Exhibit 10.37


 


AGREEMENT AND PLAN OF MERGER


 


This AGREEMENT
AND PLAN OF MERGER, dated as of [              ],
2005 (this “Agreement”), is among GM Capital Partners I, L.P., a Delaware
limited partnership (“Stockholder”), GM-Refco II Corp., a Delaware corporation
and a direct, wholly-owned subsidiary of Stockholder (“Merger Co.”), and
Refco Inc., a Delaware corporation (the “Company”).


 


WHEREAS,
Merger Co. is a holder of Class A Common Units of New Refco Group Ltd., LLC, a
Delaware limited liability company (“Refco Group”);


 


WHEREAS, the
Company intends to undertake an initial public offering of its equity interests
at a time when it is the sole owner of all of the outstanding interests in
Refco Group, and in connection therewith, the holders of the membership
interests in Refco Group desire to contribute or otherwise transfer their
membership interests in Refco Group to the Company (the “Reorganization”),
in order that Refco Group may become a direct wholly-owned subsidiary of the
Company and the Company may effectuate the initial public offering through an
offering of its common stock to the public (the “Offering”);


 


WHEREAS, in
connection with the Reorganization, the parties hereto desire that Merger Co.
be merged with and into the Company (the “Merger”), with Stockholder
receiving common stock, par value $0.001 per share, of the Company, as the
surviving corporation in the Merger (“Surviving Corporation Common Stock”)
in exchange for the capital stock of Merger Co. in the Merger;


 


WHEREAS, the
Board of Directors of the Company has declared a dividend to be paid to the
holders of record of the Surviving Corporation Common Stock immediately following
the Reorganization in an aggregate amount equal to the proceeds, if any,
received by the Company in connection with the exercise by the underwriters in
the Offering of their option to purchase up to an additional 3,750,000 shares
of common stock of the Company;


 


WHEREAS, the
respective Boards of Directors of the Company and Merger Co. have approved and
declared advisable this Agreement and the Merger, on the terms and subject to
the conditions provided for in this Agreement;


 


WHEREAS, for
federal income tax purposes, it is intended that the Merger shall qualify as a
reorganization within the meaning of Section 368(a) of the Internal Revenue
Code of 1986, as amended, and the rules and regulations promulgated thereunder,
and that this Agreement constitutes a plan of reorganization; and


 


WHEREAS,
immediately following the execution and delivery of this Agreement, each of Stockholder,
as the sole stockholder of Merger Co., and Refco Group, as the sole stockholder
of the Company, will execute and deliver a written consent approving this
Agreement (the “Merger Co. Stockholder Approval“ and the “Company
Stockholder Approval”, respectively).


 





















 


NOW,
THEREFORE, in consideration of the representations, warranties, covenants and
agreements contained in this Agreement, and intending to be legally bound
hereby, Stockholder, Merger Co. and the Company hereby agree as follows:


 


ARTICLE I



The Merger


 


Section 1.1.              The Merger. 
Upon the terms and subject to the conditions set forth in this
Agreement, and in accordance with the General Corporation Law of the State of
Delaware (the “DGCL“), at the Effective Time (as defined below) Merger Co.
shall be merged with and into the Company, and the separate corporate existence
of Merger Co. shall thereupon cease, and the Company shall be the surviving
corporation in the Merger (the “Surviving Corporation“).


 


Section 1.2.              Closing. 
The closing of the Merger (the “Closing“) shall take place at
10:00 a.m. (New York City time) on the date of the satisfaction or waiver of
the conditions to closing set forth in Article V (the “Closing Date“),
at the offices of Weil, Gotshal & Manges LLP, 767 Fifth Avenue, New York,
New York 10153, unless another time, date or place is agreed to by the parties
hereto.


 


Section 1.3.              Effective Time. 
Subject to the provisions of this Agreement, as soon as practicable on
the Closing Date the parties shall file with the Secretary of State of the
State of Delaware a certificate of merger, executed in accordance with the
relevant provisions of the DGCL (the “Certificate of Merger“).  The Merger shall become effective upon the
filing of the Certificate of Merger or at such later time as is agreed to by
the parties hereto and specified in the Certificate of Merger (the time at
which the Merger becomes effective is herein referred to as the “Effective
Time“).


 


Section 1.4.              Effects of the Merger.  The Merger shall have the effects set forth
in the DGCL.  Without limiting the
generality of the foregoing, and subject thereto, at the Effective Time, all
the properties, rights, privileges, powers and franchises of the Company and
Merger Co. shall vest in the Surviving Corporation, and all debts, liabilities
and duties of the Company and Merger Co. shall become the debts, liabilities
and duties of the Surviving Corporation.


 


Section 1.5.              Certificate of Incorporation
and By-laws of the Surviving Corporation.


 


(a)           The Amended and
Restated Certificate of Incorporation of the Company, as in effect immediately
prior to the Effective Time, shall be the certificate of incorporation of the
Surviving Corporation until thereafter amended as provided therein or by
applicable law.


 


(b)           The bylaws of Company,
as in effect immediately prior to the Effective Time, shall be the bylaws of
the Surviving Corporation until thereafter amended as provided therein or by
applicable law.


 


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Section 1.6.              Directors and Officers of the
Surviving Corporation.


 


(a)           The directors of the
Company immediately prior to the Effective Time shall be the directors of the
Surviving Corporation immediately following the Effective Time, to serve as
such until their respective successors are duly elected or appointed and
qualified or their earlier death, resignation or removal in accordance with the
certificate of incorporation and bylaws of the Surviving Corporation.


 


(b)           The officers of the
Company immediately prior to the Effective Time shall be the officers of the
Surviving Corporation until their respective successors are duly appointed and
qualified or their earlier death, resignation or removal in accordance with the
certificate of incorporation and bylaws of the Surviving Corporation.


 


ARTICLE II



Effect of the Merger on the Capital Stock of the

Constituent Corporations


 


Section 2.1.                    Effect on Capital Stock.  At the Effective Time, by virtue of the
Merger and without any action on the part of the holder of any shares of common
stock, par value $0.001 per share, of the Company (“Company Common Stock“),
or any shares of capital stock of Merger Co.:


 


(a)           Conversion of Capital Stock of
Merger Co.  All of the issued and
outstanding shares of common stock, par value $0.01 per share, of Merger Co. (“Merger
Co. Common Stock”) shall together be converted into (“Outstanding Merger
Co. Common Stock”) and become an aggregate of [                    ]
validly issued, fully paid and nonassessable shares of Surviving Corporation
Common Stock (“Surviving Corporation Common Stock Consideration”), which shall
be distributed to the Stockholder.  The
Surviving Corporation Common Stock Consideration shall be represented by a
certificate issued by the Surviving Corporation upon presentation to the Surviving
Corporation of a certificate issued by Merger Co. in respect of the Oustanding
Merger Co. Common Stock for cancellation.


 


(b)           Company Common
Stock. Each share of Company Common Stock shall remain outstanding as one
validly issued, fully paid and nonassessable share of Surviving Corporation
Common Stock.


 


ARTICLE III



Representations and Warranties of the Company 


 


The Company
represents and warrants, as of the date of this Agreement, to Stockholder and
Merger Co. as follows:


 


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Section 3.1.              Organization, Standing and
Corporate Power.


 


(a)           The Company is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware and has all requisite corporate power and authority to
enter into this Agreement and to consummate the transactions contemplated
hereby.


 


Section 3.2.              Authority; Noncontravention;
Voting Requirements.


 


(a)           The Company has all
necessary corporate power and authority to execute and deliver this Agreement
and, subject to obtaining the Company Stockholder Approval, to perform its
obligations hereunder and to consummate the Merger.  The execution, delivery and performance by
the Company of this Agreement, and the consummation of the Merger, have been
duly authorized and approved by its Board of Directors, and except for
obtaining the Company Stockholder Approval for the adoption of this Agreement,
no other corporate action on the part of the Company is necessary to authorize
the execution, delivery and performance by the Company of this Agreement and
the consummation by it of the Merger. 
This Agreement has been duly executed and delivered by the Company and,
assuming due authorization, execution and delivery hereof by the other parties
hereto, constitutes a legal, valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms, except that such
enforceability (i) may be limited by bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and other similar laws of general
application affecting or relating to the enforcement of creditors’ rights
generally and (ii) is subject to general principles of equity, whether
considered in a proceeding at law or in equity (the “Bankruptcy and Equity
Exception“).


 


(b)           Neither the
execution and delivery of this Agreement by the Company nor the consummation by
the Company of the Merger, nor compliance by the Company with any of the terms
or provisions hereof, will (i) conflict with or violate any provision of the Amended
and Restated Certificate of Incorporation or bylaws of the Company or (ii) violate
any law, judgment, writ or injunction of any governmental authority applicable
to the Company or any of its properties or assets.  Except for the Company Stockholder Approval,
no consent, waiver, approval, order, permit or authorization of, or declaration
or filing with, or notification to, any person or governmental body is required
on the part of the Company in connection with the execution and delivery of
this Agreement or the consummation of the transactions contemplated hereby.


 


Section 3.3.              Issuance of Surviving
Corporation Common Stock; Capitalization of the Surviving Corporation.  The Surviving Corporation Common Stock
Consideration to be issued as a result of the Merger has been duly authorized
and, when issued as contemplated by this Agreement, will be validly issued,
fully paid and nonassessable.  After
giving effect to the Reorganization and the Offering, the capitalization of the
Surviving Corporation will be as set forth in the prospectus filed by the
Company with the Securities and Exchange Commission with respect to the
Offering.


 


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ARTICLE IV



Representations and Warranties of Merger Co. and Stockholder


 


Merger Co. and
Stockholder, jointly and severally, represent and warrant, as of the date of
this Agreement, to the Company as follows:


 


Section 4.1.              Organization, Standing and
Corporate Power.


 


(a)           Merger Co. is a
corporation duly organized, validly existing and in good standing under the
laws of the State of Delaware and has all requisite corporate power and
authority to enter into this Agreement and to consummate the transactions
contemplated hereby.


 


(b)           Stockholder is a
limited partnership duly organized, validly existing and in good standing under
the laws of the State of Delaware and has all requisite limited partnership
power and authority to enter into this Agreement and to consummate the
transactions contemplated hereby.


 


Section 4.2.              Merger Co. Authority; Noncontravention.


 


(a)           Merger Co. has all
necessary corporate power and authority to execute and deliver this Agreement
and, subject to obtaining the Merger Co. Stockholder Approval, to perform its
obligations hereunder and to consummate the Merger.  The execution, delivery and performance by Merger
Co. of this Agreement, and the consummation of the Merger, have been duly
authorized and approved by its sole director, and except for obtaining the Merger
Co. Stockholder Approval for the adoption of this Agreement, no other corporate
action on the part of Merger Co. is necessary to authorize the execution,
delivery and performance by Merger Co. of this Agreement and the consummation
by it of the Merger.  This Agreement has
been duly executed and delivered by Merger Co. and, assuming due authorization,
execution and delivery hereof by the other parties hereto, constitutes a legal,
valid and binding obligation of Merger Co, enforceable against Merger Co in
accordance with its terms, except that such enforceability may be limited by
the Bankruptcy and Equity Exception.


 


(b)           Neither the
execution and delivery of this Agreement by Merger Co. nor the consummation by Merger
Co. of the Merger, nor compliance by Merger Co. with any of the terms or
provisions hereof, will (i) conflict with or violate any provision of the
Certificate of Incorporation or bylaws of the Merger Co. or (ii) violate any law,
judgment, writ or injunction of any governmental authority applicable to Merger
Co. or any of its properties or assets.  Except
for the Merger Co. Stockholder Approval, no consent, waiver, approval, order,
permit or authorization of, or declaration or filing with, or notification to,
any person or governmental body is required on the part of Merger Co. in
connection with the execution and delivery of this Agreement or the
consummation of the transactions contemplated hereby.


 


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Section 4.3.              Stockholder Authority;
Noncontravention.


 


(a)           Stockholder has all necessary limited
partnership power and authority to execute and deliver this Agreement and to
consummate the transactions contemplated hereby.  The execution, delivery and performance by
Stockholder of this Agreement have been duly authorized and approved by its
general partner and no other action on the part of the general partner of
Stockholder is necessary to authorize the execution, delivery and performance
by Stockholder of this Agreement and the consummation by it of the transactions
contemplated hereby.  This Agreement has
been duly executed and delivered by Stockholder and, assuming due
authorization, execution and delivery hereof by the other parties hereto,
constitutes a legal, valid and binding obligation of Stockholder, enforceable
against Stockholder in accordance with its terms, except that such
enforceability may be limited by the Bankruptcy and Equity Exception,


 


(b)           Neither the execution and delivery of
this Agreement by Stockholder nor compliance by Stockholder with any of the
terms or provisions hereof, will (i) conflict with or violate any provision of
the limited partnership agreement of Stockholder or (ii) violate any law,
judgment, writ or injunction of any governmental authority applicable to
Stockholder or any of its properties or assets. 
Except for such consents or approvals obtained prior to the date hereof,
no consent, waiver, approval, order, permit or authorization of, or declaration
or filing with, or notification to, any person or governmental body is required
on the part of Stockholder in connection with the execution and delivery of
this Agreement or the consummation of the transactions contemplated hereby.


 


Section 4.4.              Capitalization.


 


(a)           The authorized capital stock of
Merger Co. consists of 1000 shares of Merger Co. Common Stock.  As of the date hereof, there are, and as of
the Closing Date, there will be, 1000 shares of Merger Co. Common Stock issued
and outstanding, all of which are owned of record and beneficially by Stockholder,
and no shares of Merger Co. Common Stock are held by Merger Co. as treasury
stock.  All of the issued and outstanding
shares of Merger Co. Common Stock were duly authorized for issuance and are
validly issued, fully paid and non-assessable.


 


(b)           Except as set forth in Section
4.4(a) above, Merger Co. has no authorized, issued and outstanding or
reserved capital stock and there is no existing option, warrant, call, right,
or contract of any character to which Merger Co. is a party requiring, and
there are no securities of Merger Co. outstanding which upon conversion or exchange
would require, the issuance of any shares of capital stock of Merger Co. or
other securities convertible into, exchangeable for or evidencing the right to
subscribe for or purchase shares of capital stock of Merger Co.  Merger Co. is not a party to any voting trust
or other contract with respect to the voting, redemption, sale, transfer or
other disposition of the Merger Co. Common Stock.


 


Section 4.5.              Operations of Merger Co.  Merger Co. was formed solely for the purpose
of holding membership interests in Refco Group.  Merger Co. has engaged in no business other
than as set forth in this Section 4.5, has no liabilities, and has
conducted its operations solely as contemplated hereby.


 


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Section 4.6.              Investment Intent and
Eligibility.  Stockholder
is an “accredited investor” within the meaning of Rule 501(a) under Regulation
D promulgated under the Securities Act of 1933, as amended (the “Securities
Act”) by the Securities and Exchange Commission.  The Surviving Corporation Common Stock to be
acquired by Stockholder pursuant to this Agreement is being acquired for
Stockholder’s own account, not as a nominee or agent for any other person and
without a view to the distribution of such Surviving Corporation Common Stock
or any interest therein in violation of the Securities Act or any state
securities laws.


 


ARTICLE V



Conditions Precedent


 


Section 5.1.              Conditions to Each Party’s
Obligation to Effect the Merger.  The
respective obligations of each party hereto to effect the Merger shall be
subject to the satisfaction on or prior to the Closing Date of the following
conditions:


 


(a)           Company Stockholder
Approval.  The Company Stockholder
Approval shall have been obtained in accordance with applicable law and the Amended
and Restated Certificate of Incorporation and bylaws of the Company.


 


(b)           Merger Co.
Stockholder Approval.  The Merger Co.
Stockholder Approval shall have been obtained in accordance with applicable law
and the Certificate of Incorporation and bylaws of Merger Co.


 


ARTICLE VI



Indemnification


 


Section 6.1.              Obligation to Indemnify.


 


(a)           Following the Closing,
the Company hereby agrees to save, indemnify and hold harmless Stockholder from
and against, and in respect of, and shall on demand reimburse Stockholder for
all loss, liability, claim, damage, deficiency, injury and all costs and
expenses (including all attorney fees and other defense costs) (collectively “Losses”)
suffered or incurred by Stockholder in respect of any misrepresentation or
breach of warranty by the Company contained in this Agreement.


 


(b)           Following the
Closing, Stockholder hereby agrees to save, indemnify, and hold harmless the Company
from and against, and in respect of, and shall on demand reimburse the Company
for all Losses suffered or incurred by the Company in respect of any
misrepresentation or breach of warranty by Stockholder or Merger Co. contained
in this Agreement.


 


(c)           The representations
and warranties contained in this Agreement shall survive the Merger.


 


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ARTICLE VII


 


Miscellaneous


 


Section 7.1.              Entire Agreement.  This Agreement and the other documents
referred to herein represent the entire understanding and agreement between the
parties hereto with respect to the subject matter hereof.


 


Section 7.2.              Amendments and Waivers.  This Agreement can be amended, supplemented
or changed, and any provision hereof can be waived, only by written instrument
making specific reference to this Agreement signed by the party against whom
enforcement of any such amendment, supplement, modification or waiver is
sought.  No action taken pursuant to this
Agreement, including any investigation by or on behalf of any party, shall be
deemed to constitute a waiver by the party taking such action of compliance
with any representation, warranty, or agreement contained herein.  The waiver by any party hereto of a breach of
any provision of this Agreement shall not operate or be construed as a further
or continuing waiver of such breach or as a waiver of any other or subsequent
breach.  No failure on the part of any
party to exercise, and no delay in exercising, any right, power or remedy
hereunder shall operate as a waiver thereof, nor shall any single or partial
exercise of such right, power or remedy by such party preclude any other or
further exercise thereof or the exercise of any other right, power or remedy.


 


Section 7.3.              Binding Effect; Assignment.  This Agreement shall be binding upon and
inure to the benefit of the parties and their respective successors and
permitted assigns.  Nothing in this
Agreement shall create or be deemed to create any third party beneficiary
rights in any person or entity not a party to this Agreement except as
expressly contemplated by this Agreement. 
No assignment of this Agreement or of any rights or obligations
hereunder may be made by any of the parties hereto without the prior written
consent of the other parties and any attempted assignment without the required
consents shall be void.  No assignment of
any obligations hereunder shall relieve the parties hereto of any such
obligations.


 


Section 7.4.              Counterparts.  This Agreement may be executed in any number
of 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.


 


Section 7.5.              Governing Law; Jurisdiction; Waiver
of Jury Trial.  This Agreement, and
all claims or causes of action (whether in contract or tort) that may be based
upon, arise out of or relate to this Agreement or the negotiation, execution or
performance of this Agreement (including any claim or cause of action based
upon, arising out of or related to any representation or warranty made in or in
connection with this Agreement), shall be governed by and construed in
accordance with the internal laws of the State of Delaware.  Any action against any party relating to the
foregoing shall be brought in any federal or state court of competent jurisdiction
located within the State of Delaware, and the parties hereto hereby irrevocably
submit to the non-exclusive


 


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jurisdiction of any federal or
state court located within the State of Delaware over any such action.  The parties hereby irrevocably waive, to the
fullest extent permitted by applicable law, any objection that they may now or
hereafter have to the laying of venue of any such action brought in such court
or any defense of inconvenient forum for the maintenance of such action.


 


Section 7.6.              Notices.  All notices, requests and other
communications to any party hereunder shall be in writing and shall be deemed
given if delivered personally, facsimiled (which is confirmed) or sent by
overnight courier (providing proof of delivery) to the parties at the following
addresses:


 


If to Stockholder or Merger Co., to:


 


 


 


If to the Company, to:


 


Refco Inc.

One World Financial Center

200 Liberty Street

New York, New York 10281

Attention:          Chief
Executive Officer

Facsimile:          (212)
693-7686


 


or such other address or facsimile number as
such party may hereafter specify by like notice to the other parties
hereto.  All such notices, requests and
other communications shall be deemed received on the date of receipt by the
recipient thereof if received prior to 5:00 P.M. in the place of receipt and
such day is a business day in the place of receipt.  Otherwise, any such notice, request or
communication shall be deemed not to have been received until the next
succeeding business day in the place of receipt.


 


Section 7.7.              Severability.  If any term or other provision of this
Agreement is invalid, illegal, or incapable of being enforced by any law or
public policy, all other terms or provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
materially adverse to any party.  Upon
such determination that any term or other provision is invalid, illegal, or
incapable of being enforced, the parties hereto shall negotiate in good faith
to modify this Agreement so as to effect the original intent of the parties as
closely as possible in an acceptable manner in order that the transactions
contemplated hereby are consummated as originally contemplated to the greatest
extent possible.


 


 


[THE REMAINDER OF THIS PAGE IS INTENTIONALLY
LEFT BLANK.]


 


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IN WITNESS
WHEREOF, the undersigned have executed this Agreement and Plan of Merger as of
the date first written above.


 


	
   

  	
  REFCO INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  



 


 


SIGNATURE PAGE TO AGREEMENT AND PLAN OF MERGER


 





















 


	
   

  	
  GM-REFCO II CORP.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  GM CAPITAL PARTNERS I, L.P.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  GM Partners I, LLC, with respect to

  
	
   

  	
   

  	
  its series, GM Capital Partners I

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  General Motors Investment

  
	
   

  	
   

  	
  Management Corporation, as

  
	
   

  	
   

  	
  Managing Member

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title: