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Developed Technology Resource - LLC Interest Redemption Agreement
This Agreement is entered into this 4th day of March, 2002 by and between Developed Technology Resource, Inc., a Minnesota corporation (hereinafter "DTR"), API Dairy Partners LP (hereinafter "API I"), a Delaware limited partnership, Agribusiness Partners International LP II (hereinafter "API II") a Delaware limited partnership; and Foodmaster International, LLC, a Delaware limited liability company (hereinafter the "Company").
RECITALS
A. DTR, API I and API II are the only members of the Company, and as such are parties to a Limited Liability Company Agreement dated as of March 3, 1997, first amended by an Amended and Restated Limited Liability Company Agreement dated as of September 11, 1998, and next amended by a Second Amended and Restated Limited Liability Company Agreement dated November 1999, which Second Amended and Restated Limited Liability Company Agreement, attached hereto as Exhibit A and is referred to herein as the "LLC Agreement."
B. Under Section 5.02(a) of the LLC Agreement, DTR has a 30% "Percentage Interest" in the Company, subject to a potential increase in that Percentage Interest on the Termination Date as provided in Section 5.02(b) and (c) of the LLC Agreement, all of which is referred to herein as the "DTR Interest."
C. The Company is desirous of redeeming and DTR is desirous of selling the DTR Interest.
AGREEMENT
NOW THEREFORE, in consideration of the premises and the mutual covenants contained herein, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
1.1 Definitions. Initially capitalized terms used in this Agreement, if not defined herein, shall have the meaning set forth in the LLC Agreement.
ARTICLE II
REDEMPTION OF INTEREST, PRICE, ETC.
2.1 Redemption of Interest. At the Closing, the Company will redeem from DTR, and DTR will assign, transfer and convey to the Company, the DTR Interest, pursuant to the terms and conditions hereof by delivery of an Assignment in the form attached herein as Exhibit B, and such other documentation as the Company may reasonably require.
2.2 Redemption Price. The Redemption Price shall be $1,500,000 (subject to adjustment as described below), $500,000 of which will be paid in cash at the Closing, and $1,000,000 (subject to adjustment as described below) of which will be paid by the execution and delivery by the Company of (i) a promissory note in the form of Exhibit C in the principal amount of $500,000 due on September 30, 2002, and (ii) a promissory note in the form of Exhibit D in the principal amount of $500,000 due on March 31, 2003, subject to a discount for early payment as provided in the terms of such note. The promissory notes are referred to herein as the "Promissory Notes".
ARTICLE III
WARRANTIES AND REPRESENTATIONS
3.1 Warranties and Representations of DTR. DTR warrants and represents to the Company, API I and API II as follows:
(a) Organization, Power and Authority. DTR is a corporation duly
organized, validly existing and in good standing under the laws of the
state of Minnesota, and has the full power and authority to enter into
this Agreement and to carry out the transactions provided for herein.
All action of the Board of Directors and shareholders of DTR required
to permit DTR to comply with the provisions of this Agreement have been
taken.
(b) No Encumbrances. The DTR Interest, when transferred by DTR to
the Company under the terms of this Agreement, will be free of all
liens, restrictions and encumbrances, except those imposed on DTR under
the terms of the LLC Agreement, and except for restrictions on transfer
imposed under applicable state and federal laws relating to the offer
and sale of securities.
(c) Binding Effect. Upon execution and delivery of this Agreement
by all parties hereto, this Agreement shall be binding upon DTR,
enforceable against DTR in accordance with its terms, except as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the
enforcement of creditor's rights generally, and by general principals
of equity.
(d) No Conflicts. The execution, delivery and performance of this
Agreement by DTR will not (i) violate any order, judgment, decision or
decree of any court, governmental agency or person authorized to
resolve disputes having jurisdiction or proper authority over or
respect to DTR or its properties, or the Articles of Incorporation or
By-Laws of DTR; (ii) result in a material breach of or constitute (with
due notice or lapse of time) a material default under any agreement to
which DTR is a party or by which DTR is bound; or (iii) violate any
provision of any law applicable to DTR; in all cases where such
violation, breach or default is likely to have a material adverse
effect on the DTR Interest or the consummation of the transactions
provided for herein.
3.2 Representations and Warranties of API I, API II and the Company. API I, API II and the Company warrant and represent with respect to themselves only, and, jointly and severally to their knowledge with respect to parties other than themselves, as follows:
(a) Organization. API I and API II are each limited partnerships,
and the Company is a limited liability company, each duly organized,
validly existing and in good standing under the laws of the state of
Delaware, and each has the full power and authority to enter into this
Agreement and to carry out the transactions provided for herein. All
actions of the general partners of API I and API II and of the Board of
Managers and members of said general partners, and of the manager and
members of the Company, required to permit API I , API II and the
Company to comply with the provisions of this Agreement have been
taken.
(b) Binding Effect. Upon the execution and delivery of this
Agreement by all parties hereto, this Agreement shall be binding upon
each of API I, API II and the Company, enforceable against each,
jointly and severally, in accordance with its terms, except as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the
enforcement of creditor's rights generally, and by general principals
of equity.
(c) No Conflicts. The execution, delivery and performance of this
Agreement by API I, API II and the Company will not (i) violate any
order, judgment, decision or decree of any court, governmental agency
or person authorized to resolve disputes having jurisdiction or proper
authority over or respect to API I, API II and the Company, or their
respective properties; the Certificate of Limited Partnership, Limited
Partnership Agreement or other governing document of API I or API II;
or the Certificate of Formation, the LLC Agreement or any other
governing document of the Company; (ii) result in a material breach of
or constitute (with due notice or lapse of time) a material default
under any agreement to which API I, API II or the Company is a party or
by which API I, API II or the
Company are bound; or (iii) violate any provision of any law applicable
to API I, API II or the Company, in all cases where such is likely to
have a material adverse effect on the DTR Interest or the consummation
of the transactions provided for herein.
(d) Financial Statements. Attached hereto as Exhibit E, are the
consolidated balance sheet of the Company as of December 31, 2001, and
the consolidated income statement of the Company for the year then
ended (the "Financial Statements"). The Financial Statements fairly and
accurately present the financial condition and results of operations of
the Company as of the date and for the period indicated in accordance
with generally accepted accounting principals consistently applied, and
were compiled from the books and records of the Company as regularly
maintained by the Company.
3.3 Other Agreements. While there is any amount due under the Promissory Notes, neither the Company, API I nor API II will take any action which would cause or permit (i) the sale of any assets of the Company, except in the ordinary course of business, (ii) the distribution of any assets of the Company to its members, other than in reimbursement of expenses incurred on be half of the Company or in the payment of services provided consistent with past practice, (iii) a merger or combination of the Company with any other entity, (iv) the issuance or transfer of any equity interest in the Company, other than where such issuance or transfer does not prevent API I or API II together to control the business of the Company and where such issuance is for fair value as reasonably determined API I and API II.
ARTICLE IV
CLOSING AND CLOSING TRANSACTIONS
4.1 Closing. The event at which the DTR Interest is assigned and transferred to the Company, and the Redemption Price is paid by the Company to DTR, is referred to herein as the "Closing," and the time said Closing occurs is referred to herein as the "Time of Closing." The Closing shall take place at 225 South 6th Street, Suite 4300, Minneapolis, Minnesota, at 10:00 a.m. Central Standard Time, on March 6, 2002, or at such other place and time as DTR and the Company may mutually agree.
4.2 Deliveries by DTR. DTR shall deliver, or cause to be delivered, to the Company at or prior to the Closing, the following:
(i) An...
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