment Management Agreement, as amended, the JV Investment Management
Agreement, as amended, the Fourth Amended and Restated Ramius LLC Agreement
and, in each case if applicable, the JV Note and the New Parent Revolver, which
breach has remained uncured for a period of 10 days after receipt by Ramius of
written notice of such breach; (b) unless the UniCredit Parties and their
Affiliates beneficially own, in the aggregate, less than 4.9% of the
outstanding Common Stock throughout any consecutive ninety (90) day period, the
failure of the Managing Member to vote all of the shares of Class A Common
Stock held by Ramius in favor of the election to the board of directors of New
Parent of the Board Designee; (c) if the Managing Member ceases to be
controlled by at least two of Peter A. Cohen, Morgan B. Stark, Thomas W.
Strauss and Jeffrey Solomon; or (d) a Change of Control.
Managing Member
as defined in the Ramius LLC Agreement.
Material Adverse Effect means with respect to
Ramius or Transferor, as the case may be, any event, change, circumstance or
development which has or is reasonably likely to have a material adverse effect
on (i) the financial condition, results of operations or business of such
party and its Subsidiaries taken as a whole; provided, however,
that, with respect to clause (i), the term Material Adverse Effect shall not
include any effects resulting from (A) changes, after the date hereof, in
GAAP or regulatory accounting requirements applicable generally to companies in
the industries in which such party and its Subsidiaries operate,
5
(B) changes, after the date hereof, in laws, rules, regulations or
the interpretation of laws, rules or regulations by Governmental Bodies of
general applicability to companies in the industries in which such party and
its Subsidiaries operate, (C) actions or omissions taken with the prior
written consent of the other party or expressly required by this Agreement, (D) changes
in global, national or regional political conditions (including acts of
terrorism or war) or general business, economic or market conditions, including
changes generally in prevailing interest rates, currency exchange rates, credit
markets and price levels or trading volumes in the United States or foreign
securities markets, in each case generally affecting the industries in which
such party or its Subsidiaries operate and including changes to any previously
correctly applied asset marks resulting therefrom, (E) the execution of
this Agreement or the public disclosure of this Agreement or the transactions
contemplated hereby, including losses of employees to the extent resulting
therefrom, (F) failure, in and of itself, to meet earnings projections,
but not including any underlying causes thereof, (G) changes
in the trading price of a partys common stock, in and of itself, but not
including any underlying causes or (H) in the case of Ramius and its
Subsidiaries, withdrawals from the Funds that are consistent with withdrawals
from the Funds over the past twelve months, except, with respect to
clauses (A), (B) and (D), to the extent that the effects of such change
are materially and disproportionately adverse to the financial condition,
results of operations or business of such party and its Subsidiaries, taken as
a whole, as compared to other companies in the industry in which such party and
its Subsidiaries operate or (ii) the ability of such party to timely
consummate the transactions contemplated by this Agreement.
New Parent as
defined in the caption to this Agreement.
New Parent Parties as defined in the caption to this
Agreement.
New Parent Revolver means the $25,000,000 secured revolving credit
facility that may be entered into by the Lender and New Parent on or
immediately prior to the Closing.
New Parent Revolver
Execution as
defined in Section 2.1(a).
Order any order, injunction,
judgment, decree, ruling, assessment or arbitration award of any Governmental
Body or arbitrator.
Ordinary Course of
Business means, with respect to any Person, the ordinary
and usual course of business of such Person consistent with its past practice
through the date hereof.
Person any
individual, partnership, limited liability company, joint venture, corporation,
trust, government (or agencies or political subdivisions thereof) and other
association or entity.
Ramius as
defined in the caption to this Agreement.
Ramius Asset Exchange as defined in the Recitals.
Ramius Funds means investment funds managed by Ramius or its
Subsidiaries.
6
Ramius Investment Management Agreement means the Amended and
Restated Investment Management Agreement, dated as of June 3, 2003,
between Ramius (f/k/a Ramius Capital Group, LLC) and Bank Austria Cayman
Islands Limited, as hereafter amended (including on the date hereof).
Ramius LLC Agreement means the Third Amended and Restated
Limited Liability Company Agreement of Ramius, dated as of January 1,
2007.
Ramius Parties as defined in the Recitals.
Ramius Revolving Credit Agreement means the Revolving Loan
Agreement, dated as of June 3, 2003, by and between Ramius (f/k/a Ramius
Capital Group, LLC) and BA Alpine Holdings, Inc., as thereafter amended
(including on the date hereof).
Registration Rights
Agreement means the Registration Rights Agreement in the form of Exhibit D
hereto.
SEC means the United
States Securities and Exchange Commission.
Securities Act the Securities
Act of 1933, as amended, and the rules and regulations promulgated
thereunder.
Subsidiary with respect to any
Person (the Owner),
any corporation or other Person of which securities or other interests having
the power to elect a majority of that corporations or other Persons board of
directors or similar governing body, or otherwise having the power to direct
the business and policies of that corporation or other Person (other than
securities or other interests having such power only upon the happening of a
contingency that has not occurred), are held by the Owner or one or more of its
Subsidiaries; provided that none of the JV Funds or Ramius Funds shall be deemed
to be a Subsidiary of Ramius or the JV.
Third Party Investors as
defined in Section 8.1.
Transaction Agreement
as defined in the Recitals.
Transferor as
defined in the caption to this Agreement.
UniCredit as
defined in the Recitals.
UniCredit Consent
means the Consent, dated the date hereof, of UniCredit and certain of its
Affiliates.
UniCredit Parties
as defined in the Recitals.
Section 1.2. Usage.
(a) Interpretation.
In this Agreement, unless a clear contrary intention appears:
(i) the singular number includes the
plural number and vice versa;
7
(ii) reference to any Person includes such Persons successors and
assigns but, if applicable, only if such successors and assigns are not
prohibited by this Agreement, and reference to a Person in a particular
capacity excludes such Person in any other capacity or individually;
(iii) reference to any gender includes each other gender;
(iv) reference to any agreement, document or instrument means such
agreement, document or instrument as amended or modified and in effect from
time to time in accordance with the terms thereof;
(v) reference to any Law means such Law as amended, modified,
codified, replaced or reenacted, in whole or in part, and in effect from time
to time, including rules and regulations promulgated thereunder, and
reference to any section or other provision of any Law means that provision of
such Law from time to time in effect and constituting the substantive amendment,
modification, codification, replacement or reenactment of such section or other
provision;
(vi) hereunder, hereof, hereto, and words of similar import shall be deemed
references to this Agreement as a whole and not to any particular Article, Section or
other provision hereof;
(vii) including (and
with correlative meaning include)
means including without limiting the generality of any description preceding
such term;
(viii) with respect to the determination of any period of time, from means from and including and to
means to but excluding; and
(ix) references to documents, instruments or agreements shall be deemed
to refer as well to all addenda, Exhibits, schedules or amendments thereto.
(b) Legal Representation of the Parties. This Agreement was negotiated by the parties
with the benefit of legal representation, and any rule of construction or
interpretation otherwise requiring this Agreement to be construed or
interpreted against any party shall not apply to any construction or
interpretation hereof.
ARTICLE II.
JV INTEREST EXCHANGE; CLOSING
Section 2.1. JV Interest Exchange;
Closing; Exchange Consideration.
(a) Upon
the terms and subject to the conditions set forth in this Agreement, at the
Closing, Transferor shall transfer, convey, assign, and deliver to JV Acquiror
the JV Interest, free and clear of all Encumbrances, and New Parent shall, and
Ramius and Cowen shall cause New Parent, on behalf of JV Acquiror, to issue and
deliver to Transferor, or its designee in accordance with Section 11.8, (i) good
valid title to 2,713,882 shares (the Base Number of Shares) of Class A
Common Stock (subject to adjustment as provided below), free and clear of
8
all
Encumbrances (other than pursuant to this Agreement) (the Common Stock
Consideration), and (ii) the JV Note and the JV Note Security
Agreement, provided, however, that if the New Parent Revolver has been entered
into by New Parent and the Lender on or immediately prior to the Closing (the New
Parent Revolver Execution), then New Parent shall not execute and deliver
the JV Note and the JV Note Security Agreement, but shall instead borrow under
the New Parent Revolver an amount equal to the JV Principal Amount and shall
deliver to Transferor the JV Principal Amount in cash, by wire transfer of
immediately available funds (the Debt Consideration and, together with
the Common Stock Consideration, the Exchange Consideration).
(b) In
the event that the Base Number of Shares would exceed 4.9% of the issued and
outstanding shares of Class A Common Stock immediately following the
consummation of the transactions contemplated by the Transaction Agreement and
the JV Interest Exchange, (i) the number of shares that constitute the Common
Stock Consideration shall be adjusted downward so that the Transferor receives
a number of shares of Class A Common Stock equal to 4.9% of the issued and
outstanding shares of Class A Common Stock (the Adjusted Number of
Shares) and (ii) the JV Principal Amount shall be increased by an
amount equal to the product of (x) $8.6555 and (y) the excess of (I) the
Base Number of Shares over (II) the Adjusted Number of Shares.
Section 2.2. Closing. Subject to the conditions set forth in this
Agreement, the consummation of the transactions provided for in this Agreement
(the Closing) shall be
held at the time of the closing under the Transaction Agreement at the offices
of Willkie Farr & Gallagher, 787 Seventh Avenue, New York, New York
10019, or at such other place as the closing under the Transaction Agreement is
to occur or as the parties hereto shall otherwise agree in writing. Ramius shall provide notice to Transferor of
the date of the closing under the Transaction Agreement at least three business
days in advance. At the Closing, all of
the transactions provided for in this Article II shall be
consummated on a substantially concurrent basis, effective immediately
following the consummation of the Ramius Asset Exchange.
Section 2.3. Closing Obligations. In addition to any other documents to be
delivered under other provisions of this Agreement, at the Closing:
(a) Transferor shall deliver:
(i) To JV Acquiror, an assignment (the Assignment)
of all of the JV Interest in the form of Exhibit E hereto, executed by
Transferor;
(ii) the Registration Rights Agreement executed, in respect of the
Exchange Consideration, by the UniCredit Parties that are members of Ramius as
of the Closing and Transferor; and
(iii) if the New Parent Revolver Execution has not occurred, an executed
counterpart to the JV Note, executed by the UniCredit Parties thereto.
(b) New Parent shall, and Ramius, Cowen and JV Acquiror shall cause
New Parent to, deliver to Transferor:
9
(i) Duly executed and validly issued
stock certificates in the name of Transferor representing the Common Stock
Consideration;
(ii) on behalf of JV Acquiror, evidence
that the shares of Class A Common Stock included in the Exchange
Consideration have been authorized for listing on the NASDAQ;
(iii) (x) if the New Parent Revolver
Execution has not occurred, the JV Note and the JV Note Security Agreement,
each executed by New Parent and any Subsidiaries party thereto or (y) if
the New Parent Revolver Execution has occurred, the JV Principal Amount in
cash; and
(iv) the Registration Rights Agreement
executed by New Parent.
(c) Ramius shall deliver to New Parent
and Transferor the Registration Rights Agreement executed by Ramius.
(d) JV Acquiror shall deliver to Park
Exchange LLC:
(i) the Joinder Agreement executed by
Acquiror.
ARTICLE III.
REPRESENTATIONS AND WARRANTIES OF TRANSFEROR
Transferor represents and
warrants to the other parties hereto, both as of the date hereof and as of the
Closing, as follows:
Section 3.1. Organization and Good
Standing. Each of the UniCredit Parties is a
entity duly organized, validly existing and in good standing under the laws of
its jurisdiction of organization, with full corporate power and authority to
conduct its business as it is now being conducted and to own or use the
properties and assets that it purports to own or use.
Section 3.2. Enforceability; Authority; No
Conflict.
(a) This Agreement and the Amendments
constitute the legal, valid and binding obligations of the UniCredit Parties
that are parties thereto, enforceable against each of them in accordance with
its terms, except as such enforceability may be limited by bankruptcy,
insolvency, reorganization, fraudulent conveyance or transfer or similar laws affecting
the enforcement of creditors rights generally and general principles of equity
(whether considered in a proceeding at law or in equity). Upon the execution and delivery by the
applicable UniCredit Parties of the other Ancillary Agreements to which it is a
party, each of such agreements so executed thereby will constitute the legal,
valid and binding obligation of such UniCredit Party, enforceable against it in
accordance with its terms, except as such enforceability may be limited by
bankruptcy, insolvency, reorganization, fraudulent conveyance or transfer or
similar laws affecting the enforcement of creditors rights generally and
general principles of equity (whether considered in a proceeding at law or in
equity). Each of the UniCredit Parties has
the requisite right, power and authority to execute and deliver this Agreement
and the
10
Ancillary Agreements executed (or to be executed thereby) to which
it is a party, and to perform its obligations under this Agreement and such
Ancillary Agreements, and such action has been duly authorized by all necessary
corporate or limited liability company action.
(b) Neither the execution and delivery
of this Agreement or the applicable Ancillary Agreements by the UniCredit
Parties nor the consummation or performance of any of this Agreement or such
Ancillary Agreements by any of them will, directly or indirectly (with or
without notice or lapse of time):
(i) Breach any provision of any of the
Governing Documents of the UniCredit Party executing or delivering such
agreement;
(ii) Breach any Law or any Order to
which the UniCredit Party executing or delivering such agreement may be
subject; or
(iii) contravene, conflict with or result
in a violation or Breach of any of the terms or requirements of any
Governmental Authorization applicable to the UniCredit Party executing or
delivering such agreement.
Section 3.3. Title.
Transferor owns good and marketable title to the JV Interest, free and
clear of all Encumbrances. The Interest
constitutes the entire equity interest in the JV owned by UniCredit or its
Affiliates.
Section 3.4. No Consents.
No consents or approvals of or filings or registrations with or
notice to any Governmental Body or any other Person are necessary in connection
with (a) the execution and delivery by the UniCredit Parties of this
Agreement and the Ancillary Agreements and (b) the consummation by the
UniCredit Parties of the transactions contemplated by this Agreement and the
Ancillary Agreements.
ARTICLE IV.
REPRESENTATIONS AND WARRANTIES OF RAMIUS
Ramius represents and
warrants to the other parties hereto, both as of the date hereof and as of the
Closing, as follows:
Section 4.1. Organization and Good Standing. Ramius is a limited liability company duly
formed, validly existing and in good standing under the laws of the
jurisdiction of its formation, with full limited liability company power and
authority to conduct its business as it is now being conducted and to own or
use the properties and assets that it purports to own or use.
Section 4.2. Enforceability; Authority; No
Conflict.
(a) This Agreement and the Amendments
constitutes the legal, valid and binding obligations of Ramius, enforceable
against Ramius in accordance with its terms, except as such enforceability may
be limited by bankruptcy, insolvency, reorganization, fraudulent conveyance or
transfer or similar laws affecting the enforcement of creditors
11
rights generally and general principles of equity (whether
considered in a proceeding at law or in equity). Upon the execution and delivery by Ramius of
the other Ancillary Agreements to which it is a party, each of such agreements
will constitute the legal, valid and binding obligation of Ramius, enforceable
against Ramius in accordance with its terms, except as such enforceability may
be limited by bankruptcy, insolvency, reorganization, fraudulent conveyance or
transfer or similar laws affecting the enforcement of creditors rights
generally and general principles of equity (whether considered in a proceeding
at law or in equity). Ramius has the
requisite right, power and authority to execute and deliver this Agreement and
the Ancillary Agreements executed (or to be executed thereby) to which it is a
party, and to perform its obligations under this Agreement and such Ancillary
Agreements, and such action has been duly authorized by all necessary limited
liability company action.
(b) Neither the execution and delivery
of this Agreement or the applicable Ancillary Agreements by Ramius nor the
consummation or performance of any of this Agreement or such applicable
Ancillary Agreements will, directly or indirectly (with or without notice or
lapse of time):
(i) Breach any provision of any of the
Governing Documents of Ramius;
(ii) Breach any Law or any Order to
which Ramius may be subject; or
(iii) contravene, conflict with or result
in a violation or Breach of any of the terms or requirements of any
Governmental Authorization applicable to Ramius.
Section 4.3. No
Consents. Except as set forth on
Schedule 4.3 hereto and except for the consents of the members of Ramius in
connection with the transactions contemplated by the Transaction Agreement, no
consents or approvals of or filings or registrations with or notice to any
Governmental Body or any other Person are necessary in connection with (A) the
execution and delivery by Ramius of this Agreement or any Ancillary Agreement
and (B) the consummation by Ramius of the transactions contemplated by
this Agreement or any Ancillary Agreement.
ARTICLE V.
REPRESENTATIONS AND
WARRANTIES OF NEW PARENT AND JV ACQUIROR
New
Parent represents and warrants to Transferor, both as of the date hereof and as
of the Closing, as follows:
Section 5.1. Organization and Good Standing.
(a) Both
New Parent and JV Acquiror are corporations duly incorporated, validly existing
and in good standing under the laws of the State of Delaware. Both New Parent and JV Acquiror have the
requisite corporate power and authority to conduct their respective businesses
as they are now being conducted and to own or use the properties and assets
that they purport to own or use.
12
Section 5.2. Enforceability; Authority; No
Conflict.
(a) This Agreement and the Amendments
constitute the legal, valid and binding obligations of the New Parent Parties,
enforceable against the New Parent Parties in accordance with its terms, except
as such enforceability may be limited by bankruptcy, insolvency,
reorganization, fraudulent conveyance or transfer or similar laws affecting the
enforcement of creditors rights generally and general principles of equity
(whether considered in a proceeding at law or in equity). Upon the execution and delivery by each of
the New Parent Parties of the other Ancillary Agreements to which it is a
party, each of such agreements will constitute the legal, valid and binding
obligation of such New Parent Party, enforceable against such Person in accordance
with its terms, except as such enforceability may be limited by bankruptcy,
insolvency, reorganization, fraudulent conveyance or transfer or similar laws
affecting the enforcement of creditors rights generally and general principles
of equity (whether considered in a proceeding at law or in equity). Each New Parent Party has the requisite
right, power and authority to execute and deliver this Agreement and the
Ancillary Agreements executed (or to be executed thereby) to which it is a
party, and to perform its obligations under this Agreement and such Ancillary
Agreements, and such action has been duly authorized by all necessary corporate
or limited liability company action, as the case may be.
(b) Neither the execution and delivery
of this Agreement or the applicable Ancillary Agreements by any New Parent
Party nor the consummation or performance of any of this Agreement or such
applicable Ancillary Agreements will, directly or indirectly (with or without
notice or lapse of time):
(i) Breach any provision of any of the
Governing Documents of such Person;
(ii) Breach any Law or any Order to
which such Person may be subject; or
(iii) contravene, conflict with or result
in a violation or Breach of any of the terms or requirements of any Governmental
Authorization applicable to such Person.
(c) No Consents. Except as set forth on Schedule 5.2 hereto,
no consents or approvals of or filings or registrations with or notice to any
Governmental Body or any other Person are necessary in connection with (A) the
execution and delivery by the New Parent Parties of this Agreement and (B) the
consummation by the New Parent Parties of the transactions contemplated by this
Agreement.
Section 5.3. Capitalization. The authorized capital stock of New Parent
will at Closing consist of 250,000,000 shares of Class A Common Stock,
250,000,000 shares of Class B Common Stock, par value $0.01 per share, and
10,000,000 shares of undesignated preferred stock, par value $0.01 per
share. As of the Closing, all of the
issued and outstanding shares of Class A Common Stock issued to Transferor
or its designee in accordance with this Agreement
13
shall have been duly authorized and validly issued and
will be fully paid, nonassessable and will not have been issued in violation of
any applicable Law or Contract.
ARTICLE VI.
CONDITIONS PRECEDENT TO RAMIUSS, NEW PARENTS AND JV ACQUIRORS OBLIGATIONS TO
CLOSE
The obligation of Acquiror
to acquire the JV Interest from Transferor and the obligation of New Parent to
issue the Exchange Consideration to Transferor and for each of Ramius, Acquiror
and New Parent to take the other actions required to be taken by such parties
at the Closing is subject to the satisfaction, at or prior to the Closing, of
each of the following conditions (any of which may be waived by such parties,
in whole or in part):
Section 6.1. Accuracy of Representations. The representations and warranties of
Transferor set forth in this Agreement shall be true and correct in all
respects (without regard to any materiality qualifiers therein) as of the date
hereof and as of the Closing as though made on and as of the Closing, other
than representations and warranties that speak as of another specific date or
time prior to the date hereof (which need only be true and correct as of such
date or time); provided, however, that for purposes of
determining satisfaction of this condition, such representations and warranties
shall be deemed to be true and correct in all respects unless the failure or
failures of such representations and warranties to be so true and correct,
individually or in the aggregate, would have a Material Adverse Effect on
Transferor.
Section 6.2. Performance. Each of the covenants and obligations that Transferor
and HVB AG are required to perform or to comply with pursuant to this Agreement
and each of the covenants and obligations that each of the UniCredit Parties
are required to perform or to comply with pursuant to the Ancillary Agreements,
in each case, at or prior to the Closing, shall have been duly performed and
complied with in all material respects.
Section 6.3. Ramius
Asset Exchange. The transactions
contemplated by the Transaction Agreement, including, without limitation, the
Ramius Asset Exchange, shall have been consummated.
Section 6.4. Ancillary
Agreements. Each of the Ancillary
Agreements shall be in full force and effect.
Section 6.5. No Injunctions or Restraints; Illegality. No order, injunction or decree issued by any
court or agency of competent jurisdiction or other law preventing or making
illegal the consummation of the transactions contemplated by this Agreement
shall be in effect.
ARTICLE VII.
CONDITIONS PRECEDENT TO TRANSFERORS OBLIGATION TO CLOSE
The obligation of Transferor
to transfer the JV Interest to JV Acquiror and to accept the Exchange
Consideration and of Transferor and HVB AG to take the other actions required
to be taken thereby at the Closing is subject to the satisfaction, at or prior
to the Closing,
14
of each of the following
conditions (any of which may be waived by such parties, in whole or in part):
Section 7.1. Accuracy of Representations. The representations and warranties of Ramius
set forth in this Agreement shall be true and correct in all respects (without
regard to any materiality qualifiers therein) as of the date hereof and as of
the Closing as though made on and as of the Closing, other than representations
and warranties that speak as of another specific date or time prior to the date
hereof (which need only be true and correct as of such date or time); provided,
however, that for purposes of determining satisfaction of this
condition, such representations and warranties shall be deemed to be true and
correct in all respects unless the failure or failures of such representations
and warranties to be so true and correct, individually or in the aggregate,
would have a Material Adverse Effect on Ramius.
Section 7.2. Performance. Each of the covenants and obligations that
each of the New Parent Parties, Ramius and Cowen is required to perform or to
comply with pursuant to this Agreement and each of the covenants and
obligations that such parties are required to perform or comply with pursuant
to the applicable Ancillary Agreements, in each case, at or prior to the
Closing, shall have been duly performed and complied with in all material
respects.
Section 7.3. Ramius
Asset Exchange. The transactions
contemplated by the Transaction Agreement, including, without limitation, the
Ramius Asset Exchange, shall have been consummated in accordance with the
Transaction Agreement.
Section 7.4. NASDAQ Listing. The shares of Class A Common
Stock to be issued as part of the Exchange Consideration shall have been
authorized for listing on the NASDAQ, subject to official notice of issuance.
Section 7.5. No Injunctions or Restraints; Illegality. No order, injunction or decree issued by any
court or agency of competent jurisdiction or other law preventing or making
illegal the consummation of the transactions contemplated by this Agreement
shall be in effect.
Section 7.6. Debt Consideration. The JV Note and JV Note Security Agreement
shall have been executed by New Parent and its Subsidiaries party thereto; provided,
that if the New Parent Revolver Execution has occurred, the JV Note and JV Note
Security Agreement shall not be executed.
ARTICLE VIII.
OTHER AGREEMENTS, ASSURANCES AND ACKNOWLEDGEMENTS
Section 8.1. Exchange
Consideration Transfer Restrictions.
(a) Subject
to Section 8.1(b), following the Closing, Transferor shall not
sell, assign, pledge, transfer or otherwise dispose of all or any part of the Class A
Common Stock issued as part of the Exchange Consideration (including any other
equity securities of New Parent issued or issuable in exchange for or with
respect to such shares of Class A Common Stock (x) by way of
dividend, split or combination of shares or (y) in
15
connection with a
reclassification, recapitalization, merger, consolidation, other reorganization
or similar transaction); provided, that (i) Transferor
may assign all or any part of the Exchange Consideration to any Affiliate all
of the outstanding equity interests of which are owned, directly or indirectly,
by Transferor or by any person which directly or indirectly wholly owns
Transferor, (ii) Transferor may, at any time, transfer a portion of the
Exchange Consideration to the extent necessary to prevent Transferor from being
in violation of the BHC Act or other federal, state or foreign banking Law (in
Transferors sole discretion); and (iii) Transferor may, in non-market
private sale transactions, sell or transfer all or any part of the Exchange
Consideration to third party investors (Third Party Investors);
provided that, without the consent of Ramius, no such private sale transaction,
individually or in the aggregate, shall result in any Third Party Investor and
it Affiliates beneficially owning in excess of 10% of the outstanding shares of
Class A Common Stock as of the completion of such transaction; provided
further, that any transferee of all or portion of the Exchange Consideration
referred to in clauses (i) or (iii) above shall agree in writing to
be bound by Sections 8.1(a) and 8.1(b). Any purported sale, pledge, assignment,
transfer or other disposition of all or of any portion of the Exchange
Consideration in violation of this Section 8.1(a) shall be
null and void and of no force and effect.
(b) The
restrictions set forth in Section 8.1(a) shall expire and be
of no further force or effect commencing one day after the six month
anniversary of the Closing, with respect to the Common Stock included in the
Exchange Consideration if and to the extent that following any sale, assignment,
pledge, transfer or other disposition of such Common Stock by such holder, the
Transferor, its Affiliates and its permitted third-party transferees in
accordance with this Agreement and the Fourth Amended and Restated Limited
Liability Company retain beneficial ownership of at least fifty percent (50%)
of the sum of (x) the Class A Common Stock constituting Exchange
Consideration and (y) the Common Stock constituting the aggregate Capital
Contributions of the Series I Members under the Fourth Amended and
Restated Limited Liability Company (as adjusted for stock splits,
consolidations, recapitalizations, reorganizations, mergers and similar events
affecting the New Parent capital).
Following the second anniversary of the date of this Agreement, the transfer
restrictions set forth in Section 9.1 with respect to the Exchange
Consideration shall terminate. In
addition, any such transfer restrictions shall terminate and cease to apply
following a Lock-up Termination Event.
(c) Notwithstanding
anything to the contrary in this Agreement, subject to any applicable
provisions of the Insider Trading policy of New Parent, the UniCredit Parties
and their Affiliates shall not be restricted from engaging in hedging or
derivatives transactions with respect to shares of Common Stock of New
Parent. Subject to receiving information
regarding the beneficial ownership of Common Stock by the UniCredit Parties and
their Affiliates through Ramius in accordance with the Fourth Amended and
Restated Limited Liability Company of Ramius, the UniCredit Parties shall
provide written notice to Ramius and New Parent reasonably promptly upon
becoming aware that the UniCredit Parties and their Affiliates beneficially
own, in the aggregate, less than 4.9% of the Common Stock of New Parent whether
as a result of hedging or derivates transactions or otherwise. New Parent will promptly inform Transferor in
the event that it enters into any redemption, repurchase or similar transaction
involving its
16
Common Stock that would
reasonably be expected to result in an increase in Transferors or its
Affiliates proportionate interest in the Common Stock.
(d) Notwithstanding
anything to the contrary in this Agreement, but subject to the restrictions on
transfer set forth in Section 8.01(a) and Section 8.01(b),
unless permitted by applicable law, the UniCredit Parties shall not sell or
dispose of any shares of Class B Common Stock they or their Affiliates may
hold from time to time, except solely upon the consummation of any of the
following events: (a) any disposition of shares of Class B Common
Stock to the public in connection with a widely dispersed offering (including,
without limitation, a public offering registered under the Securities Act), (b) any
disposition by a holder of Class B Common Stock of shares of Class B
Common Stock under Rule 144 or Rule 144A promulgated by the SEC under
the Securities Act, or any similar rule then in force, of no more than two
percent (2%) of the outstanding voting securities of New Parent, (c) any
transfer by a holder of Class B Common Stock of shares of Class B
Common Stock in a single transaction to an independent third party or group
(as such term is used for purposes of Section 13(d) of the Exchange Act,
whether or not applicable) of independent third parties who holds or acquires
at least a majority of the outstanding voting securities of New Parent without
regard to the transfer of any shares of Class B Common Stock.
(e) Pursuant to this Agreement and the
Fourth Amended and Restated Ramius LLC Agreement, unless and until the
UniCredit Parties and their Affiliates beneficially own, in the
aggregate, less than 4.9% of the Common Stock of New Parent throughout any
consecutive ninety (90) day period, BA Alpine Holdings Inc. or its
Affiliate-designee shall have the right to nominate one (but no more than one)
individual (the Board Designee) to serve as a director on the board of
directors of New Parent and New Parent shall nominate such designee (or a replacement
designee) as part of the slate proposed by New Parent in connection with any
vote to elect the board of directors of New Parent. In the event that the Board Designee ceases
to be a member of the board of directors of New Parent, unless the UniCredit Parties and their
Affiliates beneficially own, in the aggregate, less than 4.9% of the common
stock of New Parent throughout any consecutive ninety (90) day period, BA
Alpine Holdings Inc. or its Affiliate-designee shall be entitled to select
another person to fill such vacancy and such person shall be appointed by New
Parent to the board of directors.
(f) Subject
to applicable law and stock exchange requirements, unless and until the UniCredit Parties
and their Affiliates beneficially own, in the aggregate, less than 10% of the
Common Stock of New Parent throughout any consecutive ninety (90) day period
following the Closing, New Parent shall use reasonable best efforts to cause
the Board Designee to be a member of each committee of the board of directors
of New Parent.
(g) In
connection with the closing of the transactions pursuant to the Transaction
Agreement, BA Alpine Holdings Inc. shall, upon request by New Parent, notify
New Parent at least ten days prior to the initial filing of the proxy statement
to be submitted to the stockholders of Cowen in connection with the
Transactions, the name of
17
its initial designee to
the board of directors of New Parent.
Such individual shall become a director of New Parent, effective the
business day after the Closing.
(h) For
so long as there is a Board Designee on the board of directors of New Parent,
in the event that Transferor intends to sell or transfer all or a part of the
Exchange Consideration in accordance with this Section 8.1, such
sale or transfer must be made in accordance with the Insider Trading Policy of
New Parent attached hereto as Exhibit E, including, without limitation,
limitations on sales during any blackout periods.
(i) For so long as BA Alpine Holdings
has the right to a Board Designee, New Parent shall not amend its Insider
Trading Policy (i) in any material respect or (ii) in any manner
which would in its practical application discriminatorily affect only the
UniCredit Parties and their Affiliates and which is not reasonably supported by
rational legal or business purpose unrelated to the UniCredit Parties or their
Affiliates investment in Common Stock (other than discriminatory treatment of
the UniCredit Parties and their Affiliates), in each case without the prior
written consent of Transferor, other than any changes that are required by
law. New Parent will use commercially
reasonable efforts to respond as promptly as reasonably practicable to any
request for pre-approval under the Insider Trading Policy made by the UniCredit
Parties or their Affiliates.
Section 8.2. Acknowledgements. Transferor
acknowledges that anything in the JV LLC Agreement to the contrary
notwithstanding, (i) the JV need not make any further distributions to any
member of the JV until this Agreement is terminated; provided, that the (x) JV
may make distributions of up to $5,000,000 in the aggregate to Ramius and (y) Ramius
shall cause JV to make payments of the Retained Fee Stream in accordance with Section 10.1(a) and
the JV LLC Agreement and (ii) the JVs or Ramiuss entering into an
agreement to consummate any transaction, which consummation is subject to (and
does not occur prior to) the occurrence of the Closing, shall not be deemed to
violate the JV LLC Agreement.
Section 8.3. Actions
of Cowen and Ramius. Each of Cowen
and Ramius shall take all actions necessary to cause the New Parent Parties to
comply with their respective obligations hereunder. Notwithstanding anything else in this
Agreement to the contrary, to the extent that New Parent fails to fulfill any
of its obligations under this Agreement due solely to the breach of this
Agreement by either Ramius or Cowen, such breaching party shall be solely
liable for any such failure by New Parent.
Section 8.4. Registration Rights Agreement. Cowen and Ramius shall cause New Parent to
execute and deliver to Transferor the Registration Rights Agreement, at or
prior to Closing.
Section 8.5. JV Note; JV Note Security Agreement. If the New Parent Revolver Execution has not occurred, Cowen and
Ramius shall cause New Parent to execute and deliver to Transferor the JV Note
and the JV Note Security Agreement, at or prior to Closing.
Section 8.6. Transfer Restriction JV Interest. For a period of one year following the
Closing, JV Acquiror will not sell, transfer or otherwise dispose of all or a
portion
18
of the JV Interest and will not acquire any additional
interest in the JV; provided that no sale, transfer or disposition to any
unrelated third-party purchaser from JV Acquiror shall be prohibited hereunder.
Section 8.7. Reorganization.
In
connection with any merger, consolidation, tender offer, or any other
transaction resulting in the stockholders of New Parent immediately before such
transaction owning substantially the same aggregate voting power of the
resultant entity, New Parent
shall use its reasonable best efforts to ensure that BA Alpine Holdings right
to designate a Board Designee to the surviving or succeeding parent company
shall be preserved on the terms described herein, including the requisite
ownership thresholds.
Section 8.8. Tax Treatment. The parties hereto agree to treat the JV
Interest Exchange as a taxable transaction for U.S. federal income tax purposes
that is not part of the Code Section 351 exchange contemplated by the
Transaction Agreement. New Parent and JV Acquiror (and Cowen, as successor to
JV Acquiror) agree to report the JV Interest Exchange consistently with the
foregoing on all applicable tax returns and will not take any action, or
knowingly fail to take any action, which action or failure to act could be
reasonably likely to cause the JV Interest Exchange to be treated as a tax-free
transaction for U.S. federal income tax purposes.
Section 8.9. Registration. Ramius shall in good faith evaluate and consider whether the
shares of Class A Common Stock included in the Exchange Consideration may
in accordance with applicable securities laws be included in the Registration
Statement on Form S-4 (the Form S-4) to be filed by Cowen in
connection with the transactions contemplated by the Transaction
Agreement. If Ramius determines that
such shares may be so included, Ramius shall use commercially reasonable
efforts to include such shares in the Form S-4.
Section 8.8. Closing. Transferor,
HVB AG, Cowen, Ramius and New Parent each acknowledge and agree that the
parties to this Agreement intend (a) for the conditions to each partys
obligation to effect the Closing be satisfied no later than the time at which
the conditions to effect the closing of the transactions contemplated by the
Transaction Agreement are satisfied (other than the condition contained in Section 8.1(f) of
the Transaction Agreement), and (b) to effect the Closing immediately
following the satisfaction of the conditions to the obligations to effect the
closing of the transactions contemplated by the Transaction Agreement (other
than the condition contained in Section 8.1(f) of the Transaction
Agreement). In furtherance and not in
limitation of the foregoing, if, at the time the conditions to effect the
closing under the Transaction Agreement have been met (other than the condition
contained in Section 8.1(f) of the Transaction Agreement), the New
Parent Revolver Execution has not occurred, New Parent shall execute and
deliver, and Transferor shall accept, the JV Note and JV Security Agreement,
such that the conditions to this Agreement shall be satisfied on or before the
time that the conditions to effect the closing under the Transaction Agreement
have been satisfied (other than the condition contained in Section 8.1(f) of
the Transaction Agreement).
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ARTICLE
IX.
TERMINATION
Section 9.1. Termination.
This Agreement shall terminate prior to the Closing solely as follows
(and may not be terminated following the Closing):
(a) By mutual written consent of the parties hereto;
(b) upon termination of the Transaction Agreement; or
(c) by either party in the event that the Closing has not
occurred on or before December 31, 2009, unless the failure of the Closing
to occur by such date shall be due to the failure of the party seeking to
terminate this Agreement to perform or observe the covenants and agreements of
such party set forth in this Agreement.
Section 9.2. Effect of Termination.
In the event this Agreement is terminated pursuant to Section 9.1
all further obligations of the parties hereunder shall terminate, except for
the obligations set forth in this Section 9.2 and Article XI,
and except that such termination shall not relieve any party hereto of any
Liability for any Breach of this Agreement prior to such termination.
ARTICLE X.
STATUS OF OTHER AGREEMENTS
Section 10.1. JV LLC Agreement. At the Closing, the JV LLC
Agreement shall terminate as between the Ramius Parties that are parties
thereto, on the one hand, and the UniCredit Parties that are parties thereto,
on the other, except that:
(a) Transferor shall remain entitled to its rights in and
to the HVB Retained Fee Stream (as defined in the JV LLC Agreement) pursuant to
Section 3.6(h)(ii) as if the transactions contemplated in this
Agreement were occurring in connection with a Put/Call Event or Buy/Sell Right
under the JV LLC Agreement and Ramius shall cause JV to make such payments in
accordance with the JV LLC Agreement;.
(b) Section 8.1 (Confidentiality) of the JV LLC
Agreement as to HVB AG and its Subsidiaries (as defined in the JV LLC
Agreement) will survive indefinitely;
(c) so long as the HVB Solicitation Agreement remains in
effect, Section 6.7(e) (Sales Loads) of the JV LLC Agreement will
survive; and
(d) Section 10.1 (Indemnification) of the JV LLC
Agreement shall continue to apply to the Transferor and its Affiliates with
respect to the period during which Transferor was a member of the JV as if such
Persons were Members or Affiliates of Members thereunder.
Section 10.2. Other Agreements. Except as provided in Section 10.1
and in the Ancillary Agreements: all agreements (including the HVB Solicitation
Agreement, the Ramius Revolving Credit
Agreement, the JV Secured Revolving Loan Agreement, the Ramius
20
Investment Management
Agreement, the JV Investment Management Agreement and the agreements with
respect to the Ramius Funds and JV Funds into which investments have been made)
between Ramius and any of its Subsidiaries (or Ramius Funds), on the one hand,
and UniCredit and any of its Subsidiaries, on the other, shall remain in full
force and effect with such modifications thereto as are contemplated by the
UniCredit Consent and the Amendments.
ARTICLE XI.
GENERAL PROVISIONS
Section 11.1. Expenses. Each of the
parties hereto will bear its own expenses in connection with the negotiation,
execution and delivery of this Agreement and the Ancillary Agreements; provided that (i) Ramius shall reimburse UniCredit for
fees and expenses of Gleacher Partners (not to exceed $250,000 in the
aggregate) incurred by UniCredit in connection with analyses prepared by
Gleacher Partners in connection with UniCredits evaluation of the transactions
contemplated by this Agreement, the Transaction Agreement and the Ancillary
Agreements and (ii) Ramius shall reimburse UniCredit for additional out of
pocket expenses (not to exceed $400,000 in the aggregate) incurred by UniCredit
or it Subsidiaries to third parties in connection with their evaluation
(including the negotiation, execution and delivery of this Agreement and the
Ancillary Agreements) of the transactions contemplated by this Agreement, the
Transaction Agreement and the Ancillary Agreements upon submission of
reasonably detailed documentation of such expenses.
Section 11.2. Public Announcements and Confidentiality.
None of the parties hereto or their Affiliates shall issue or cause the
publication of any press release or other public announcement with respect to,
or otherwise make any public statement concerning, the transactions contemplated
by this Agreement without the prior consent of the other parties hereto; provided,
however, that any party may, without the prior consent of any other
party hereto (but after prior consultation with the other parties hereto to the
extent practicable under the circumstances and using commercially reasonable
efforts to accommodate any reasonable requests of the other parties with
respect to any such disclosure) issue or cause the publication of any press
release or other public announcement to the extent required by Law or any
Governmental Body.
Section 11.3. Notices. All notices,
Consents, waivers and other communications required or permitted by this
Agreement shall be in writing and shall be deemed given to a party when (a) delivered
to the appropriate address by hand or by nationally recognized overnight
courier service (costs prepaid); (b) sent by facsimile or e-mail with
confirmation of transmission by the transmitting equipment; or (c) received
or rejected by the addressee, if sent by certified mail, return receipt
requested, in each case to the following addresses, facsimile numbers or e-mail
addresses and marked to the attention of the person (by name or title)
designated below (or to such other address, facsimile number, e-mail address or
person as a party may designate by notice to the other parties):
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If to Transferor or HVB AG:
Bayerische Hypo- und
Vereinsbank AG
Arabellastr. 12
81925 Munich
Germany
Attention: Maximilian Hogger
Fax: Fax +49 89 378-3312687
Email: maximilian.hogger@unicreditgroup.de
With a copy to:
UniCredit Markets and Investment Banking
Bayerische Hypo- und Vereinsbank AG
150 east 42nd Street
New York, NY 10017
Attention: Mr. Richard Cerick
Fax:
(212) 672-5531
Email: richard_cerick@hvbamericas.com
If to Ramius or New Parent:
Ramius LLC
599 Lexington Avenue, 20th Fl.
New York, New York 10022
Attention: Owen S. Littman, Esq.
General Counsel
Fax: (212) 845-7986
Email: olittman@ramius.com
with a copy to:
Willkie Farr & Gallagher LLP
787 Seventh Avenue
New York, NY 10019-6099
Attention: David K. Boston
Laurence D. Weltman
Laura L. Delanoy
Fax: (212) 728-8111
Email:
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dboston@willkie.com
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lweltman@willkie.com
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ldelanoy@willkie.com
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If to Cowen or New
Parent, to:
Cowen Group, Inc.
1221 Avenue of Americas
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New York, NY 10020
Attention:
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J. Kevin McCarthy, Esq.
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General Counsel
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Facsimile:
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(646) 562-1936
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with a copy to:
Wachtell, Lipton, Rosen & Katz
51 West 52nd St.
New York, NY 10019
Attention: Edward Herlihy, Esq.
David E. Shapiro, Esq.
Fax: (212) 403-2000
Email:
Section 11.4. Governing Law; Jurisdiction; WAIVER
OF JURY TRIAL; Enforcement.
(a) Governing Law; Jurisdiction.
This Agreement shall be governed and construed in accordance with the
internal laws of the State of Delaware applicable to contracts made and wholly
performed within such state, without regard to any applicable conflicts of law
principles. The parties hereto agree that any suit, action or proceeding
brought by either party to enforce any provision of, or based on any matter
arising out of or in connection with, this Agreement or the transactions
contemplated hereby shall be brought in any federal or state court located in
the State of Delaware. Each of the parties hereto submits to the exclusive
jurisdiction of any such court in any suit, action or proceeding seeking to
enforce any provision of, or based on any matter arising out of, or in
connection with, this Agreement or the transactions contemplated hereby and
hereby irrevocably waives the benefit of jurisdiction derived from present or
future domicile or otherwise in such action or proceeding. Each party hereto irrevocably waives, to the
fullest extent permitted by law, any objection that it may now or hereafter
have to the laying of the venue of any such suit, action or proceeding in any
such court or that any such suit, action or proceeding brought in any such
court has been brought in an inconvenient forum.
(b) WAIVER OF JURY
TRIAL. EACH OF THE PARTIES HEREBY WAIVES TRIAL
BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY, IN ANY MATTERS (WHETHER
SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF, RELATED TO,
OR CONNECTED WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
(c) Enforcement. The parties
agree that irreparable damage would occur in the event that any of the
provisions of this Agreement were not performed in accordance with their
specific terms on a timely basis or were otherwise breached. It is accordingly agreed that the parties
shall be entitled to an injunction or other equitable relief to prevent
breaches of this Agreement and to enforce specifically the terms and provisions
of this
23
Agreement in any court identified in Section 11.4
hereto, this being in addition to any other remedy to which they are entitled
at law or in equity.
Section 11.5. Waiver; Remedies
Cumulative. The rights and remedies of the parties to
this Agreement are cumulative and not alternative. Neither any failure nor any delay by any
party in exercising any right, power or privilege under this Agreement or any
of the documents referred to in this Agreement will operate as a waiver of such
right, power or privilege, and no single or partial exercise of any such right,
power or privilege will preclude any other or further exercise of such right,
power or privilege or the exercise of any other right, power or privilege. To the maximum extent permitted by applicable
law, (a) no claim or right arising out of this Agreement or any of the
documents referred to in this Agreement can be discharged by one party, in
whole or in part, by a waiver or renunciation of the claim or right unless in
writing signed by the other party; (b) no waiver that may be given by a
party will be applicable except in the specific instance for which it is given;
and (c) no notice to or demand on one party will be deemed to be a waiver
of any obligation of that party or of the right of the party giving such notice
or demand to take further action without notice or demand as provided in this
Agreement or the documents referred to in this Agreement.
Section 11.6. Entire Agreement and
Modification. This Agreement supersedes all prior
agreements, whether written or oral, between the parties with respect to its
subject matter (including any letter of intent and any confidentiality
agreement between the parties related to the subject matter of this Agreement)
and constitutes (along with the agreements described in Article X)
a complete and exclusive statement of the terms of the agreement between the
parties with respect to its subject matter. This Agreement may not be amended,
supplemented, or otherwise modified except by a written agreement executed by
the party to be charged with the amendment and Transferor.
Section 11.7. Disclaimers. EXCEPT FOR THE
REPRESENTATIONS AND WARRANTIES EXPRESSLY SET FORTH IN ARTICLES III, IV,
AND V OR IN ANY ANCILLARY AGREEMENT, EACH AS APPLICABLE, NONE OF THE
PARTIES HERETO HAVE MADE OR HEREBY MAKE ANY EXPRESS OR IMPLIED REPRESENTATION
AND WARRANTY, STATUTORY OR OTHERWISE, OF ANY NATURE.
Section 11.8. Assignments,
Successors and No Third-Party Rights. No party may assign any of
its rights or delegate any of its obligations under this Agreement without the
prior written consent of the other parties; provided, however, that Transferor
shall be entitled to assign its rights to receive shares of Class A Common
Stock at the Closing to one or more of its Affiliates all of the outstanding
equity interests of which are owned, directly or indirectly, by Transferor or
by any person which directly or indirectly wholly owns Transferor. Subject to the preceding sentence, this
Agreement will apply to, be binding in all respects upon and inure to the
benefit of the successors and permitted assigns of the parties. Nothing
expressed or referred to in this Agreement will be construed to give any Person
other than the parties to this Agreement any legal or equitable right, remedy
or claim under or with respect to this Agreement or any provision of this
Agreement, except such rights as shall inure to a successor or permitted
assignee pursuant to this Section 11.8.
24
Section 11.9. Severability. If any
provision of this Agreement is held invalid or unenforceable by any court of
competent jurisdiction, the other provisions of this Agreement will remain in
full force and effect. Any provision of
this Agreement held invalid or unenforceable only in part or degree will remain
in full force and effect to the extent not held invalid or unenforceable.
Section 11.10. Construction. The headings
of Articles and Sections in this Agreement are provided for convenience only
and will not affect its construction or interpretation. All references to Articles, Sections and Parts
refer to the corresponding Articles, Sections and Parts of this Agreement.
Section 11.11. Execution of
Agreement.
This Agreement may be executed in one or more counterparts, each of
which will be deemed to be an original copy of this Agreement and all of which,
when taken together, will be deemed to constitute one and the same agreement.
The exchange of copies of this Agreement and of signature pages by
facsimile or email transmission shall constitute effective execution and
delivery of this Agreement as to the parties and may be used in lieu of the
original Agreement for all purposes.
Signatures of the parties transmitted by facsimile or email shall be
deemed to be their original signatures for all purposes.
Section 11.12. HVB AG Obligation. HVB AG hereby
agrees that it shall be jointly and severally responsible for the prompt and
complete performance by Transferor, when due, of all of Transferors
obligations under this Agreement and the Ancillary Agreements.
Section 11.13. Survival. All
representations, warranties, covenants and agreements in this Agreement shall
survive the Closing. The right to
indemnification, reimbursement or other remedy based upon such representations,
warranties, covenants and agreements shall not be affected by any investigation
conducted with respect to, or any knowledge acquired (or capable of being
acquired) at any time, whether before or after the execution and delivery of
this Agreement or the Closing, with respect to the accuracy or inaccuracy of or
compliance with any such representation, warranty, covenant or agreement. The waiver of any condition based upon the
accuracy of any representation or warranty, or on the performance of or
compliance with any covenant or agreement, will not affect the right to
indemnification, reimbursement or other remedy based upon such representations,
warranties, covenants and agreements.
25
IN WITNESS WHEREOF, the parties hereto have executed
this Agreement, all as of the day and year first above written.
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RAMIUS, LLC
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By: C4S & Co.,
LLC
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By:
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/s/ Peter A. Cohen
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Name: Peter A. Cohen
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Title: Managing Member
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HVB ALTERNATIVE ADVISORS
LLC
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By:
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/s/ Gavin Burke
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Name: Gavin Burke
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Title: Managing Director
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By:
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/s/ John Gallagher
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Name: John Gallagher
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Title: Managing Director
Tax
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BAYERISCHE HYPO- UND
VEREINSBANK AG
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By:
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/s/
Gavin Burke
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Name: Gavin Burke
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Title: Managing Director
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By:
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/s/ John Gallagher
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Name: John Gallagher
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Title: Managing Director
Tax
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COWEN GROUP INC.
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By:
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/s/
Christopher A. White
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Name: Christopher A. White
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Title: Vice President
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LEXINGTONPARK PARENT CORP.
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By:
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/s/
Jeffrey M. Solomon
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Name: Jeffrey M. Solomon
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Title: President
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By:
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/s/ Christopher A. White
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Name: Christopher A. White
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Title: Vice President
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LEXINGTON
MERGER CORP.
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By:
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/s/
Jeffrey M. Solomon
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Name: Jeffrey M. Solomon
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Title: President
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By:
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/s/ Christopher A. White
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Name: Christopher A. White
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Title: Vice President
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