An email chain obtained by Upcomer shows that it is very likely that over 83 percent of the limited partners who have invested in Echo Fox will ask Rick Fox to resign as manager of the general partner of Echo Fox--immediately. This demand comes on the heels of 11th hour negotiations as to who will acquire Echo Fox and their LCS slot.
As of 3pm on Tuesday, there were two organizations whose bids were being considered--The Shapiro Group and Peak6 (Evil Geniuses). Fox wants to approve the Shapiro deal while the 83 percent of limited partners that were contacted by the lead adviser, along with others want to approve the Peak6 deal. Fox has a very good reason as to why he would like to see the Shapiro deal go through.
While monetary details of the Shapiro offer were not included in the email chain, one of the emails appears to make it very clear where the vast majority of the limited partners stand.
"The holders of a substantial majority of the limited partnership interests in Echo Fox have made it clear that they favor the Evil Geniuses offer, and do not and will not agree to the competing offer from MMIPH (aka the Shapiro group) based upon its present terms and conditions--specifically the condition requiring the 'absence of pending or threatened claims by EF equity holders against EF or purchasers."
If the Shapiro offer goes through, Fox would have a great deal of protection against being sued by members of the EF Loans or members of the investment group.
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One very important email takes the stance that if the Shapiro offer actually went through there would be a very high risk that Riot Games would revoke the LCS team slot if Echo Fox were to submit a term sheet of sale that was not approved or ratified by the limited partners.
That same email goes on to state that if somehow Fox is able to punch home the sale to the Shapiro Group that Fox's actions could be considered reckless, with a willful and wanton disregard of his fiduciary duties to Echo Fox. Additionally, Fox may "subject himself to personal liability that is well beyond his ability to pay--no matter how much additional consideration he has been offered by the Shapiro Group, in whatever form--or to discharge in a personal bankruptcy filing."
The Peak6 deal is a $31.5 million dollar cash deal with all funds to be paid 30 days after closing, which was what the limited partners and other investors wanted to get done.
"I have just concluded an emergency conference call with the holders of 83.3 percent of the limited partners interest in Echo Fox...They approve the Evil Geniuses offer, which we now understand to have been increased to $31.5 million..."