Document:

EX-10.1

Exhibit 10.1

ASSET PURCHASE AGREEMENT

 

 

ASSET PURCHASE AGREEMENT

Dated as of September 19, 2008

Among

IFL Corp., d/b/a International Fight League,

and

HDNet LLC

 

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	Page	 
	SECTION 1. DEFINITIONS
	 	 	1	 
	 
	 	 	 	 
	Section 1.1. Definitions
	 	 	1	 
	Section 1.2. Other Definitional and Interpretive Matter
	 	 	8	 
	 
	 	 	 	 
	SECTION 2. PURCHASE AND SALE
	 	 	8	 
	 
	 	 	 	 
	Section 2.1. Purchased Assets
	 	 	8	 
	Section 2.2. Excluded Assets
	 	 	9	 
	Section 2.3. Assumed Liabilities
	 	 	10	 
	Section 2.4. Excluded Liabilities
	 	 	10	 
	Section 2.5. Assignments; Cure Amounts
	 	 	11	 
	Section 2.6. Further Assurances
	 	 	11	 
	 
	 	 	 	 
	SECTION 3. PURCHASE PRICE
	 	 	12	 
	 
	 	 	 	 
	Section 3.1. Purchase Price
	 	 	12	 
	Section 3.2. Closing Date Payment
	 	 	12	 
	Section 3.3. Allocation of Purchase Price
	 	 	12	 
	Section 3.4. Closing Date
	 	 	13	 
	Section 3.5. Buyer’s Deliveries
	 	 	13	 
	Section 3.6. Seller’s Deliveries
	 	 	13	 
	 
	 	 	 	 
	SECTION 4. REPRESENTATIONS AND WARRANTIES OF SELLER
	 	 	14	 
	 
	 	 	 	 
	Section 4.1. Organization of Seller
	 	 	15	 
	Section 4.2. Subsidiaries and Investments
	 	 	15	 
	Section 4.3. Authority of Seller
	 	 	15	 
	Section 4.4. Assumed Contracts and Cure Costs
	 	 	15	 
	Section 4.5. Intellectual Property
	 	 	16	 
	Section 4.6. Title to Purchased Assets
	 	 	16	 
	Section 4.7. Proceedings
	 	 	16	 
	Section 4.8. Consent and Approvals
	 	 	17	 
	Section 4.9. Accuracy of Information Furnished
	 	 	17	 
	 
	 	 	 	 
	SECTION 5. REPRESENTATIONS AND WARRANTIES OF BUYER
	 	 	17	 
	 
	 	 	 	 
	Section 5.1. Organization and Authority of Buyer
	 	 	17	 
	Section 5.2. No Finder
	 	 	18	 
	Section 5.3. Ownership of Seller
	 	 	18	 

 

	 	 	 	 	 
	 	 	Page	 
	SECTION 6. ACTION PRIOR TO THE CLOSING DATE
	 	 	18	 
	 
	 	 	 	 
	Section 6.1. Investigation of the Business by Buyer
	 	 	18	 
	Section 6.2. Third Party Consents
	 	 	18	 
	Section 6.3. Governmental Approvals
	 	 	18	 
	Section 6.4. Conduct of Business Prior to the Closing Date
	 	 	20	 
	Section 6.5. Notification of Breach; Disclosure
	 	 	20	 
	Section 6.6. Insurance
	 	 	21	 
	Section 6.7. Bankruptcy Court Approval
	 	 	21	 
	Section 6.8. Bankruptcy Filings
	 	 	21	 
	 
	 	 	 	 
	SECTION 7. ADDITIONAL AGREEMENTS
	 	 	22	 
	 
	 	 	 	 
	Section 7.1. Taxes
	 	 	22	 
	Section 7.2. Adequate Assurances Regarding Assumed Contracts
	 	 	23	 
	Section 7.3. Certain Actions
	 	 	23	 
	Section 7.4. Reasonable Access to Records and Certain Personnel
	 	 	23	 
	 
	 	 	 	 
	SECTION 8. CONDITIONS TO CLOSING
	 	 	24	 
	 
	 	 	 	 
	Section 8.1. Conditions to Obligations of Each Party
	 	 	24	 
	Section 8.2. Conditions to Obligations of Buyer
	 	 	24	 
	Section 8.3. Conditions to Obligations of Seller
	 	 	25	 
	 
	 	 	 	 
	SECTION 9. TERMINATION
	 	 	25	 
	 
	 	 	 	 
	Section 9.1. Termination
	 	 	25	 
	Section 9.2. Break Up Fee
	 	 	26	 
	Section 9.3. Effect of Termination
	 	 	26	 
	 
	 	 	 	 
	SECTION 10. INDEMNIFICATION
	 	 	27	 
	 
	 	 	 	 
	Section 10.1. No Survival of Representations and Warranties
	 	 	27	 
	 
	 	 	 	 
	SECTION 11. GENERAL PROVISIONS
	 	 	27	 
	 
	 	 	 	 
	Section 11.1. Confidential Nature of Information
	 	 	27	 
	Section 11.2. No Public Announcement
	 	 	27	 
	Section 11.3. Notices
	 	 	28	 
	Section 11.4. Successors and Assigns
	 	 	29	 
	Section 11.5. Entire Agreement; Amendments; Disclosure Schedules
	 	 	29	 
	Section 11.6. Waivers
	 	 	29	 
	Section 11.7. Expenses
	 	 	30	 
	Section 11.8. Partial Invalidity
	 	 	30	 
	Section 11.9. Execution in Counterparts
	 	 	30	 
	Section 11.10. Governing Law
	 	 	30	 
	Section 11.11. No Third Party Beneficiaries
	 	 	31	 

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SCHEDULES

	 	 	 
	Section	 	Schedule
	2.1(a)  

	 	Equipment
	2.1(b)

	 	Assumed Contracts and Cure Costs
	2.1(c)

	 	Intellectual Property
	2.2

	 	Excluded Assets
	4.7

	 	Proceedings
	4.8

	 	Consents and Approvals
	5.2

	 	Brokers

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EXHIBIT LIST

EXHIBIT A     -     FORM OF ASSUMPTION AND ASSIGNMENT AGREEMENT

EXHIBIT B     -     BIDDING PROCEDURES

EXHIBIT C     -     BIDDING PROCEDURES ORDER

EXHIBIT D     -     FORM OF BILL OF SALE

EXHIBIT E     -     FORM OF SALE ORDER

EXHIBIT F     -     FORM OF NAME USE AGREEMENT

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ASSET PURCHASE AGREEMENT

          This Asset Purchase Agreement (this “Agreement”) is made as of August ___, 2008, by and among
IFL Corp., d/b/a International Fight League, a Delaware corporation (“Seller”) and HDNet LLC, a
Delaware limited liability company (“Buyer”). Capitalized terms used herein and not otherwise
defined herein shall have the meanings set forth in Section 1.1.

          WHEREAS, Seller operated a professional mixed martial arts sports league (the
“Business”);

          WHEREAS, on September 15, 2008 (the “Petition Date”), the Seller filed a voluntary petition
for relief (the “Filing”) commencing a case under chapter 11 of title 11 of the United States Code
(the “Bankruptcy Code”) in the United States Bankruptcy Court for the Southern District of New York
(the “Bankruptcy Court”);

          WHEREAS, Seller desires to sell to Buyer, all of the Purchased Assets, and Buyer desires to
purchase from Seller the Purchased Assets, and assume the Assumed Liabilities, upon the terms and
conditions hereinafter set forth;

          WHEREAS, the Parties intend to effectuate the transactions contemplated by this Agreement
through a sale of the Purchased Assets pursuant to section 363 of the Bankruptcy Code; and

          WHEREAS, the execution and delivery of this Agreement and Seller’s ability to consummate the
transactions set forth in this Agreement are subject, among other things, to the entry of the Sale
Order.

          NOW, THEREFORE, in consideration of the premises and the mutual promises herein made, and in
consideration of the representations, warranties and covenants herein contained, the Parties agree
as follows:

SECTION 1.

DEFINITIONS

Section 1.1. Definitions.

          In this Agreement, the following terms have the meanings specified or referred to in this
Section 1.1 and shall be equally applicable to both the singular and plural forms.

          “Affiliate” means, as to any Person, any other Person which directly or indirectly
controls, or is under common control with, or is controlled by, such Person. As used in this
definition, “control” (including, with its correlative meanings, “controlled by” and “under common
control with”) shall mean possession, directly or indirectly, of the power to direct or cause the
direction of management or policies (whether through ownership of securities or partnership or
other ownership interests, by contract or otherwise) of such Person.

          “Aggregate Cash Consideration” has the meaning specified in Section 3.1.

          “Agreement” has the meaning specified in the preamble.

          “Allocation Schedule(s)” has the meaning specified in Section 3.3.

 

          “Alternative Transaction” has the meaning specified in Section 9.1.

          “Ancillary Documents” means the Bill of Sale, Assumption and Assignment Agreement, Assignment
of Patents, Assignment of Trademarks, Assignment of Copyrights, Assignment of Domain Names, Name
Use Agreement, and each other agreement, document or instrument (other than this Agreement)
executed and delivered by the parties hereto in connection with the consummation of the
transactions contemplated by this Agreement.

          “Assignment of Copyrights” has the meaning specified in Section 3.6(b).

          “Assignment of Domain Names” has the meaning specified in Section 3.6(b).

          “Assignment of Trademarks” has the meaning specified in Section 3.6(b).

          “Assumed Contracts” has the meaning specified in Section 2.1(b).

          “Assumed
Liabilities” has the meaning specified in Section 2.3.

          “Assumption and Assignment Agreement” means the Assumption and Assignment Agreement in
substantially the form of Exhibit A.

          “Auction” has the meaning specified in Section 6.7(a).

          “Avoidance Actions” means any and all claims for relief of Seller under chapter 5 of the
Bankruptcy Code.

          “Bankruptcy Case” means the cases commenced by the Seller under chapter 11 of the Bankruptcy
Code, styled In re IFL Corp., Case No. 08-13589 (MG) and pending before the Bankruptcy Court.

          “Bankruptcy Code” means Title 11 of the United States Code, Sections 101 et. seq.

          “Bankruptcy Court” has the meaning specified in the recitals.

          “Bidding Procedures” means the bidding procedures in substantially the form attached hereto as
Exhibit B, together with such changes thereon, if any, as shall have been required by the
Bankruptcy Court or agreed to by the Parties.

          “Bidding Procedures Order” means an order of the Bankruptcy Court, in substantially the form
attached hereto as Exhibit C, approving the Bidding Procedures and the amount, timing and terms of
payment of the Break-Up Fee as set forth herein.

          “Bill of Sale” means the Bill of Sale substantially in the form of Exhibit D.

          “Break-Up Fee” has the meaning specified in 9.2(a).

          “Business” has the meaning specified in the recitals.

          “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.

          “Buyer” has the meaning specified in the preamble.

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          “Closing” has the meaning specified in Section 3.4.

          “Closing Date” has the meaning specified in Section 3.4.

          “Code” means the United States Internal Revenue Code of 1986, as amended.

          “Computers” means all computer equipment and hardware, including, without limitation, all
central processing units, terminals, disk drives, tape drives, electronic memory units, printers,
keyboards, screens, peripherals (and other input/output devices), modems and other communication
controllers, and any and all parts and appurtenances thereto, together with all intellectual
property used in connection with the operation of such computer equipment, including, without
limitation, all software and rights under any licenses related to such use.

          “Contract” means any agreement, contract, obligation, promise, instrument, undertaking or
other arrangements (whether written or oral), and any amendment thereto, that is legally binding,
other than a Lease, to which Seller is party.

          “Copyrights” means all United States and foreign copyrights and copyrightable subject matter,
whether registered or unregistered, including all United States copyright registrations and
applications for registration and foreign equivalents, all moral rights, all common-law copyright
rights, and all rights to register and obtain renewals and extensions of copyright registrations,
together with all other copyright rights accruing by reason of any international copyright
convention.

          “Cure Costs” has the meaning specified in Section 2.5(a).

          “Disclosure Schedules” means the disclosure schedules attached hereto that Seller has prepared
and delivered to Buyer pursuant to the terms of this Agreement, setting forth information regarding
the Business, the Purchased Assets, the Assumed Liabilities and other matters with respect to
Seller as set forth therein.

          “Documents” means all books, records, files, invoices, inventory records, product
specifications, advertising materials, customer lists, cost and pricing information, supplier
lists, business plans, catalogs, customer literature, quality control records and manuals, research
and development files, records and laboratory books and credit records of customers (including all
data and other information stored on discs, tapes or other media) to the extent used in or to the
extent relating to the assets, properties, including the Intellectual Property, business or
operations of the Business.

          “Domain Names” means any alphanumeric designation registered with or assigned by a domain name
registrar, registry or domain name registration authority as part of an electronic address on the
Internet.

          “Encumbrance” means any interest, charge, lien, claim (as defined in section 101(5) of the
Bankruptcy Code), mortgage, sublease, hypothecation, deed of trust, pledge, security interest,
option, right of use, first offer or first refusal, easement, servitude, restrictive covenant,
encroachment, encumbrance, or other similar restriction of any kind.

          “Environmental Laws” means all Legal Requirements and programs (including those promulgated or
sponsored by industry associations, insurance companies, and risk management companies) concerning
or relating to pollution or protection of the environment, including those relating to the
presence, use, manufacturing, refining, production, generation, handling, transportation,
treatment, recycling, transfer, storage, disposal, distribution, importing, labeling, testing,
processing, discharge,

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release, threatened release, control, or other action or failure to act involving cleanup of any
hazardous materials, substances or wastes, chemical substances or mixtures, pesticides, pollutants,
contaminants, toxic chemicals, petroleum products or byproducts, asbestos, polychlorinated
biphenyls, noise, or radiation, each as amended and as now or hereafter in effect and in effect at
Closing.

          “Equipment” means all furniture, fixtures, equipment, Computers, machinery, apparatus,
appliances, spare parts, signage, supplies, vehicles, forklifts and all other tangible personal
property of every kind and description in which Seller has an interest.

          “Excluded Assets” has the meaning specified in Section 2.2.

          “Excluded Liabilities” has the meaning specified in Section 2.4.

          “Filing” has the meaning specified in the recitals.

          “Final Order” means an action taken or Order issued by the applicable Governmental Authority
as to which: (i) no request for stay of the action or Order is pending, no such stay is in effect,
and, if any deadline for filing any such request is designated by statute or regulation, it is
passed, including any extensions thereof; (ii) no petition for rehearing or reconsideration of the
action or Order, or protest of any kind, is pending before the Governmental Authority and the time
for filing any such petition or protest is passed; (iii) the Governmental Authority does not have
the action or Order under reconsideration or review on its own motion and the time for such
reconsideration or review has passed; and (iv) the action or Order is not then under judicial
review, there is no notice of appeal or other application for judicial review pending, and the
deadline for filing such notice of appeal or other application for judicial review has passed,
including any extensions thereof.

          “GAAP” means generally accepted accounting principles in the United States.

          “Governmental Authority” means any federal, state, local or foreign, governmental entity or
any subdivision, agency, instrumentality, authority, department, commission, board, bureau,
official or other regulatory, administrative or judicial authority thereof or any federal, state,
local or foreign court, tribunal or arbitrator or any self regulatory organization, agency or
commission.

          “Hazardous Materials” means any pollutant, contaminant or waste regulated by or subject to
liability under any Environmental Laws, including without limitation any substance defined as a
“hazardous waste,” “hazardous substance,” “pollutant” or “contaminant” under any Environmental Law,
including the Comprehensive Environmental Response Compensation and Liability Act (42 U.S.C. § 9601
et. seq.) and/or the Resource Conservation and Recovery Act (42 U.S.C. § 6901 et. seq.

          “Indebtedness” of any Person means, without duplication, (i) the principal of and premium (if
any) in respect of (A) indebtedness of such Person for borrowed money and (B) indebtedness
evidenced by notes, debentures, bonds or other similar instruments for the payment of which such
Person is responsible or liable; (ii) all obligations of such Person issued or assumed as the
deferred purchase price of property, all conditional sale obligations of such Person and all
obligations of such Person under any title retention agreement (but excluding trade accounts
payable and other accrued current liabilities arising in the Ordinary Course of Business (other
than the current liability portion of any indebtedness for borrowed money)); (iii) all obligations
of such Person under leases required to be capitalized in accordance with GAAP; (iv) all
obligations of such Person for the reimbursement of any obligor on any letter of credit, banker’s
acceptance or similar credit transaction; (v) all obligations of such Person under interest rate or
currency swap transactions (valued at the termination value thereof); (vi) the liquidation value,
accrued and unpaid dividends; prepayment or redemption premiums and penalties (if any), unpaid fees
or expenses and other monetary obligations in respect of any redeemable preferred stock of such

-4-

 

Person; (vii) all obligations with respect to any factoring programs of Seller; (viii) all
obligations of the type referred to in clauses (i) through (vii) of any Persons for the payment of
which such Person is responsible or liable, directly or indirectly, as obligor, guarantor, surety
or otherwise, including guarantees of such obligations; and (ix) all obligations of the type
referred to in clauses (i) through (v) of other Persons secured by any lien on any property or
asset of such Person (whether or not such obligation is assumed by such Person).

          “Independent Accounting Firm” has the meaning specified in Section 3.3.

          “Intellectual Property” means all intellectual property rights of any kind owned, used, held
for use, or licensed (as licensor or licensee) by Seller, including all Software, Copyrights,
Patents, Trademarks, Trade Secrets, Domain Names, all rights to privacy and personal information,
and all rights and remedies related thereto (including the right to sue for and recover damages,
profits and any other remedy in connection therewith) for past, present or future infringement,
misappropriation or other violation relating to any of the foregoing.

          “IRS” means the United States Internal Revenue Service.

          “Legal Requirement” means any federal, state, provincial, local, municipal, foreign,
international, multinational, or other administrative Order, constitution, law, ordinance,
principle of common law, regulation, statute or treaty.

          “Liability” means any debt, loss, claim (as defined in section 101(5) of the Bankruptcy Code),
damage, demand, fine, judgment, penalty, liability or obligation (whether direct or indirect, known
or unknown, absolute or contingent, asserted or unasserted, accrued or unaccrued, matured or
unmatured, determined or determinable, liquidated or unliquidated, or due or to become due, and
whether in contract, tort, strict liability, successor liability or otherwise),
and including all costs and expenses relating thereto (including fees, discounts and expenses
of legal counsel, experts, engineers and consultants and costs of investigations).

          “Material Adverse Effect” means any fact, condition, change, violation, inaccuracy,
circumstance, effect or event, individually or in the aggregate, that has, or would be reasonably
expected to have, a material adverse effect on the property, business, operations, assets (tangible
and intangible), or condition (financial or otherwise) of the Business or the Purchased Assets or
the ability of Seller to perform any of its respective material obligations under this Agreement or
the Ancillary Agreements to which it is a party, which occurs other than by reason of the filing of
the Bankruptcy Case or operating in bankruptcy.

          “Name Use Agreement” means the Name Use Agreement in substantially the form of
Exhibit F.

          “Order” means any order, injunction, judgment, decree, ruling, writ, assessment or arbitration
award of a Governmental Authority.

          “Ordinary Course of Business” means the ordinary and usual course of day-to-day operations of
the Business (including acts and omissions of Seller in the ordinary and usual course) through the
date hereof, consistent with past practice and operations in a bankruptcy.

          “Parent” has the meaning specified in Section 2.6(c).

          “Party” or “Parties” means, individually or collectively, Buyer and each Seller.

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          “Patents” means United States and foreign patents (including certificates of invention and
other patent equivalents), patent applications, provisional applications and patents issuing
therefrom, as well as any continuations, continuations-in-part, divisions, extensions,
reexaminations, reissues, renewals, patent disclosures, technology, inventions (whether or not
patentable or reduced to practice) or improvements thereto.

          “Permitted Encumbrances” means (i) Encumbrances that constitute Assumed Liabilities, (ii)
statutory liens for current property Taxes and assessments not yet due and payable, including,
without limitation, liens for ad valorem Taxes and statutory liens not yet due and payable arising
other than by reason of any default by Seller that, in each case, are not material to the Business
or the value of the Purchased Assets, and (iii) landlords’, carriers’, warehousemen’s, mechanics’,
suppliers’, materialmen’s, repairmen’s liens or other like Encumbrances arising in the Ordinary
Course of Business that, in each case, are not material to the Business with respect to amounts not
yet overdue, provided, that, in each case enumerated in this definition, such Encumbrance shall
only be a Permitted Encumbrance if it cannot be satisfied solely through the payment of money or
otherwise removed, discharged, released or transferred, as the case may be, pursuant to section
363(f) of the Bankruptcy Code or otherwise.

          “Person” means any individual, corporation, partnership, joint venture, limited liability
company, association, joint-stock company, trust, unincorporated organization, Governmental
Authority or other entity.

          “Petition Date” has the meaning specified in the recitals.

          “Proceeding” means any action, arbitration, audit, claim, cause of action, hearing,
investigation, litigation, or suit (whether civil, criminal, administrative or investigative)
commenced, brought, conducted, or heard by or before, or otherwise involving, any Governmental
Authority or arbitrator.

          “Products” means any and all products and services currently marketed or sold by
Seller.

          “Purchase Price” has the meaning specified in Section 3.1.

          “Purchased Assets” has the meaning specified in Section 2.1.

          “Representative” means with respect to a particular Person, any duly authorized director,
officer, employee, agent, consultant, advisor or other representative of such Person, including
legal counsel, accountants and financial advisors.

          “Sale Hearing” means the hearing conducted by the Bankruptcy Court to approve the transactions
contemplated by this Agreement or a competing transaction.

          “Sale Motion” means the motion, in form and substance satisfactory to Buyer in its sole
discretion, filed by Seller pursuant to, inter alia, sections 363 and 365 of the Bankruptcy Code to
secure entry of the Sale Order by the Bankruptcy Court.

          “Sale Order” means an Order of the Bankruptcy Court in the form attached hereto as Exhibit E,
pursuant to, inter alia, sections 105, 363 and 365 of the Bankruptcy Code (i) authorizing and
approving, inter alia, the sale of the Purchased Assets to Buyer on the terms and conditions set
forth herein free and clear of all Liabilities and Encumbrances (other than Permitted
Encumbrances), the assumption and assignment of the Assumed Liabilities, and the assumption and
assignment of the

-6-

 

Assumed Contracts to Buyer and (ii) containing certain findings of facts, including, without
limitation, a finding that Buyer is a good faith purchaser pursuant to section 363(m) of the
Bankruptcy Code.

          “Seller” has the meaning specified in the preamble.

          “Software” means all computer software programs (whether in source code, object code, or other
form) and systems, databases and platforms owned, licensed or used by Seller, including all
databases, compilations, tool sets, compilers, higher level or “proprietary” languages, related
documentation, technical manuals and materials, and any licenses to use or other rights relating to
the foregoing.

          “Subsidiary” means any Person of which (i) a majority of the outstanding share capital, voting
securities or other equity interests are owned, directly or indirectly, by Seller or (ii) Seller is
entitled, directly or indirectly, to appoint a majority of the board of directors or managers or
comparable supervisory body of such Person.

          “Successful Bidder” has the meaning specified in the Sale Order.

          “Tax” or “Taxes” (and with correlative meaning, “Taxable” and “Taxing”) means (i) any federal,
state, provincial, local, foreign or other income, alternative, minimum, add-on minimum,
accumulated earnings, personal holding company, franchise, capital stock, net worth, capital,
profits, intangibles, windfall profits, gross receipts, value added, sales, use, goods and
services, excise, customs duties, transfer, conveyance, mortgage, registration, stamp, documentary,
recording, premium, severance, environmental, natural resources, real property, personal property,
ad valorem, intangibles, rent, occupancy, license, occupational, employment, unemployment
insurance, social security, disability, workers’ compensation, payroll, health care, withholding,
estimated or other similar taxes, duty, levy or other governmental charge or assessment or
deficiencies thereof (including all interest and penalties thereon and additions thereto whether
disputed or not) and (ii) any transferee liability in respect of any items described in clause (i)
above.

          “Tax Return” means any return, report or similar statement required to be filed with respect
to any Taxes (including any attached schedules), including any information return, claim for
refund, amended return or declaration of estimated Tax.

          “Third Party Consents” has the meaning specified in Section 4.8.

          “Trademarks” means United States, state and foreign trademarks, service marks, logos, slogans,
trade dress and trade names (including all assumed or fictitious names under which the Business is
conducted), and any other indicia of source of goods and services, designs and logotypes related to
the above, in any and all forms, whether registered or unregistered, and registrations and pending
applications to register the foregoing (including intent to use applications), and all goodwill
related to or symbolized by the foregoing.

          “Trade Secrets” means confidential or proprietary information and trade secrets (including,
without limitation, ideas, research and development, know-how, formulae, compositions, processes
and techniques, technical data, designs, drawings, specifications, customer and supplier lists,
pricing and cost information, and business and marketing plans and proposals).

          “Transfer Taxes” has the meaning specified in Section 7.1(b).

-7-

 

Section 1.2. Other Definitional and Interpretive Matter.

     Unless otherwise expressly provided, for purposes of this Agreement, the following rules of
interpretation shall apply:

Calculation of Time Period. When calculating the period of time before which, within which or
following which any act is to be done or step taken pursuant to this Agreement, the date that is
the reference date in calculating such period shall be excluded. If the last day of such period is
a non-Business Day, the period in question shall end on the next succeeding Business Day.

Dollars. Any reference in this Agreement to $ shall mean U.S. dollars.

Exhibits/Schedules. All Exhibits and Schedules annexed hereto or referred to herein are
hereby incorporated in and made a part of this Agreement as if set forth in full herein. Any
capitalized terms used in any Schedule or Exhibit but not otherwise defined therein shall be
defined as set forth in this Agreement.

Gender and Number. Any reference in this Agreement to gender shall include all genders, and words
imparting the singular number only shall include the plural and vice versa.

Headings. The provision of a Table of Contents, the division of this Agreement into Articles,
Sections and other subdivisions and the insertion of headings are for convenience of reference only
and shall not affect or be utilized in construing or interpreting this Agreement. All references
in this Agreement to any “Section” are to the corresponding Section of this Agreement unless
otherwise specified.

Herein. The words such as “herein,” “hereof” and “hereunder” refer to this Agreement as a whole
and not merely to a subdivision in which such words appear unless the context otherwise requires.

Including. The word “including” or any variation thereof means “including, without limitation” and
shall not be construed to limit any general statement that it follows to the specific or similar
items or matters immediately following it.

     (viii) No Strict Construction. The Parties participated jointly in the negotiation and
drafting of this Agreement and, in the event an ambiguity or question of intent or interpretation
arises, this Agreement shall be construed as jointly drafted by the Parties and no presumption or
burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any
provision of this Agreement.

SECTION 2.

PURCHASE AND SALE

Section 2.1. Purchased Assets.

          Upon the terms and subject to the conditions set forth in this Agreement, on the Closing Date,
Seller shall sell, transfer, assign, convey and deliver, or cause to be sold, transferred,
assigned, conveyed and delivered, to Buyer, and Buyer shall purchase, free and clear of all
Encumbrances (other than Permitted Encumbrances), all right, title and interest of Seller in,

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to or under all of the properties and assets of Seller (other than the Excluded Assets) of every
kind and description, wherever located, real, personal or mixed, tangible or intangible, owned,
leased, licensed, used or held for use in or relating to the Business (herein collectively called
the “Purchased Assets”), including, but not limited to, all right, title and interest of each
Seller in, to or under:

          (a) all Equipment listed on Schedule 2.1(a);

          (b) all Contracts listed or described on Schedule 2.1(b) (the “Assumed Contracts”);

          (c) all Intellectual Property (including all goodwill associated therewith) including, without
limitation, Seller’s film, video and image library listed or described on
Schedule 2.1(c);

          (d) all Documents related to the Purchased Assets;

          (e) all goodwill and other intangible assets associated with the Business or the Purchased
Assets;

          (f) any proprietary rights in Internet protocol addresses, ideas, concepts, methods,
processes, formulae, models, methodologies, algorithms, reports, data, customer lists, mailing
lists, business plans, market surveys, market research studies, websites, information contained on
drawings and other documents, information relating to research, development or testing, and
documentation and media constituting, describing or relating to the Intellectual Property,
including memoranda, manuals, technical specifications and other records wherever created
throughout the world, but excluding reports of accountants, investment bankers, crisis managers,
turnaround consultants and financial advisors or consultants; and

          (g) all advertising, marketing and promotional materials, studies, reports and all other
printed or written materials relating to the Business;

provided, however, none of the Parties hereto intends that Buyer, or any of its Affiliates, shall
be deemed to be a successor to Seller with respect to Purchased Assets; provided, further, that
notwithstanding the foregoing or anything to the contrary contained herein, Buyer reserves the
right, in its sole discretion, to amend and or supplement Schedule 2.1(b) (to add or remove any
contracts that are to be assigned) and/or Schedule 2.1(c) (to remove any of the Intellectual
Property) at any time prior to Closing.

Section 2.2. Excluded Assets.

          Nothing herein contained shall be deemed to sell, transfer, assign or convey the Excluded
Assets to Buyer, and Seller shall retain all right, title and interest to, in and under the
Excluded Assets. For all purposes of and under this Agreement, the term “Excluded Assets” shall
mean all assets which are not Purchased Assets and which are set forth on Schedule 2.2.

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Section 2.3. Assumed Liabilities.

          Upon the terms and subject to the conditions set forth in this Agreement,
on the Closing Date, Buyer shall execute and deliver to Seller the Assumption and Assignment
Agreement pursuant to which Buyer shall assume and agree to discharge, when due (in accordance with
their respective terms and subject to the respective conditions thereof), the Cure Costs (defined
below), if any, under the Assumed Contracts (collectively the “Assumed Liabilities”).

Section 2.4. Excluded Liabilities.

          Notwithstanding any provision in this Agreement to the contrary, Buyer shall not assume and
shall not be obligated to assume or be obliged to pay, perform or otherwise discharge any Liability
of Seller, and Seller shall be solely and exclusively liable with respect to all Liabilities of
Seller, other than the Assumed Liabilities (collectively the “Excluded Liabilities”). For the
avoidance of doubt, the Excluded Liabilities include, but are not limited to, the following:

          (a) any Liability of Seller, arising out of, or relating to, this Agreement or the
transactions contemplated by this Agreement, whether incurred prior to, at or subsequent to the
Closing Date, including, without limitation, all finder’s or broker’s fees and expenses and any and
all fees and expenses of any Representatives of Seller;

          (b) other than as specifically set forth herein, any Liability relating to (x) events or
conditions occurring or existing in connection with, or arising out of, the Business as operated
prior to the Closing Date, or (y) the ownership, possession, use, operation or sale or other
disposition prior to the Closing Date of any Purchased Assets (or any other assets, properties,
rights or interests associated, at any time prior to the Closing Date, with the Business);

          (c) any Liability for Taxes (i) attributable to periods or portions thereof as determined
pursuant to Section 7.1(a) ending on or prior to the Closing Date, (ii) any liability or obligation
of Seller, or any member of any consolidated, affiliated, combined or unitary group of which Seller
is or has been a member, for Taxes and (iii) Taxes of any other Person pursuant to an agreement or
otherwise;

          (d) any Liability incurred by Seller or their respective directors, officers, stockholders,
agents or employees (acting in such capacities) after the Closing Date;

          (e) any Liability of Seller to any Person on account of any Order or Proceeding;

          (f) any Liability relating to or arising out of the ownership or operation of an Excluded
Asset;

          (g) any Liability or obligation under any Assumed Contract that is required to be set forth on
Schedule 2.1(b) but is not set forth therein;

          (h) other than as specifically set forth herein, any liability or obligation of

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Seller under any Indebtedness, including, without limitation, any Indebtedness owed to any
stockholder or other Affiliate of Seller, and any Contract evidencing any such financing
arrangement;

          (i) any liability or obligation, whether known or unknown, (i) arising under Environmental
Laws attributable to or incurred as a result of any acts, omissions, or conditions first occurring
or in existence as of or prior to the Closing Date, including, but not limited to, any liability or
obligation with respect to the release, handling, discharge, treatment, storage, generation,
disposal, or presence of Hazardous Materials at any location, (ii) claims relating to employee
health and safety, including claims for injury, sickness, disease or death of any Person or (iii)
compliance with any Legal Requirement relating to any of the foregoing; and

          (j) other than as specifically set forth herein, fees or expenses of Seller incurred with
respect to the transactions contemplated herein.

Section 2.5. Assignments; Cure Amounts.

          Seller shall transfer and assign all Assumed Contracts to Buyer, and Buyer shall assume all
Assumed Contracts from Seller, as of the Closing Date pursuant to section 365 of the Bankruptcy
Code and the Sale Order. In connection with such assignment and assumption, Buyer shall cure all
defaults under such Assumed Contracts to the extent required by section 365(b) of the Bankruptcy
Code pursuant to the Sale Order (such amounts, the “Cure Costs”).

          The Sale Order shall provide that as of the Closing, Seller shall assign to Buyer the Assumed
Contracts and the Assumed Contracts shall be identified by the name and date of the Assumed
Contract, the other party to the Assumed Contract and the address of such party for notice
purposes, all included on an exhibit attached to either the motion filed in connection with the
Sale Order or a motion for authority to assume and assign such Assumed Contracts. Such exhibit
shall also set forth the amounts necessary to cure any defaults under each of the Assumed Contracts
as determined by Seller based on Seller’ books and records or as otherwise determined by the
Bankruptcy Court.

          In the case of Contracts and other commitments included in the Purchased Assets that cannot be
transferred or assigned effectively without the consent of third parties, which consent has not
been obtained prior to the Closing (after giving effect to the Sale Order and the Bankruptcy Code),
Seller shall, subject to any approval of the Bankruptcy Court that may be required and the terms
set forth in Section 6.3, cooperate with Buyer in endeavoring to obtain such consent.

Section 2.6. Further Assurances.

          (a) At the Closing, and at all times thereafter as may be necessary, Seller and Buyer shall
execute and deliver such other instruments of transfer as shall be reasonably necessary to vest in
Buyer title to the Purchased Assets free and clear of all Encumbrances (other than Permitted
Encumbrances), and such other instruments as shall be reasonably necessary to evidence the
assignment by Seller and the assumption by Buyer or its designee of the Assumed Liabilities,
including the Assumed Contracts. Seller and Buyer shall cooperate with one another to execute and
deliver such other documents and instruments as may be reasonably required to

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carryout the transactions contemplated hereby.

          (b) At the Closing, and at all times thereafter as may be necessary, Seller shall, at the
reasonable request of Buyer, execute, deliver, and file, or cause to be executed, delivered, and
filed, such other instruments of conveyance and transfer and take such other actions as Buyer may
reasonably request, in order to more effectively consummate the transactions contemplated by this
Agreement and to vest in Buyer good and marketable title to the Intellectual Property included in
the Purchased Assets, including, without limitation, executing, filing, and recording, with all
appropriate intellectual property registration authorities and other relevant entities, all
assignment instruments and other filings that are necessary to correctly record the prior chain of
title with respect to ownership of the Intellectual Property included in the Purchased Assets.

          (c) From and after the Closing, International Fight League, Inc. (“Parent”), the sole equity
security owner of Seller, shall be entitled to retain and utilize, without license, royalty, fee,
assessment or other charge, the mark “International Fight League” solely for use as Parent’s
corporate name until Parent becomes engaged in an active trade or business; provided that, from the
Closing, Parent shall utilize the mark “International Fight League” solely for general corporate
purposes and not in any trade or business in accordance with the terms of the Name Use Agreement.

SECTION 3.

PURCHASE PRICE

Section 3.1. Purchase Price.

          Subject to the terms and conditions set forth in this Agreement and in reliance upon the
representations and warranties of the Parties set forth herein, at the Closing, the purchase price
to be paid by Buyer to the Seller in exchange for the Purchased Assets shall be (i) $650,000.00 in
immediately available funds (the “Aggregate Cash Consideration”), and (ii) the assumption by Buyer
of the Assumed Liabilities (collectively, the “Purchase Price”), payable at the Closing.

Section 3.2. Closing Date Payment.

          At the Closing, Buyer shall pay to Seller by wire transfer of immediately available funds, to
the account(s) designated by Seller, the Aggregate Cash Consideration. Other
than the Assumed Liabilities, Buyer shall have no obligation to pay or otherwise satisfy any
Claim (as defined in the Bankruptcy Code) of creditors (including, without limitation, mechanics,
suppliers and material men) against Seller or the Property or any affiliate of Seller.

Section 3.3. Allocation of Purchase Price.

          As soon as practicable after the date hereof, Buyer shall deliver to Seller for Seller’s
review and approval allocation schedule(s) (the “Allocation Schedule(s)”) allocating the Purchase
Price in accordance with the percentages set forth on the Allocation Schedule(s), including the
Assumed Liabilities that are liabilities for federal income Tax purposes, among the Purchased
Assets. The Allocation Schedule(s) shall be reasonable and shall be prepared in accordance with
section 1060 of the Code and the regulations thereunder. Seller agree that, following their
approval of the Allocation Schedule(s), such approval not to be unreasonably withheld or delayed,
Seller shall sign the Allocation Schedule(s) and return an executed copy thereof to Buyer, it being
understood and agreed that on or before the twentieth (20th) Business Day following their receipt
of the Allocation Schedule(s) from Buyer

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as herein provided, Seller shall either deliver an executed copy thereof to Buyer or, in the event
that Seller shall have objections to all or any portion of the Allocation Schedule(s), Seller shall
deliver to Buyer a written objection to such Allocation Schedule(s), which written objection shall
set forth in reasonable detail the basis for the objections of Seller thereto. In the event that
Seller shall deliver a written objection to the Allocation Schedule(s), Seller and Buyer shall
thereafter work in good faith for a period of fifteen (15) Business Days to resolve any and all
objections set forth therein, and upon the resolution of all such objections, Seller and Buyer
shall execute and deliver to the other Party or Parties a signed copy of such agreed upon
Allocation Schedule(s). In the event that Buyer and Seller are unable to resolve such dispute
within such fifteen (15) Business Day period, Buyer and Seller shall jointly retain a nationally
recognized firm of independent certified public accountants mutually acceptable to Buyer and the
Seller (an “Independent Accounting Firm”) to resolve the disputed items and the determinations of
such Independent Accounting Firm shall be conclusive and binding upon the Parties for the purposes
of this Section 3.3. Upon resolution of the disputed items, the allocation reflected on the
Allocation Schedule(s) shall be adjusted to reflect such resolution. The costs, fees and expenses
of the Independent Accounting Firm shall be borne equally by Buyer and Seller. Buyer and Seller
will each file IRS Form 8594, and all Tax Returns, in accordance with the Allocation Schedule(s)
that are agreed upon by the Parties pursuant to the terms of this Section 3.3. Buyer, on the one
hand, and Seller, on the other hand, each agrees to provide the other promptly with any other
information required to complete Form 8594.

Section 3.4. Closing Date.

          Upon the terms and conditions set forth in this Agreement the closing of the sale of the
Purchased Assets and the assumption of the Assumed Liabilities contemplated hereby (the “Closing”)
shall be effected by electronic delivery and shall be deemed to take place at the offices of
Lowenstein Sandler PC, counsel for the Seller, at 1251 Avenue of the Americas, 18th
Floor, New York, New York 10022, as promptly as practicable, and at no time later than the third
Business Day following the date on which the conditions set forth in Section 8 have been satisfied
or waived (other than the conditions which by their nature are to be satisfied at the Closing, but
subject to the satisfaction or waiver of such conditions), or at such other place or time as Buyer
and Seller may mutually agree. The date and time at which the Closing actually occurs is
hereinafter referred to as the “Closing Date.”

Section 3.5. Buyer’s Deliveries.

          At or prior to the Closing, Buyer shall deliver to Seller:

          (a) the Assumption and Assignment Agreement, and each other Ancillary Document to which Buyer
is a party, duly executed by Buyer;

          (b) the Aggregate Cash Consideration;

          (c) the officer’s certificates required to be delivered pursuant to Sections 8.3(a) and (b);
and

          (d) such other assignments and other good and sufficient instruments of assumption and
transfer, in form reasonably satisfactory to Seller, as Seller may reasonably request to transfer
and assign the Assumed Liabilities to Buyer.

Section 3.6. Seller’s Deliveries.

          At or prior to the Closing, Seller shall deliver to Buyer:

          (a) the Bill of Sale and Assumption and Assignment Agreement and each

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other Ancillary Document to which Seller is a party, duly executed by such Seller;

          (b) instruments of assignment of the, Trademarks (the “Assignment of Trademarks”), Copyrights
(the “Assignment of Copyrights”) and Domain Names (the “Assignment of Domain Names”) that are owned
by Seller and included in the Purchased Assets, if any, including all Trademarks, Copyrights and
Domain Names listed on Schedule 2.1(c) hereto, duly executed by Seller, in form for recordation
with the appropriate Governmental Authorities, in form reasonably acceptable to the parties, and
any other assignments or instruments with respect to any Intellectual Property included in the
Purchased Assets for which an assignment or instrument is required to assign, transfer and convey
such assets to Buyer;

          (c) evidence of receipt of the Third Party Consents to the extent such consents are not
provided for or satisfied by the Sale Order;

          (d) a copy of the final Sale Order;

          (e) the officer’s certificates required to be delivered pursuant to Sections 8.2(a) and (b);

          (f) certificates executed by Seller, in the form prescribed under Treasury Regulation Section
1.1445-2(b), that Seller is not a foreign person within the meaning of Section 1445(f)(3) of the
Code;

          (g) a certificate of good standing, or equivalent document as certified by the applicable
Government Authority;

          (h) a certificate of an authorized Person of Seller, dated the Closing Date, in form and
substance reasonably satisfactory to Buyer, as to (i) no amendments to the certificate of formation
(or equivalent formation documents) delivered pursuant to this Section 3.6, (ii) Seller
authorization to execute and perform its obligations under this Agreement and the Ancillary
Documents to which Seller are a party; and (iii) incumbency and signatures of the authorized
Persons of Seller executing this Agreement such Ancillary Documents;

          (i) all instruments and documents necessary to release any and all Encumbrances (other than
Permitted Encumbrances), including appropriate UCC financing statement amendments (termination
statements); and

          (j) such other bills of sale, deeds, endorsements, assignments and other good and sufficient
instruments of conveyance and transfer, in form reasonably satisfactory to Buyer, as Buyer may
reasonably request to vest in Buyer all the right, title and interest of Seller in, to or under any
or all the Purchased Assets.

SECTION 4.

REPRESENTATIONS AND WARRANTIES OF SELLER

          As an inducement to Buyer to enter into this Agreement and to consummate the transactions
contemplated hereby, Seller represents and warrants to Buyer and agrees as follows:

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Section 4.1. Organization of Seller.

          Seller is an entity duly organized, validly existing and in good standing under the laws of
the State of Delaware. Seller is in good standing in each of the jurisdictions in which the
ownership or leasing of its properties or the conduct of its businesses requires such
qualification, except where failure to so qualify or be in good standing would not reasonably be
expected to have a Material Adverse Effect. Seller has full corporate or similar power and
authority to own or lease and to operate and use the Purchased Assets and to carry on the Business
as now conducted.

Section 4.2. Subsidiaries and Investments.

          Seller does not, directly or indirectly, own, of record or beneficially, any outstanding
voting securities, membership interests or other equity interests in any Person.

Section 4.3. Authority of Seller.

          (a) Seller has full power and authority to execute, deliver and, subject to the entry of the
Sale Order, perform its obligations under, and consummate the transactions contemplated by, this
Agreement and each of the Ancillary Documents. The execution, delivery and performance of this
Agreement and Ancillary Documents by Seller, and consummation of the transactions contemplated
hereby and thereby, have been duly authorized and approved by all required action on the part of
Seller, including by Seller’s board of directors and, subject to the entry of the Sale Order, does
not require any authorization or consent of Seller’s shareholders or members that has not been
obtained. This Agreement has been duly authorized, executed and delivered by Seller and, subject to
the entry of the Sale Order, is the legal, valid and binding obligation of Seller enforceable in
accordance with its terms, and the Ancillary Documents have been duly authorized by Seller and upon
execution and delivery by Seller and subject to the entry of the Sale Order, will be a legal, valid
and binding obligation of Seller enforceable in accordance with its terms.

          (b) Subject to receipt of the Third Party Consents, and after giving effect to the Sale Order,
none of the execution and delivery of this Agreement or the Ancillary Documents by Seller, the
consummation by Seller of any of the transactions contemplated hereby or thereby, or compliance
with or fulfillment of the terms, conditions and provisions hereof or thereof by Seller, will
conflict with, result in a breach of the terms, conditions or provisions of, or constitute a
default or an event of default, or permit the acceleration of any Liability or obligation or loss
of a material benefit, or result in the creation of any Encumbrance on any of the assets or
properties of the Business (in each case with or without notice or lapse of time or both), under
(i) any charter (or similar governing instrument) or by-laws (or similar governing document) of
Seller, (ii) any Permits, (iii) any Order to which Seller is bound or any Purchased Asset is
subject, (iv) any Legal Requirement affecting Seller or the Purchased Assets, or (v) any Contract
to which Seller or any of the Purchased Assets is a party or otherwise bound.

Section 4.4. Assumed Contracts and Cure Costs.

          (a) Schedule 2.1(b) lists each Contract that relates to the Business or any of the Purchased
Assets. Seller has delivered to Buyer a correct and complete copy of each written Contract (as
amended to date) listed in Schedule 2.1(b). Each such Contract is enforceable and,

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subject to the payment of any applicable Cure Costs, will continue to be enforceable on identical
terms following the consummation of the Transactions. Other than the obligation to pay any
applicable Cure Costs, neither Seller nor, to Seller’s knowledge, any of the counter-parties to any
such Contract is or has been in (and no event has occurred that, with or without notice or lapse of
time, would create or constitute a) breach or violation of, or default under, any of such
Contract’s provisions.

          (b) Schedule 2.1(b) sets forth a true and complete list of the Cure Costs associated with each
of the Assumed Contracts. Buyer acknowledges, understands
and agrees that the Cure Costs set forth herein and in Schedule 2.1(b) is based upon the
information of the arrears and other costs due under each Assumed Contract to cure any defaults in
such Assumed Contract on the date hereof and is subject to adjustment following each counter party
to the Assumed Contracts’ submission to the Bankruptcy Court of any objections to the Cure Costs
and adjudication by the Bankruptcy Court of the Cure Costs associated with any Assumed Contract.

Section 4.5. Intellectual Property.

          Schedule 2.1(c) sets forth a true and complete list of all Seller’s Intellectual Property
relating to the Purchased Assets. Except as set forth in Schedule 2.1(c), Seller owns, or possesses
adequate rights to use, all Intellectual Property used in the Business. No Third Party Consent is
required for the assignment of all interests in the Intellectual Property used in the Business to
Buyer as contemplated by this Agreement. Seller’s use of the Intellectual Property in the Business
does not, and Buyer’s use of such Intellectual Property after Closing will not, infringe upon any
rights any other person owns or holds.

Section 4.6. Title to Purchased Assets.

          Seller has, and, upon delivery to Buyer on the Closing Date of the instruments of transfer
contemplated by Section 3.6, and subject to the terms of the Sale Order, Seller will thereby
transfer to Buyer, good and valid title to all of the Purchased Assets, free and clear of all
Encumbrances, except for the Assumed Liabilities and for Permitted Encumbrances. Except for the
Excluded Assets there are no material assets, material properties, material rights or material
interests of any kind or nature that Seller has been using, holding or operating in the Business
that will not be used, held or owned by Buyer immediately following the Closing.

Section 4.7. Proceedings.

          Schedule 4.7 sets forth a true and complete list of all Orders and Proceedings by or against
Seller arising from or relating to the Purchased Assets. Except as set forth in Schedule 4.7, there
are no instances in which Seller (a) is subject to any outstanding Order or (b) is a party, the
subject of or, to Seller’s knowledge, is threatened to be made a party to or the subject of, any
Proceeding. No Order or Proceeding required to be set forth in Schedule 4.7 questions the
enforceability of this Agreement or the Ancillary Document or the transactions contemplated hereby
and thereby, or could result in any Material Adverse Effect on the Business or Purchased Assets,
and Seller has no basis to believe that any such Proceeding may be brought or threatened against
Seller or Buyer.

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Section 4.8. Consent and Approvals.

          Schedule 4.8 sets forth a true and complete list of each material consent, waiver,
authorization or approval of any governmental or regulatory authority, domestic
or foreign, or of any other Person, and each declaration to or filing or registration with any
such governmental or regulatory authority, that is required in connection with the execution and
delivery of this Agreement and the Ancillary Documents by the Seller or the performance by the
Seller of its obligations hereunder or thereunder (the “Third Party Consents”).

Section 4.9. Accuracy of Information Furnished.

          No representation, statement or information contained in this Agreement, any of the Ancillary
Documents or any Contract or other document made available or furnished to Buyer or its
Representatives by or on behalf of Seller contains any untrue statement of a material fact or omits
any material fact necessary to make the information contained therein not misleading.

EXCEPT AS SET FORTH ABOVE, (A) ALL THE PURCHASED ASSETS SHALL BE TRANSFERRED ON AN AS-IS, WHERE-IS
BASIS, AND (B) SELLER MAKES NO FURTHER REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED, IN
RESPECT OF THE PURCHASED ASSETS, AND ANY SUCH REPRESENTATION AND WARRANTIES ARE HEREBY EXPRESSLY
DISCLAIMED.

SECTION 5.

REPRESENTATIONS AND WARRANTIES OF BUYER

          As an inducement to Seller to enter into this Agreement and to consummate the transactions
contemplated hereby, Buyer hereby represents and warrants to Seller and agrees as follows:

Section 5.1. Organization and Authority of Buyer.

          (a) Buyer is a limited liability company duly organized, validly existing and in good standing
under the laws of the State of Delaware. Buyer has full corporate power and authority to execute,
deliver and perform its obligations under this Agreement and all of the Ancillary Documents to
which it is a party. The execution, delivery and performance of this Agreement and such Ancillary
Documents by Buyer have been duly authorized and approved by Buyer’s managers and do not require
any further authorization or consent of Buyer or its managers or members. This Agreement has been
duly authorized, executed and delivered by Buyer and is the legal, valid and binding agreement of
Buyer enforceable against Buyer in accordance with its terms, and each Ancillary Document to which
Buyer is a party has been duly authorized by Buyer and upon execution and delivery by Buyer will be
a legal, valid and binding obligation of Buyer enforceable against Buyer in accordance with its
terms, except as (i) enforceability may be limited by bankruptcy, insolvency, reorganization or
other similar laws affecting creditors rights generally and (ii) the remedy of specific performance
and injunctive and other forms of equitable relief may be subject to equitable defenses.

          (b) Neither the execution and delivery of this Agreement or any of such Ancillary Documents or
the consummation of any of the transactions contemplated hereby or thereby nor compliance with or
fulfillment of the terms, conditions and provisions hereof or thereof will:

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          (i) conflict with, result in a breach of the terms, conditions or provisions of, or
constitute a default, or an event of default under (1) Buyer’s organizational documents,
(2) any Order to which Buyer is a party or by which it is bound or (3) any Legal
Requirement affecting Buyer; or

          (ii) require the approval, consent, authorization or act of, or the making by Buyer of
any declaration, filing or registration with, any Person, other than filings with the
Bankruptcy Court.

Section 5.2. No Finder.

          Except as set forth on Schedule 5.2, neither Buyer nor any Person acting on its behalf has
paid or become obligated to pay any fee or commission to any broker, finder or intermediary for or
on account of the transactions contemplated by this Agreement for which Seller is or will become
liable, and Buyer shall hold harmless and indemnify Seller from any claims with respect to any such
fees or commissions.

Section 5.3. Ownership of Seller.

          Buyer does not hold, directly or indirectly, any beneficial or other ownership interest in
Seller or its securities.

SECTION 6.

ACTION PRIOR TO THE CLOSING DATE

          The Parties covenant and agree to take the following actions between the date hereof and the
earlier of the termination of this Agreement and the Closing Date:

Section 6.1. Investigation of the Business by Buyer.

          Seller shall permit Buyer’s authorized Representatives reasonable access during regular
business hours and upon reasonable notice, to the offices, properties, agreements and other
documentation and financial records with respect to the Business, the Purchased Assets, and the
Assumed Liabilities to the extent Buyer reasonably requests. Any such investigation shall be
conducted in a manner so as not to interfere with the operations of the Business. Seller shall use
their commercially reasonable efforts to cause their outside accountants and outside counsel to
cooperate with Buyer in its investigation.

Section 6.2. Third Party Consents.

          Seller shall use its best efforts to obtain all Third Party Consents to the extent such
consents are not provided for or satisfied by the Sale Order.

Section 6.3. Governmental Approvals.

          (a) During the period prior to the Closing Date, Seller and Buyer shall act diligently and
reasonably, and shall cooperate with each other, to do or cause to be done, all things necessary,
proper or advisable consistent with applicable confidentiality and Legal Requirements to cause the
conditions precedent to the Closing to be satisfied and to cause the Closing to occur, including to
secure any consents and approvals of any governmental authority

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required to be obtained by them, in order to assign or transfer any Permits to Buyer, to permit the
consummation of the transactions contemplated by this Agreement, or to otherwise satisfy the
conditions set forth in Section 8, in each case as necessary to the extent such consents are not
provided for or satisfied by the Sale Order; provided, however, that Seller shall not make any
agreement or understanding affecting the Purchased Assets or the Business (excluding the Excluded
Assets or Excluded Liabilities) as a condition for obtaining any such consents or approvals except
with the prior written consent of Buyer. Subject to the limitations set forth in this Section 6.3,
Buyer shall act diligently and reasonably to cooperate with Seller, to the extent commercially
reasonable, to obtain the consents and approvals contemplated by this Section 6.3(b); provided,
however, Buyer shall not be required to waive any of the conditions to Closing set forth in Section
8.

          (b) Subject to all applicable confidentiality and Legal Requirements, Seller and Buyer (i)
shall promptly inform each other of any communication from any Governmental Authority concerning
this Agreement, the transactions contemplated hereby, and any filing, notification or request for
approval and (ii) shall permit the other Party to review in advance any proposed written
communication or information submitted to any such Governmental Authority in response thereto;
provided, that a Party may request entry into a joint defense agreement as a condition to providing
any such materials and that, upon receipt of that request, the Parties shall work in good faith to
enter into a joint defense agreement to create and preserve attorney-client privilege in a form and
substance mutually acceptable to the Parties. In addition, none of Parties shall agree to
participate in any meeting with any Governmental Authority in respect of any filings, investigation
or other inquiry with respect to this Agreement or the transactions contemplated hereby, unless
such Party consults with the other Parties in advance and, to the extent permitted by any such
Governmental Authority, gives the other Parties the opportunity to attend and participate thereat,
in each case to the maximum extent practicable. Subject to any restrictions under applicable laws,
rules or regulations, each Party shall furnish the other with copies of all correspondence, filings
and communications (and memoranda setting forth the substance thereof) between it and its
Affiliates and their respective Representatives on the one hand, and the Governmental Authority or
members of its staff on the other hand, with respect to this Agreement, the
transactions contemplated hereby (excluding documents and communications which are subject to
preexisting confidentiality agreements or to the attorney-client privilege or work product
doctrine) or any such filing, notification or request for approval. Each Party shall also furnish
the other Party with such necessary information and assistance as such other party and its
Affiliates may reasonably request in connection with their preparation of necessary filings,
registration or submissions of information to the Governmental Authority in connection with this
Agreement, the transactions contemplated hereby and any such filing, notification or request for
approval. Seller and Buyer shall prosecute all required requests for approval with all necessary
diligence and otherwise use their respective commercially reasonable efforts to obtain the grant
thereof by an Order as soon as possible including in order to resolve such objections or suits
which, in any case if not resolved, could reasonably be expected to prevent, materially impede or
materially delay the consummation of the transactions contemplated hereunder or the other
transactions contemplated hereby, including by Buyer selling, holding separate or otherwise
disposing of or conducting its business in a manner which would resolve such objections or suits or
agreeing to sell, hold separate or otherwise dispose of or conduct its business in a manner which
would resolve such objections or suits or permitting the sale, holding separate or other
disposition of, any of its assets or the assets of its subsidiaries

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or the conducting of its business in a manner which would resolve such objections or suits.

          (c) Notwithstanding anything else to the contrary in this Agreement, in the event that any
administrative or judicial action or proceeding is instituted (or threatened to be instituted) by a
Governmental Authority or private party challenging the transactions hereunder or any other
agreement contemplated hereby, (i) each Party shall cooperate in all respects with each other and
use its respective best efforts to contest and resist any such action or proceeding and to have
vacated, lifted, reversed or overturned any decree, judgment, injunction or other order, whether
temporary, preliminary or permanent, that is in effect and that prohibits, prevents or restricts
consummation of the transactions contemplated by this Agreement, and (ii) Buyer must defend, at its
sole cost and expense, any action or actions, whether judicial or administrative, in connection
with the transactions contemplated by this Agreement.

Section 6.4. Conduct of Business Prior to the Closing Date.

          (a) From and after the date hereof until the earlier of the Closing Date and the termination
of this Agreement in accordance with the terms of Section 9 hereof, Seller shall maintain the
Purchased Assets and operate and carry on the Business only in the Ordinary Course of Business,
except as otherwise expressly required by this Agreement or with the express written consent of
Buyer. Consistent with the foregoing and to the extent permitted or required by the Bankruptcy
Case, Seller shall use commercially reasonable efforts to (i) maintain the Purchased Assets and the
assets and properties of, or used by, the Seller relating to the Business in their current
condition (ordinary wear and tear excepted), (ii) maintain the business organization of the
Business intact, (iii) maintain the Documents of the Business, and (iv) comply with all Legal
Requirements. In connection therewith, Seller not shall (1) offer employment for any period
on or after the Closing Date to any employee or agent of the Business regarding whom Buyer makes
offers of employment in accordance with the terms set forth herein or (2) otherwise attempt to
persuade any such employee or agent to terminate his or her relationship with the Business.

          (b) From and after the date hereof until the earlier of the Closing Date and the termination
of this Agreement in accordance with the terms of Section 9 hereof, except (u) where the effect
would be immaterial, (w) in the Ordinary Course of Business, (x) as expressly provided in this
Agreement, including in connection with the Auction or (y) as with the express written approval of
Buyer, no Seller shall:

          (i) fail to maintain the Purchased Assets in their present condition or permit any
Encumbrances on the Purchased Assets;

          (ii) grant or acquire, agree to grant to or acquire from any Person, or dispose of or
permit to lapse any rights to, any material Intellectual Property; or

          (iii) enter into any agreement or commitment to take any action prohibited by this
Section 6.4(b).

Section 6.5. Notification of Breach; Disclosure.

          Each Party shall promptly notify the other of any event, condition or circumstance of which
such Party becomes aware prior to the Closing Date that would cause, or would

-20-

 

reasonably be expected to cause, a violation or breach of this Agreement (or a breach of any
representation or warranty contained in this Agreement). During the period prior to the Closing
Date, each Party will promptly advise the other in writing of any written notice or other
communication from any Person alleging that the consent of such Person is or may be required in
connection with the transactions contemplated by this Agreement. It is acknowledged and understood
that no notice given pursuant to this Section 6.5 shall have any effect on the representations,
warranties, covenants or agreements contained in this Agreement for purposes of determining
satisfaction of the conditions contained herein.

Section 6.6. Insurance.

          Until the Closing, Seller shall maintain (including necessary renewals thereof) insurance
policies against risk and liabilities to the extent and in the manner and at the levels maintained
by Seller as of the date hereof with respect to the Business and the Purchased Assets.

Section 6.7. Bankruptcy Court Approval.

          (a) Seller and Buyer acknowledge that this Agreement and the sale of the Purchased Assets are
subject to Bankruptcy Court approval. Seller and Buyer acknowledge that (i) to obtain such
approval, Seller must demonstrate that they have taken reasonable steps to obtain the highest or
otherwise best offer possible for the Purchased Assets, including, but not limited to, giving
notice of the transactions contemplated by this Agreement to creditors and certain other interested
parties as ordered by the Bankruptcy Court, and conducting an auction in respect of the Purchased
Assets (the “Auction”), and (ii) Buyer must provide adequate assurance of future performance under
the Assumed Contracts.

          (b) As soon as reasonably possible after the Parties execute this Agreement, but in any event
no later than five Business Days after the Parties execute this Agreement, Seller shall file the
Sale Motion with the Bankruptcy Court, together with required supporting papers and required
notices.

          (c) In the event an appeal is taken or a stay pending appeal is requested, with respect to the
Sale Order, Seller shall promptly notify Buyer of such appeal or stay request and shall promptly
provide to Buyer a copy of the related notice of appeal or order of stay. Seller shall also provide
Buyer with written notice of any motion or application filed in connection with any appeal from
either of such orders.

          (d) From and after the date hereof, Seller shall not take any action that is intended to
result in, or fail to take any action the intent of which failure to act would result in, the
reversal, voiding, modification or staying of the Sale Order.

Section 6.8. Bankruptcy Filings.

          (a) From and after the date hereof, at least two Business Days prior to filing any papers or
pleadings in the Bankruptcy Case that relate, in whole or in part, to this Agreement or Buyer,
Seller shall provide Buyer with a copy of such papers or pleadings.

          (b) Buyer shall provide Seller with prompt notice of any papers or pleadings filed by a party
other than the Buyer in the Bankruptcy Case that relate, in whole or in part, to the

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Purchased Assets, this Agreement or Buyer.

SECTION 7.

ADDITIONAL AGREEMENTS

Section 7.1. Taxes.

          (a) Seller shall be liable for and shall pay, and pursuant to Section
7.1(c) shall reimburse Buyer for, all Taxes (whether assessed or unassessed) applicable to the
Business and the Purchased Assets, in each case attributable to periods (or portions thereof)
ending on or prior to the Closing Date. Without limiting the obligations of Buyer contained
elsewhere in this Agreement, including in respect of the Assumed Liabilities, Buyer shall be liable
for and shall pay, and pursuant to Section 7.1(c) shall reimburse the applicable Seller for, all
Taxes (whether assessed or unassessed) applicable to the Business, the Purchased Assets and the
Assumed Liabilities, in each case attributable to periods (or portions thereof) beginning after the
Closing Date. For purposes of this paragraph (a), any period beginning before and ending after the
Closing Date shall be treated as two partial periods, one ending on the Closing Date and the other
beginning on the day after the Closing Date except that Taxes (such as property Taxes) imposed on a
periodic basis shall be allocated on a daily basis.

          (b) Without limiting the other terms set forth in this Agreement, any sales Tax, use Tax, real
property transfer or gains Tax, real property records recordation fees, documentary stamp Tax or
similar Tax attributable to the sale or transfer of the Purchased Assets and not exempted under the
Sale Order or by section 1146(c) of the Bankruptcy Code (“Transfer Taxes”) shall be borne by
Seller.

          (c) Seller or Buyer, as the case may be, shall provide reimbursement for any Tax paid by one
Party all or a portion of which is the responsibility of the other Party in accordance with the
terms of this Section 7.1. Within a reasonable time prior to the payment of any such Tax, the Party
paying such Tax shall give notice to the other of the Tax payable and each Party’s respective
liability therefor, although failure to do so will not relieve the other Party from its liability
hereunder.

          (d) Buyer and Seller agree to furnish or cause to be furnished to each other, upon request, as
promptly as practicable, such information and assistance relating to the Business and the Purchased
Assets (including access to books and records) as is reasonably necessary for the filing of all Tax
Returns, the making of any election relating to Taxes, the preparation for any audit by any taxing
authority, and the prosecution or defense of any claim, suit or proceeding relating to any Tax.
Buyer and Seller shall retain all books and records with respect to Taxes pertaining to the
Purchased Assets for a period of at least six years following the Closing Date. On or after the end
of such period, each party shall provide the other with at least 10 days prior written notice
before destroying any such books and records, during which period the party receiving such notice
can elect to take possession, at its own expense, of such books and records. Seller and Buyer shall
cooperate with each other in the conduct of any audit or other proceeding relating to Taxes
involving the Purchased Assets or the Business.

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Section 7.2. Adequate Assurances Regarding Assumed Contracts.

          With respect to each Assumed Contract, Buyer will use commercially reasonable efforts to
provide adequate assurance as required under the Bankruptcy Code of the future performance by Buyer
of each such Assumed Contract. Buyer and Seller agree that they will promptly take all actions
reasonably required to assist in obtaining a
Bankruptcy Court finding that there has been an adequate demonstration of adequate assurance
of future performance under the Assumed Contracts, such as furnishing affidavits, non-confidential
financial information or other documents or information for filing with the Bankruptcy Court and
making Buyer’s and Seller’ employees and representatives available to testify before the Bankruptcy
Court.

Section 7.3. Certain Actions.

          Within ten (10) days after the Closing Date, Seller shall take such corporate and other
actions necessary to change its corporate or company name, as the case may be, to a name that is
not similar to, or confusing with, the current name of Seller, including any necessary filings
required by the general corporation or other law of the state in which such Seller is incorporated,
or otherwise organized. Buyer and Parent shall enter into the Name Use Agreement, permitting
Parent to continue to retain “International Fight League” as its corporate name so long as it is a
dormant company and is not engaged in an active trade or business in accordance with Section
2.6(c).

Section 7.4. Reasonable Access to Records and Certain Personnel.

          In order to facilitate Seller’ efforts to (i) administer and close the Bankruptcy Cases, (ii)
prepare tax returns (together, the “Post-Close Filings”), and (iii) allow Parent to file reports
with the Securities and Exchange Commission, for a period of two (2) years following the Closing,
the Buyer shall permit Seller and Seller’s counsel and accountants (collectively, “Permitted Access
Parties”) during regular business hours, with reasonable notice, and subject to reasonable rules
and regulations, reasonable access to the financial and other books and records which comprised
part of the Purchased Assets that are required to complete the Post-Close Filings, which access
shall include (x) the right of such Permitted Access Parties to copy, at such Permitted Access
Parties’ expense, such required documents and records and (y) Buyer’s copying and delivering to the
relevant Permitted Access Parties such documents or records as they require, but only to the extent
such Permitted Access Parties furnish Buyer with reasonably detailed written descriptions of the
materials to be so copies and applicable Permitted Access Party reimburses the Buyer for the costs
and expenses thereof; provided, however, that the foregoing rights of access shall not be
exercisable in such a manner as to interfere with the normal operations of Buyer’s business.
Notwithstanding anything contained in this Section 7.4 to the contrary, in no event shall Seller
have access to any information that, based on advice of Buyer’s counsel, could (1) reasonably be
expected to create liability under applicable law, or waive any legal privilege, (2) result in the
discharge of any Trade Secrets of Buyer, its affiliates or any third parties or (3) violate any
obligation of Buyer with respect to confidentiality.

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SECTION 8.

CONDITIONS TO CLOSING

Section 8.1. Conditions to Obligations of Each Party.

          The respective obligations of each Party to effect the sale and purchase of the Purchased
Assets shall be subject to the fulfillment (or, if permitted by applicable law, waiver) on or prior
to the Closing Date, of the following conditions:

          (a) Consents, shall have been obtained or expired, as the case may be;

          (b) the Sale Order shall be unstayed (other than the ten-day period set forth in Rule 6004 of
the Federal Rules of Bankruptcy Procedure); and

          (c) no Governmental Authority shall have enacted, issued, promulgated or entered any Order
that is in effect and has the effect of making illegal or otherwise prohibiting the consummation of
the transactions contemplated by this Agreement that has not been withdrawn or terminated.

Section 8.2. Conditions to Obligations of Buyer.

          The obligation of Buyer to purchase of the Purchased Assets contemplated by this Agreement
shall be subject to the fulfillment on or prior to the Closing Date of the following additional
conditions:

          (a) the representations and warranties of Seller contained in this Agreement shall be true and
correct in all material respects when made and on and as of the Closing Date with the same effect
as if such representations and warranties had been made on and as of such date, and Buyer shall
have received a certificate of Seller to such effect signed by a duly authorized officer thereof;

          (b) each covenant and obligation that Seller is required to perform or to comply with pursuant
to this Agreement at or prior to the Closing shall have been duly performed and complied with in
all material respects, and Buyer shall have received a certificate of Seller to such effect signed
by a duly authorized manager or member thereof;

          (c) Seller shall have the requisite authority to assign the Intellectual Property set forth in
Schedule 2.1(c) to Buyer;

          (d) each of the deliveries required to be made to Buyer pursuant to Section 3.6 shall have
been so delivered; and

          (e) the Sale Order shall have been entered and shall have become a Final Order and shall be in
form and substance satisfactory to Buyer in its sole reasonable discretion.

          Any condition specified in this Section 8.2 may be waived by Buyer; provided that no such
waiver shall be effective against Buyer unless it is set forth in a writing executed by Buyer.

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Section 8.3. Conditions to Obligations of Seller.

          The obligation of Seller to sell the Purchased Assets contemplated by this Agreement shall be
subject to the fulfillment on or prior to the Closing Date of the following additional conditions:

          (a) the representations and warranties of Buyer contained in this Agreement shall be true and
correct in all material respects when made and on and as of the Closing Date with the same effect
as if such representations and warranties had been made on and as of such date and Seller shall
have received a certificate of Buyer to such effect signed by a duly authorized officer thereof;

          (b) each covenant and obligation that Buyer is required to perform or to comply with pursuant
to this Agreement at or prior to the Closing shall have been duly performed and complied with in
all material respects, and Seller shall have received a certificate of Buyer to such effect signed
by a duly authorized manager or member thereof;

          (c) each of the deliveries required to be made to Seller pursuant to Section 3.5 shall have
been so delivered; and

          (d) The Sale Order shall have been entered and become a Final Order.

          Any condition specified in this Section 8.3 may be waived by Seller; provided that no such
waiver shall be effective against Seller unless it is set forth in writing executed by Seller.

SECTION 9.

TERMINATION

Section 9.1. Termination.

          This Agreement may be terminated, and the transactions contemplated hereby may be abandoned,
by written notice promptly given to the other parties hereto, at any time prior to the Closing
Date:

          (a) by mutual written consent of Buyer and Seller;

          (b) by either Buyer or Seller if any permanent injunction or other order of a court or
competent authority or government agency which prevents the consummation of the transaction shall
have become final and not appealable;

          (c) by either Buyer or Seller upon ten (10) days written notice of such termination to the
other parties, if the Closing shall not have occurred on or prior to December 31, 2008; provided
that the failure of the Closing to occur by such date is not
due (in whole or in part) to a material breach by the terminating party of such party’s
representations, warranties or covenants under this Agreement; and

          (d) by Buyer if Seller (i) agrees in writing, (ii) publicly announces its intention, or (iii)
is authorized by its board of directors (or equivalent body), to sell, transfer, lease or otherwise
dispose of, directly or indirectly, including through an asset sale, stock sale,

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merger, reorganization or other similar transaction, all or any portion of the Purchased Assets to
any Person other than Buyer whether as a result of the proposal of a stand alone plan of
reorganization or otherwise;

          (e) by Buyer if there has been a breach by Seller of any of its representations, warranties or
covenants that would result in the condition set forth in Section 8.2(a) or Section 8.2(b) not
being met, which breach is not curable, or if curable, is not cured within thirty (30) days after
notice of such breach is given by Buyer to Seller; or

          (f) by either Buyer or Seller if the Bankruptcy Court approves an Alternative Transaction, or
an Alternative Transaction is consummated.

          (g) For purposes of this Section 9.1, “Alternative Transaction” means any one of the following
transactions with or by any person or group (other than the Buyer): (a) a merger, consolidation or
similar transaction involving Seller, or (b) a sale, lease or other disposition directly or
indirectly by merger, consolidation, tender offer, share exchange or otherwise of any assets of
Seller, excluding the Excluded Assets and Excluded Liabilities.

Section 9.2. Break Up Fee.

          (a) Seller acknowledges (i) that Buyer has made a substantial investment in time and incurred
substantial out-of-pocket expenses in connection with the negotiation and execution of this
Agreement, its due diligence with respect to the Purchased Assets, and its efforts to consummate
the transactions contemplated hereby, and (ii) that Buyer’s efforts have substantially benefited
Seller and will benefit Seller and will benefit the bankruptcy estate of Seller through the
submission of the offer reflected in this Agreement which will serve as a minimum bid on which
other potentially interested bidders can rely. Therefore, as compensation for entering into this
Agreement, taking action to consummate the transactions contemplated hereby and incurring the costs
and expenses related thereto and other losses and damages, including foregoing other opportunities,
Seller agrees to pay to Buyer, in accordance with the provisions of this Section 9.2, an amount
equal to three percent (3%) of the Aggregate Cash Consideration (the “Break-Up Fee”).

          (b) Subject to limitations set forth in the Bidding Procedures, the Break-Up Fee shall become
payable to Buyer if, at any time prior to the entry of the Sales
Order, this Agreement is terminated by Buyer pursuant to Sections 9.1(c), (d), (e) or (f) or
by Seller pursuant to 

Section 9.1(f).

Section 9.3. Effect of Termination.

          (a) In the event of termination of this Agreement by either Party, all rights and obligations
of the Parties under this Agreement shall terminate without any liability of any Party to any other
Party except as otherwise provided in this Section 9 and except that each Party shall be liable for
any willful breach of this Agreement by such Party. Notwithstanding the foregoing, the provisions
of Section 9.2, Section 10 and Section 11 shall expressly survive the expiration or termination of
this Agreement.

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SECTION 10.

INDEMNIFICATION

Section 10.1. No Survival of Representations and Warranties.

          The representations and warranties of Buyer and Seller made in this Agreement and the
covenants of Buyer and Seller contained in this Agreement that, by their terms, are to be performed
at or prior to the Closing shall not survive the Closing Date and shall be extinguished by the
Closing and the consummation of the transaction contemplated by this Agreement. Absent fraud, Buyer
shall not have any remedy against Seller or their Affiliates, and Seller shall not have any remedy
against Buyer or its Affiliates for (i) any breach of a representation or warranty contained in
this Agreement (other than to terminate the Agreement in accordance with the terms hereof and as
provided in Section 9.2) and (ii) if the Closing occurs, any breach of a covenant contained in this
Agreement with respect to the period prior to the Closing Date. All covenants required to be
performed after the Closing Date shall survive this Closing Date.

SECTION 11.

GENERAL PROVISIONS

Section 11.1. Confidential Nature of Information.

          Each Party agrees that it will treat in confidence all documents, materials and other
information that it shall have obtained regarding the other Party during the course of the
negotiations leading to the consummation of the transactions contemplated hereby (whether obtained
before or after the date of this Agreement), the investigation provided for herein and the
preparation of this Agreement and other related documents. Such documents, materials and
information shall not be disclosed or communicated to any third Person (other than, in the case of
Buyer, to its counsel, accountants, financial advisors and potential lenders, and in the case of
Seller, to their counsel, accountants and financial advisors). No Party shall use any confidential
information referred to in the
second immediately preceding sentence in any manner whatsoever except solely for the purpose
of evaluating the proposed purchase and sale of the Purchased Assets and the enforcement of its
rights hereunder and under the Ancillary Documents; provided, however, that after the Closing,
Buyer may use or disclose any confidential information included in the Purchased Assets and may use
or disclose other confidential information that is otherwise reasonably related to the Business or
the Purchased Assets. The obligation of each Party to treat such documents, materials and other
information in confidence shall not apply to any information that (i) is or becomes available to
such Party from a source other than the disclosing Party, provided such other source was not, and
such Party would have no reason to believe such source was, subject to a confidentiality obligation
in respect of such information, (ii) is or becomes available to the public other than as a result
of disclosure by such Party or its agents, (iii) is required to be disclosed under applicable law
or judicial process, including the Bankruptcy Case, but only to the extent it must be disclosed, or
(iv) such Party reasonably deems necessary to disclose to obtain any of the consents or approvals
contemplated hereby.

Section 11.2. No Public Announcement.

          Neither Seller nor Buyer shall, without the approval of Seller (in the case of a disclosure by
Buyer) or Buyer (in the case of a disclosure by Seller), make any press release or other public
announcement concerning the transactions contemplated by this Agreement, except

-27-

 

as and to the extent that any such party shall be so obligated by law, including as may be required
by the Bankruptcy Case, securities laws, or the rules of any stock exchange, in which case the
other party or parties shall be advised prior to such disclosure and the parties shall use their
reasonable best efforts to cause a mutually agreeable release or announcement to be issued.

Section 11.3. Notices.

          All notices or other communications required or permitted hereunder shall be in writing and
shall be given or delivered by personal delivery, by facsimile or by a nationally recognized
private overnight courier service addressed as follows:

If to Buyer, to:

HDNet LLC

320 South Walton Street

Callas, Texas 75226 

Attn:
Robert Thoele 

Facsimile:
214-571-9221

with a copy to (which shall not constitute notice):

Alvin Gump Strauss Hauer & Feld LLP 

1700
Pacific Ave, Suite 4100 

Dallas, Texas 75201

Attn: Robert W. Dockery, Esq. and Kevin D. Rice, Esq.

Facsimile: 214-969-4343

If to Seller, to:

IFL Corp.

38 Park Avenue, 2nd
Floor

 Rutherford, New Jersey 07070

Attn: Michael Keefe 

Facsimile:
201-635-1801

with a copy to (which shall not constitute notice):

Lowenstein Sandler PC

1251 Avenue of the Americas, 18th Floor 

New
York, New York 10022

Attn: Sharon L. Levine, Esq. and S. Jason Teele, Esq.

Facsimile: 973-597-2400

or to such other address or facsimile number as such party may indicate by a notice delivered to
the other party hereto.

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          Any notice, consent, authorization, direction or other communication delivered as aforesaid
shall be deemed to have been effectively delivered and received, if sent by a nationally recognized
private overnight courier service, on the date following the date upon which it is delivered for
overnight delivery to such courier service, if delivered personally (with written confirmation of
receipt), on the date of such delivery or, if sent via facsimile, on the date of the transmission
of the facsimile, provided that the sender thereof receives written confirmation that the facsimile
was successfully delivered to the intended recipient.

Section 11.4. Successors and Assigns.

          (a) Except as expressly permitted in this Agreement, the rights and obligations of the Parties
under this Agreement shall not be assignable by such parties without the written consent of the
other parties hereto.

          (b) This Agreement shall be binding upon and inure to the benefit of the Parties and their
successors and permitted assigns. The successors and permitted
assigns hereunder shall include any permitted assignee as well as the successors in interest
to such permitted assignee (whether by merger, consolidation, liquidation (including successive
mergers, consolidations or liquidations) or otherwise). Nothing in this Agreement, expressed or
implied, is intended or shall be construed to confer upon any Person other than the parties and
successors and assigns permitted by this Section 11.4 any right, remedy or claim under or by reason
of this Agreement.

Section 11.5. Entire Agreement; Amendments; Disclosure Schedules.

          This Agreement, the Ancillary Documents and Disclosure Schedules referred to herein contain
the entire understanding of the parties hereto with regard to the subject matter contained herein
or therein, and supersede all prior agreements, understandings or letters of intent between or
among any of the parties hereto with respect to such subject matter. This Agreement shall not be
amended, modified or supplemented except by a written instrument signed by an authorized
representative of each of the Parties.

Section 11.6. Waivers.

          Any term or provision of this Agreement may be waived, or the time for its performance may be
extended, by the party or parties entitled to the benefit thereof. Any such waiver shall be validly
and sufficiently authorized for the purposes of this Agreement if, as to any party, it is
authorized in writing by an authorized representative of such party. Except as otherwise provided
herein, the failure of any party hereto to enforce at any time any provision of this Agreement
shall not be construed to be a waiver of such provision, nor in any way to affect the validity of
this Agreement or any part hereof or the right of any party thereafter to enforce each and every
such provision. No waiver of any breach of this Agreement shall be held to constitute 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 right, power or remedy. All remedies hereunder are
cumulative and are not exclusive of any other remedies provided by law.

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Section 11.7. Expenses.

          Each party hereto will pay all costs and expenses incident to its negotiation and preparation
of this Agreement and to its performance and compliance with all agreements and conditions
contained herein on its part to be performed or complied with, including the fees, expenses and
disbursements of its counsel and accountants.

Section 11.8. Partial Invalidity.

          Wherever possible, each provision hereof shall be interpreted in such
manner as to be effective and valid under applicable law, but in case any one or more of the
provisions contained herein shall, for any reason, be held to be invalid, illegal or unenforceable
in any respect, such provision shall be ineffective to the extent, but only to the extent, of such
invalidity, illegality or unenforceability without invalidating the remainder of such invalid,
illegal or unenforceable provision or provisions or any other provisions hereof, unless such a
construction would be unreasonable.

Section 11.9. Execution in Counterparts.

          This Agreement may be executed in counterparts, each of which shall be considered an original
instrument, but all of which shall be considered one and the same agreement, and shall become
binding when one or more counterparts have been signed by and delivered to each of the Parties
hereto. Delivery of an executed counterpart of a signature page to this Agreement by facsimile
shall be effective as delivery of a manually executed counterpart of this Agreement.

Section 11.10. Governing Law.

          (a) This Agreement shall be governed by, and construed in accordance with, the laws of the
State of Delaware applicable to contracts executed in and to be performed in that State.

          (b) All actions and proceedings arising out of or relating to this Agreement, including the
resolution of any and all disputes hereunder, shall be heard and determined in the Bankruptcy
Court, and the Parties hereby irrevocably submit to the exclusive jurisdiction of the Bankruptcy
Court in any such action or proceeding and irrevocably waive the defense of an inconvenient forum
to the maintenance of any such action or proceeding. The Parties hereby consent to service of
process by mail (in accordance with Section 11.3) or any other manner permitted by law.

          (c) THE PARTIES HEREBY IRREVOCABLY WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING
OR COUNTERCLAIM (WHETHER BASED IN CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR THE ACTIONS OF SELLER, BUYER, OR THEIR RESPECTIVE REPRESENTATIVES IN THE NEGOTIATION
OR PERFORMANCE HEREOF.

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Section 11.11. No Third Party Beneficiaries.

          This Agreement is for the sole benefit of the Parties and their permitted assigns and nothing
herein, express or implied, is intended to or shall confer upon any other Person any legal or
equitable benefit, claim, cause of action, remedy or right of any kind.

[SIGNATURE PAGES FOLLOW]

-31-

 

          IN WITNESS WHEREOF, the parties hereto have caused this
Asset Purchase Agreement to be executed the day and year first above written.

	 	 	 	 	 
	 	BUYER:

HDNet LLC

 	 
	 	By:  	/s/ Robert W. Thoele
 	 
	 	Name:  ROBERT W. THOELE 	 
	 	Title:  CFO & GENERAL COUNSEL 	 
	 
	 	SELLER:

IFL Corp.

 	 
	 	By:  	/s/ Michael C. Keefe	 
	 	Name:  Michael C. Keefe	 
	 	Title:  Executive Vice President 	 
	 

[Signature Page to Asset Purchase Agreement]

 

Schedule 2.1(a) 

Equipment

4 GB P2 Cards

Tripod/Organizer

Light Kit/Access

Mixer/Microphones

G-Raid 800 GB drive for editing

1995 Fruehauf trailer (VIN: 1HV05324SE030924)

Lift Pads for Fruehauf trailer

Panasonic HD Recorder

Breakout Box

DVD Duplicator

Portable DVR

LCD 7” monitor

RIVA Pro II Kit

Fresnel Kit (portable light kit)

Wide Angle adapters Soft Light

Kit Egg Crate (light diffuser)

Fresnel Kit (portable light kit)

Phone system

Wireless microphone system

Two Knack boxes (large metal rolling storage containers)

Miscellaneous TV production hardware

Sparring padding for MMA training

5-Rope ring used at IFL events

 

 SCHEDULE 2.1(b)

Assumed Contracts And Cure Costs

Agreement dated February 20, 2007, between Seller and Alfred Haber Distribution, Inc., and the
Addendum thereto dated October 31, 2007. Cure cost: $0.00.

Letter Agreement dated March 20, 2008, between Seller and National Sports Programming, owner and
operator of Fox Sports Net programming service. Cure cost: $0.00.

Production and Distribution Agreement dated November 27, 2007, between Seller and HDNet LLC, and
Amendment No. 1 thereto dated December 18, 2007. Cure cost: $0.00.

Production and Distribution Agreement dated January 31, 2008, between Seller and HDNet LLC. Cure
cost: $0.00.

 

 

 Schedule 2.1(c)

Intellectual Property

     Trademarks, Trade Names and Service Marks

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	REG	 	REG	 	 
	MARK	 	COUNTRY	 	STATUS	 	 	APP NO	 	APP DATE	 	 	NO	 	DATE	 	CLASS
	ANACONDAS*

	 	United States of
America
	 	Registered
	 	 	78770112	 	 	09-Dec-2005
	 	 	3399717	 	 	18-Mar-2008
	 	41 Int.
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	BATTLEGROUND

	 	United States of
America
	 	Published
	 	 	77103709	 	 	09-Feb-2007
	 	 	 	 	 	 	 	41 Int.
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	BATTLEGROUND IFL

	 	United States of
America
	 	Published
	 	 	77103697	 	 	09-Feb-2007
	 	 	 	 	 	 	 	41 Int.
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	CONDORS

	 	United States of
America
	 	Registered
	 	 	77049856	 	 	22-Nov-2006
	 	 	3300902	 	 	02-Oct-2007
	 	41 Int.
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	IFL

	 	United States of
America
	 	Registered
	 	 	77179000	 	 	11-May-2007
	 	 	3372084	 	 	22-Jan-2008
	 	25 Int., 41
Int.
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	IFL BATTLEGROUND

	 	United States of
America
	 	Published
	 	 	77138713	 	 	23-Mar-2007
	 	 	 	 	 	 	 	41 Int. 09 Int., 16 Int., 25 Int.,

28 Int., 41 Int.
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	IFL INTERNATIONAL 

FIGHT LEAGUE & Design

	 	United States of
America
	 	ALLOWED
	 	 	78598351	 	 	30-Mar-2005
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	IFL INTERNATIONAL 

FIGHT LEAGUE & Fist 

Design

	 	United States of
America
	 	Pending
	 	 	77363137	 	 	03-Jan-2008	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	INTERNATIONAL FIGHT 

LEAGUE

	 	United States of
America
	 	Pending
	 	 	77178978	 	 	11-May-2007
	 	 	 	 	 	 	 	25 Int., 41
Int.
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	PITBULLS*

	 	United States of
America
	 	Registered
	 	 	78770116	 	 	09-Dec-2005
	 	 	3406920	 	 	01-Apr-2008
	 	41 Int.
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	SCORPION*S

	 	United States of
America
	 	Registered
	 	 	78854819	 	 	05-Apr-2006
	 	 	3357718	 	 	18-Dec-2007
	 	41 Int.
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	THE SILVERBACKS*

	 	United States of
America
	 	Registered
	 	 	78770114	 	 	09-Dec-2005
	 	 	3304224	 	 	02-Oct-2007
	 	41 Int.
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	TORONTO DRAGONS*

	 	United States of
America
	 	Pending
	 	 	78906748	 	 	13-Jun-2006
	 	 	 	 	 	 	 	41 Int.

 

			
	*	 	Debtor asserts that it is the owner of these marks, although filing with the Patent and
Trademark Office is by another entity

Schedule 2.1(c)-1

 

 

Copyright Television Broadcasts

FSN Shows

	 	 	 	 	 
	AIR DATE	 	EVENT DATE / VENUE	 	SHOW CONTENT
	2006
	 	 	 	 
	 
	 	 	 	 
	5/21

	 	4/20 / Atlantic City
	 	Anacondas vs. Silverbacks
	5/28

	 	4/20 / Atlantic City
	 	Pitbulls vs. Tiger Sharks
	6/4

	 	6/3 / Atlantic City
	 	Tiger Sharks vs. Silverbacks
	9/24

	 	9/9 / Portland
	 	Anacondas vs. Sabres
	10/1

	 	9/9 / Portland
	 	Superfight show w/ Horn vs. Lindland Superfight
	10/2

	 	9/23 / Moline
	 	Pitbulls vs. Silverbacks w/ Gracie
vs. Miletich

(2-hour Best Damn Sports Show Period special)
	10/8

	 	9/9 / Portland
	 	Tigersharks vs. Wolfpack
	11/12

	 	9/23 / Moline
	 	Razorclaws vs. Dragons
	11/19

	 	11/2 / Portland
	 	Dragons vs. Silverbacks — Semifinal #1
	9- 11/26

	 	11/2 / Portland
	 	Anacondas vs. Wolfpack — Semifinal #2
	10- 12/31

	 	12/29 / Mohegan
	 	Silverbacks vs. Wolfpack
	 
	 	 	 	 
	2007
	 	 	 	 
	 
	2/23
	 	1/19 / Oakland
	 	Condors vs. Tiger Sharks
	 	 	 	 	 
	3/2
	 	1/19 / Oakland
	 	Lions vs. Razorclaws
	 	 	 	 	 
	3/9
	 	2/2 / Houston
	 	Scorpions vs. Sabres
	 	 	 	 	 
	3/16
	 	2/2 / Houston
	 	Anacondas vs. Silverbacks
	 	 	 	 	 
	3/23
	 	2/23 / Atlanta
	 	Dragons vs. Wolfpack
	 	 	 	 	 
	3/30
	 	2/23 / Atlanta
	 	Pitbulls vs. Red Bears
	 	 	 	 	 
	4/6
	 	3/17 / Los Angeles
	 	Anacondas vs. Razorclaws
	 	 	 	 	 
	4/13
	 	4/13 Uncasville, CT
	 	Wolfpack vs. Pitbulls (same day show)
	 	 	 	 	 
	4/20
	 	3/17 / Los Angeles
	 	Condors vs. Sabres
	 
	4/27

	 	4/7 / Moline
	 	Lions vs. Silverbacks I
	5/4

	 	4/7 / Moline
	 	Lions vs. Silverbacks II
	5/11

	 	4/7 / Moline
	 	Red Bears vs. Tiger Sharks
	5/18

	 	4/13 / Uncasville
	 	Dragons vs. Scorpions
	6/1

	 	 	 	IFL’s Greatest Hits- Knockout special

Schedule 2.1(c)-2

 

 

	 	 	 	 	 
	AIR DATE	 	EVENT DATE / VENUE	 	SHOW CONTENT
	6/8

	 	 	 	SPECIAL: Meet the Stars (Highlight and background of four IFL stars- Horodecki, Rothwell, Patterson, Hieron)
	6/15

	 	5/19 / Chicago
	 	Condors vs. Razorclaws
	6/22

	 	5/19 / Chicago
	 	Red Bears vs. Silverbacks
	6/29

	 	6/1 / Everett, WA
	 	Sabres vs. Wolfpack
	7/6

	 	6/1 / Everett, WA
	 	Anacondas vs. Tigersharks
	7/13

	 	6/16 / Reno
	 	Dragons vs. Pitbulls
	7/20

	 	6/16 / Reno
	 	Lions vs. Scorpions
	7/27

	 	 	 	SPECIAL: Meet the Stars #2 (Highlight and background of four IFL stars- Benji Radach,
Vladimir Matyushenko, John Gunderson)
	8/17

	 	 	 	Season recap of team finalist number one
	8/24

	 	 	 	Season recap of team finalist number two
	8/31

	 	 	 	Special: Meet the Stars #3 (Four best fighters
backstories and highlights)
	9/9

	 	8/2 / Meadowlands, NJ
	 	IFL semi-final one
	9/16

	 	8/2 / Meadowlands, NJ
	 	IFL semi-final two
	9/23

	 	9/20 / Florida
	 	IFL final
	 
	 	 	 	 
	2008
	 	 	 	 
	 
	 	 	 	 
	4/19/08

	 	11/3/07 / Chicago
	 	Grand Prix Semi-Final Part 1
	4/26/08

	 	11/3/07 / Chicago
	 	Grand Prix Semi-Final Part 2
	5/3/08

	 	12/29/07 / Uncasville
	 	Grand Prix Final Part 1: Fabiano vs LC Davis /Hieron

vs Heleno / Radach vs Horwich
	5/10/08

	 	12/29/07 / Uncasville
	 	Grand Prix Final Part 2: Schultz vs. Horodecki /Nelson
vs Jaoude
	5/17/08

	 	2/29/08 / Las Vegas
	 	IFL Lightweight Championship — Ryan Schultz vs
John Gunderson; plus Dias vs Defranco
	5/24/08

	 	2/29/08 / Las Vegas
	 	IFL Heavyweight Championship — Roy Nelson vs
Fabio Scherner; plus: Ellenberger vs. Healy &
Ferreira vs Polley
	5/31/08

	 	2/29/08 / Las Vegas
	 	IFL Middleweight Championship — Matt Horwich
vs Ryan McGivern; plus: Loveland vs Dennis Davis
	6/7/08

	 	4/4 / Meadowlands, NJ
	 	IFL Light Heavyweight Championship — Vladimir
Matyushenko vs Jamal Patterson
	6/14/08

	 	4/4 / Meadowlands, NJ
	 	IFL Featherweight Championship — Wagnney
Fabiano vs. Shad Lierley
	6/21/08

	 	4/4 / Meadowlands, NJ
	 	IFL Welterweight Championship — Jay Hieron vs
Mark Miller
	6/28/08

	 	5/16 / Uncasville, CT
	 	IFL Championship
	7/5/08

	 	5/16 / Uncasville, CT
	 	IFL Championship
	7/12/08

	 	5/16 / Uncasville, CT
	 	IFL Championship

Schedule 2.1(c)-3

 

 

Copyright Television Broadcasts

MyNetwork IFL Battleground Shows

	 	 	 
	AIRDATE	 	STORY
	03/12/07

	 	The International Fight League premieres on network television. 72 of the
greatest fighters in the world, 9 mixed martial arts bouts, and the main event: the IFL World Championship Title Fight
	 
	 	 
	03/19/07

	 	Did a bad referee call cost Bas Rutten and his LA Anacondas their shot at the
championship? Now the Anacondas are getting their re-match. Plus, 10 mixed
martial arts bouts and the first ever IFL Superfight on network TV.
	 
	 	 
	03/26/07

	 	The first family of Mixed Martial Arts, the legendary Gracie family, are out to
prove the dominance of Brazilian Jiu-Jitsu. Renzo Gracie’s New York Pitbulls
take on the IFL’s best teams in their climb to the top in 9 featured bouts.
	 
	 	 
	04/09/07

	 	IFL Battleground goes to Portland to meet Olympian Matt Lindland and his
Wolfpack. The show will have a minimum of nine fights, including
lightweight Ryan Schultz’s return to the ring following his devastating
knockout shown in episode one.
	 
	 	 
	04/16/07

	 	Cain and Able, IFL style. Meet the brotherly rivalry of world champions Ken
and Frank Shamrock and go behind the scenes as they build their teams for
their first-ever head to head match up. IFL Battleground will also go
international for the first time, as we see the multi-cultural blend Tokyo Sabres,
led by Japanese champion Ken Yasuda...a total of 11 fights.
	 
	 	 
	04/23/07

	 	The IFL goes to the Pacific Northwest and meets the Seattle Tigersharks and
world champion kick-boxer Maurice Smith, and then goes to Orange County
California to meet the Condors and their Brazilian influence of world champion
Marco Ruas...a total of 11 bouts.
	 
	 	 
	04/30/07

	 	Meet MMA legend, coach Don “The Predator” Frye, his Tucson Scorpions, his
family. His popular website advice column “Dear Don” becomes a weekly
feature. Also why Tokyo Sabres’ coach Ken Yasuda keeps firing players. Team
“survivors” Vladimir “The Janitor” Matuschenko, and two of LA’s own, South
Central’s Savant Young and Antonio McKee.
	 
	 	 
	05/07/07

	 	A battle for IFL supremacy as Renzo Gracie’s first place New York Pitbulls
face last season World Champ finalists, Olympian Matt Lindland’s Portland
Wolfpack. Is Gracie’s boundless confidence any match for such unexpected
personalities as formerly homeless Matt Horwich, who uses God’s motivation
to beat his opponents? Plus Wolfpack Ryan Schultz returns after December’s
devastating knockout.
	 
	 	 
	05/14/07

	 	Knockouts in and out of the ring...We count down the IFL’s greatest knockouts
of all time. The athletes and coaches tell what its like to both take and give the
knockout blow. Plus the nationwide auditions begin in LA for the first-ever IFL
ring-girl search. You won’t believe who shows up...

Schedule 2.1(c)-4

 

 

	 	 	 
	AIRDATE	 	STORY
	05/21/07

	 	The IFL goes to America’s heartland as Ken Shamrocks Nevada Lions battle
Pat Miletich’s Quad Cities Silverbacks with a spot in the IFL semi-finals at
stake. The event will feature undefeated heavyweight Ben Rothwell against
once beaten Roy Nelson in a meeting of two of the IFL’s best, along with two
of top lightweights Bart Palaczewski and John Gunderson doing battle.
	 
	 	 
	06/04/07

	 	The IFL takes you to the Windy City to meet world champion Igor Zinoviev
and his Red Bears, led by military sharp shooter and Chicago native Mark
Miller. We will also go indepth to meet some of the IFL’s biggest stars,
including New York’s Jamal Patterson, Orange County’s submission expert
Jeremy Williams and the Anacondas knock out artist Chris Horodecki.
	 
	 	 
	06/11/07

	 	IFL Battleground goes to Portland to meet Olympian Matt Lindland and his
Wolfpack. The show will have a minimum of nine fights, including
lightweight Ryan Schultz’s return to the ring following his devastating
knockout shown in episode one.
	 
	 	 
	06/18/07

	 	IFL Greatest Knockouts In and Out of the Ring...Knockouts in and out of the
ring...We count down the IFL’s greatest knockouts of all time. The athletes and
coaches tell what it’s like to both take and give the knockout blow. Plus the
nationwide auditions begin in LA for the first-ever IFL ring-girl search. You
won’t believe who shows up...
	 
	 	 
	06/25/07

	 	The Orange County Condors return to the ring against Frank Shamrock’s
Razorclaws, the first match since the tragic death of Jeremy Williams. It’s also
a match-up of the coaches as world champion Maurice Smith meets Marco
Ruas in a superfight.
	 
	 	 
	07/02/07

	 	The Silverbacks look to stay alive in the playoff hunt as they battle the
revitalized Chicago Red Bears. Undefeated heavyweight Ben “North Star”
Rothwell and once-beaten lightweight Bart Palazcewski return to the ring for
Quad Cities, while Igor Zinoviev’s Red Bears bring Chicago native Mike
Miller in to meet UFC veteran Josh Neer.
	 
	 	 
	07/09/07

	 	The Tokyo Sabres, looking to finish the regular season undefeated, take on
Matt Lindland’s Portland Wolfpack, who need a big win to stay alive. Tokyo’s
Savant Young slugs it out with Ryan Schultz and Kaz Hamanaka looks for his
first win against eccentric Wolfpack star Matt Horwich. We also take to the
seas for the IFL’s trip to Fleet Week aboard the USS Wasp, and the IFL Ring
Card Girl competition continues.
	 
	 	 
	07/16/07

	 	The IFL’s top team, the Los Angeles Anacondas, looks to grab momentum
heading into the playoffs, facing off against the hometown Seattle Tiger
Sharks. The Tiger Sharks, needing a convincing win to reach the postseason,
send tough-nosed Shad Lierley against rising superstar Chris Horodecki and
local hero Brad Blackburn versus dangerous Jay Hieron. The second segment
of the IFL’s work with the USO also airs this week.
	 
	 	 
	07/23/07

	 	The IFL makes it’s first trip to Las Vegas and the stakes are high as Carlos
Newton’s Dragon’s led by undefeated lightweight Waggney Fabiano try to
send Renzo Gracie’s Pitbulls, led by star middleweight Delson Heleno from the
ranks of the unbeaten and knock them from playoff contention. The IFL’s ring
girl search enters its final stages in a special show from Las Vegas as well.

Schedule 2.1(c)-5

 

 

	 	 	 
	AIRDATE	 	STORY
	08/13/07

	 	The first IFL regular season comes to an end as the homestanding Nevada
Lions, coached by Ken Shamrock, meet the Tucson Scorpions, led by world
champion Don Frye. The final spots for the IFL’s Grand Prix are on the line as
Lions stars Roy “Big Country” Nelson, lightweight star and Houston native
John Gunderson try to grab spots for the individual belt competition.
Undefeated light heavyweight Mike Whitehead and Lions welterweight Pat
Healy also have spots on the line for the Grand Prix. The IFL also goes back to
sea to visit with the Marines on board the Winston Churchil as they head into
new York for Fleet Week.
	 
	 	 
	08/20/07

	 	SEASON RECAP
	 
	 	 
	08/27/07

	 	Grand Prix preview show
	 
	 	 
	09/10/07

	 	Semi-final number one: Undefeated heavyweight Ben Rothwell leads the Quad
Cities Sliverbacks against the Los Angeles Anacondas, led by undefeated Benji
Radich with a berth in the IFL finals on the line.
	 
	 	 
	09/17/07

	 	Semi- final number Two: The last berth in the IFL finals is on the line as the
New York Pitbulls, led by heavyweight Bryan Vitell, go up against the Tokyo
Sabres, led by the undefeated duo of Antonio Mckee and Vladimir “The
Janitor” Matyuschenko
	 
	 	 
	09/24/07

	 	Season Final: The first full IFL season concludes, as the two greatest schools in
the sport of Mixed Martial Arts, the Miletich Fighting System, the Quad Cities
Silverbacks goes head to head with the Gracie Jiu-Jitsu system, the New York
Pitbulls, for worldwide team supremacy. See if undefeated heavyweight Ben
Rothwell can continue his run, or if the Pitbulls can bring the New York area
their first team title of any kind since the 2000 New York Yankees

Copyright DVDs

	 	 	 
	RELEASE DATE	 	TITLE
	2007

	 	IFL Greatest Knockouts & Extreme Action
	 
	 	 
	2007

	 	IFL Championship 2007

In addition, Seller has numerous other tapes or events, interviews and background material used as
the source for the edited shows televised on FSN and MyNetwork. Seller has numerous still images
and photos of athletes, coaches and events.

Schedule 2.1(c)-6

 

 

Schedule 2.2

Excluded Assets

	1.	 	Cash, investments, bank accounts and security deposits;
	 
	2.	 	Amounts due from Alfred Haber Distributions, Inc. for the period of June 30, 2008 to
September 30, 2008;
	 
	3.	 	Existing accounts receivable;
	 
	4.	 	Any rights or amounts that may be recovered or recoverable on Seller’s claim against
ProElite, Inc. and its affiliates and CBS Corporation and its affiliates related to the
agreement and discussion between Seller and its affiliates and ProElite, Inc. and CBS
Corporation and their respective affiliates that occurred in June and July 2008;
	 
	5.	 	All tax refunds;
	 
	6.	 	Office equipment and supplies, including servers and computer equipment;
	 
	7.	 	Books and records other than those relating directly to the purchased assets; and
	 
	8.	 	Prepaid expenses.

Schedule 2.1(c)-7

 

 

Schedule 4.7

Proceedings

     None.

Schedule 2.1(c)-8

 

 

Schedule 4.8

Consents and Approvals

Entry of an order by the United States Bankruptcy Court for the Southern District of New York
approving the sale of the Assets as set forth herein.

Schedule 2.1(c)-9

 

 

Schedule 5.2

Brokers

     None.

Schedule 2.1(c)-10

 

 

EXHIBIT A 

ASSUMPTION AND ASSIGNMENT AGREEMENT

 

 

ASSUMPTION AND ASSIGNMENT AGREEMENT 

          THIS ASSUMPTION AND ASSIGNMENT AGREEMENT (this “Assumption and Assignment Agreement”)
is entered into as of October ___, 2008, by and among IFL Corp., d/b/a International Fight League, a
Delaware corporation (“Seller”) and HDNet LLC, a Delaware limited liability company
(“Buyer”). All capitalized words and terms used in this Assumption and Assignment Agreement
and not defined herein shall have the respective meanings ascribed to them in the Asset Purchase
Agreement, dated as of September 19, 2008, by and between the Seller and the Buyer (the
“Agreement”).

          WHEREAS, pursuant to the Agreement, the Seller has agreed to sell, convey, assign, transfer
and deliver to the Buyer all of the Seller’s right, title and interest, as of the Closing Date
hereof, in and to the Assets; and

          WHEREAS, Buyer has, pursuant to the Asset Purchase Agreement,
agreed to assume the Assumed Liabilities of the Seller.

          NOW, THEREFORE, in consideration of the foregoing and for other good and valuable
consideration (the receipt and sufficiency of which are hereby acknowledged), the parties hereto,
intending to be legally bound hereby, agree as follows:

          1. Pursuant to and in accordance with the terms of the Agreement, Seller hereby sells,
conveys, transfers and delivers over unto the Buyer and its successors and assigns, all of the
right, title and interest of the Seller in, to and under all Assigned Agreements.

          2. Pursuant to and in accordance with the terms of the Agreement, the Buyer hereby assumes (a)
all of the obligations of the Seller under the Assigned Agreements that are included in the Assets
and (b) the Assumed Liabilities.

          3. This Assumption and Assignment Agreement is not intended to create any broader obligations
of the Buyer or the Seller than those contained in the Agreement and in the event of any ambiguity
or conflict between the terms hereof and the Agreement, the terms of the Agreement shall govern and
be controlling.

          4. This Assumption and Assignment Agreement and the covenants and agreements set forth herein
shall be binding upon, inure to the benefit of, and be enforceable by the Buyer and the Seller,
respectively, and their respective successors and assigns.

          5. This Assumption and Assignment Agreement shall be construed, interpreted and governed in
accordance with the Laws of the State of Delaware regardless of the Laws that might otherwise
govern under applicable principles of conflicts of laws thereof.

          6. In case at any time after the Closing Date any further action is necessary or desirable to
transfer or record the transfer of any of the Assets to the Buyer or to otherwise carry out the
purposes of the Agreement and this Assumption and Assignment Agreement, the proper officers and
directors of the Buyer and the Seller shall execute, acknowledge, deliver and perform, or cause to
be executed, acknowledged, delivered and performed, all such further acts, transfers, conveyances,
assurances and documents (including assignments, acknowledgements and consents and other
instruments of transfer) and shall take, or cause to be taken, such further action, in each
case to the extent consistent with the Agreement and this Assumption and Assignment Agreement
and not inconsistent with applicable Laws.

A-1

 

          7. This Assumption and Assignment Agreement may be executed in multiple counterparts, all of
which, when executed and delivered, shall be considered one and the same agreement.

          IN WITNESS WHEREOF, each of the parties hereto has caused this Assumption and Assignment
Agreement to be executed by one of its duly authorized officers as of the date first above written.

	 	 	 	 	 
	 	BUYER:

HDNet LLC

 	 
	 	By:  	 	 
	 	Name:  	 	 
	 	Title:  	 	 
	 
	 	SELLER:

IFL Corp.

 	 
	 	By:  	 	 
	 	Name:  	 	 
	 	Title:  	 	 
	 

A-2

 

EXHIBIT B

BIDDING PROCEDURES

 

 

Assets To Be Sold 

          The assets proposed to be sold are the Assets (as defined in the Agreement and as more fully
set forth in section 2.1 of the Agreement), that comprise substantially all of the Seller’s assets.

As Is, Where Is

          The sale of the Assets shall be on an “as is, where is” basis and without representations or
warranties of any kind, nature, or description by the Debtor, its agents, or estate, except, with
respect to the Purchaser, to the extent set forth in the Agreement and, with respect to a
Successful Bidder, to the extent set forth in the relevant purchase agreement of such Successful
Bidder approved by the Bankruptcy Court.

Free Of Any And All Claims And Interests

          The Assets shall be sold free and clear of all pledges, liens, security interests,
encumbrances, claims, charges, options, and interests thereon (collectively, the “Claims
and Interests”) and the Claims and Interests, if any, shall attach to the net
proceeds of the sale of such Assets.

Participation Requirements

          Any person who wishes to participate in the Bidding Process (a “Potential Bidder”) must become
a Qualified Bidder. As a prerequisite to becoming a Qualified Bidder, a Potential Bidder, other
than the Purchaser, must deliver (unless previously delivered) to the Seller, who shall promptly
deliver copies to the Official Committee of Unsecured Creditors (the “Committee”), if one
is appointed in the Debtor’s case: (i) an executed confidentiality agreement substantially in the
form attached hereto as Exhibit 2, (ii) current audited financial statements of the Potential
Bidder, or, if the Potential Bidder is an entity formed for the purpose of acquiring the Assets,
current audited financial statements of the equity holders of the Potential Bidder who shall
guarantee the obligations of the Potential Bidder, or such other form of financial disclosure and
credit-quality support or enhancement acceptable to the Seller, and (iii) a preliminary
(non-binding) written proposal regarding (a) the purchase price range, (b) any Assets expected to
be

 

 

excluded, (c) the structure and financing of the transaction (including, but not limited to, the
sources of financing of the Purchase Price (as defined in the Agreement) and the requisite deposit,
(d) any anticipated regulatory approvals required to close the transaction, the anticipated time
frame and any anticipated impediments for obtaining such approvals, (e) any conditions to closing
that it may wish to impose in addition to those set forth in the Agreement, and (f) the nature and
extent of additional due diligence it may wish to conduct and the date by which such due diligence
will be completed.

          A Potential Bidder who delivers the documents described in the previous subparagraphs above
and whose financial information and credit-quality support or enhancement demonstrate the financial
capability of such Potential Bidder to consummate the Sale, if selected as the successful bidder,
and who the Seller, in consultation with the Committee (if one is appointed in the Debtor’s case),
determine (based on availability of financing, experience, and other considerations) to be able to
consummate the Sale within the time frame provided by the Agreement shall be deemed a “Qualified
Bidder.” As promptly as practicable, after a Potential Bidder delivers all of the materials
required above, the Seller, in consultation and with the Committee (if one is appointed in the
Debtor’s case), shall determine, and shall notify the Potential Bidder, whether such Potential
Bidder is a Qualified Bidder. At the same time that the Seller notifies the Potential Bidder that
it is a Qualified Bidder, the Seller shall allow the Qualified Bidder to begin to conduct due
diligence with respect to the Assets as provided below. Notwithstanding the foregoing, the
Purchaser for itself or on behalf of its designee, assignee or affiliate, shall be deemed a
Qualified Bidder for purposes of the Bidding Process.

Due Diligence 

          All due diligence shall be coordinated by the Seller, and all requests for due diligence
materials and related information shall be made to counsel for the Seller, Lowenstein Sandler PC,
1251 Avenue of the Americas, 18th Floor, New York, New York 10022, Attention: Sharon
Levine, Esq. (slevine@lowenstein.com) and S. Jason Teele, Esq.

B-2

 

(steele@lowenstein.com), or any other professional retained by the Seller and as directed
by the Seller.

          The Seller shall afford each Qualified Bidder access to due diligence materials reasonably
requested; provided, however, that the Seller, in its reasonable discretion, may permit Potential
Bidders to conduct limited due diligence, provided such Potential Bidders execute a confidentiality
agreement substantially in the form attached hereto as Exhibit 1, for the limited purpose of
permitting such Potential Bidders to determine whether or not they desire to submit a Qualified
Bid.

          The Seller shall coordinate all reasonable requests for information and due diligence access
from Qualified Bidders. Any additional due diligence shall not continue after the Bid Deadline,
except as otherwise consented to by the Seller. The Seller may, in its discretion, coordinate
diligence efforts such that multiple Qualified Bidders have simultaneous access to due diligence
materials. The Seller shall not be obligated to furnish any information relating to the Assets to
any person other than to Qualified Bidders.

          Each Qualified Bidder shall be deemed to acknowledge and represent that it has had an
opportunity to conduct any and all due diligence regarding the Assets prior to making its offer,
that it has relied solely upon its own independent review, investigation, and/or inspection of any
documents and/or the Assets in making its bid, and that it did not rely upon any written or oral
statements, representations, promises, warranties, or guaranties whatsoever, whether express,
implied, by operation of law or otherwise, regarding the Assets, or the completeness of any
information provided in connection therewith, the Bidding Process or the Auction (as defined
herein), except, as to the Successful Bidder, as expressly stated in the definitive agreement with
such Successful Bidder approved by the Bankruptcy Court.

Bid Deadline

          All Bids (as defined below) must be submitted in writing so that they are actually received no
later than 5:00 p.m. (prevailing Eastern time) on October 23, 2008 (the “Bid
Deadline”). Each Qualified Bidder (as defined below) must deliver copies of its Bid to

B-3

 

Lowenstein Sandler PC, counsel for the Debtor, 1251 Avenue of the Americas, 18th Floor, New York,
New York 10022, Attention: Sharon Levine, Esq. and S. Jason Teele, Esq., or by e-mail to
slevine@lowenstein.com and steele@lowenstein.com. The Debtor’s counsel shall serve copies of all
Bids received on (i) counsel for the Purchaser, Akin Gump Strauss Hauer & Feld LLP, 1700 Pacific
Ave, Suite 4100, Dallas, Texas 75201, Attention: Robert W. Dockery, Esq. and Kevin D. Rice, Esq.,
(ii) counsel for any official committees appointed in the Debtor’s case, and (iii) the Office of
the United States Trustee.

Bid Requirements

          All bids must include the following documents: (i) a letter stating that the bidder’s offer is
irrevocable for the period set forth in the Bidding Procedures, (ii) an executed copy of the
Agreement marked to show amendments and modifications to the Agreement, purchase price, and
proposed schedules, (iii) a good faith deposit of ten percent (10%) of the aggregate bid amount
(the “Good Faith Deposit”), and (iv) satisfactory written evidence of a commitment for financing or
other ability to consummate the proposed transaction.

Qualified Bids

          To be deemed a “Qualified Bid,” a bid must be received by the Bid Deadline and, among other
things, (i) must be on terms and conditions (other than the amount of the consideration and the
particular liabilities being assumed) that are substantially similar to, and are not materially
more burdensome or conditional to Seller than those contained in the Agreement, (ii) must not be
contingent on obtaining financing or the outcome of unperformed due diligence beyond the
contingencies set forth in the Agreement, (iii) must have a value (inclusive of any credit bid
component) greater than the purchase price reflected in the Agreement plus the amount of the
Break-Up Fee, (iv) must not be conditioned on bid protections, other than those contemplated in the
Bidding Procedures, (v) must contain acknowledgements and representations as set forth in the
Bidding Procedures, and (vi) include a commitment to consummate the Sale within not more than
fifteen (15) days after entry of a Bankruptcy Court order approving such purchase. The Seller, in
consultation with the

B-4

 

Committee (if one is appointed in the Debtor’s case), shall have the right to deem a bid a
Qualified Bid, if such bid does not conform to one or more of the aforementioned requirements,
provided however, that such bid must have a value greater than or equal to the sum of the Purchase
Price plus the amount of the Break-Up Fee, taking into account all material terms of any such bid.
Each Qualified Bid other than that of the Purchaser shall be called a “Subsequent Bid.”

Bid Protection

          Recognizing the Purchaser’s expenditure of time, energy, and resources, the Seller has agreed
to provide certain bid protections to the Purchaser. Specifically, the Seller has determined that
the Agreement will further the goals of the Bidding Procedures by setting a floor which all other
Qualified Bids must exceed and, therefore, is entitled to be selected as the Purchaser. As a
result, the Seller has agreed that if the Seller sell the Assets to a Successful Bidder other than
the Purchaser, the Seller shall, in certain circumstances, pay to the Purchaser a Break-Up Fee
equal to three percent (3%) of the Aggregate Cash Consideration (as defined in the Agreement). The
payment of the Break-Up Fee shall be governed by the provisions of the Agreement and the Bidding
Procedures Order.

Conduct Of Auction

          If the Debtor receives at least one Qualified Bid in addition to the Agreement, the Debtor
will conduct an auction (the “Auction”) on October 27, 2008, at the offices of Lowenstein Sandler
PC, 1251 Avenue of the Americas, 18th Floor, New York, New York, at 10:00 a.m. (prevailing Eastern
time). At least two (2) business days prior to the Auction, each Qualified Bidder with a Qualified
Bid must inform the Seller whether it intends to participate in the Auction and at least one (1)
business day prior to the Auction, the Seller will provide such bidders copies of the Qualified Bid
which the Seller believes is the highest or otherwise best offer for the Assets, (iii) all
Qualified Bidders will be entitled to be present for all Subsequent Bids, and (iv) bidding at the
Auction will begin with the highest or otherwise best Qualified Bid,

B-5

 

continue in minimum increments of at least $25,000, and conclude after each participating bidder
has had the opportunity to submit one or more additional Subsequent Bids.

Participation in the Auction

     Only Qualified Bidders who have submitted Qualified Bids will be eligible to participate in
the Auction. Only the authorized representatives of each of the Qualified Bidders, the Purchaser,
the Committee (if one is appointed in the Debtor’s case), the Office of the United States Trustee,
and the Seller shall be permitted to attend the Auction. At the Auction, Qualified Bidders will be
permitted to increase and/or improve their bids. Unless otherwise agreed to by the Seller, no
Qualified Bidder will be permitted more than one-half hour to respond to the previous bid at
Auction and, at the expiration of such time (unless extended), the Auction shall conclude.

Selection of Successful Bid

          As soon as practicable after the conclusion of the Auction, the Seller will, in consultation
with its attorneys and financial advisors, review each Qualified Bid and identify the highest or
otherwise best offer for the Assets (the “Successful Bid”) and the bidder making such bid
(the “Successful Bidder”). The Seller will sell the Assets for the highest or otherwise
best Qualified Bid to the Successful Bidder upon the approval of such Qualified Bid by the
Bankruptcy Court after the hearing (the “Sale Hearing”).

Sale Hearing

          The Sale Hearing is currently scheduled for October 28, 2008 at 10:00 a.m.
(prevailing Eastern time) before the Honorable Martin Glenn, United States Bankruptcy Judge, in
the United States Bankruptcy Court for the Southern District of New York, located at One Bowling
Green, Room 501, New York, New York 10004. The Sale Hearing may be adjourned or rescheduled by the
Seller without notice other than by an announcement of the adjourned date at the Sale Hearing.

          If no Qualified Bids other than that of the Purchaser are received, the Seller will proceed
with the sale of the Assets to the Purchaser following entry of the order approving the

B-6

 

Sale. If the Seller receives additional Qualified Bids, then, at the Sale Hearing, the Seller shall
seek approval of the Successful Bid, as well as the second highest or best Qualified Bid (the
“Alternate Bid” and such bidder, the “Alternate Bidder”). A bid will not be deemed
accepted by the Seller unless and until approved by the Bankruptcy Court. Following approval of the
sale to the Successful Bidder, if the Successful Bidder fails to consummate the sale for specified
reasons, then the Alternate Bid will be deemed to be the Successful Bid and the Seller will
effectuate a sale to the Alternate Bidder without further order of the Bankruptcy Court.

Return Of Good Faith Deposits

          Good faith deposits of all Qualified Bidders (except for the Successful Bidder) shall be held
in an interest-bearing escrow account and all Qualified Bids shall remain open until two (2)
business days following the closing of the Sale (the “Return Date”).
Notwithstanding the foregoing, the good faith deposit submitted by the Successful Bidder, together
with interest thereon, shall be applied against the payment of the Purchase Price upon closing of
the Sale to the Successful Bidder. If a Successful Bidder fails to consummate an approved sale, the
Seller will not have any obligation to return such good faith deposit and it shall irrevocably
become property of the Seller. On the Return Date, the Seller will return the good faith deposits
of all other Qualified Bidders, together with the accrued interest thereon.

Reservation of Rights

          The Seller (i) may determine which Qualified Bid, if any, is the highest or otherwise best
offer, and (ii) may reject at any time, any bid (other than the Purchaser’s bid) that is: (a)
inadequate or insufficient, (b) not in conformity with the requirements of the Bankruptcy Code, the
Bidding Procedures, or the terms and conditions of the Sale, or (c) contrary to the best interests
of the Seller, its estate and creditors as determined by the Seller in its sole discretion.

B-7

 

EXHIBIT 1 TO BIDDING PROCEDURES

(Nondisclosure Agreement)

 

 

NONDISCLOSURE AGREEMENT 

          This Nondisclosure Agreement (this “Agreement”) by and between               , a               
corporation (the “Recipient”), and IFL Corp. (the “Provider”) is dated as of the
latest date set forth on the signature page hereto. Recipient and Provider are each a “Party” and
collectively, the “Parties”).

          1. General. In connection with the consideration of a possible negotiated transaction
(a “Possible Transaction”) between the Parties, Provider is prepared to make available to the
Recipient certain “Diligence Material” (as defined in Section 2 below) in accordance with the
provisions of this Agreement, and both Parties agree to take or abstain from taking certain other
actions as hereinafter set forth.

          2. Definitions. (a) The term “Diligence Material” means information concerning the
Provider which has been or is furnished to the Recipient or its Representatives in connection with
the Recipient’s evaluation of a Possible Transaction, including its business, financial condition,
operations, assets and liabilities, and includes all notes, analyses, compilations, studies,
interpretations or other documents prepared by the Recipient or its Representatives which contain
or are based upon, in whole or in part, the information furnished by the Recipient hereunder. The
term Diligence Material does not include information which (i) is or becomes generally available to
the public other than as a result of a disclosure by the Recipient or its Representatives in breach
of this Agreement, (ii) was within the Recipient’s possession prior to its being furnished to the
Recipient by or on behalf of the Provider, provided that the source of such information was not
bound by a confidentiality agreement with, or other contractual, legal or fiduciary obligation of
confidentiality to, the Provider with respect to such information, or (iii) is or becomes available
to the Recipient on a non-confidential basis from a source other than the Provider or its
Representatives, provided that such source is not bound by a confidentiality agreement with, or
other contractual, legal or fiduciary obligation of confidentiality to, the Provider with respect
to such information.

 

 

          (b) The term “Representatives” shall include the directors, officers, employees,
agents, partners or advisors (including, without limitation, attorneys, accountants, consultants,
bankers and financial advisors) of the Recipient or the Provider, as applicable.

          (c) The term “Person” includes the media and any corporation, partnership, group,
individual or other entity.

          3. Use of Diligence Material. The Recipient shall, and it shall cause its
Representatives to, use the Diligence Material solely for the purpose of evaluating a Possible
Transaction, keep the Diligence Material confidential, and, subject to Section 5, will not, and
will cause its Representatives not to, disclose any of the Diligence Material in any manner
whatsoever; provided, however, that any of such information may be disclosed to the
Recipient’s Representatives who need to know such information for the sole purpose of helping the
Recipient evaluate a Possible Transaction. The Recipient agrees to be responsible for any breach of
this Agreement by any of the Recipient’s Representatives. This Agreement does not grant the
Recipient or any of its Representatives any license to use the Provider’s Diligence Material except
as provided herein.

          4. Legally Required Disclosure. If the Recipient or its Representatives are requested or
required (by oral questions, interrogatories, other requests for information or documents in legal
proceedings, subpoena, civil investigative demand or other similar process) to disclose any of the
Diligence Material, the Recipient shall provide the Provider with prompt written notice of any such
request or requirement together with copies of the material proposed to be disclosed so that the
Provider may seek a protective order or other appropriate remedy and/or waive compliance with the
provisions of this Agreement. If, in the absence of a protective order or other remedy or the
receipt of a waiver by the Provider, the Recipient or its Representatives are nonetheless legally
compelled to disclose Diligence Material or otherwise be liable for contempt or suffer other
censure or penalty, the Recipient or its Representatives may, without liability hereunder, disclose
to such requiring person only that portion of such Diligence Material or any such facts which the
Recipient or its Representatives is legally required to

 -3- 

 

disclose, provided that the Recipient and/or its Representatives cooperate with the Provider to
obtain an appropriate protective order or other reliable assurance that confidential treatment will
be accorded such Diligence Material or such facts by the person receiving the material.

          5. Return or Destruction of Diligence Material. If Recipient decides that it does not
wish to proceed with a Possible Transaction, it will promptly inform the Provider of that decision.
In that case, or at any time upon the request of the Provider for any reason, the Recipient will,
and will cause its Representatives to, within five (5) business days of receipt of such notice,
destroy or return all Diligence Material in any way relating to the Provider or its products,
services, employees or other assets or liabilities, and no copy or extract thereof (including
electronic copies) shall be retained, except that Recipient’s outside counsel may retain one copy
to be kept confidential and used solely for archival purposes. The Recipient shall provide to the
Provider a certificate of compliance with the previous sentence signed by an executive officer of
the Recipient. Notwithstanding the return or destruction of the Diligence Material, the Recipient
and its Representatives will continue to be bound by the Recipient’s obligations hereunder with
respect to such Diligence Material.

          6. Maintaining Privilege. If any Diligence Material includes materials or information
subject to the attorney-client privilege, work product doctrine or any other applicable privilege
concerning pending or threatened legal proceedings or governmental investigations, the Recipient
understands and agrees that the Recipient and the Provider have a commonality of interest with
respect to such matters and it is the desire, intention and mutual understanding of the Parties
that the sharing of such material by Provider is not intended to, and shall not, waive or diminish
in any way the confidentiality of such material or its continued protection under the
attorney-client privilege, work product doctrine or other applicable privilege. All Diligence
Material provided by the Recipient that is entitled to protection under the attorney-client
privilege, work product doctrine or other applicable privilege shall remain entitled to such
protection under these privileges, this Agreement, and under the joint defense doctrine.

 -4- 

 

          7. Not a Transaction Agreement. The Recipient understands and agrees that no contract
or agreement providing for a Possible Transaction exists between the Parties unless and until a
final definitive agreement for a Possible Transaction has been executed and delivered, and the
Recipient hereby waives, in advance, any claims (including, without limitation, breach of contract)
relating to the existence of a Possible Transaction unless and until the Parties shall have entered
into a final definitive agreement for a Possible Transaction. The Recipient also agrees that,
unless and until a final definitive agreement regarding a Possible Transaction has been executed
and delivered, neither Party will be under any legal obligation of any kind whatsoever with respect
to such Possible Transaction by virtue of this Agreement except for the matters specifically agreed
to herein. Either Party may terminate discussions and negotiations with the other Party at any
time.

          8. No Representations or Warranties; No Obligation to Disclose. The Recipient
understands and acknowledges that neither the Provider nor its Representatives makes any
representation or warranty, express or implied, as to the accuracy or completeness of the Diligence
Material furnished by or on behalf of the Provider and shall have no liability to the Recipient,
its Representatives or any other Person relating to or resulting from the use of the Diligence
Material furnished to the Recipient or its Representatives or any errors therein or omissions
therefrom. As to the information delivered to the Recipient, the Provider will only be liable for
those representations or warranties which are made in a final definitive agreement regarding a
Possible Transaction, when, as and if executed, and subject to such limitations and restrictions as
may be specified therein. Nothing in this Agreement shall be construed as obligating a the
Provider to provide, or to continue to provide, any information to any Person.

          9. Modifications and Waiver. No provision of this Agreement can be waived or amended
in favor of either Party except by written consent of the other Party, which consent shall
specifically refer to such provision and explicitly make such waiver or amendment. No failure or
delay by either Party in exercising any right, power or privilege hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise thereof preclude any other or

 -5- 

 

future exercise thereof or the exercise of any other right, power or privilege hereunder.

          10. Remedies. Recipient understands and agrees that money damages would not be a
sufficient remedy for any breach of this Agreement by Recipient or any of its Representatives and
that Provider shall be entitled to equitable relief, including injunction and specific performance,
as a remedy for any such breach or threat thereof. Such remedies shall not be deemed to be the
exclusive remedies for a breach of this Agreement, but shall be in addition to all other remedies
available at law or equity to Provider.

          11. Legal Fees. In the event of litigation relating to this Agreement, if a court of
competent jurisdiction determines that either Recipient or its Representatives has breached this
Agreement, then the Recipient shall be liable and pay to the Provider the reasonable legal fees and
costs incurred in connection with such litigation, including any appeal therefrom.

          12. Governing Law. This Agreement is for the benefit of the Provider and shall be
governed by and construed in accordance with the laws of the State of New York applicable to
agreements made and to be performed entirely within such State.

          13. Severability. If any term, provision, covenant or restriction contained in this
Agreement is held by any court of competent jurisdiction to be invalid, void or unenforceable, the
remainder of the terms, provisions, covenants or restrictions contained in this Agreement shall
remain in full force and effect and shall in no way be affected, impaired or invalidated, and if a
covenant or provision is determined to be unenforceable by reason of its extent, duration, scope or
otherwise, then the Parties intend and hereby request that the court or other authority making that
determination shall only modify such extent, duration, scope or other provision to the extent
necessary to make it enforceable and enforce it in its modified form for all purposes of this
Agreement.

          14. Term. This Agreement shall terminate one (1) year after the date of this
Agreement.

          15. Entire Agreement. This Agreement contains the entire agreement between the
Parties regarding the subject matter hereof and supersedes all prior agreements,

 -6- 

 

understandings, arrangements and discussions between the Parties regarding such subject matter.

          16. Counterparts. This Agreement may be signed in counterparts, each of which shall
be deemed an original but all of which shall be deemed to constitute a single instrument.

          IN WITNESS WHEREOF, each of the undersigned entities has caused this Agreement to be signed by
its duly authorized representatives as of the date written below.

	 	 	 	 	 	 	 	 	 
	PROVIDER:	 	RECIPIENT:	 	 
	 
	 	 	 	 	 	 	 	 
	IFL CORP.	 	[COMPANY NAME]	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	[Address]	 	 	 
	 	 	 	 	 	 	 	 
	By:
	 	 

	 	By:	 	 

	 	 
	Name:

	 	 

	 	Name:
	 	 

	 	 
	Title

	 	 

	 	Title
	 	 

	 	 

 -7- 

 

EXHIBIT C

BIDDING PROCEDURES ORDER

  

 

UNITED STATES BANKRUPTCY COURT

SOUTHERN DISTRICT OF NEW YORK

	 	 	 	 	 
	 

	 	 	 	Chapter 11
	In re:
	 	 	 	 
	 

	 	 	 	Case No. 08-13589 (MG)
	IFL Corp.,
	 	 	 	 
	 
	 	 	 	 
	 

	 	Debtor.	 	 

ORDER UNDER 11 U.S.C. § 105(a) AND FED. R. BANKR. P. 2002 AND 9014

APPROVING (I) BIDDING PROCEDURES, (II) CERTAIN BID PROTECTIONS, (III)

FORM AND MANNER OF SALE NOTICES, AND (IV) SETTING OF A SALE

HEARING 

          Upon the motion, dated September 19, 2008 (the “Motion”),1 of the
above-captioned debtor and debtor-in-possession (the “Debtor” or “Seller”) for
orders under 11 U.S.C. §§ 363 and 365 and Fed. R. Bankr. P. 2002, 6004, 6006, and 9014 (a) approving (i) bidding
procedures, (ii) certain bid protections, (iii) the form and manner of sale notices, and (iv) the
sale hearing date (the “Sale Hearing”), and (b) authorizing and approving (i) the
sale of substantially all of the Debtor’s assets (the “Assets”) free and clear of liens,
claims, and encumbrances (the “Sale”) to the Purchaser, (ii) the assumption by the Seller
and assignment to the Purchaser of certain executory contracts and unexpired leases (collectively,
the “Assumed Contracts”), and (iii) the assumption of certain liabilities
(collectively, the “Assumed Liabilities”) by the Purchaser; and the Court having
reviewed the Motion; and the Court having considered the arguments of counsel at the hearing held
on October 10, 2008 (the “Hearing”); and upon the record of the Hearing; and after due
deliberation thereon, and sufficient cause appearing therefor,

          IT IS HEREBY FOUND AND DETERMINED THAT:2

          A. The Court has jurisdiction over this matter and over the property of the

 

			
	1	 	Capitalized terms used but not otherwise defined herein shall have the meanings ascribed to them
in the Motion.
	 
	2	 	Findings of fact shall be construed as conclusions of law and conclusions of law shall be
construed as findings of fact when appropriate. See Fed. R. Bankr. P. 7052.

 

 

Debtor and its bankruptcy estate pursuant to 28 U.S.C. §§ 157(a) and 1334.

          B. This is a core proceeding pursuant to 28 U.S.C. § 157(b)(2)(A), (N), and (O).

          C. The notice given by the Debtor of the Motion and the Hearing constitutes due and sufficient
notice thereof.

          D. The Debtor has articulated good and sufficient reasons for approving (i) the Bidding
Procedures, (ii) the granting of certain bid protections as provided in the Agreement, (iii) the
manner of notice of the Motion, the Sale Hearing, and the assumption and assignment of the Assumed
Contracts, (iv) the form of notice of the Motion and the Sale Hearing to be distributed to
creditors and other parties in interest, including prospective bidders, (v) the form of notice of
the Cure Amounts and the assumption of the Assumed Contracts to be filed with the Court and served
on parties to each Assumed Contract, and (vi) the scheduling of the Sale Hearing.

          E. The Debtor’s payment to the Purchaser (as set forth in the Agreement), of the Break-Up Fee
(the “Bid Protection”) (i) is an actual and necessary cost and expense of
preserving the Debtor’s estate, within the meaning of section 503(b) of the Bankruptcy Code, (ii)
is of substantial benefit to the Debtor’s estate, (iii) is reasonable and appropriate, including in
light of the size and nature of the Sale and the efforts that have been and will be expended by the
Purchaser notwithstanding that the proposed Sale is subject to higher or better offers for the
Assets, (iv) was negotiated by the parties at arm’s length and in good faith, and (v) is necessary
to ensure that the Purchaser will continue to pursue its proposed acquisition of the Assets. The
Bid Protection was a material inducement for, and condition of, the Purchaser’s entry into the
Agreement. The Purchaser is unwilling to commit to hold open its offer to purchase the Assets under
the terms of the Agreement unless it is assured of payment of the Bid Protection. Further, because
the Bid Protection induced the Purchaser to research the value of the Assets and submit a bid that
will serve as a minimum or floor bid on which other bidders can rely, the Purchaser has provided a
benefit to the Debtor’s estate which the Debtor believes will increase the likelihood

C-2

 

that the price at which the Assets are sold will reflect their true worth. Finally, absent
authorization of the Bid Protection, the Debtor believes that it may lose the opportunity to obtain
the highest or otherwise best available offer for the Assets.

          F. The Bidding Procedures are reasonable and appropriate and represent the best method for
maximizing the realizable value of the Assets.

          THEREFORE, IT IS ORDERED, ADJUDGED, AND DECREED THAT:

          2. The Bidding Procedures, as set forth on Exhibit 1 attached hereto and incorporated
herein by reference as if fully set forth in this Order, are hereby approved and shall govern all
proceedings relating to the Agreement and any Subsequent Bids (as defined in the Bidding
Procedures) for the Assets in the Bidding Process.

          3. The Debtor, in consultation with the Committee (if one is
appointed in the Debtor’s case): (i) may determine which Qualified Bid, if any, is the highest or otherwise best
offer, and (ii) may reject at any time, any bid (other than the Purchaser’s bid) that is: (a)
inadequate or insufficient, (b) not in conformity with the requirements of the Bankruptcy Code, the
Bidding Procedures, or the terms and conditions of the Sale, or (c) contrary to the best interests
of the Debtor, its estate and creditors as determined by the Debtor and Committee (if one is
appointed in the Debtor’s case). Notwithstanding the foregoing, the Debtor, in consultation with
the Committee (if one is appointed in the Debtor’s case), may in the exercise of its reasonable
discretion, determine that a bid that is not otherwise a Qualified Bid is the highest and best bid
for the Assets. The Debtor, in consultation with the Committee (if one is appointed in the Debtor’s
case), is authorized to terminate the Bidding Process or the Auction at any time if it determines
that the Bidding Process will not maximize the value of the Assets to be realized by the Debtor’s
estate.

          4. The Sale Hearing shall be held before the undersigned United States Bankruptcy Judge on October
28, 2008 at 10:00 a.m. (prevailing Eastern time) in the United States Bankruptcy Court for the
Southern District of New York, One Bowling Green, Room 501, New York, New York 10004, at which time
the Court shall consider the Motion, the Successful

C-3

 

Bidder, and confirm the results of the Auction, if any.

          5. Objections to the Sale of the Assets shall be filed and
served no later than 4:00 p.m. (prevailing Eastern time) on October 23, 2008 (the “Objection Deadline”).

          6. The failure of any objecting person or entity to timely file its objection by the Objection
Deadline shall be a bar to the assertion, at the Sale Hearing or thereafter, of any objection to
the Motion, the Sale, or the Debtor’s consummation and performance of the Agreement (including the
transfer of the Assets, Assumed Contracts free and clear of all Liens and Claims), if authorized by
the Court.

          7. The Sale Hearing may be adjourned from time to time without further notice to creditors or
parties in interest other than by announcement of the adjournment in open court or on the Court’s
calendar on the date scheduled for the Sale Hearing or any adjourned date.

          8. The Bid Protection, as more fully described in the Agreement is hereby approved. The
Debtor’s obligation to pay the Bid Protection, as provided by the Agreement, shall survive
termination of the Agreement and, until paid, shall constitute an administrative expense pursuant
to Bankruptcy Code Section 507(b) and the Debtor shall be authorized to pay the Bid Protection to
the Purchaser in accordance with the terms of the Agreement without further order of this Court.

          9. Notice of (a) the Motion, (b) the Sale Hearing, and (c) the proposed assumption and
assignment of the Assumed Contracts to the Purchaser pursuant to the Agreement or to a Successful
Bidder shall be good and sufficient, and no other or further notice shall be required, if given as
follows:

          (a) Notice Of Sale Hearing. Within five (5) business days after entry of this Order
(the “Mailing Date”), the Debtor shall serve the Motion, the Agreement, the
proposed Sale Order, the Bidding Procedures, and a copy of the Bidding Procedures Order by
first-class mail, postage prepaid, upon (i) all of the Debtor’s known creditors, (ii) all entities
known to have expressed a bona fide interest in acquiring the Assets, (iii) any party known to have
or to assert a lien on any of the Assets, (iv) the Securities and Exchange Commission, (v) the
Office of the

C-4

 

United States Trustee, (vi) counsel for the Committee, if any is appointed, (vii) all federal,
state and local regulatory authorities with jurisdiction over the Debtor, (viii) the office of the
United States Attorney for the Southern District of New York, (ix) all non-debtor parties to the
Assumed Contracts, (x) all parties who entered a notice of appearance and request for service of
pleadings pursuant to Fed. R. Bankr. P. 2002, and (xi) any parties identified by the Debtor as
having an interest in bidding on the Assets.

          (b) Sale Notice. On or before the Mailing Date, the Debtor shall serve by first-class
mail, postage prepaid, a notice of the Sale (the “Sale Notice”), substantially in the form annexed
hereto as Exhibit 2, upon all known creditors of the Debtor.

          (c) Cure Notice. No later than fifteen (15) business days after the entry of this
Order, the Debtor shall file with the Court and serve on all nondebtor parties to the Assumed
Contracts a notice (the “Cure Notice”), substantially in the form annexed hereto as
Exhibit 3, of the cure amount necessary to assume each Assumed Contract (the “Cure
Amount”). The nondebtor party to the Assumed Contract shall have ten (10) days from the
service of the Cure Notice to object to the Cure Amount and must state in its objection with
specificity what Cure is required (with appropriate documentation in support thereof). If no
objection is timely received, the Cure Amount set forth in the Cure Notice shall be controlling,
notwithstanding anything to the contrary in any Assumed Contract or any other document, and the
nondebtor party to the Assumed Contract shall be forever barred from asserting any other claims
against the Debtor, the Purchaser, or the Successful Bidder (as appropriate), or the property of
either of them, as to such Assumed Contract. The inclusion of any Assumed Contract in the Cure
Notice shall not constitute an assumption by the Debtor of any such Assumed Contract, nor shall it
constitute an admission or a waiver with respect to the Debtor’s right to assume or reject any such
Assumed Contract.

          (d) Assumption Notice. Only if the Purchaser is not the Successful Bidder, within two
(2) business days of the conclusion of the Auction, the Debtor shall cause a notice, substantially
in the form of the notice attached hereto as Exhibit 4, to be sent to each nondebtor

C-5

 

party to an Assumed Contract identifying the Successful Bidder and the executory contracts and/or
unexpired leases to be assumed as part of the Sale. Any objection to the assumption and assignment
of any Assumed Contract shall be filed no later than 4:00 p.m. (prevailing Eastern time) two (2)
business days prior to the Sale Hearing.

          10. This Court shall retain jurisdiction to hear and determine all matters arising from the
implementation of this Order.

          11. Except as otherwise specifically set forth in this Order, the rights of all
parties-in-interest are hereby preserved in all respects.

          12. The requirement under Rule 9013-1(b) of the Local Bankruptcy Rules for the United States
Bankruptcy Court for the Southern District of New York for the service and filing of a separate
memorandum of law is deemed satisfied by the Motion.

Dated:                      ___, 2008
           
New York, New York

	 	 	 
	 

	 	 
	 

	 	Honorable Martin Glenn
	 

	 	United States Bankruptcy Judge

C-6

 

Exhibit 1

Bidding Procedures

 

 

BIDDING PROCEDURES 

Assets To Be Sold 

          The assets proposed to be sold are the Assets (as defined in the Agreement and as more fully
set forth in section 2.1 of the Agreement), that comprise substantially all of the Seller’s assets.

As Is, Where Is 

          The sale of the Assets shall be on an “as is, where is” basis and without representations or
warranties of any kind, nature, or description by the Debtor, its agents, or estate, except, with
respect to the Purchaser, to the extent set forth in the Agreement and, with respect to a
Successful Bidder, to the extent set forth in the relevant purchase agreement of such Successful
Bidder approved by the Bankruptcy Court.

Free Of Any And All Claims And Interests 

          The Assets shall be sold free and clear of all pledges, liens, security interests,
encumbrances, claims, charges, options, and interests thereon (collectively, the “Claims and
Interests”) and the Claims and Interests, if any, shall attach to the net proceeds of the sale of
such Assets.

Participation Requirements 

          Any person who wishes to participate in the Bidding Process (a “Potential
Bidder”) must become a Qualified Bidder. As a prerequisite to becoming a Qualified Bidder,
a Potential Bidder, other than the Purchaser, must deliver (unless previously delivered) to the
Seller, who shall promptly deliver copies to the Official Committee of Unsecured Creditors (the
“Committee”), if one is appointed in the Debtor’s case: (i) an executed confidentiality
agreement substantially in the form attached hereto as Exhibit 2, (ii) current audited financial
statements of the Potential Bidder, or, if the Potential Bidder is an entity formed for the purpose
of acquiring the Assets, current audited financial statements of the equity holders of the
Potential Bidder who shall guarantee the obligations of the Potential Bidder, or such other form of
financial disclosure

 

 

and credit-quality support or enhancement acceptable to the Seller, and (iii) a preliminary
(non-binding) written proposal regarding (a) the purchase price range, (b) any Assets expected to
be excluded, (c) the structure and financing of the transaction (including, but not limited to, the
sources of financing of the Purchase Price (as defined in the Agreement) and the requisite deposit,
(d) any anticipated regulatory approvals required to close the transaction, the anticipated time
frame and any anticipated impediments for obtaining such approvals, (e) any conditions to closing
that it may wish to impose in addition to those set forth in the Agreement, and (f) the nature and
extent of additional due diligence it may wish to conduct and the date by which such due diligence
will be completed.

          A Potential Bidder who delivers the documents described in the previous subparagraphs above
and whose financial information and credit-quality support or enhancement demonstrate the financial
capability of such Potential Bidder to consummate the Sale, if selected as the successful bidder,
and who the Seller, in consultation with the Committee (if one is appointed in the Debtor’s case),
determine (based on availability of financing, experience, and other considerations) to be able to
consummate the Sale within the time frame provided by the Agreement shall be deemed a “Qualified
Bidder.” As promptly as practicable, after a Potential Bidder delivers all of the materials
required above, the Seller, in consultation and with the Committee (if one is appointed in the
Debtor’s case), shall determine, and shall notify the Potential Bidder, whether such Potential
Bidder is a Qualified Bidder. At the same time that the Seller notifies the Potential Bidder that
it is a Qualified Bidder, the Seller shall allow the Qualified Bidder to begin to conduct due
diligence with respect to the Assets as provided below. Notwithstanding the foregoing, the
Purchaser for itself or on behalf of its designee, assignee or affiliate, shall be deemed a
Qualified Bidder for purposes of the Bidding Process.

Due Diligence 

          All due diligence shall be coordinated by the Seller, and all requests for due diligence
materials and related information shall be made to counsel for the Seller, Lowenstein Sandler PC,
1251 Avenue of the Americas, 18th Floor, New York, New York 10022, Attention:

-2-

 

Sharon Levine, Esq. (slevine@lowenstein.com) and S. Jason Teele, Esq.
(steele@lowenstein.com), or any other professional retained by the Seller and as directed
by the Seller.

          The Seller shall afford each Qualified Bidder access to due diligence materials reasonably
requested; provided, however, that the Seller, in its reasonable discretion, may permit Potential
Bidders to conduct limited due diligence, provided such Potential Bidders execute a confidentiality
agreement substantially in the form attached hereto as Exhibit 1, for the limited purpose of
permitting such Potential Bidders to determine whether or not they desire to submit a Qualified
Bid.

          The Seller shall coordinate all reasonable requests for information and due diligence access
from Qualified Bidders. Any additional due diligence shall not continue after the Bid Deadline,
except as otherwise consented to by the Seller. The Seller may, in its discretion, coordinate
diligence efforts such that multiple Qualified Bidders have simultaneous access to due diligence
materials. The Seller shall not be obligated to furnish any information relating to the Assets to
any person other than to Qualified Bidders.

          Each Qualified Bidder shall be deemed to acknowledge and represent that it has had an
opportunity to conduct any and all due diligence regarding the Assets prior to making its offer,
that it has relied solely upon its own independent review, investigation, and/or inspection of any
documents and/or the Assets in making its bid, and that it did not rely upon any written or oral
statements, representations, promises, warranties, or guaranties whatsoever, whether express,
implied, by operation of law or otherwise, regarding the Assets, or the completeness of any
information provided in connection therewith, the Bidding Process or the Auction (as defined
herein), except, as to the Successful Bidder, as expressly stated in the definitive agreement with
such Successful Bidder approved by the Bankruptcy Court.

Bid Deadline 

          All Bids (as defined below) must be submitted in writing so that they are actually received no
later than 5:00 p.m. (prevailing Eastern time) on October 23, 2008 (the “Bid

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Deadline”). Each Qualified Bidder (as defined below) must deliver copies of its Bid to
Lowenstein Sandler PC, counsel for the Debtor, 1251 Avenue of the Americas, 18th Floor, New York,
New York 10022, Attention: Sharon Levine, Esq. and S. Jason Teele, Esq., or by e-mail to
slevine@lowenstein.com and steele@lowenstein.com. The Debtor’s counsel shall serve copies of all
Bids received on (i) counsel for the Purchaser, Akin Gump Strauss Hauer & Feld LLP, 1700 Pacific
Ave, Suite 4100, Dallas, Texas 75201, Attention: Robert W. Dockery, Esq. and Kevin D. Rice, Esq.,
(ii) counsel for any official committees appointed in the Debtor’s case, and (iii) the Office of
the United States Trustee.

Bid Requirements 

          All bids must include the following documents: (i) a letter stating that the bidder’s offer is
irrevocable for the period set forth in the Bidding Procedures, (ii) an executed copy of the
Agreement marked to show amendments and modifications to the Agreement, purchase price, and
proposed schedules, (iii) a good faith deposit of ten percent (10%) of the aggregate bid amount
(the “Good Faith Deposit”), and (iv) satisfactory written evidence of a
commitment for financing or other ability to consummate the proposed transaction.

Qualified Bids 

          To be deemed a “Qualified Bid,” a bid must be received by the Bid Deadline
and, among other things, (i) must be on terms and conditions (other than the amount of the
consideration and the particular liabilities being assumed) that are substantially similar to, and
are not materially more burdensome or conditional to Seller than those contained in the Agreement,
(ii) must not be contingent on obtaining financing or the outcome of unperformed due diligence
beyond the contingencies set forth in the Agreement, (iii) must have a value (inclusive of any
credit bid component) greater than the purchase price reflected in the Agreement plus the amount of
the Break-Up Fee, (iv) must not be conditioned on bid protections, other than those contemplated in
the Bidding Procedures, (v) must contain acknowledgements and representations as set forth in the
Bidding Procedures, and (vi) include a commitment to consummate the Sale within not more than
fifteen (15) days after entry of a

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Bankruptcy Court order approving such purchase. The Seller, in consultation with the Committee (if
one is appointed in the Debtor’s case), shall have the right to deem a bid a Qualified Bid, if such
bid does not conform to one or more of the aforementioned requirements, provided however, that such
bid must have a value greater than or equal to the sum of the Purchase Price plus the amount of the
Break-Up Fee, taking into account all material terms of any such bid. Each Qualified Bid other than
that of the Purchaser shall be called a “Subsequent Bid.”

Bid Protection 

          Recognizing the Purchaser’s expenditure of time, energy, and resources, the Seller has agreed
to provide certain bid protections to the Purchaser. Specifically, the Seller has determined that
the Agreement will further the goals of the Bidding Procedures by setting a floor which all other
Qualified Bids must exceed and, therefore, is entitled to be selected as the Purchaser. As a
result, the Seller has agreed that if the Seller sell the Assets to a Successful Bidder other than
the Purchaser, the Seller shall, in certain circumstances, pay to the Purchaser a Break-Up Fee
equal to three percent (3%) of the Aggregate Cash Consideration (as defined in the Agreement). The
payment of the Break-Up Fee shall be governed by the provisions of the Agreement and the Bidding
Procedures Order.

Conduct Of Auction 

          If the Debtor receives at least one Qualified Bid in addition to the Agreement, the Debtor
will conduct an auction (the “Auction”) on October 27, 2008, at the offices of Lowenstein
Sandler PC, 1251 Avenue of the Americas, 18th Floor, New York, New York, at 10:00 a.m. (prevailing
Eastern time). At least two (2) business days prior to the Auction, each Qualified Bidder with a
Qualified Bid must inform the Seller whether it intends to participate in the Auction and at least
one (1) business day prior to the Auction, the Seller will provide such bidders copies of the
Qualified Bid which the Seller believes is the highest or otherwise best offer for the Assets,
(iii) all Qualified Bidders will be entitled to be present for all Subsequent Bids, and (iv)
bidding at the Auction will begin with the highest or otherwise best Qualified Bid,

-5-

 

continue in minimum increments of at least $25,000, and conclude after each participating bidder
has had the opportunity to submit one or more additional Subsequent Bids.

Participation in the Auction 

          Only Qualified Bidders who have submitted Qualified Bids will be eligible to participate in
the Auction. Only the authorized representatives of each of the Qualified Bidders, the Purchaser,
the Committee (if one is appointed in the Debtor’s case), the Office of the United States Trustee,
and the Seller shall be permitted to attend the Auction. At the Auction, Qualified Bidders will be
permitted to increase and/or improve their bids. Unless otherwise agreed to by the Seller, no
Qualified Bidder will be permitted more than one-half hour to respond to the previous bid at
Auction and, at the expiration of such time (unless extended), the Auction shall conclude.

Selection of Successful Bid 

          As soon as practicable after the conclusion of the Auction, the Seller will, in consultation
with its attorneys and financial advisors, review each Qualified Bid and identify the highest or
otherwise best offer for the Assets (the “Successful Bid”) and the bidder making
such bid (the “Successful Bidder”). The Seller will sell the Assets for the highest
or otherwise best Qualified Bid to the Successful Bidder upon the approval of such Qualified Bid by
the Bankruptcy Court after the hearing (the “Sale Hearing”).

Sale Hearing 

          The Sale Hearing is currently scheduled for October 28, 2008 at 10:00 a.m. (prevailing
Eastern time) before the Honorable Martin Glenn, United States Bankruptcy Judge, in the United
States Bankruptcy Court for the Southern District of New York, located at One Bowling Green, Room
501, New York, New York 10004. The Sale Hearing may be adjourned or rescheduled by the Seller
without notice other than by an announcement of the adjourned date at the Sale Hearing.

          If no Qualified Bids other than that of the Purchaser are received, the Seller will proceed
with the sale of the Assets to the Purchaser following entry of the order approving the

-6-

 

Sale. If the Seller receives additional Qualified Bids, then, at the Sale Hearing, the Seller shall
seek approval of the Successful Bid, as well as the second highest or best Qualified Bid (the
“Alternate Bid” and such bidder, the “Alternate Bidder”). A bid
will not be deemed accepted by the Seller unless and until approved by the Bankruptcy Court.
Following approval of the sale to the Successful Bidder, if the Successful Bidder fails to
consummate the sale for specified reasons, then the Alternate Bid will be deemed to be the
Successful Bid and the Seller will effectuate a sale to the Alternate Bidder without further order
of the Bankruptcy Court.

Return Of Good Faith Deposits 

          Good faith deposits of all Qualified Bidders (except for the Successful Bidder) shall be held
in an interest-bearing escrow account and all Qualified Bids shall remain open until two (2)
business days following the closing of the Sale (the “Return Date”).
Notwithstanding the foregoing, the good faith deposit submitted by the Successful Bidder, together
with interest thereon, shall be applied against the payment of the Purchase Price upon closing of
the Sale to the Successful Bidder. If a Successful Bidder fails to consummate an approved sale, the
Seller will not have any obligation to return such good faith deposit and it shall irrevocably
become property of the Seller. On the Return Date, the Seller will return the good faith deposits
of all other Qualified Bidders, together with the accrued interest thereon.

Reservation of Rights 

          The Seller (i) may determine which Qualified Bid, if any, is the highest or otherwise best
offer, and (ii) may reject at any time, any bid (other than the Purchaser’s bid) that is: (a)
inadequate or insufficient, (b) not in conformity with the requirements of the Bankruptcy Code, the
Bidding Procedures, or the terms and conditions of the Sale, or (c) contrary to the best interests
of the Seller, its estate and creditors as determined by the Seller in its sole discretion.

-7-

 

EXHIBIT 1 TO BIDDING PROCEDURES 

(Nondisclosure Agreement)

 

 

NONDISCLOSURE AGREEMENT 

          This Nondisclosure Agreement (this “Agreement”) by and between                     , a                     
corporation (the “Recipient”), and IFL Corp. (the “Provider”) is dated as of the
latest date set forth on the signature page hereto. Recipient and Provider are each a
“Party” and collectively, the “Parties”).

          1. General. In connection with the consideration of a possible negotiated transaction
(a “Possible Transaction”) between the Parties, Provider is prepared to make
available to the Recipient certain “Diligence Material” (as defined in Section 2 below) in
accordance with the provisions of this Agreement, and both Parties agree to take or abstain from
taking certain other actions as hereinafter set forth.

          2. Definitions. (a) The term “Diligence Material” means information
concerning the Provider which has been or is furnished to the Recipient or its Representatives in
connection with the Recipient’s evaluation of a Possible Transaction, including its business,
financial condition, operations, assets and liabilities, and includes all notes, analyses,
compilations, studies, interpretations or other documents prepared by the Recipient or its
Representatives which contain or are based upon, in whole or in part, the information furnished by
the Recipient hereunder. The term Diligence Material does not include information which (i) is or
becomes generally available to the public other than as a result of a disclosure by the Recipient
or its Representatives in breach of this Agreement, (ii) was within the Recipient’s possession
prior to its being furnished to the Recipient by or on behalf of the Provider, provided that the
source of such information was not bound by a confidentiality agreement with, or other contractual,
legal or fiduciary obligation of confidentiality to, the Provider with respect to such information,
or (iii) is or becomes available to the Recipient on a non-confidential basis from a source other
than the Provider or its Representatives, provided that such source is not bound by a
confidentiality agreement with, or other contractual, legal or fiduciary obligation of
confidentiality to, the Provider with respect to such information.

 

 

          (b) The term “Representatives” shall include the directors, officers, employees,
agents, partners or advisors (including, without limitation, attorneys, accountants, consultants,
bankers and financial advisors) of the Recipient or the Provider, as applicable.

          (c) The term “Person” includes the media and any corporation, partnership, group,
individual or other entity.

          3. Use of Diligence Material. The Recipient shall, and it shall cause its
Representatives to, use the Diligence Material solely for the purpose of evaluating a Possible
Transaction, keep the Diligence Material confidential, and, subject to Section 5, will not, and
will cause its Representatives not to, disclose any of the Diligence Material in any manner
whatsoever; provided, however, that any of such information may be disclosed to the
Recipient’s Representatives who need to know such information for the sole purpose of helping the
Recipient evaluate a Possible Transaction. The Recipient agrees to be responsible for any breach of
this Agreement by any of the Recipient’s Representatives. This Agreement does not grant the
Recipient or any of its Representatives any license to use the Provider’s Diligence Material except
as provided herein.

          4. Legally Required Disclosure. If the Recipient or its Representatives are requested
or required (by oral questions, interrogatories, other requests for information or documents in
legal proceedings, subpoena, civil investigative demand or other similar process) to disclose any
of the Diligence Material, the Recipient shall provide the Provider with prompt written notice of
any such request or requirement together with copies of the material proposed to be disclosed so
that the Provider may seek a protective order or other appropriate remedy and/or waive compliance
with the provisions of this Agreement. If, in the absence of a protective order or other remedy or
the receipt of a waiver by the Provider, the Recipient or its Representatives are nonetheless
legally compelled to disclose Diligence Material or otherwise be liable for contempt or suffer
other censure or penalty, the Recipient or its Representatives may, without liability hereunder,
disclose to such requiring person only that portion of such Diligence Material or any such facts
which the Recipient or its Representatives is legally required to

-2-

 

disclose, provided that the Recipient and/or its Representatives cooperate with the Provider to
obtain an appropriate protective order or other reliable assurance that confidential treatment will
be accorded such Diligence Material or such facts by the person receiving the material.

          5. Return or Destruction of Diligence Material. If Recipient decides that it does not
wish to proceed with a Possible Transaction, it will promptly inform the Provider of that decision.
In that case, or at any time upon the request of the Provider for any reason, the Recipient will,
and will cause its Representatives to, within five (5) business days of receipt of such notice,
destroy or return all Diligence Material in any way relating to the Provider or its products,
services, employees or other assets or liabilities, and no copy or extract thereof (including
electronic copies) shall be retained, except that Recipient’s outside counsel may retain one copy
to be kept confidential and used solely for archival purposes. The Recipient shall provide to the
Provider a certificate of compliance with the previous sentence signed by an executive officer of
the Recipient. Notwithstanding the return or destruction of the Diligence Material, the Recipient
and its Representatives will continue to be bound by the Recipient’s obligations hereunder with
respect to such Diligence Material.

          6. Maintaining Privilege. If any Diligence Material includes materials or information
subject to the attorney-client privilege, work product doctrine or any other applicable privilege
concerning pending or threatened legal proceedings or governmental investigations, the Recipient
understands and agrees that the Recipient and the Provider have a commonality of interest with
respect to such matters and it is the desire, intention and mutual understanding of the Parties
that the sharing of such material by Provider is not intended to, and shall not, waive or diminish
in any way the confidentiality of such material or its continued protection under the
attorney-client privilege, work product doctrine or other applicable privilege. All Diligence
Material provided by the Recipient that is entitled to protection under the attorney-client
privilege, work product doctrine or other applicable privilege shall remain entitled to such
protection under these privileges, this Agreement, and under the joint defense doctrine.

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          7. Not a Transaction Agreement. The Recipient understands and agrees that no contract
or agreement providing for a Possible Transaction exists between the Parties unless and until a
final definitive agreement for a Possible Transaction has been executed and delivered, and the
Recipient hereby waives, in advance, any claims (including, without limitation, breach of contract)
relating to the existence of a Possible Transaction unless and until the Parties shall have entered
into a final definitive agreement for a Possible Transaction. The Recipient also agrees that,
unless and until a final definitive agreement regarding a Possible Transaction has been executed
and delivered, neither Party will be under any legal obligation of any kind whatsoever with respect
to such Possible Transaction by virtue of this Agreement except for the matters specifically agreed
to herein. Either Party may terminate discussions and negotiations with the other Party at any
time.

          8. No Representations or Warranties; No Obligation to Disclose. The Recipient
understands and acknowledges that neither the Provider nor its Representatives makes any
representation or warranty, express or implied, as to the accuracy or completeness of the Diligence
Material furnished by or on behalf of the Provider and shall have no liability to the Recipient,
its Representatives or any other Person relating to or resulting from the use of the Diligence
Material furnished to the Recipient or its Representatives or any errors therein or omissions
therefrom. As to the information delivered to the Recipient, the Provider will only be liable for
those representations or warranties which are made in a final definitive agreement regarding a
Possible Transaction, when, as and if executed, and subject to such limitations and restrictions as
may be specified therein. Nothing in this Agreement shall be construed as obligating a the
Provider to provide, or to continue to provide, any information to any Person.

          9. Modifications and Waiver. No provision of this Agreement can be waived or amended
in favor of either Party except by written consent of the other Party, which consent shall
specifically refer to such provision and explicitly make such waiver or amendment. No failure or
delay by either Party in exercising any right, power or privilege hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise thereof preclude any other or

-4-

 

future exercise thereof or the exercise of any other right, power or privilege hereunder.

          10. Remedies. Recipient understands and agrees that money damages would not be a
sufficient remedy for any breach of this Agreement by Recipient or any of its Representatives and
that Provider shall be entitled to equitable relief, including injunction and specific performance,
as a remedy for any such breach or threat thereof. Such remedies shall not be deemed to be the
exclusive remedies for a breach of this Agreement, but shall be in addition to all other remedies
available at law or equity to Provider.

          11. Legal Fees. In the event of litigation relating to this Agreement, if a court of
competent jurisdiction determines that either Recipient or its Representatives has breached this
Agreement, then the Recipient shall be liable and pay to the Provider the reasonable legal fees and
costs incurred in connection with such litigation, including any appeal therefrom.

          12. Governing Law. This Agreement is for the benefit of the Provider and shall be
governed by and construed in accordance with the laws of the State of New York applicable to
agreements made and to be performed entirely within such State.

          13. Severability. If any term, provision, covenant or restriction contained in this
Agreement is held by any court of competent jurisdiction to be invalid, void or unenforceable, the
remainder of the terms, provisions, covenants or restrictions contained in this Agreement shall
remain in full force and effect and shall in no way be affected, impaired or invalidated, and if a
covenant or provision is determined to be unenforceable by reason of its extent, duration, scope or
otherwise, then the Parties intend and hereby request that the court or other authority making that
determination shall only modify such extent, duration, scope or other provision to the extent
necessary to make it enforceable and enforce it in its modified form for all purposes of this
Agreement.

          14. Term. This Agreement shall terminate one (1) year after the date of this
Agreement.

          15. Entire Agreement. This Agreement contains the entire agreement between the
Parties regarding the subject matter hereof and supersedes all prior agreements,

-5-

 

understandings, arrangements and discussions between the Parties regarding such subject matter.

          16. Counterparts. This Agreement may be signed in counterparts, each of which shall
be deemed an original but all of which shall be deemed to constitute a single instrument.

          IN WITNESS WHEREOF, each of the undersigned entities has caused this Agreement to be signed by
its duly authorized representatives as of the date written below.

	 	 	 	 	 	 	 
	PROVIDER:	 	RECIPIENT:
	 
	 	 	 	 	 	 
	IFL CORP.	 	[COMPANY NAME]
	 
	 	 	 	 	 	 
	 	 	 	 	[Address]
	 
	By:

	 	 	 	By:	 	 
	 

	 	 
	 	 	 	 
	Name:

	 	 	 	Name:	 	 
	 

	 	 
	 	 	 	 
	Title

	 	 	 	Title	 	 
	 

	 	 
	 	 	 	 

-6-

 

Exhibit 2 

Sale Notice

 

 

LOWENSTEIN SANDLER PC

Sharon L. Levine, Esq.

S. Jason Teele, Esq.

Timothy R. Wheeler, Esq.

1251 Avenue of the Americas, 18th Floor

New York, New York 10020

(212) 262-6700 (Telephone)

(212) 262-7402 (Facsimile)

-and-

65 Livingston Avenue

Roseland, New Jersey 07068

(973) 597-2500 (Telephone)

(973) 597-2400 (Facsimile)

Proposed Counsel to the Debtor and Debtor in Possession

UNITED STATES BANKRUPTCY COURT

SOUTHERN DISTRICT OF NEW YORK

	 	 	 	 	 
	 

	 	 	 	Chapter 11
	In re:
	 	 	 	 
	 

	 	 	 	Case No. 08-13589 (MG)
	IFL Corp.,
	 	 	 	 
	 
	 	 	 	 
	 

	 	Debtor.	 	 

NOTICE OF SALE OF CERTAIN ASSETS AT AUCTION 

          PLEASE TAKE NOTICE OF THE FOLLOWING:

          1. Pursuant to the Order Under 11 U.S.C. § 105(a) And Fed. R.
Bankr. P. 2002 And 9014 Approving (i) Bidding Procedures, (ii) Certain Bid Protections, (iii) Form And Manner
Of Sale Notices, And (iv) Sale Hearing Date (the “Bidding Procedures
Order”) entered by the United States Bankruptcy Court for the Southern District of New York
(the “Bankruptcy Court”) on October 10, 2008, the above-captioned debtor and
debtor-in-possession (the “Debtor”) is offering substantially all of its assets (the
“Assets”) for sale. Capitalized terms used but not otherwise defined in this notice shall
have the meanings ascribed to them in the Bidding Procedures.

 

 

          2. All interested parties are invited to make an offer to purchase the Assets in accordance
with the terms and conditions approved by the Bankruptcy Court (the “Bidding
Procedures”). Pursuant to the Bidding Procedures, the Debtor may conduct an auction for the
Assets (the “Auction”) beginning at 10:00 a.m. on October 27, 2008 at the offices
of Lowenstein Sandler PC, 1251 Avenue of the Americas, 18th Floor, New York, New York 10022

          3. Participation at the Auction is subject to the Bidding
Procedures and the Bidding Procedures Order. A copy of the Bidding Procedures
is attached hereto as Exhibit 1.

          4. The Debtor has accepted a bid only when the bid has been
approved by the Bankruptcy Court at the Sale Hearing. Notwithstanding Bankruptcy Court approval of a sale pursuant
to the terms of a bid by a Qualified Bidder, the Good Faith Deposits of all bidders will be
retained by the Debtor, and all bids will remain open until two (2) business days following the
closing of the Sale (the “Return Date”); provided, however, that if the Debtor
determines not to sell the Assets, the Good Faith Deposits of all Qualified Bidders will be
returned by the Debtor within forty-eight (48) hours of the Auction. Upon failure to consummate the
sale of the Assets because of a breach or failure on the part of the Successful Bidder, the Debtor
may select in its business judgment the next highest or otherwise best Qualified Bid to be the
Successful Bid without further order of the Court. On the Return Date, the Debtor will return the
Good Faith Deposits of all Qualified Bidders, except the Successful Bidder, with accrued interest.

          5. The Debtor may: (a) determine, in its business judgment,
which Qualified Bid is the highest or otherwise best offer and (b) reject at
any time before entry of an order of the Bankruptcy Court approving a
Qualified Bid any bid which, in the Debtor’s sole discretion, is (i)
inadequate or insufficient, (ii) not in conformity with the requirements of
the Bankruptcy Code, the Bidding Procedures, or the terms and conditions of
sale, or (iii) contrary to the best interests of the Debtor, its estate, and
its creditors.

          6. A hearing to approve the Sale of the Assets to the highest and best bidder will be held on
October 28, 2008 at 10:00 a.m. Prevailing Eastern Time at the United States Bankruptcy
Court for the Southern District of New York, One Bowling Green, Room 501, New

-2-

 

York, New York 10004, before the Honorable Martin Glenn, United States Bankruptcy Judge. The
hearing on the Sale my be adjourned without notice other than an adjournment in open court.

          7. This notice is qualified in its entirety by the Bidding
Procedures Order.

	 	 	 
	 

	 	LOWENSTEIN SANDLER PC
	 
	 	 
	 

	 	/s/ S. Jason Teele
	 

	 	 
	 

	 	Sharon L. Levine, Esq.
	 

	 	S. Jason Teele, Esq.
	 

	 	Timothy R. Wheeler, Esq.
	 

	 	1251 Avenue of the Americas, 18th Floor
	 

	 	New York, New York 10020
	 

	 	(212) 262-6700 (Telephone)
	 

	 	(212) 262-7402 (Facsimile)
	 
	 	 
	 

	 	-and-
	 
	 	 
	 

	 	65 Livingston Avenue
	 

	 	Roseland, New Jersey 07068
	 

	 	(973) 597-2500 (Telephone)
	 

	 	(973) 597-2400 (Facsimile)
	 
	 	 
	 

	 	Proposed Counsel to the Debtor and Debtor in Possession

Dated:                     , 2008

            New York, New York

-3-

 

EXHIBIT 1 

BIDDING PROCEDURES 

Assets To Be Sold 

          The assets proposed to be sold are the Assets (as defined in the Agreement and as more fully
set forth in section 2.1 of the Agreement) which comprise substantially all of the Seller’s assets.

As Is, Where Is 

          The sale of the Assets shall be on an “as is, where is” basis and without representations or
warranties of any kind, nature, or description by the Debtor, its agents, or estate, except, with
respect to the Purchaser, to the extent set forth in the Agreement and, with respect to a
Successful Bidder, to the extent set forth in the relevant purchase agreement of such Successful
Bidder approved by the Bankruptcy Court.

Free Of Any And All Claims And Interests 

          The Assets shall be sold free and clear of all pledges, liens, security interests,
encumbrances, claims, charges, options, and interests thereon (collectively, the “Claims
and Interests”) and the Claims and Interests, if any, shall attach to the net
proceeds of the sale of such Assets.

Participation Requirements 

          Any person who wishes to participate in the Bidding Process (a “Potential
Bidder”) must become a Qualified Bidder. As a prerequisite to becoming a Qualified Bidder,
a Potential Bidder, other than the Purchaser, must deliver (unless previously delivered) to the
Seller, who shall promptly deliver copies to the Official Committee of Unsecured Creditors (the
“Committee”), if one is appointed in the Debtor’s case: (i) an executed confidentiality
agreement substantially in the form attached hereto as Exhibit 2, (ii) current audited financial
statements of the Potential Bidder, or, if the Potential Bidder is an entity formed for the purpose
of acquiring the Assets, current audited financial statements of the equity holders of the
Potential Bidder who

 

 

shall guarantee the obligations of the Potential Bidder, or such other form of financial disclosure
and credit-quality support or enhancement acceptable to the Seller, and (iii) a preliminary
(non-binding) written proposal regarding (a) the purchase price range, (b) any Assets expected to
be excluded, (c) the structure and financing of the transaction (including, but not limited to, the
sources of financing of the Purchase Price (as defined in the Agreement) and the requisite deposit,
(d) any anticipated regulatory approvals required to close the transaction, the anticipated time
frame and any anticipated impediments for obtaining such approvals, (e) any conditions to closing
that it may wish to impose in addition to those set forth in the Agreement, and (f) the nature and
extent of additional due diligence it may wish to conduct and the date by which such due diligence
will be completed.

          A Potential Bidder who delivers the documents described in the previous subparagraphs above
and whose financial information and credit-quality support or enhancement demonstrate the financial
capability of such Potential Bidder to consummate the Sale, if selected as a successful bidder, and
who the Seller, in consultation with the Committee (if one is appointed in the Debtor’s case),
determine (based on availability of financing, experience, and other considerations) to be able to
consummate the Sale within the time frame provided by the Agreement shall be deemed a “Qualified
Bidder.” As promptly as practicable, after a Potential Bidder delivers all of the materials
required above, the Seller, in consultation and with the Committee (if one is appointed in the
Debtor’s case), shall determine, and shall notify the Potential Bidder, whether such Potential
Bidder is a Qualified Bidder. At the same time that the Seller notify the Potential Bidder that it
is a Qualified Bidder, the Seller shall allow the Qualified Bidder to begin to conduct due
diligence with respect to the Assets as provided below. Notwithstanding the foregoing, the
Purchaser for itself or on behalf of its designee, assignee or affiliate, shall be deemed a
Qualified Bidder for purposes of the Bidding Process.

Due Diligence 

          All due diligence shall be coordinated by the Seller, and all requests for due diligence
materials and related information shall be made to counsel for the Seller, Lowenstein

-2-

 

Sandler PC, 1251 Avenue of the Americas, 18th Floor, New York, New York 10022,
Attention: Sharon Levine, Esq. (slevine@lowenstein.com) and S. Jason Teele, Esq.
(steele@lowenstein.com), or any other professional retained by the Seller and as directed
by the Seller.

          The Seller shall afford each Qualified Bidder access to due diligence materials reasonably
requested; provided, however, that the Seller, in its reasonable discretion, may permit Potential
Bidders to conduct limited due diligence, provided such Potential Bidders execute a confidentiality
agreement substantially in the form attached hereto as Exhibit 1, for the limited purpose of
permitting such Potential Bidders to determine whether or not they desire to submit a Qualified
Bid.

          The Seller shall coordinate all reasonable requests for information and due diligence access
from Qualified Bidders. Any additional due diligence shall not continue after the Bid Deadline,
except as otherwise consented to by the Seller. The Seller may, in its discretion, coordinate
diligence efforts such that multiple Qualified Bidders have simultaneous access to due diligence
materials. The Seller shall not be obligated to furnish any information relating to the Assets to
any person other than to Qualified Bidders.

          Each Qualified Bidder shall be deemed to acknowledge and represent that it has had an
opportunity to conduct any and all due diligence regarding the Assets prior to making its offer,
that it has relied solely upon its own independent review, investigation, and/or inspection of any
documents and/or the Assets in making its bid, and that it did not rely upon any written or oral
statements, representations, promises, warranties, or guaranties whatsoever, whether express,
implied, by operation of law or otherwise, regarding the Assets, or the completeness of any
information provided in connection therewith, the Bidding Process or the Auction (as defined
herein), except, as to the Successful Bidder, as expressly stated in the definitive agreement with
such Successful Bidder approved by the Bankruptcy Court.

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Bid Deadline 

          All Bids (as defined below) must be submitted in writing so that they are actually received no
later than 5:00 p.m. (prevailing Eastern time) on October 23, 2008 (the “Bid
Deadline”). Each Qualified Bidder (as defined below) must deliver copies of its Bid to
Lowenstein Sandler PC, counsel for the Debtor, 1251 Avenue of the Americas, 18th Floor, New York,
New York 10022, Attention: Sharon Levine, Esq. and S. Jason Teele, Esq., or by e-mail to
slevine@lowenstein.com and steele@lowenstein.com. Debtor’s counsel shall serve copies of all Bids
received on (i) counsel for the Purchaser, Akin Gump Strauss Hauer & Feld LLP, 1700 Pacific Ave,
Suite 4100, Dallas, Texas 75201, Attention: Robert W. Dockery, Esq. and Kevin D. Rice, Esq., (ii)
counsel for any official committees appointed in the Debtor’s case, and (iii) the Office of the
United States Trustee.

Bid Requirements 

          All bids must include the following documents: (i) a letter stating that the bidder’s offer is
irrevocable for the period set forth in the Bidding Procedures, (ii) an executed copy of the
Agreement marked to show amendments and modifications to the Agreement, purchase price, and
proposed schedules, (iii) a good faith deposit of ten percent (10%) of the aggregate bid amount
(the “Good Faith Deposit”), and (iv) satisfactory written evidence of a
commitment for financing or other ability to consummate the proposed transaction.

Qualified Bids 

          To be deemed a “Qualified Bid,” a bid must be received by the Bid Deadline
and, among other things, (i) must be on terms and conditions (other than the amount of the
consideration and the particular liabilities being assumed) that are substantially similar to, and
are not materially more burdensome or conditional to Seller than those contained in the Agreement,
(ii) must not be contingent on obtaining financing or the outcome of unperformed due diligence
beyond the contingencies set forth in the Agreement, (iii) must have a value (inclusive of any
credit bid component) greater than the purchase price reflected in the Agreement plus the amount of
the Break-Up Fee, (iv) must not be conditioned on bid protection,

-4-

 

other than those contemplated in the Bidding Procedures, (v) must contain acknowledgements and
representations as set forth in the Bidding Procedures, and (vi) include a commitment to consummate
the Sale within not more than 15 days after entry of a Bankruptcy Court order approving such
purchase. The Seller, in consultation with the Committee (if one is appointed in the Debtor’s
case), shall have the right to deem a bid a Qualified Bid, if such bid does not conform to one or
more of the aforementioned requirements, provided however, that such bid must have a value greater
than or equal to the sum of the Purchase Price plus the amount of the Break-Up Fee, taking into
account all material terms of any such bid. Each Qualified Bid other than that of the Purchaser
shall be called a “Subsequent Bid.”

Bid Protection 

          Recognizing the Purchaser’s expenditure of time, energy, and resources, the Seller has agreed
to provide certain bidding protections to the Purchaser. Specifically, the Seller has determined
that the Agreement will further the goals of the Bidding Procedures by setting a floor which all
other Qualified Bids must exceed and, therefore, is entitled to be selected as the Purchaser. As a
result, the Seller has agreed that if the Seller sell the Assets to a Successful Bidder other than
the Purchaser, the Seller shall, in certain circumstances, pay to the Purchaser a Break-Up Fee
equal to three percent (3%) of the Aggregate Cash Consideration (as defined in the Agreement). The
payment of the Break-Up Fee shall be governed by the provisions of the Agreement and the Bidding
Procedures Order.

Conduct Of Auction 

          If the Debtor receives at least one Qualified Bid in addition to the Agreement, the Debtor
will conduct an auction (the “Auction”) on October 27, 2008, 2008 at the offices of
Lowenstein Sandler PC, 1251 Avenue of the Americas, 18th Floor, New York, New York, at 10:00 a.m.
(prevailing Eastern time). At least two business days prior to the Auction, each Qualified Bidder
with a Qualified Bid must inform the Seller whether it intends to participate in the Auction and at
least one business day prior to the Auction, the Seller will provide such bidders copies of the
Qualified Bid which the Seller believes is the highest or otherwise best

-5-

 

offer for the Assets, (iii) all Qualified Bidders will be entitled to be present for all Subsequent
Bids, and (iv) bidding at the Auction will begin with the highest or otherwise best Qualified Bid,
continue in minimum increments of at least $25,000, and conclude after each participating bidder
has had the opportunity to submit one or more additional Subsequent Bids.

Participation in the Auction 

          Only Qualified Bidders who have submitted Qualified Bids will be eligible to participate in
the Auction. Only the authorized representatives of each of the Qualified Bidders, the Purchaser,
the Committee (if one is appointed in the Debtor’s case), the Office of the United States Trustee,
and the Seller shall be permitted to attend the Auction. At the Auction, Qualified Bidders will be
permitted to increase and/or improve their bids. Unless otherwise agreed to by the Seller, no
Qualified Bidder will be permitted more than one-half hour to respond to the previous bid at
Auction and, at the expiration of such time (unless extended), the Auction shall conclude.

Selection of Successful Bid 

          As soon as practicable after the conclusion of the Auction, the Seller will, in consultation
with its attorneys and financial advisors, review each Qualified Bid and identify the highest or
otherwise best offer for the Assets (the “Successful Bid”) and the bidder making
such bid (the “Successful Bidder”). The Seller will sell the Assets for the highest
or otherwise best Qualified Bid to the Successful Bidder upon the approval of such Qualified Bid by
the Bankruptcy Court after the hearing (the “Sale Hearing”).

Sale Hearing 

          The Sale Hearing is currently scheduled for October 28, 2008 at 10:00 a.m. (prevailing
Eastern time) before the Honorable Martin Glenn, United States Bankruptcy Judge, in the United
States Bankruptcy Court for the Southern District of New York, located at One Bowling Green, Room
501, New York, New York 10004. The Sale Hearing may be adjourned or rescheduled by the Seller
without notice other than by an announcement of the adjourned date at the Sale Hearing.

-6-

 

          If no Qualified Bids other than that of the Purchaser are received, the Seller will proceed
with the sale of the Assets to the Purchaser following entry of the order approving the Sale. If
the Seller receives additional Qualified Bids, then, at the Sale Hearing, the Seller shall seek
approval of the Successful Bid, as well as the second highest or best Qualified Bid (the
“Alternate Bid” and such bidder, the “Alternate Bidder”). A bid
will not be deemed accepted by the Seller unless and until approved by the Bankruptcy Court.
Following approval of the sale to the Successful Bidder, if the Successful Bidder fails to
consummate the sale for specified reasons, then the Alternate Bid will be deemed to be the
Successful Bid and the Seller will effectuate a sale to the Alternate Bidder without further order
of the Bankruptcy Court.

Return Of Good Faith Deposits 

          Good faith deposits of all Qualified Bidders (except for the Successful Bidder) shall be held
in an interest-bearing escrow account and all Qualified Bids shall remain open until two business
days following the closing of the Sale (the “Return Date”). Notwithstanding the
foregoing, the good faith deposit submitted by the Successful Bidder, together with interest
thereon, shall be applied against the payment of the Purchase Price upon closing of the Sale to the
Successful Bidder. If a Successful Bidder fails to consummate an approved sale, the Seller will not
have any obligation to return such good faith deposit and it shall irrevocably become property of
the Seller. On the Return Date, the Seller will return the good faith deposits of all other
Qualified Bidders, together with the accrued interest thereon.

Reservation of Rights 

          The Seller (i) may determine which Qualified Bid, if any, is the highest or otherwise best
offer, and (ii) may reject at any time, any bid (other than the Purchaser’s bid) that is: (a)
inadequate or insufficient, (b) not in conformity with the requirements of the Bankruptcy Code, the
Bidding Procedures, or the terms and conditions of the Sale, or (c) contrary to the best interests
of the Seller, its estate and creditors as determined by the Seller in its sole discretion.

-7-

 

EXHIBIT 1 TO BIDDING PROCEDURES 

(Nondisclosure Agreement)

 

 

NONDISCLOSURE AGREEMENT 

          This Nondisclosure Agreement (this “Agreement”) by and between                     , a                     
corporation (the “Recipient”), and IFL Corp. (the “Provider”) is dated as of the
latest date set forth on the signature page hereto. Recipient and Provider are each a “Party” and
collectively, the “Parties”).

          1. General. In connection with the consideration of a possible negotiated transaction
(a “Possible Transaction”) between the Parties, Provider is prepared to make
available to the Recipient certain “Diligence Material” (as defined in Section 2 below) in
accordance with the provisions of this Agreement, and both Parties agree to take or abstain from
taking certain other actions as hereinafter set forth.

          2. Definitions. (a) The term “Diligence Material” means information
concerning the Provider which has been or is furnished to the Recipient or its Representatives in
connection with the Recipient’s evaluation of a Possible Transaction, including its business,
financial condition, operations, assets and liabilities, and includes all notes, analyses,
compilations, studies, interpretations or other documents prepared by the Recipient or its
Representatives which contain or are based upon, in whole or in part, the information furnished by
the Recipient hereunder. The term Diligence Material does not include information which (i) is or
becomes generally available to the public other than as a result of a disclosure by the Recipient
or its Representatives in breach of this Agreement, (ii) was within the Recipient’s possession
prior to its being furnished to the Recipient by or on behalf of the Provider, provided that the
source of such information was not bound by a confidentiality agreement with, or other contractual,
legal or fiduciary obligation of confidentiality to, the Provider with respect to such information,
or (iii) is or becomes available to the Recipient on a non-confidential basis from a source other
than the Provider or its Representatives, provided that such source is not bound by a
confidentiality agreement with, or other contractual, legal or fiduciary obligation of
confidentiality to, the Provider with respect to such information.

 

 

          (b) The term “Representatives” shall include the directors, officers, employees,
agents, partners or advisors (including, without limitation, attorneys, accountants, consultants,
bankers and financial advisors) of the Recipient or the Provider, as applicable.

          (c) The term “Person” includes the media and any corporation, partnership, group,
individual or other entity.

          3. Use of Diligence Material. The Recipient shall, and it shall cause its
Representatives to, use the Diligence Material solely for the purpose of evaluating a Possible
Transaction, keep the Diligence Material confidential, and, subject to Section 5, will not, and
will cause its Representatives not to, disclose any of the Diligence Material in any manner
whatsoever; provided, however, that any of such information may be disclosed to the
Recipient’s Representatives who need to know such information for the sole purpose of helping the
Recipient evaluate a Possible Transaction. The Recipient agrees to be responsible for any breach of
this Agreement by any of the Recipient’s Representatives. This Agreement does not grant the
Recipient or any of its Representatives any license to use the Provider’s Diligence Material except
as provided herein.

          4. Legally Required Disclosure. If the Recipient or its Representatives are requested
or required (by oral questions, interrogatories, other requests for information or documents in
legal proceedings, subpoena, civil investigative demand or other similar process) to disclose any
of the Diligence Material, the Recipient shall provide the Provider with prompt written notice of
any such request or requirement together with copies of the material proposed to be disclosed so
that the Provider may seek a protective order or other appropriate remedy and/or waive compliance
with the provisions of this Agreement. If, in the absence of a protective order or other remedy or
the receipt of a waiver by the Provider, the Recipient or its Representatives are nonetheless
legally compelled to disclose Diligence Material or otherwise be liable for contempt or suffer
other censure or penalty, the Recipient or its Representatives may, without liability hereunder,
disclose to such requiring Person only that portion of such Diligence Material or any such facts
which the Recipient or its Representatives is legally required to

-2-

 

disclose, provided that the Recipient and/or its Representatives cooperate with the Provider to
obtain an appropriate protective order or other reliable assurance that confidential treatment will
be accorded such Diligence Material or such facts by the Person receiving the material.

          5. Return or Destruction of Diligence Material. If Recipient decides that it does not
wish to proceed with a Possible Transaction, it will promptly inform the Provider of that decision.
In that case, or at any time upon the request of the Provider for any reason, the Recipient will,
and will cause its Representatives to, within five business days of receipt of such notice, destroy
or return all Diligence Material in any way relating to the Provider or its products, services,
employees or other assets or liabilities, and no copy or extract thereof (including electronic
copies) shall be retained, except that Recipient’s outside counsel may retain one copy to be kept
confidential and used solely for archival purposes. The Recipient shall provide to the Provider a
certificate of compliance with the previous sentence signed by an executive officer of the
Recipient. Notwithstanding the return or destruction of the Diligence Material, the Recipient and
its Representatives will continue to be bound by the Recipient’s obligations hereunder with respect
to such Diligence Material.

          6. Maintaining Privilege. If any Diligence Material includes materials or information
subject to the attorney-client privilege, work product doctrine or any other applicable privilege
concerning pending or threatened legal proceedings or governmental investigations, the Recipient
understands and agrees that the Recipient and the Provider have a commonality of interest with
respect to such matters and it is the desire, intention and mutual understanding of the Parties
that the sharing of such material by Provider is not intended to, and shall not, waive or diminish
in any way the confidentiality of such material or its continued protection under the
attorney-client privilege, work product doctrine or other applicable privilege. All Diligence
Material provided by the Recipient that is entitled to protection under the attorney-client
privilege, work product doctrine or other applicable privilege shall remain entitled to such
protection under these privileges, this Agreement, and under the joint defense doctrine.

-3-

 

          7. Not a Transaction Agreement. The Recipient understands and agrees that no contract
or agreement providing for a Possible Transaction exists between the Parties unless and until a
final definitive agreement for a Possible Transaction has been executed and delivered, and the
Recipient hereby waives, in advance, any claims (including, without limitation, breach of contract)
relating to the existence of a Possible Transaction unless and until the shall have entered into a
final definitive agreement for a Possible Transaction. The Recipient also agrees that, unless and
until a final definitive agreement regarding a Possible Transaction has been executed and
delivered, neither Party will be under any legal obligation of any kind whatsoever with respect to
such Possible Transaction by virtue of this Agreement except for the matters specifically agreed to
herein. Either Party may terminate discussions and negotiations with the other Party at any time.

          8. No Representations or Warranties; No Obligation to Disclose. The Recipient
understands and acknowledges that neither the Provider nor its Representatives makes any
representation or warranty, express or implied, as to the accuracy or completeness of the Diligence
Material furnished by or on behalf of the Provider and shall have no liability to the Recipient,
its Representatives or any other Person relating to or resulting from the use of the Diligence
Material furnished to the Recipient or its Representatives or any errors therein or omissions
therefrom. As to the information delivered to the Recipient, the Provider will only be liable for
those representations or warranties which are made in a final definitive agreement regarding a
Possible Transaction, when, as and if executed, and subject to such limitations and restrictions as
may be specified therein. Nothing in this Agreement shall be construed as obligating a the
Provider to provide, or to continue to provide, any information to any Person.

          9. Modifications and Waiver. No provision of this Agreement can be waived or amended
in favor of either Party except by written consent of the other Party, which consent shall
specifically refer to such provision and explicitly make such waiver or amendment. No failure or
delay by either Party in exercising any right, power or privilege hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise thereof preclude any other or

-4-

 

future exercise thereof or the exercise of any other right, power or privilege hereunder.

          10. Remedies. Recipient understands and agrees that money damages would not be a
sufficient remedy for any breach of this Agreement by Recipient or any of its Representatives and
that Provider shall be entitled to equitable relief, including injunction and specific performance,
as a remedy for any such breach or threat thereof. Such remedies shall not be deemed to be the
exclusive remedies for a breach of this Agreement, but shall be in addition to all other remedies
available at law or equity to Provider.

          11. Legal Fees. In the event of litigation relating to this Agreement, if a court of
competent jurisdiction determines that either Recipient or its Representatives has breached this
Agreement, then the Recipient shall be liable and pay to the Provider the reasonable legal fees and
costs incurred in connection with such litigation, including any appeal therefrom.

          12. Governing Law. This Agreement is for the benefit of the Provider and shall be
governed by and construed in accordance with the laws of the State of New York applicable to
agreements made and to be performed entirely within such State.

          13. Severability. If any term, provision, covenant or restriction contained in this
Agreement is held by any court of competent jurisdiction to be invalid, void or unenforceable, the
remainder of the terms, provisions, covenants or restrictions contained in this Agreement shall
remain in full force and effect and shall in no way be affected, impaired or invalidated, and if a
covenant or provision is determined to be unenforceable by reason of its extent, duration, scope or
otherwise, then the Parties intend and hereby request that the court or other authority making that
determination shall only modify such extent, duration, scope or other provision to the extent
necessary to make it enforceable and enforce them in their modified form for all purposes of this
Agreement.

          14. Term. This Agreement shall terminate one year after the date of this Agreement.

          15. Entire Agreement. This Agreement contains the entire agreement between the
Parties regarding the subject matter hereof and supersedes all prior agreements,

-5-

 

understandings, arrangements and discussions between the Parties regarding such subject matter.

          16. Counterparts. This Agreement may be signed in counterparts, each of which shall
be deemed an original but all of which shall be deemed to constitute a single instrument.

          IN WITNESS WHEREOF, each of the undersigned entities has caused this Agreement to be signed by
its duly authorized representatives as of the date written below.

	 	 	 	 	 	 	 
	PROVIDER:	 	RECIPIENT:
	 
	 	 	 	 	 	 
	IFL CORP.	 	[COMPANY NAME]
	 
	 	 	 	 	 	 
	 	 	 	 	[Address]
	 
	By:

	 	 	 	By:	 	 
	 

	 	 
	 	 	 	 
	Name:

	 	 	 	Name:	 	 
	 

	 	 
	 	 	 	 
	Title

	 	 	 	Title	 	 
	 

	 	 
	 	 	 	 

-6-

 

Exhibit 3

Cure Notice

 

 

LOWENSTEIN SANDLER PC

Sharon L. Levine, Esq.

S. Jason Teele, Esq.

Timothy R. Wheeler, Esq.

1251 Avenue of the Americas, 18th Floor

New York, New York 10020

(212) 262-6700 (Telephone)

(212) 262-7402 (Facsimile)

-and-

65 Livingston Avenue

Roseland, New Jersey 07068

(973) 597-2500 (Telephone)

(973) 597-2400 (Facsimile)

Proposed Counsel to the Debtor and Debtor in Possession

UNITED STATES BANKRUPTCY COURT

SOUTHERN DISTRICT OF NEW YORK

	 	 	 	 	 
	 

	 	 	 	Chapter 11
	In re:
	 	 	 	 
	 

	 	 	 	Case No. 08-13589 (MG)
	IFL Corp.,
	 	 	 	 
	 
	 	 	 	 
	 

	 	Debtor.	 	 

NOTICE OF CURE AMOUNT WITH RESPECT TO EXECUTORY

CONTRACT OR UNEXPIRED LEASE TO BE ASSUMED AND ASSIGNED

          PLEASE TAKE NOTICE THAT:

          Pursuant to the Order Under 11 U.S.C. § 105(a) And Fed. R. Bankr. P. 2002 And 9014 Approving
(i) Bidding Procedures, (ii) Certain Bid Protections, (iii) Form And Manner Of Sale Notices, And
(iv) Sale Hearing Date (the “Bidding Procedures Order”) entered by the
United States Bankruptcy Court for the Southern District of New York (the “Bankruptcy
Court”) on October 10, 2008, the above-captioned debtor and debtor-in-possession (the
“Debtor”), hereby provides notice of its intent to assume and assign the executory
contracts or unexpired leases (the “Assumed Contracts”) listed on Exhibit 1
hereto to the Purchaser or Successful

 

 

Bidder with respect to the Debtor’s Assets. Capitalized terms used but not otherwise defined in
this notice shall have the meanings ascribed to them in the Bidding Procedures Order.

          On the Closing Date, or as soon thereafter as reasonably practicable, the Debtor will pay the
amount that the Debtor’s records reflect is owing for pre-petition arrearages as set forth on
Exhibit 1 (the “Cure Amount”). The Debtor’s records reflect that all
post-petition amounts owing under each Assumed Contract have been paid and will continue to be paid
until the assumption and assignment of each Assumed Contract and that, other than the Cure Amount,
there are no other defaults under any Assumed Contract.

          Objections, if any, to the proposed Cure Amount must (a) be in writing, (b) state with
specificity the cure asserted to be required, (c) include appropriate documentation thereof, (d)
conform to the Federal Rules of Bankruptcy Procedure, the Local Bankruptcy Rules for the Southern
District of New York, (e) be filed with the Bankruptcy Court in accordance with General Order M-242
(as amended) – registered users of the Bankruptcy Court’s case filing system must file
electronically, and all other parties-in-interest must file on a 3.5 inch disk (preferably in
Portable Document Format (PDF), WordPerfect, or any other Windows-based word processing format),
(f) be submitted in hard-copy form directly to the chambers of the Honorable Martin Glenn, United
States Bankruptcy Judge, United States Bankruptcy Court for the Southern District of New York, One
Bowling Green, Room 501, New York, New York 10004, and (g) be served in hard copy form within ten
days of service of this Notice upon (i) the Debtor, 38 Park Avenue, 2nd Floor, Rutherford, New
Jersey 07070 (Attn: Michael C. Keefe, Esq.), (ii) counsel for the Debtor, Lowenstein Sandler PC,
1251 Avenue of the Americas, 18th Floor, New York, New York 10022 (Attn: Sharon Levine,
Esq. and S. Jason Teele, Esq.), (iii) counsel for the Purchaser, Akin Gump Strauss Hauer & Feld
LLP, 1700 Pacific Ave, Suite 4100, Dallas, Texas 75201 (Attn: Robert W. Dockery, Esq. and Kevin D.
Rice, Esq.), and (vii) the United States Trustee for Region 2, 33 Whitehall Street, Suite 2100, New
York, New York 10004 (Serene Nakano, Esq.).

-2-

 

          To be considered timely, all objections must be filed and served in accordance with the
foregoing paragraph on or before ten (10) days from the date of this Notice.

          If an objection to the Cure Amount is timely filed, a hearing with respect to the objection
will be held before the Honorable Martin Glenn, United States Bankruptcy Judge, United States
Bankruptcy Court for the Southern District of New York, One Bowling Green, Room 501, New York, New
York 10004, at such date and time as the Court may schedule. A hearing regarding the Cure Amount,
if any, may be continued at the sole discretion of the Debtor until after the Closing Date.

          The failure of any objecting person or entity to timely file its objection shall be a bar to
the assertion, at the Sale Hearing or thereafter, of any objection to the Motion, the sale of the
Assets, or the Debtor’s consummation and performance of the Agreement (including the transfer of
the Assets and the Assumed Contracts free and clear of all Liens and Claims), if authorized by the
Court.

          Prior to the Closing Date, the Debtor or Successful Bidder may amend its decision with respect
to the assumption and assignment of the Assumed Contracts and provide a new notice amending the
information provided in this Notice.

	 	 	 
	 

	 	LOWENSTEIN SANDLER PC
	 
	 

	 	 
	 

	 	Sharon L. Levine, Esq.
	 

	 	S. Jason Teele, Esq.
	 

	 	Timothy R. Wheeler, Esq.
	 

	 	1251 Avenue of the Americas, 18th Floor
	 

	 	New York, New York 10020
	 

	 	(212) 262-6700 (Telephone)
	 

	 	(212) 262-7402 (Facsimile)
	 
	 	 
	 

	 	-and-
	 
	 	 
	 

	 	65 Livingston Avenue
	 

	 	Roseland, New Jersey 07068
	 

	 	(973) 597-2500 (Telephone)
	 

	 	(973) 597-2400 (Facsimile)

-3-

 

	 	 	 
	 

	 	Proposed Counsel to the Debtor and Debtor in Possession

Dated:                     , 2008

      New York, New York

-4-

 

Exhibit 4

Assumption Notice

 

 

LOWENSTEIN SANDLER PC

Sharon L. Levine, Esq.

S. Jason Teele, Esq.

Timothy R. Wheeler, Esq.

1251 Avenue of the Americas, 18th
Floor 

New York, New York 10020

(212) 262-6700 (Telephone)

(212) 262-7402 (Facsimile)

-and-

65 Livingston Avenue

Roseland, New Jersey 07068

(973) 597-2500 (Telephone)

(973) 597-2400 (Facsimile)

Proposed Counsel to the Debtor and Debtor in Possession

UNITED STATES BANKRUPTCY COURT

SOUTHERN DISTRICT OF NEW YORK

	 	 	 	 	 
	 

	 	 	 	Chapter 11
	In re:
	 	 	 	 
	 

	 	 	 	Case No. 08-13589 (MG)
	IFL Corp.,
	 	 	 	 
	 
	 

	 	Debtor.	 	 

NOTICE OF ASSUMPTION AND ASSIGNMENT

OF EXECUTORY CONTRACT OR UNEXPIRED LEASE 

          PLEASE TAKE NOTICE THAT:

          Pursuant to the Order Under 11 U.S.C. § 105(a) And Fed. R. Bankr. P. 2002 And 9014 Approving
(i) Bidding Procedures, (ii) Certain Bid Protections, (iii) Form And Manner Of Sale Notices, And
(iv) Sale Hearing Date (the “Bidding Procedures Order”) entered by the United States
Bankruptcy Court for the Southern District of New York (the “Bankruptcy Court”) on October
10, 2008, the above-captioned debtor and debtor-in-possession (the “Debtor”) has accepted the bid
of                      (the “Successful Bidder”) for the purchase of substantially all of the
Debtor’s assets (the “Assets”). The terms of the bid are set forth in the Asset Purchase
Agreement, dated as of                      ___, 2008 between the Debtor and the Successful Bidder

 

 

(the “Agreement”). Capitalized terms used but not otherwise defined in this notice shall
have the meaning ascribed to them in the Bidding Procedures Order.

          Pursuant to the terms of the Agreement, the Debtor will seek to assume and assign the
contracts and leases listed on Exhibit 1 hereto (the “Assumed Contracts”)
at the hearing to be held at 10:00 a.m. (Prevailing Eastern Time) on October 28, 2008 (the
“Sale Hearing”) before the Honorable Martin Glenn, United States Bankruptcy Judge,
United States Bankruptcy Court for the Southern District of New York, One Bowling Green, Room 501,
New York, New York 10004.

          Objections, if any, to the assumption and assignment of any Assumed Contract must (a) be in
writing, (b) state with specificity the asserted objection, (c) conform to the Federal Rules of
Bankruptcy Procedure, the Local Bankruptcy Rules for the Southern District of New York, (e) be
filed with the Bankruptcy Court in accordance with General Order M-242 (as amended) — registered
users of the Bankruptcy Court’s case filing system must file electronically, and all other
parties-in-interest must file on a 3.5 inch disk (preferably in Portable Document Format (PDF),
WordPerfect, or any other Windows-based word processing format), (f) be submitted in hard-copy form
directly to the chambers of the Honorable Martin Gless, United States Bankruptcy Judge, United
States Bankruptcy Court for the Southern District of New York, One Bowling Green, Room 501, New
York, New York 10004, and (g) be served in hard copy form within ten (10) days of service of this
Notice upon (i) the Debtor, 38 Park Avenue, 2nd Floor, Rutherford, New Jersey 07070 (Attn: Michael
C. Keefe, Esq.), (ii) counsel for the Debtor, Lowenstein Sandler PC, 1251 Avenue of the Americas,
18th Floor, New York, New York 10022 (Attn: Sharon Levine, Esq. and S. Jason Teele, Esq., (iii)
counsel for the Purchaser, Akin Gump Strauss Hauer & Feld LLP, 1700 Pacific Ave, Suite 4100,
Dallas, Texas 75201 (Attn: Robert W. Dockery, Esq. and Kevin D. Rice, Esq.), and (vii) the United
States Trustee for Region 2, 33 Whitehall Street, Suite 2100, New York, New York 10004, (Serene
Nakano, Esq.).

          If an objection to the assumption or assignment of an Assumed Contract is timely filed, a
hearing with respect to the objection will be held before the Honorable Martin Glenn,

-2-

 

United States Bankruptcy Judge, United States Bankruptcy Court for the Southern District of New
York, One Bowling Green, Room 501, New York, New York 10004, at the Sale Hearing or such date and
time as the Court may schedule.

          Objections to the assumption or assignment of an Assumed Contract must be filed and served in
accordance with the foregoing paragraph on or before two (2) days prior to the Sale Hearing.

	 	 	 
	 

	 	LOWENSTEIN SANDLER PC
	 
	 
	 	 
	 

	 	 
	 

	 	Sharon L. Levine, Esq. S.
	 

	 	Jason Teele, Esq. 
	 

	 	Timothy R. Wheeler, Esq.
	 

	 	1251 Avenue of the Americas, 18th Floor
	 

	 	 New York, New York 10020
	 

	 	(212) 262-6700 (Telephone)
	 

	 	(212) 262-7402 (Facsimile)
	 
	 	 
	 

	 	-and-
	 
	 	 
	 

	 	65 Livingston Avenue 
	 

	 	Roseland, New Jersey 07068 
	 

	 	(973) 597-2500 (Telephone) 
	 

	 	(973) 597-2400 (Facsimile)
	 
	 	 
	 

	 	Proposed Counsel to the Debtor and Debtor in Possession

Dated:                     , 2008 New York,

            New York

-3-

 

EXHIBIT D

BILL OF SALE

 

 

BILL OF SALE 

          This Bill of Sale dated                      ___, 2008 is executed and delivered by and among IFL
Corp., d/b/a International Fight League, a Delaware corporation (“Seller”) and HDNet LLC, a
Delaware limited liability company (“Buyer”). All capitalized words and terms used in this
Bill of Sale and not defined herein shall have the respective meanings ascribed to them in the
Asset Purchase Agreement, dated as of September 19, 2008, by and between the Seller and the Buyer
(the “Agreement”).

          WHEREAS, pursuant to the Agreement, the Seller has agreed to sell, transfer, convey, assign
and deliver to the Buyer the Assets for the consideration specified in the Agreement; and

          WHEREAS, the Agreement and the transactions contemplated therein were approved by the
Bankruptcy Court on October ___, 2008.

          NOW, THEREFORE, in consideration of the mutual promises set forth in the Agreement and other
good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the
Seller hereby agrees as follows:

          1. The Seller hereby sells, transfers, conveys, assigns and
delivers to the Buyer, its successors and assigns, to have and to hold forever, all right, title and interest in,
to and under all of the Assets.

          2. The Seller hereby covenants and agrees that it will, at the
request of the
Buyer and without further consideration, execute and deliver such other instruments of sale,
transfer, conveyance and assignment, and take such other action, as may reasonably be necessary to
more effectively sell, transfer, convey, assign and deliver to, and vest in, the Buyer, its
successors and assigns, good, clear, record and marketable title to the Assets hereby sold,
transferred, conveyed, assigned and delivered, or intended so to be, and to put the Buyer in actual
possession and operating control thereof, to assist the Buyer in exercising all rights with respect
thereto and to carry out the purpose and intent of the Agreement.

          3. The Seller does hereby irrevocably constitute and appoint the Buyer, its successors and
assigns, its true and lawful attorney, with full power of substitution, in its name or otherwise,
and on behalf of the Seller, or for its own use, to claim, demand, collect and receive at any time
and from time to time any and all of the Assets, and to prosecute the same at law or in equity and,
upon discharge thereof, to complete, execute and deliver any and all necessary instruments of
satisfaction and release as set forth in the Agreement.

          4. The Seller, by its execution of this Bill of Sale, and the Buyer, by its acceptance of this
Bill of Sale, each hereby acknowledges and agrees that neither the representations and warranties
nor the rights, remedies or obligations of any party under the Agreement shall be deemed to be
enlarged, modified or altered in any way by this instrument.

          5. This Bill of Sale may be executed in multiple counterparts, all of which, when executed and
delivered, shall be considered one and the same agreement.

D-1

 

     IN WITNESS WHEREOF, the Seller and the Buyer have caused this instrument to be duly executed
under seal as of and on the date first above written.

	 	 	 	 	 
	 	SELLER:

IFL CORP.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

	 	 	 	 	 
	ACCEPTED:	 	 
	 
	 	 	 	 
	BUYER:	 	 
	 
	 	 	 	 
	HDNet LLC	 	 
	 
	 	 	 	 
	By:
	 	 	 	 
	 

	 	 	 	 
	 

	 	Name:	 	 
	 

	 	Title:	 	 

D-2

 

EXHIBIT E

SALE ORDER

 

 

UNITED STATES BANKRUPTCY COURT

SOUTHERN DISTRICT OF NEW YORK

	 	 	 	 	 
	 

	 	 	 	Chapter 11
	In re:
	 	 	 	 
	 
	 

	 	 	 	Case No. 08-13589 (MG)
	IFL Corp.,
	 	 	 	 
	 
	 

	 	Debtor.	 	 

ORDER UNDER 11 U.S.C. §§ 363 AND 365 AND FED. R. BANKR. P. 2002, 6004, 6006,

AND 9014 (A) AUTHORIZING AND APPROVING (I) SALE OF SUBSTANTIALLY

ALL ASSETS OF THE DEBTOR FREE AND CLEAR OF LIENS, CLAIMS, AND

ENCUMBRANCES, (II) ASSUMPTION AND ASSIGNMENT OF CERTAIN

EXECUTORY CONTRACTS AND UNEXPIRED LEASES, AND (III) ASSUMPTION OF

CERTAIN LIABILITIES; AND (B) APPROVING RELATED COMPROMISES

          Upon the motion, dated September 19, 2008 (the “Motion”),1 of the
above-captioned debtor and debtor-in-possession (the “Debtor” or “Seller”) for
orders under 11 U.S.C. §§ 363 and 365 and Fed. R. Bankr. P. 2002, 6004, 6006, and 9014 (a)
approving (i) bidding procedures, (ii) certain bid protections, (iii) the form and manner of sale
notices, and (iv) the sale hearing date (the “Sale Hearing”), and (b) authorizing
and approving (i) the sale of substantially all of the Debtor’s assets (the “Assets”) free
and clear of liens, claims, and encumbrances (the “Sale”) to the Purchaser, (ii) the
assumption by the Seller and assignment to the Purchaser of certain executory contracts and
unexpired leases (collectively the “Assumed Contracts”), and (iii) the assumption
of certain liabilities (collectively, the “Assumed Liabilities”) by the Purchaser;
and the Court having reviewed the Motion; and the Court having entered on                      ___, 2008 an
Order approving (i) bidding procedures, (ii) certain bid protections, and (iii) the form and manner
of sale notices (Docket No. ___) (the “Bidding Procedures Order”); and upon
the record of the sale hearing (the “Sale Hearing”) conducted on                      ___,
2008; and upon the record in this chapter 11 case; and the Debtor, Purchaser and the Committee
having reviewed and agreed to

 

			
	1	 	Capitalized terms used but not otherwise defined herein shall have the meanings ascribed to them
in the Motion.

E-1

 

the terms of this Order; and it appearing that the relief sought by the Debtor, as modified by this
Order, is necessary and in the best interests of the Debtor, its creditors and bankruptcy estate
and other parties in interest; and due deliberation having been had, and sufficient cause appearing
therefor;

THE COURT HEREBY FINDS AND DETERMINES THAT: 2

          A. On September 15, 2008, (the “Petition Date”), the Debtor filed a voluntary petition for
reorganization under chapter 11 of title 11 of the United States Code (the “Bankruptcy
Code”).

          B. Since the Petition Date, the Debtor has continued in possession and management of its
assets and properties as a debtor in possession pursuant to sections 1107(a) and 1108 of the
Bankruptcy Code.

          C. No trustee or examiner has been appointed in the Debtor’s chapter 11 case.

         
D. On                     
___, the United States Trustee appointed an Official Committee of Unsecured Creditors (the
“Committee”).

          E. The Court has jurisdiction over the Motion pursuant to 28 U.S.C. §§ 157 and 1334. This
matter is a core proceeding pursuant to 28 U.S.C. § 157(b)(2)(A), (M) and (O). Venue of this case
and the Motion in this District is proper under 28 U.S.C. §§ 1408 and 1409.

          F. The statutory predicates for the relief sought in the Motion are sections 105(a), 363 and
365 of the Bankruptcy Code and Fed. R. Bankr. P. 2002, 6004, 6006 and 9014.

          G. As evidenced by the certificate of service previously filed with the Court, and based on
the representations of counsel for the Debtor at the Sale Hearing: (i) proper, timely, adequate and
sufficient notice of the Motion and the Sale Hearing has been provided in accordance with sections
102(1), 363 and 365 of the Bankruptcy Code, Fed. R. Bankr. P. 2002, 6004, 6006, 9007 and 9014, and
the Bidding Procedures Order; (ii) such notice was good and sufficient and appropriate under the
particular circumstances; and (iii) no other or further notice

 

			
	2	 	Findings of fact shall be construed as conclusions of law and conclusions of law shall be
construed as findings of fact where appropriate. See Fed. R. Bankr. P. 7052.

E-2

 

of the Motion, the Sale Hearing or the entry of this Order is required.

          H. A reasonable opportunity to object or be heard regarding the relief requested in the Motion
has been afforded to all interested persons and entities.

          I. The Seller is the sole and lawful owner of the Assets to be sold pursuant to the Agreement.

          J. Pursuant to the Bidding Procedures Order, on October 27, 2008 the Debtor conducted an
auction to receive and consider competing offers to purchase the Assets. No competing bids were
submitted.

          K. The offer of Purchaser to purchase the Assets is the highest and best offer received for
the sale of the Assets.

          L. The purchase price to be paid by Purchaser is fair and constitutes reasonably equivalent
value and reasonable market value for the Assets.

          M. Purchaser is a good faith purchaser with respect to the Assets, as that term is used in
section 363(m) of the Bankruptcy Code. The Agreement was negotiated, proposed and entered into by
the parties in good faith, from arm’s length bargaining positions and without collusion, and the
Purchaser therefore is entitled to the protections of section 363(m) of the Bankruptcy Code with
respect to the Assets. Neither the Debtor nor the Purchaser have engaged in any conduct that would
cause or permit the Agreement to be voided under section 363(n) of the Bankruptcy Code.

          N. Except as specifically provided in the Agreement or this Order, Purchaser shall not assume
or become liable for any Pre-Closing Date liens, claims, interests and/or encumbrances relating to
the Assets being sold by the Seller unless expressly stated in the Agreement or this Order. Any
valid and enforceable liens, claims, interests and/or encumbrances shall attach to the proceeds of
the sale with the same priority, validity, and enforceability as they had immediately before the
closing of the sale.

          O. The Debtor has articulated sound business reasons for entering into the Agreement and
selling the Assets as set forth in the Motion outside of a chapter 11 plan, and it is

E-3

 

a reasonable exercise of the Debtor’s business judgment to execute, deliver and consummate the
Agreement with the Purchaser and consummate the transactions contemplated by the Agreement and as
set forth in this Order.

          P. The Seller may sell the Assets free and clear of all liens, claims, interests and/or
encumbrances because, in each case, one or more of the standards set forth in section 363(f)(1)-(5)
of the Bankruptcy Code has been satisfied. The Assets are not encumbered by any liens, claims,
interests and/or encumbrances. No party asserted any liens, claims, interests and/or encumbrances
in or to the Assets and no such party objected to the sale or the Motion (any such objections
having been withdrawn or resolved). Thus, all such holders are deemed to have consented to the
sale and the Motion pursuant to section 363(f)(2) of the Bankruptcy Code.

          Q. The terms and conditions of the Agreement, including the total consideration to be realized
by the Seller pursuant to the Agreement, are fair and reasonable, and the transactions contemplated
by the Agreement, as modified by this Order, are in the best interests of the Debtor, its creditors
and estate.

          R. A valid business purpose exists for approval of the transactions contemplated by the Motion
pursuant to sections 105, 363(b), (f), and (m) of the Bankruptcy Code. The Seller may sell,
transfer and assign the Assets free and clear of all liens, claims, interests and/or encumbrances
in accordance with sections 105 and 363 of the Bankruptcy Code. As a condition to purchasing the
Assets, the Purchaser requires that (a) the Assets be sold free and clear of all liens, claims,
encumbrances, options, rights of first refusal and other interests; and (b) the Purchaser shall
have no liability whatsoever for any obligations of or claims (including without limitation as
defined in section 101(5) of the Bankruptcy Code) against the Seller except those expressly assumed
in the Agreement or by this Order. Purchaser would not enter into the Agreement and consummate the
transactions contemplated by the Agreement, thus adversely affecting the Debtor’s estate, if the
sale to Purchaser was not free and clear of all such liens, claims, encumbrances, options, rights
of first refusal and other interests or if Purchaser was or would be liable for any such
obligations of or claims (including, without limitation, as defined

E-4

 

in section 101(5) of the Bankruptcy Code) against the Seller, except as otherwise explicitly
provided in the Agreement or this Order.

          S. The transfer of the Assets to the Purchaser is or will be a legal, valid and effective
transfer of the Assets, and will vest the Purchaser with all right, title and interest in and to
the Assets, free and clear of all liens, claims, interests and/or encumbrances, except those
explicitly and expressly excluded by the Purchaser in the Agreement or this Order.

          T. A valid business purpose exists for approval of the assumption and assignment of the
Assumed Contracts by the Seller to the Purchaser in accordance with section 365 of the Bankruptcy
Code.

          U. The requirements of sections 363(b) and 363(f) of the Bankruptcy Code and any other
applicable law relating to the sale of the Assets have been satisfied.

          V. The Court takes judicial notice of the record in this case including, without limitation,
the Bidding Procedures Order.

          NOW, THEREFORE, IT IS HEREBY ORDERED, ADJUDGED AND DECREED THAT:

A. Sale of Assets Approved; Transactions Authorized.

          1. The Motion is granted.

          2. All objections to the Motion or the relief requested therein that have not been withdrawn,
waived, or settled, and all reservations of rights included in such objections, are overruled on
the merits and denied.

          3. The Motion, Agreement and the transactions contemplated thereby are approved as modified by
this Order, and the Seller is hereby authorized and empowered to enter into, and to perform their
obligations under, the Agreement and to act as necessary to effectuate the terms of the Agreement,
without further corporate authorization or Order of this Court.

          4. The Seller is hereby authorized and empowered, pursuant to sections 105 and 363(b) and (f)
of the Bankruptcy Code, to sell the Assets to the Purchaser pursuant to and in accordance with the
terms and conditions of the Agreement and this Order; and pursuant to

E-5

 

sections 105 and 363 of the Bankruptcy Code, title to the Assets shall pass to Purchaser at the
closing free and clear of any and all liens (including mechanics’, materialmens’ and other
consensual and non-consensual liens and statutory liens), security interests, encumbrances and
claims (including, but not limited to, any “claim” as defined in section 101(5) of the Bankruptcy
Code), reclamation claims, mortgages, deeds of trust, pledges, covenants, restrictions,
hypothecations, charges, indentures, loan agreements, instruments, contracts, leases, licenses,
options, rights of first refusal, rights of offset, recoupment, rights of recovery, judgments,
orders and decrees of any Court or foreign or domestic governmental entity, claims for
reimbursement, contribution, indemnity or exoneration, assignment, debts, charges, suits, rights of
recovery, interests, products liability, alter-ego, environmental, successor liability, tax and
other liabilities, causes of action and claims, to the fullest extent of the law, in each case
whether secured or unsecured, choate or inchoate, filed or unfiled, scheduled or unscheduled,
noticed or unnoticed, recorded or unrecorded, perfected or unperfected, allowed or disallowed,
contingent or non-contingent, liquidated or unliquidated, matured or unmatured, material or
non-material, disputed or undisputed, or known or unknown, whether arising prior to, on, or
subsequent to the Petition Date and through the Closing Date, whether imposed by agreement,
understanding, law, equity or otherwise (collectively, the “Liens and
Claims”), with all such Liens and Claims upon the Assets to be unconditionally released,
discharged and terminated; provided that all such Liens and Claims shall attach to the proceeds of
the transaction with the same priority, validity, force and effect as they existed with respect to
the Assets prior to closing, except as may be expressly set forth herein.

          5. The Seller and Purchaser are authorized to modify, amend and/or supplement the Agreement to
conform to the terms of this Order and any modifications stated on the record at the Sale Hearing.

B. Transfer Of The Assets To Purchaser.

          6. The transfer of the Assets to Purchaser pursuant to the Agreement constitutes a legal,
valid and effective transfer and shall vest Purchaser with all right, title and

E-6

 

interest of the Seller in and to the Assets so transferred.

          7. This Order and the Agreement shall be binding upon, and shall inure to the benefit of, the
Seller and Purchaser and their respective successors and assigns, including, without limitation,
any chapter 11 trustee hereinafter appointed for the Seller or any trustee appointed in a chapter 7
case if the Debtor’s case is converted from chapter 11.

          8. On the date of the closing of the transactions contemplated
by the
Agreement (the “Closing Date”), each of the creditors of the Debtor is authorized
and directed to execute such documents and take all other actions as may be necessary to release
its Liens and Claims against or in the Assets, if any, as such Liens and Claims may have been
recorded or may otherwise exist.

          9. If any person or entity that has filed financing statements, mortgages, mechanic’s liens,
lis pendens, or other documents or agreements evidencing Liens and Claims against or in the Assets
shall not have delivered to the Debtor prior to the Closing Date, in proper form for filing and
executed by the appropriate parties, termination statements, instruments of satisfaction, and
releases of all Liens and Claims that the person or entity has with respect to the Assets, the
Debtor is hereby authorized and directed to execute and file such statements, instruments, releases
and other documents on behalf of the person or entity with respect to the Assets.

          10. Effective upon the Closing Date, all parties and/or entities asserting Liens and Claims
and contract rights against the Seller and/or any of the Assets are hereby permanently enjoined and
precluded from, in each case only with respect to such Liens and Claims: (i) asserting, commencing
or continuing in any manner any action against the Purchaser or any of its current or former
directors, officers, agents, representatives or employees (collectively, the “Protected
Parties”) or against any Protected Party’s assets or properties, including without
limitation the Assets; (ii) the enforcement, attachment, collection or recovery, by any manner or
means, of any judgment, award, decree or order against the Protected Parties or any properties or
assets of the Protected Parties, including without limitation the Assets; (iii) creating,
perfecting

E-7

 

or enforcing any encumbrance of any kind against the Protected Parties or any properties or assets
of the Protected Parties, including without limitation the Assets; (iv) asserting any setoff, right
of subrogation or recoupment of any kind against any obligation due the Protected Parties; and (v)
taking any action, in any manner, in any place whatsoever, that does not conform to or comply with
the provisions of this Order or the Agreement.

          11. The provisions of this Order authorizing the sale of the Assets free and clear of Liens
and Claims (with such Liens and Claims to attach to the proceeds of the sale of the Assets as
provided in this Order) shall be self-executing, and neither the Seller, the Purchaser nor any
other party shall be required to execute or file releases, termination statements, assignments,
cancellations, consents or other instruments to effectuate, consummate and/or implement the
provisions hereof with respect to such sale; provided, however, that this paragraph
shall not excuse such parties from performing any and all of their respective obligations under the
Agreement or this Order. Without in any way limiting the foregoing, Purchaser is empowered to
execute and file releases, termination statements, assignments, consents, cancellations or other
instruments to effectuate, consummate and/or implement the provisions hereof with respect to such
sale.

          12. Consummation of the Agreement and the transactions contemplated therein and thereby will
not effect a de facto merger or consolidation of the Seller and the Purchaser or result in the
continuation of the Seller’s business under the Purchaser’s control.

          13. All entities who are presently, or on the Closing Date may be, in possession of some or
all of the Assets are hereby directed to surrender possession of the Assets to the Purchaser on the
Closing Date.

C. Assumption And Assignment Of Assumed Contracts Authorized.

          14. The requirements of section 365(b) of the Bankruptcy Code having been satisfied, the
Seller is hereby authorized and empowered to assume and assign and sell the Assumed Contracts to
the Purchaser under the Agreement free and clear of all Liens and Claims pursuant to sections 363
and 365 of the Bankruptcy Code.

E-8

 

          15. Pursuant to section 365(k) of the Bankruptcy Code, effective upon the assignment of the
Assumed Contracts to the Purchaser hereunder, the Seller shall be relieved from any further
obligations under or related to the Assumed Contracts.

D. Good Faith Purchase.

          16. The purchase by Purchaser is a purchase in good faith for fair value within the meaning of
section 363(m) of the Bankruptcy Code, and Purchaser is entitled to all of the protections afforded
good faith purchasers by section 363(m) of the Bankruptcy Code.

          17. The sale approved by this Order is not subject to avoidance pursuant to section 363(n) of
the Bankruptcy Code. The consideration provided by Purchaser for the Assets under the Agreement
shall be deemed to constitute reasonably equivalent value and fair consideration.

E. Maintenance Of Financial Records; Access Thereto.

          18. Notwithstanding anything to the contrary contained in the Agreement, all financial books
and records of Seller which remain in the possession of Purchaser after the Closing Date (the
“Financial Records”), are subject to the right of the Debtor, the Committee and any
subsequently appointed trustee (including without limitation a trustee appointed pursuant to a plan
of reorganization to liquidate the Debtor’s remaining assets) to review and copy the Financial
Records, at such trustee’s sole cost and expense, during normal business hours and upon reasonable
notice until the date the Debtor’s bankruptcy case are closed or dismissed by Order of the Court.

          19. The Purchaser agrees that prior to destroying or otherwise disposing of any of the
Financial Records, Purchaser shall provide written notice to the Debtor (as provided for in the
Agreement) and/or the Committee or any trustee appointed, of its intent to dispose of or destroy
the Financial Records. The Seller and/or Committee or trustee appointed shall have thirty (30) days
from the date notice is given to take possession of or copy the Financial Records, at their sole
cost and expense.

E-9

 

F. Additional Decretals.

          20. The recitals and findings of facts set forth above are hereby incorporated as a part of
this Order.

          21. As provided by Fed. R. Bankr. P. 6004(h), 6006(d) and 7062, this Order shall be effective
and enforceable immediately upon entry.

          22. The provisions of this Order are nonseverable and mutually dependent.

          23. Nothing
contained in any plan of reorganization (or liquidation) confirmed in this case or the order of
confirmation confirming any such plan shall conflict with or derogate from the provisions of the
Agreement or the terms of this Order.

          24. This Order shall be binding upon and inure to the benefit of the Debtor, Purchaser,
Committee, and each of their respective former, present, and future assigns, predecessors,
successors, affiliates, parent companies, subsidiaries, controlled companies, employees, officers,
directors, shareholders, principals, members or agents, whether a signatory hereto or not,
including, but not limited to, any subsequently appointed trustee (including without limitation a
chapter 7 trustee).

          25. This Court shall retain exclusive jurisdiction to enforce the provisions of this Order and
the Agreement and to resolve any dispute concerning this Order, the Agreement, or the rights and
duties of the parties hereunder or thereunder or any issues relating to the Agreement and this
Order, including, but not limited to, interpretation of the terms, conditions and provisions
thereof, and the status, nature and extent of the Assets, and all issues and disputes arising in
connection with the relief authorized herein, inclusive of those concerning the transfer of the
Assets free and clear of Liens and Claims.

          26. The Debtor, Purchaser, and Committee expressly understand and agree that the Agreement and
this Order, together, constitute the entire understanding and agreement between the parties, and
supersede and replace all other prior negotiations, agreements or understandings between the
parties, whether written or oral, relating to the subject matter hereof. Each of the parties
acknowledges and represents that no other party or agent or attorney of any

E-10

 

other party has made a promise, representation, or warranty whatsoever, express or implied, not
contained herein concerning the subject matter of the Agreement or this Order. Each party
acknowledges and represents that it has not agreed to this Order in reliance upon any promise,
representation or warranty whatsoever not expressly set forth in the Agreement or this Order.

          27. The division of this Order into sections or other subdivisions and the insertion of
headings are for convenience of reference only and shall not affect or be utilized in construing or
interpreting this Order.

          28. Each person signing this Order as an agent or representative of any party hereby covenants
and warrants to the Court and the other parties that he or she is fully authorized to sign this
Order on behalf of the party he or she represents and is fully authorized to bind that Party to all
of the terms of this Order.

Agreed To By:

	 	 	 	 	 	 	 
	Dated:                      __, 2008	 	IFL CORP.	 	 
	 	 	Debtor and Debtor-in-Possession	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ DRAFT	 	 
	 

	 	 	 	 	 	 
	 	 	Sharon L. Levine, Esq.	 	 
	 	 	S. Jason Teele, Esq. 	 	 
	 	 	Timothy R. Wheeler, Esq.	 	 
	 	 	LOWENSTEIN SANDLER PC	 	 
	 	 	1251 Avenue of the Americas, 18th Floor New	 	 
	 	 	York, New York 10020	 	 
	 	 	Tel: (212) 262-6700	 	 

	 	 	 	 	 	 	 
	Dated:                      __, 2008	 	HD NET LLC	 	 
	 	 	Purchaser	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ DRAFT	 	 
	 

	 	 	 	 	 	 
	 	 	Robert W. Dockery, Esq.	 	 
	 	 	Kevin D. Rice, Esq.	 	 
	 	 	AKIN GUMP STRAUSS HAUER & FELD LLP	 	 
	 	 	1700 Pacific Ave, Suite 4100	 	 
	 	 	Dallas, Texas 75201	 	 

E-11

 

	 	 	 	 	 	 	 
	Dated:                      __, 2008	 	OFFICIAL COMMITTEE OF UNSECURED	 	 
	 	 	CREDITORS FOR IFL CORP.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ DRAFT	 	 
	 

	 	 	 	 	 	 
	 	 	[To Be Inserted As Appropriate]	 	 
	 
	 	 	 	 	 	 
	THE FOREGOING IS HEREBY ORDERED:
	 	 	 	 	 	 
	 
	Dated:                      ___, 2008 

            New York, New York
	 	 	 	 	 	 
	 
	 	 	 	 	 
	 	 	Honorable Martin Glenn	 	 
	 	 	United States Bankruptcy Judge	 	 

E-12

 

EXHIBIT F

NAME USE AGREEMENT

 

 

NAME USE AGREEMENT 

          This Name Use Agreement is dated as of October ___, 2008 is executed and delivered by and
among IFL Corp., d/b/a International Fight League, a Delaware corporation (“Seller”),
International Fight League, Inc. (“Parent”) and HDNet LLC, a Delaware limited liability
company (“Buyer”). All capitalized words and terms used in this Trade Name Use Agreement
and not defined herein shall have the respective meanings ascribed to them in the Asset Purchase
Agreement, dated as of September ___, 2008, by and between the Seller and the Buyer (the
“Agreement”).

          WHEREAS, pursuant to the Agreement, on the Closing Date, Buyer is the sole and exclusive owner
of the trademark “International Fight League” (the “Mark”);

          WHEREAS, Seller, Parent and Buyer have agreed that, from and after the Closing Date, Parent
shall be entitled to retain and utilize, without license, royalty, fee, assessment or other charge,
the Mark solely for use as Parent’s corporate name until Parent becomes engaged in an active trade
or business; provided that, from and after the Closing Date, Parent shall utilize the Mark
solely for general corporate purposes and not in any trade or business.

          NOW, THEREFORE, in consideration of the premises and the mutual promises and undertakings
herein contained, and for other good and valuable consideration, the parties agree as follows:

          1. Grant of Mark By Buyer. Buyer grants to Parent the non-exclusive, non-transferrable
right to use the Mark as its corporate name during the Term (defined below), provided that Parent
shall utilize the Mark solely for general corporate purposes and not in any trade or business.

          2. Term. This Name Use Agreement shall commence on the Closing Date and terminate on
the earlier of (i) the date on which Parent becomes engaged in any active trade or business other
than activities constituting general corporate purposes and (ii) two (2) years after the date
hereof (the “Term”).

          3. Reservation of Rights. Except for the limited rights herein expressly granted to
Parent, all rights in the Mark are reserved to Buyer throughout the world for the sale and
exclusive use or other disposition by Buyer at anytime, and from time to time, without any
obligation to Seller or Parent.

          4. Transfer Prohibited. Neither the Mark nor the use of the Mark granted hereunder
shall be assigned, sublicensed, or otherwise transferred by Parent without the prior written
consent of Buyer. In the event of a prohibited transfer, Buyer shall have the right to terminate
this Name Use Agreement forthwith by written notice to Grantee.

          5. Rights Upon Termination. Upon the termination (by expiration or otherwise) of this
Name Use Agreement, for any reason, all rights granted to Parent hereunder shall automatically
revert to Buyer for its use or disposition. Upon termination, Parent shall promptly cease use of
the Mark. Without limiting the foregoing, upon termination or expiration of this Name Use Agreement
for any reason, Buyer shall have no liability for reimbursement or for damages for loss of
goodwill, or on account of any expenditures, investments, leases, or commitments made by Parent.
Parent acknowledges and agrees that it has no expectation and

F-1

 

has received no assurances that its relationship with Buyer will continue beyond the Term or its
earlier termination as set forth herein, that any investment in the Mark by Parent will be
recovered or recouped, or that Parent shall obtain any anticipated amount of profits by virtue of
this Name Use Agreement.

          6. No Franchise or Joint Venture. The parties expressly acknowledge that this Name
Use Agreement shall not be deemed to create an agency, partnership, franchise, employment, or joint
venture relationship between Parent and Buyer. Nothing in this Name Use Agreement shall be
construed as a grant of authority to Parent to waive any right, incur any obligation or liability,
enter into any agreement, grant any release or otherwise purport to act in the name of Buyer.

          7. Ownership; Form of Use. Parent acknowledges that Buyer owns all right, title, and
interest in and to the Mark and agrees that it will do nothing inconsistent with such ownership.
Parent agrees that nothing in this Name Use Agreement shall give it any right, title, or interest
in the Mark other than the right to use it in accordance with this Name Use Agreement, and Parent
agrees that it will not attack the title of Buyer to the Mark or attack the validity of this Name
Use Agreement.

          8. Waiver; Modification. No wavier or modification of any of the terms of this Name
Use Agreement shall be valid unless in writing. No waiver by any party of a breach hereof or a
default hereunder shall be deemed a waiver by such party of a subsequent breach or default of like
or similar nature.

          9. Notices. Notices and other communications required or permitted to the given under
this Agreement shall be in writing and delivered by hand or overnight delivery, or placed in
certified or registered mail, return receipt requested, at the addresses specified below or such
other address as either party may, by notice to the other, designate:

If to Buyer, to:

HDNet LLC

320 South Walton Street

Dallas, Texas 75226

Attn: Robert Thoele

Facsimile: 214-571-9221

with a copy to (which shall not constitute notice):

Alvin Gump Strauss Hauer & Feld LLP

1700 Pacific Ave, Suite 4100

Dallas, Texas 75201

Attn: Robert W. Dockery, Esq. and Kevin D. Rice, Esq.

Facsimile: 214-969-4343

If to Seller, to:

IFL Corp.

38 Park Avenue, 2nd Floor

F-2

 

Rutherford, New Jersey 07070

Attn: Michael Keefe

Facsimile: 201-635-1801

with a copy to (which shall not constitute notice):

Lowenstein Sandler PC

1251 Avenue of the Americas, 18th Floor

New York, New York 10022

Attn: Sharon L. Levine, Esq. and S. Jason Teele, Esq.

Facsimile: 973-597-2400

If to Parent, to:

International Fight League, Inc.

38 Park Avenue, 2nd
Floor 

Rutherford, New Jersey 07070

Attn: Michael Keefe

Facsimile: 201-635-1801

Notices and other communications shall be deemed given when delivered by hand or overnight delivery
to the proper address or the date of the return receipt, as provided above.

          10. Governing Laws. This Name Use Agreement shall be governed by, and construed in
accordance with, the laws of the State of Delaware applicable to contracts executed in and to be
performed in that State.

          11. This Name Use Agreement may be executed in multiple counterparts, all of which, when
executed and delivered, shall be considered one and the same agreement.

          IN WITNESS WHEREOF, the parties hereto have caused this Name Use Agreement to be executed the
day and year first above written.

	 	 	 	 	 	 	 
	 	 	BUYER:	 	 
	 
	 	 	 	 	 	 
	 	 	HDNet LLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 	 	Name:	 	 
	 	 	Title:	 	 

F-3

 

	 	 	 	 	 	 	 
	 	 	SELLER:	 	 
	 
	 	 	 	 	 	 
	 	 	IFL Corp.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 	 	Name:	 	 
	 	 	Title:	 	 
	 
	 	 	 	 	 	 
	 	 	PARENT:	 	 
	 
	 	 	INTERNATIONAL FIGHT LEAGUE, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 	 	Name:	 	 
	 	 	Title:	 	 

F-4EX-10.1

 
                                                                                                                                      EXHIBIT
10.1

Effective July 16, 2008

Robert B. Willumstad,

      American International Group, Inc.,

          70 Pine Street,

                New York, New York 10270.

Bob,

I am pleased to confirm some of the material terms of your arrangements with American International
Group, Inc. The Board reiterates its confidence that you are the right leader to build on AIG’s
core strengths and successfully manage it through the current environment.

We have agreed as follows:

	 	1.	 	You have been elected Chairman and Chief Executive Officer of AIG, report
directly (and only) to the Board and have all of the customary authorities, duties and
responsibilities that accompany these positions.
	 
	 	2.	 	You will receive a base salary of $1 million per year, which may be reviewed
and increased in accordance with AIG’s standard policies but may not be decreased.
	 
	 	3.	 	Your target annual cash bonus will be $8 million. Your actual cash bonuses
may range from $0 to $12 million, except that, for 2008, your minimum annual cash
bonus will be $4 million. The guaranteed minimum part of your 2008 bonus will be
deferred as a contribution to AIG’s Executive Deferred Compensation Plan.
	 
	 	4.	 	The target economic value for your annual long-term incentive will be
$13 million. Annual long-term grants will begin for 2009.
	 
	 	5.	 	After 2009, your target annual cash bonus and target annual long-term
incentive may be reviewed and changed from time to time in accordance with AIG’s
standard policies.
	 
	 	6.	 	As a special one-time award, you were granted restricted shares and options
as follows:

 

 

	 	•	 	A grant of non-qualified stock options valued at $12.0 million to purchase
AIG shares at a price per share equal to 100% of the closing price of AIG
shares on the New York Stock Exchange on the grant date. One-third of the
grant will become exercisable based on continued service (in three equal
installments on each anniversary of the grant date), one-third will become
exercisable only if the closing price of AIG shares is at least 125% of the
exercise price of the options for 15 consecutive trading days on which the
stock of AIG is traded, and one-third will become exercisable only if the
closing price of AIG shares is at least 150% of the exercise price of the
options for 15 consecutive trading days on which the stock of AIG is traded.
	 
	 	•	 	A grant of restricted shares in respect of AIG shares having a value based
on the closing price on the grant date, of $24.5 million. The grant will vest
based on continued service (with one-third of the restricted shares vesting and
delivered to you on each of the second, third and fourth anniversary of the
grant date) and pay dividends currently.

	 	 	 	These grants were made on July 16th, 2008, and will not be eligible for
AIG’s customary retirement treatment when you reach age 65. However, they will be
entitled to continued exercisability/vesting/delivery if you retire with the consent
of the AIG’s Compensation and Management Resources Committee (which you may request
at any age and which will not be unreasonably withheld) or if your employment
terminates in a manner that entitles you to benefits under AIG’s Executive Severance
Plan. In addition, exercisability/vesting/delivery will accelerate on your death or
termination for disability. For the avoidance of doubt, however, the price vesting
requirements of the stock options will continue to apply in all cases to the
relevant parts of the grant, and the stock options will remain exercisable for their
full remaining term on any termination that results in accelerated or continued
vesting.
	 
	 	 	 	The grants contain a one-year non-competition agreement, a two-year non-solicitation
agreement, a mutual non-disparagement agreement, a confidentiality agreement and a
cooperation agreement. These restrictive covenants will apply following any
termination of your employment as the only covenants of such types that will apply
to you for all purposes, including (unless you agree otherwise in writing) in
connection with any equity or long-term incentive awards to you after the date
hereof (and supersede the restrictive covenants in other awards, agreements or plans
that would otherwise apply to you). Any continued vesting of the grants in this
Section 6 will be subject to your compliance with such restrictive covenants.
Except as set forth in this letter, the terms and valuation of these awards were in
accordance with AIG’s customary practice.
	 
	 	7.	 	The equity grants described in Section 6 are subject to more detailed award
agreements AIG is issuing to you. These agreements will be

-2-

 

	 	 	 	consistent with this letter and, once accepted and returned by you, shall govern.
	 
	 	8.	 	You will be entitled to participate in AIG’s executive benefits program as in
effect from time to time. However, AIG will work with you and your advisors to
determine jointly if it is most advantageous to you to provide an alternative to your
participation in AIG’s pension plans. You also will be entitled to receive
perquisites in accordance with AIG’s practice as in effect from time to time (which
will initially include the provision of a car and driver and assistance with financial
and tax planning). In addition, AIG’s current policy requires that you use corporate
aircraft for personal travel.
	 
	 	9.	 	We would like to take this opportunity to clarify certain aspects of AIG’s
programs, as they will apply to you. First, you will participate in AIG’s Executive
Severance Plan (the “ESP”) beginning as of the date hereof notwithstanding that you
will not be a participant in AIG’s Partners Plan for 2008, and, until cash bonuses are
paid in respect of 2009 (your first full year of employment), your target bonus of
$8,000,000 will serve as your average historic annual bonus for purposes of the
Executive Severance Plan (and, after that time, 2008 will be disregarded). Second,
the events that constitute “Good Reason” for purposes of the ESP, in addition to those
events constituting Good Reason in the ESP as currently in effect (but subject to the
following sentence), shall include (1) your ceasing to serve as Chief Executive
Officer of AIG or ceasing to have all of the customary authorities, duties and
responsibilities that accompany that position (other than in connection with the
termination of your employment), (2) (a) the position of Chairman of AIG is other than
a non-executive position (whether by bylaw designation or otherwise) and (b) you do
not hold the position of Chairman of AIG, (3) any material reduction in your target
annual cash bonus opportunity or the target annual economic value of your long-term
incentive opportunity below the target amounts in this letter and (4) any revocation
or material breach of this letter (provided that as to any such event described in
these clauses (1) through (4), any relevant notice and opportunity-to-cure provisions
are complied with). However, notwithstanding any provision of the ESP to the
contrary, except in the circumstance described in clause (2) above, your ceasing to
serve as Chairman of AIG shall not constitute “Good Reason” for purposes of the ESP.
The ESP definition of “Good Reason,” as provided in this Section 9, shall also be the
definition of “Good Reason,” now and in the future, for purposes of any other
agreement, plan or award to or with you (whether such agreement, plan or award exists
on the date hereof or arises in the future). Third, you will be eligible for
retirement treatment under AIG’s annual equity and long-term awards when you reach age
65, without any additional length-of-service requirement. Fourth, on your retirement
with the consent of the Committee before age 65 or your retirement at or after age 65,
or if your employment terminates in a manner that entitles you to benefits under AIG’s
Executive Severance Plan, AIG will provide you benefit coverage (and applicable
Company contributions, if any) under its retiree medical and

-3-

 

	 	 	 	life programs then in effect (subject, if you are not otherwise eligible to
participate in the retiree medical or life programs in accordance with their
generally applicable terms, to your being imputed income to the extent required by
applicable tax law for the cost of such coverage in excess of any contribution made
by you in accordance with the terms of the applicable program) and will provide you,
with no cost to you, with access to an appropriate office and full-time secretarial
support for one year following your termination. Fifth, with respect to the
deferral of your minimum annual cash bonus for 2008 under AIG’s Executive Deferred
Compensation Plan (the “EDCP”), (i) once contributed by AIG at the time when annual
cash bonuses are paid to other senior executives in respect of 2008 (but such
contribution shall, in any event, occur no later than March 31, 2009), your interest
in the amount so deferred under the EDCP, and all investment earnings credited
thereto under the EDCP, shall be nonforfeitable at all times; (ii) your execution of
this letter shall be treated for purposes of the EDCP as an election by you to have
such deferred annual cash bonus amount, and all investment earnings credited thereto
under the EDCP, distributed to you in a cash lump sum upon your separation from
service for any reason by a date which is no later than 15 days following the date
of your separation from service or, if a delay in distribution beyond such time is
required under Section 409A(a)(2)(B)(i) of the Internal Revenue Code (the “Code”),
on the earliest date thereafter on which distribution could be made without
violating the requirements of such section; (iii) you will have all the investment
elections available under the EDCP; and (iv) on or before December 31, 2008, AIG
will amend the EDCP, to the extent necessary (in the reasonable judgment of AIG, you
and AIG’s and your respective counsel) to give effect to the foregoing, including
compliance with all requirements of Section 409A of the Code applicable to your
interest under the EDCP.
	 
	 	10.	 	Any contest or dispute between AIG and you relating to this letter or your
other employment arrangements with AIG (including termination of your employment) will
be finally settled by arbitration subject to the terms set forth in Annex
A to this letter. In addition, in the event of any such contest or dispute,
AIG will reimburse 100% of your reasonable legal fees if you substantially prevail.
In connection with your acceptance of these terms, AIG also will promptly pay
reasonable legal fees incurred in connection with your review of these arrangements
and the matters contemplated by Section 8 and 9. To the extent any taxable expense
reimbursement or in-kind benefits under Section 9 or this Section 10 is subject to
Section 409A of the Code, the amount thereof eligible in one taxable year shall not
affect the amount eligible for any other taxable year, in no event shall any expenses
be reimbursed after the last day of the taxable year following the taxable year in
which you incurred such expenses and in no event shall any right to reimbursement or
receipt of in-kind benefits be subject to liquidation or exchange for another benefit.
	 
	 	11.	 	During and after your employment hereunder, AIG will indemnify you in your
capacity as a director, officer, employee or agent of AIG to the
	 	 	 	fullest extent permitted by applicable law and AIG’s charter and by-laws, and will
provide you with director and officer liability insurance coverage on the same basis
as AIG’s other directors and executive officers.
	 
	 	12.	 	AIG represents and warrants to you that all necessary corporate and other
action has been taken to authorize the execution, delivery and performance by AIG of
this letter (including supplements and/or amendments to AIG’s plans to provide you
with the rights described in this letter).

-4-

 

          We look forward to your continued leadership.

	 	 	 	 	 
	 	Very truly yours,

American International Group, Inc.

 	 
	 	By:  	/s/
James F. Orr III	 
	 	 	Name:  	James F. Orr III	 
	 	 	Title:  	Chairman of the Compensation and Management
Resources Committee	 
	 

I agree with and accept the foregoing terms.

	 	 	 
	/s/ Robert B. Willumstad 
	 

Robert B. Willumstad

	 	 

-5-

 

Annex A

Arbitration; Choice of Forum

     (a) Any contest or dispute between AIG and you arising out of or relating to or concerning
this letter or your other employment arrangements with AIG (including termination of your
employment) shall be submitted for settlement to arbitration in New York City before, and in
accordance with the commercial arbitration rules then obtaining of, the American Arbitration
Association (the “AAA”). This paragraph is subject to the provisions of Paragraphs (b) and (c)
below.

     (b) AIG AND YOU HEREBY IRREVOCABLY SUBMIT TO THE EXCLUSIVE JURISDICTION OF ANY STATE OR
FEDERAL COURT LOCATED IN THE CITY OF NEW YORK OVER ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO OR CONCERNING THIS LETTER OR YOUR OTHER EMPLOYMENT ARRANGEMENTS WITH AIG (INCLUDING
TERMINATION OF YOUR EMPLOYMENT) THAT IS NOT OTHERWISE ARBITRATABLE OR RESOLVED ACCORDING TO
PARAGRAPH (a) OF THIS ANNEX. This includes any suit, action or proceeding to compel arbitration or
to enforce an arbitration award. AIG and you acknowledge that the forum designated by this
Paragraph (b) has a reasonable relation to this letter and to your relationship with AIG.

     (c) The agreement by you and AIG as to forum is independent of the law that may be applied in
the action, suit or proceeding, and you and AIG agree to such forum even if the forum may under
applicable law choose to apply non-forum law. You and AIG hereby waive, to the fullest extent
permitted by applicable law, any objection which you or AIG now or hereafter may have to personal
jurisdiction or to the laying of venue of any such suit, action or proceeding in any court referred
to in Paragraph (b). You and AIG agree that, to the fullest extent permitted by applicable law, a
final and non-appealable judgment in any such suit, action or proceeding in any such court shall be
conclusive and binding upon you and AIG.

     (d) You hereby agree to keep confidential the existence of, and any information concerning
(except such information as is publicly known other than by breach of this Annex), a dispute
described in this Annex, except that you may disclose information concerning such dispute as
required by applicable law or by governmental or self-regulatory agencies, to the arbitrator or
court that is considering such dispute or as necessary in connection with such arbitration or
litigation or to your legal counsel, financial and tax advisors and immediate family members
(provided that such person(s) agrees not to disclose any such information other than as necessary
to the prosecution or defense of the dispute).

-6-

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