FINAL EXECUTION VERSION

ASSET PURCHASE AGREEMENT
This Asset Purchase Agreement (this “Agreement”), dated as of October 22, 2018,
is made and entered into by and among BBHG, Inc., a Florida corporation
(“Buyer”); Brown & Brown, Inc., a Florida corporation and parent company of
Buyer (“Parent”); The Hays Group, Inc., a Minnesota corporation (“THG”); The
Hays Group of Wisconsin, LLC, a Minnesota limited liability company (“THGW”);
The Hays Benefits Group, LLC, a Minnesota limited liability company (“THBG”);
PlanIT, LLC, a Minnesota limited liability company (“PlanIT”), The Hays Benefits
Group of Wisconsin, LLC, a Minnesota limited liability company (“THBGW”); The
Hays Group of Illinois, LLC, a Minnesota limited liability company (“THGI”); and
Claims Management of Missouri, LLC, a Missouri limited liability company (“CMM,”
and together with THG, THGW, THBG, PlanIT, THBGW and THGI, each a “Seller” and
collectively, the “Sellers”); and THG, as the Sellers’ Representative (the
“Sellers’ Representative”). Buyer and each Seller are each a “Party” and
collectively the “Parties”.
BACKGROUND
Sellers are engaged in the Insurance Business throughout the United States of
America and wish to sell certain of their assets relating to such Business to
Buyer. Buyer desires to acquire such assets upon the terms and conditions
expressed in this Agreement (the “Acquisition”).
Concurrent with the execution of this Agreement, the Sellers have provided to
Buyer the following schedules to this Agreement: Schedule 1.1(a) (Current
Accounts); Schedule 1.1(i) (Office Locations); Schedule 1.4(a)(ii) (Earn-Out
Illustrations); Schedule 1.4(b)(ii) (Earn-Out Locations); Schedule 1.4(c)(i)
(Allocation of Purchase Price); Schedule 2.2(d) (“Required Consents”); Schedule
3.1(c) (Resident and Non-resident Insurance Licenses); Schedule 3.2
(Capitalization); Schedule 3.4(c) (Accounts Receivable and Accounts Payable);
Schedule 3.6(c) (Retail Brokered Business); Schedule 11.1-CC (Client Credit
Balances Amount); Schedule 11.1-EC (Estimated Carrier Payables Amount); Schedule
11.1-KO (Key Owners); and Schedule 11.1-SM (Proceedings).
THEREFORE, the Parties, intending to be legally bound, agree as follows:
ARTICLE 1.
THE ACQUISITION
Section 1.1    Covenants of Sale and Purchase of Acquired Assets. Upon the terms
and subject to the conditions set forth in this Agreement, at the Closing, each
Seller will sell, convey, assign, transfer, and deliver to Buyer, and Buyer will
purchase and acquire from each Seller in exchange for the consideration
described in Section 1.4, free and clear of any Encumbrance, all of such
Seller’s right, title, and interest in and to all of such Seller’s property and
assets, real, personal, or mixed, tangible and intangible, of every kind and
description, wherever located relating to the Insurance Business (but excluding
the Excluded Assets), including the following (collectively, the “Acquired
Assets”):
(a)Client Accounts. Such Seller’s past, current, and prospective Client Accounts
including, without limitation, the Current Accounts. Schedule 1.1(a) will set
forth (i) a complete and correct list of each Current Account and the Insurance
Products or Services in place for each Current Account as of September 30, 2018,
including the policy type, policy number, policy expiration date, and annual
Commissions of such Insurance Products or Services for each Current Account for
the twelve (12)-month period ended September 30, 2018; and (ii) the Core Revenue
received by any Seller from each of its appointing Carriers in the twelve
(12)-month period ended September 30, 2018;
(b)Tangible Personal Property. All Tangible Personal Property, including those
items described in Schedule 1.1(b). Schedule 1.1(b) will set forth the
respective book value of each described item of Tangible Personal Property and
the aggregate book value of such items;

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(c)Assumed Seller Contracts. All Seller Contracts, including those Contracts
listed in Schedule 3.7(a) and rights of Sellers under any employment agreement
between a Seller and a Hired Employee (such listed Contracts, the “Material
Seller Contracts”), and all outstanding offers or solicitations made by or to
such Seller to enter into any Seller Contract, but excluding the Excluded
Contracts (collectively, the “Assumed Seller Contracts”);
(d)Governmental Authorizations. All Governmental Authorizations and all pending
applications therefor or renewals thereof, in each case to the extent
transferable to Buyer;
(e)Records. All Records related to the operations of the Insurance Business for
the five (5)-year period preceding the Closing Date, whether compiled or
maintained by such Seller or their respective Affiliates or by other agents or
employees of such Seller or their respective Affiliates, including, without
limitation: (i) lists and other Records pertaining to past, current and/or
prospective Carriers; (ii) lists and other Records pertaining to past, current,
or prospective Clients, policy forms, and/or rating information, expiration
dates, information on risk characteristics, information concerning insurance
markets for large or unusual risks, names, and contact information regarding
Persons with decision making authority for purchasers of Insurance Products or
Services on behalf of past, current, or prospective Clients, and all types of
Records customarily used by, or available to, such Seller, including but not
limited to the Current Accounts set forth in Schedule 1.1(a); and (iii) referral
sources, research and development reports and Records, production reports and
Records, service and warranty Records, equipment logs, operating guides and
manuals, financial and accounting Records, creative materials, advertising
materials, promotional materials, studies, reports, correspondence, and other
similar documents and Records;
(f)Intangible Property. All of the intangible rights and property of such Seller
including (i) such Seller’s corporate name and fictitious trade names (and any
derivations thereof) and other Intellectual Property Assets, going concern
value, goodwill, telephone and facsimile numbers and listings, websites, domain
names, and e-mail addresses, including those items listed in Schedule 3.15; and
(ii) to the extent assignable, such Seller’s rights and privileges under any
confidentiality, non-solicitation, non-competition, or other restrictive
covenants in favor of such Seller, including any such covenants set forth in any
Excluded Contracts;
(g)Insurance Benefits. All insurance benefits payable to Sellers in connection
with the Insurance Business or the Acquired Assets, including rights and
proceeds, arising from or relating to the Acquired Assets or the Assumed
Liabilities before the Closing Date, unless expended in accordance with this
Agreement;
(h)Claims Against Third Parties. All claims of such Seller against any Third
Party relating to the Acquired Assets, whether choate or inchoate, known or
unknown, contingent or noncontingent, including all such claims listed in
Schedule 1.1(h);
(i)Office Locations. The Real Property Leases for the “Office Locations” listed
in Schedule 1.1(i);
(j)Deposits and Refunds. All rights of such Seller relating to deposits,
including all security deposits under any Real Property Lease to be assigned to
and assumed by Buyer pursuant to this Agreement, and all claims for refunds and
rights to offset in respect thereof that are not excluded under Section 1.2(e);
(k)401(k) Plan. At the end of the Payroll Transition Period, all plan documents,
contracts and insurance policies necessary for Buyer to assume sponsorship of
the 401(k) Plan; and
(l)Assets Held by Others. All of the following (if any) that, due to the
appointment requirements of Carriers of Employee Benefits Products or Services,
may be held or paid in the name of an employee or independent contractor of any
Seller: (i) Client Accounts and related Records within the Total Book of
Business, (ii) Contracts with Carriers, and/or (iii) any Core Revenue.
Section 1.2    Excluded Assets. Notwithstanding anything to the contrary
contained in Section 1.1 or elsewhere in this Agreement, the following assets of
the Sellers (collectively, the “Excluded Assets”) are not part of

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the sale and purchase contemplated hereunder, are excluded from the Acquired
Assets, and will remain the property of the Sellers after the Closing:
(a)Cash, Cash Equivalents, etc. All cash, cash equivalents, Accounts Receivable,
notes receivable, money market certificates, stocks, bonds, real property, and
airplanes and other vehicles, including the investments, equity interests, and
other assets listed on Schedule 1.2(a);
(b)Records. All minute books, equity ownership Records, organizational seals,
personnel Records and any Records that any Seller is required to retain by Law,
and Records related to the operations of the Insurance Business prior to five
(5)-year period preceding the Closing Date (collectively, “Excluded Records”);
(c)Equity Interests. Any equity interests in any Seller;
(d)Insurance Policies. All insurance policies and rights thereunder (except as
set forth in Section 1.1(g));
(e)Refunds. All claims for refund of Taxes and other governmental charges of
whatever nature;
(f)Seller Documents. All rights of the Sellers under the Seller Documents;
(g)Personal Effects. Personal effects of the directors, officers, managers,
and/or the employees of Sellers;
(h)E-mails and Electronic Records. All e-mails and electronic records (A)
unrelated to the Insurance Business, or (B) relating to the Contemplated
Transactions, of the directors, officers, managers, and/or the employees of
Sellers, wherever and in whatever or medium stored, even if stored on hardware
or software that is an Acquired Asset;
(i)Employee Benefit Plans. All Employee Benefit Plans other than the 401(k)
Plan; and
(j)Excluded Contracts. All rights of Sellers under the Excluded Contracts not
expressly assigned to Buyer hereunder, including those set forth on Schedule
1.2(j).
Section 1.3    Seller’s Liabilities.
(a)On the Closing Date, Buyer will assume and discharge only the Assumed
Liabilities. Every Liability of Sellers other than the Assumed Liabilities (each
a “Retained Liability” and collectively, the “Retained Liabilities”) will remain
the sole responsibility of, and will be retained, paid, performed, and
discharged solely by, the Sellers.
(b)Specifically, Sellers acknowledge that Buyer is not assuming any liability
related to: (i) stop-loss liability of Sellers for calendar year 2018, or (ii)
any payments to Hired Employees related to non-member profit sharing, minority
equity owner distributions or 401(k) discretionary profit sharing for calendar
year 2018.
Section 1.4    Purchase Price.
(a)The consideration for the Acquired Assets and the Restrictive Covenants will
be the assumption of the Assumed Liabilities, plus an amount (the “Purchase
Price”) equal to:
(i)A “Closing Payment” equal to $705,000,000 comprised of:
(A)cash in the amount of $605,000,000 (the “Closing Cash Consideration”); and

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(B)such number of shares of common stock, par value $0.10, of Parent (the
“Parent Shares”) as shall equal $100,000,000, before giving effect to any
adjustments pursuant to Section 1.4(f) (as valued at the average closing price
thereof on the New York Stock Exchange over the thirty (30)-day period prior to
the date hereof) (the “Closing Stock Consideration”); plus
(ii)An “Earn-Out Payment” equal to 5.96 times the result of (A) the average
annual EBITDA created by the Earn-Out Locations during the thirty-six (36)-month
period beginning January 1, 2019 and ending December 31, 2021 (the “Earn-Out
Period”) minus (B) the Base EBITDA Amount. The total Earn-Out Payment shall not
exceed $25,000,000. Schedule 1.4(a)(ii) sets forth an illustrative calculation
of the Earn-Out Payment applying a variety of assumptions of the performance of
the Earn-Out Locations during the Earn-Out Period.
(b)For purposes of Section 1.4(a)(ii):
(i)“Base EBITDA Amount” means $31,733,248.
(ii)“Earn-Out Locations” means those locations set forth on Schedule 1.4(b)(ii).
(c)The Closing Payment will be paid as follows:
(i)Buyer will pay to the Sellers’ Representative at the Closing a cash down
payment, for distribution in accordance with the percentages set forth next to
each such Seller’s name on Schedule 1.4(c)(i) (the “Closing Payment Amount”)
equal to:
(A)The Closing Cash Consideration, minus
(B)The Secured Debt Amount, as described in Schedule 1.4(c)(i)(B), minus
(C)the Closing Transaction Expenses, as described in Schedule 1.4(c)(i)(C).
(ii)Buyer will deliver to the Key Owners and such other recipients of the Parent
Shares as designated by the Sellers prior to Closing (together with the Key
Owners, the “Stock Recipients”) certificates representing the Parent Shares
constituting the Closing Stock Consideration or evidence that such Parent Shares
have been issued in book entry form from American Stock Transfer & Trust Co.,
the transfer agent for the Parent, in the name of the Stock Recipients;
(iii)Buyer, on behalf of Sellers, will pay the Secured Debt Amount in
appropriate amounts to each Seller’s secured creditors, in accordance with their
respective Secured Debt Payoff Letters, on the Closing Date;
(iv)Buyer, on behalf of Sellers, will pay the Closing Transaction Expenses in
appropriate amounts, in accordance with their respective invoices, on the
Closing Date.
(d)Earn-Out Payment Calculation; Dispute Resolution; Payment.
(i)As soon as reasonably practicable following the end of the Earn-Out Period,
but in any event no later than sixty (60) days thereafter, Buyer will calculate
the Earn-Out Payment, and provide the Sellers’ Representative with a statement
(the “Earn-Out Statement”) setting forth such calculation with reasonable
supporting documentation. The Earn-Out Statement will be deemed to be accepted
by the Sellers’ Representative and will be conclusive for purposes of
determining the Earn-Out Payment due to the Sellers, unless Sellers’
Representative delivers to Buyer, within thirty (30) days following receipt of
the Earn-Out Statement, a notice (the “Objection Notice”) specifying Sellers’
Representative’s objections to the Earn-Out Statement in reasonable detail. The
Parties will use reasonable good faith efforts to resolve the matters in
dispute, but if they do not obtain a final resolution within sixty (60) days
after Buyer’s receipt of the Objection Notice, the Parties will submit the
resolution of the disputed matters to an Independent Accounting Firm.

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(ii)If Buyer and Sellers’ Representative submit any unresolved disputed matters
to the Independent Accounting Firm, each of Buyer and Sellers’ Representative
will submit an Earn-Out Statement, together with such supporting documentation
as it deems appropriate, to the Independent Accounting Firm within 30 days after
the date on which such unresolved disputed matters were submitted to the
Independent Accounting Firm for resolution. The Independent Accounting Firm will
resolve such dispute by choosing, in respect of any disputed line item, an
amount that is within the range of the amounts for such line item as proposed by
either Buyer or Sellers’ Representative. Buyer and Sellers’ Representative and
their respective Representatives will each be entitled to meet with the
Independent Accounting Firm and will use their respective commercially
reasonable efforts to cause the Independent Accounting Firm to resolve such
dispute as soon as practicable, but in any event within 30 days after the date
on which the Independent Accounting Firm receives the Earn-Out Statement
prepared by Buyer and Sellers’ Representative. Buyer and Sellers’ Representative
will use their respective commercially reasonable efforts to cause the
Independent Accounting Firm to notify them in writing of its resolution of such
dispute as soon as practicable. Absent fraud or demonstrable error, the decision
of the Independent Accounting Firm will be conclusive and binding upon the
Parties. Each party will bear its own costs and expenses in connection with the
resolution of such dispute by the Independent Accounting Firm. Buyer and the
Sellers will bear the fees and disbursements of the Independent Accounting Firm
in the same proportion that their respective positions are confirmed or rejected
by the Independent Accounting Firm.
(iii)In conjunction with and as a condition to Buyer’s payment of the Earn-Out
Payment, the Parties will execute and deliver the Satisfaction Agreement and
Release. Buyer will pay the Earn-Out Payment (if any) within one (1) Business
Day following Buyer’s receipt of the Satisfaction Agreement and Release,
executed by the Sellers.
(e)Purchase Price Allocation. Within thirty (30) days after the end of the
fiscal quarter in which the Closing occurs, Buyer will prepare, and Buyer and
the Sellers will initial and deliver to each other, an IRS Form 8594, Asset
Acquisition Statement Under Section 1060, setting forth the above allocations as
set forth on Schedule 1.4(e), provided that such allocations will be subject to
adjustment after the end of the Earn-Out Period, as set forth in the
Satisfaction Agreement and Release, to reflect the final Purchase Price. Subject
to the immediately previous sentence, the Parties will make consistent use of
the allocations specified in this Section 1.4(e) for all Tax purposes and in all
filings, declarations, and reports with the IRS or other taxing authorities in
respect thereof, including the reports required to be filed under Section 1060
of the Code. In any Proceeding related to the determination of any Tax, none of
the Parties will contend or represent that such allocations are incorrect
allocations.
(f)No Fractional Shares. No fraction of a share of Parent Shares will be issued
by virtue of the Contemplated Transactions. Only whole shares of Parent Shares
will be delivered to each Stock Recipient. In the event that a Stock Recipient
would receive a fractional share of Parent Shares, Buyer will pay the cash value
of such fractional share to the Sellers (as valued in accordance with Section
1.4(a)(i)(B)).
Section 1.5    Agency Bill Policies; Direct Bill Policies; Other Commissions;
Fees.
(a)Agency Bill Policies.
(i)For agency bill policies for which premiums are paid in full at inception
rather than in installments, regardless of when Commissions from such policies
are received: (A) if the policy effective date is before the Closing Date, and
the premium was billed before the Closing Date, all Commissions for such
policies will be Sellers’ property; and (B) if the policy effective date is on
or after the Closing Date, or if the premium is billed on or after the Closing
Date, all Commissions for those policies will be Buyer’s property.
(ii)For agency bill policies for which premiums are paid in installments during
the policy period, regardless of when Commissions from such policies are
received: (A) if an installment effective date (the date on which payment is
due) is before the Closing Date, and the installment was billed before the
Closing Date, then all Commissions for that installment will be Sellers’
property; and (B) if an installment effective date is on or after the Closing
Date, or the installment is billed on or after the Closing Date, all Commissions
for that installment will be Buyer’s property.

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(b)Direct Bill Policies. Sellers will own all Commissions on direct bill
policies actually received by Sellers from Carriers before the Closing Date, and
Buyer will own all such Commissions actually received from Carriers on or after
the Closing Date, regardless of when billed by the Carrier.
(c)Contingent Revenues. Sellers will own all Contingent Revenues, GSCs or
Overrides paid pursuant to a Contract with a term or applicable measurement
period ending on or before the Closing Date. Buyer will own all Contingent
Revenues, GSCs or Overrides paid pursuant to a Contract with a term or
applicable measurement period beginning after the Closing Date. Sellers and
Buyer will pro rate any Contingent Revenues, GSCs or Overrides paid pursuant to
a Contract with a term or applicable measurement period that includes the
Closing Date (such amounts, “Straddle Contingents”). Any Straddle Contingents
received by Buyer will be split pro rata between Buyer and the Sellers based on:
(i) the number of days in the contract term or applicable measurement period
prior to the Closing Date (inclusive), and (ii) the number of days in the
contract term or applicable measurement period after the Closing Date. By way of
examples only, the Sellers and Buyer will split Straddle Contingents paid
pursuant to a Contract as follows: (A) if the contract term or applicable
measurement period is twelve (12) months beginning on January 1, 2018 and the
Closing Date is November 15, 2018, then Sellers would receive 319/365 and Buyer
46/365 of the Straddle Contingents earned pursuant to such Contract; (B) if the
contract term or applicable measurement period is six (6) months beginning on
July 1, 2018 and the Closing Date is November 15, 2018, the Sellers would
receive 138/184 and Buyer 46/184 of the Straddle Contingents earned pursuant to
such Contract; and (C) if the contract term or applicable measurement period is
twelve (12) months beginning on July 1, 2018 and the Closing Date is November
15, 2018, the Sellers would receive 138/365 and Buyer 227/365 of the Straddle
Contingents earned pursuant to such Contract. The Parties acknowledge that the
amount Sellers will receive after the Closing Date for Contingent Revenues, GSCs
or Overrides will not exceed $20,000,000. Further, Sellers acknowledge and agree
that no Seller will terminate a contract term or applicable measurement period
prior to the Closing Date for any Contract for which Contingent Revenues, GSCs
or Overrides could be paid, either unilaterally or in conjunction with a
Carrier.
(d)Additional or Return Commissions. Regardless of policy effective date: (i)
Sellers will own all additional Commissions received before the Closing Date as
a result of endorsements or audits, and Sellers will be liable for all return
Commissions that first become due before the Closing Date; and (ii) Buyer will
own all additional Commissions received on or after the Closing Date as a result
of endorsements or audits, and Buyer will be liable for all return Commissions
that first become due on or after the Closing Date. Notwithstanding the
foregoing, Buyer shall not be responsible for return Commission that first
become due on or after the Closing Date in excess of $300,000.
(e)Service Fees. Sellers will own all Service Fees billed (subject to the
qualification below) before the Closing Date, provided that the majority of the
services have been completed. Buyer will own all Service Fees billed on or after
the Closing Date. The foregoing shall apply so long as billing and collection of
Service Fees is consistent with past practice over the prior thirty-six (36)
month period. Buyer shall have the right to review Service Fees billed prior to
Closing for the one hundred eighty (180) day period after Closing and provide
written notice to Sellers regarding any billed Service Fee amounts that Buyer
does not believe meet the criteria that the majority of services have been
completed.
(f)Twelve Month Limitation. With respect to Clients billed on an annual,
monthly, or, as set forth in Schedule 1.5(f), a multi-year basis, except with
respect to Commissions generated from endorsements or audits, only twelve (12)
months’ of Commissions or Service Fees will be counted in any twelve (12)-month
period.
(g)Monies to be Held in Trust. Buyer and Sellers will hold in trust and promptly
pay over to the other Party (in accordance with Section 2.6(b)) any monies
received by Buyer or Sellers that is the property of the other Party/Parties.
For clarity, no monies due under this Section 1.5 will be subject to any
limitations set forth in Article 6.
Section 1.6    Return Premiums; Undesignated Premium Payments by Clients.
(a)Buyer will promptly remit any Return Premiums it receives from any Carrier on
or after the Closing Date to the applicable Client; provided, however, that if,
at the time such Return Premiums are received from

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the Carrier, any Premiums/Fees Receivable due from such Client remain
outstanding to Sellers or Buyer or have been written off by Sellers or Buyer as
bad debt in accordance with Sellers or Buyer’s Accounts Receivable collection
policy, as applicable, then such Return Premiums will be treated as follows: (i)
the Return Premiums will be paid over to Buyer or Sellers, as the case may be,
for application against (A) the Premiums/Fees Receivables set forth on a
specific invoice, invoice number, or other reasonable indication as to which
Premiums/Fees Receivable the Client intended to apply such monies, and (B) if
none, the outstanding Premiums/Fees Receivables in order of their invoicing,
i.e., with application to be made against the oldest aged Premiums/Fees
Receivables first; and (ii) any remaining Return Premiums after application
against all outstanding Premiums/Fees Receivable will be remitted by Buyer to
the Client. Sellers will promptly deliver to Buyer any Return Premiums (net of
amounts determined in accordance with clause (i) above) that Sellers receive
from any Carrier on or after the Closing Date, so that Buyer may remit or apply
such Return Premiums as appropriate under this Section 1.6. For clarity, no
monies due under this Section 1.6(a) will be subject to any limitations set
forth in Article 6.
(b)If any monies received on or after the Closing Date from a Client for payment
of any Premiums/Fees Receivable are not accompanied by an invoice, an invoice
number, or other reasonable indication as to which Premiums/Fees Receivable the
Client intended to apply such monies, such monies will be applied in the order
of their invoicing, i.e., with application to be made to the oldest aged
Premiums/Fees Receivables first.
Section 1.7    Transfer Taxes. All transfer, documentary, recording, and other
similar fees payable in connection with the execution and delivery of this
Agreement, the consummation of the Closing and the other Contemplated
Transactions will be the responsibility of, and will be paid by Buyer.
ARTICLE 2
CLOSING, ITEMS TO BE DELIVERED, FURTHER ASSURANCES
Section 2.1    Closing. The Closing will take place on the Closing Date and will
be accomplished by facsimile transmission and/or e-mail in portable document
format (“.pdf”) to the respective offices of legal counsel for the Parties to
the requisite Transaction Documents, duly executed where required.
Section 2.2    Conveyance and Delivery by the Sellers. On the Closing Date, each
Seller will surrender and deliver possession of the Acquired Assets owned by
such Seller to Buyer and take such steps as may be required to put Buyer in
actual possession and operating control of the Acquired Assets, and in addition
will deliver to Buyer such bills of sale and assignments and other good and
sufficient instruments and documents of conveyance, in form reasonably
satisfactory to Buyer, as will be necessary and effective to transfer, assign
to, and vest in, Buyer all of each Seller’s right, title, and interest in and to
the Acquired Assets, free and clear of any Encumbrance (other than Permitted
Encumbrances). Without limiting the generality of the foregoing, at the Closing,
the Sellers will deliver to Buyer:
(a)A wire transfer of immediately available funds to one or more accounts
designated by Buyer for the “Assumed PTO Liability Amount”, as described in
Schedule 2.2(a), which equals the aggregate portion of the balance of accrued
and unpaid paid time off or sick leave liability (“Assumed PTO Leave”) owed by
Seller(s) to the Hired Employees to be assumed by Buyer;
(b)The Bill of Sale, executed by the Sellers;
(c)The Key Owner Employment Agreements, executed by each Key Owner;
(d)Consents to the Acquisition and/or the assignment of any applicable Seller
Contract from those Third Parties set forth in Schedule 2.2(d) (the “Required
Consents”), in form reasonably acceptable to Buyer;
(e)The Closing Statement, executed by the Sellers;
(f)The Name Change Documents, duly authorized and executed by each Seller;

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(g)The Lease Assignments, executed by the respective Seller tenant under each
lease, as assignor, and Landlord;
(h)The Trademark Assignment, executed by the Sellers;
(i)The Secured Debt Payoff Letters, completed and executed by Sellers’ secured
creditors;
(j)The Tax Clearance Certificates from the State of Minnesota Department of
Revenue;
(k)A copy of the Seller Resolutions of each Seller, certified by such Seller’s
secretary (or an individual serving in a substantially similar capacity);
(l)Evidence, satisfactory to Buyer in its commercially reasonable discretion, of
each Seller’s arrangement to purchase the Required Tail Coverage;
(m)An IRS Form W-9, Request for Taxpayer Identification Number and
Certification, completed and executed by each Seller;
(n)The Sellers’ Closing Certificate, executed by a duly authorized officer of
each Seller;
(o)The Restrictive Covenant Agreements, executed by each Restrictive Covenant
Party;
(p)A Subscription Agreement and a Lockup Agreement, executed by each Stock
Recipient;
(q)The Transition Services Agreement, executed by Sellers; and
(r)An updated Schedule 1.1(a), Schedule 3.4(c), Schedule 3.6(c), Schedule
11.1-CC, Schedule 11.1-EC and Schedule 11.1-SM, each updated as of October 31,
2018; and
(s)Such other certificates, documents, and agreements as Buyer or Parent may
reasonably request.
Section 2.3    Delivery by Buyer and Parent. On the Closing Date, Buyer and/or
Parent, as applicable, will deliver to (or, if applicable, on behalf of)
Sellers:
(a)A wire transfer of immediately available funds to one or more accounts
designated by Sellers for the Closing Payment Amount;
(b)Certificates representing the Parent Shares constituting the Closing Stock
Consideration or evidence that such Parent Shares have been issued in book entry
form from American Stock Transfer & Trust Co., the transfer agent for the
Parent, in the name of the Stock Recipients;
(c)A wire transfer of immediately available funds to one or more accounts
designated by the secured lenders for their appropriate portions of the Secured
Debt Amount, as set forth on Schedule 1.4(c)(i)(B) and the Closing Statement;
(d)A wire transfer of immediately available funds to one or more accounts
designated by the recipients thereof for their appropriate portions of the
Closing Transaction Expenses, as set forth on Schedule 1.4(c)(i)(C) and the
Closing Statement;
(e)The Bill of Sale, executed by Buyer;
(f)The Key Owner Employment Agreements, executed by Buyer;
(g)The Closing Statement, executed by Buyer and Parent;

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(h)The Lease Assignments, executed by Buyer;
(i)The Trademark Assignment, executed by Buyer;
(j)The Buyer’s/Parent’s Closing Certificate, executed by duly authorized
officers of Buyer and Parent, respectively;
(k)The License Agreement, executed by Buyer;
(l)The Transition Services Agreement, executed by Buyer; and
(m)Such other certificates, documents, and agreements as the Sellers may
reasonably request.
Section 2.4    Mutual Performance. At the Closing, the Parties will also deliver
to each other the agreements and other documents referred to in Article 5.
Section 2.5    Sellers’ Post-Closing Obligations with Respect to Nonassigned
Acquired Assets.
(a)Subject to Section 2.2(d) and, if (i) any Seller cannot assign any of the
Acquired Assets without the Consent of or notice to a Third Party and any
necessary Consent or notice has not been given or obtained as of the Closing
Date, or (ii) any Acquired Assets are nonassignable by their nature, and the
beneficial interest in and to those Acquired Assets passes in any event to Buyer
at the Closing, Sellers will (A) hold those Acquired Assets in trust for, and
for the benefit of, Buyer on and after the Closing Date; (B) continue to use
Best Efforts, on and after the Closing Date, to obtain and to secure any consent
and give any notice as may be required to effect a valid assignment or
assignments of those Acquired Assets; (C) in the case of Leases of real or
personal property, continue as a party to each such Lease for the benefit of
Buyer and at Buyer’s expense; and (D) assign or complete the assignment or
assignments as soon as possible. If, however, any such Consent will not be
obtained or if any attempted transfer would be ineffective or would impair
Buyer’s rights so that Buyer would not in effect acquire the benefit of all such
rights, Sellers will use Best Efforts after the Closing as Buyer’s agent in
order to obtain for it the benefits thereunder and will use Best Efforts to
cooperate, to the maximum extent permitted by Law, with Buyer in any other
reasonable arrangement designed to provide such benefits to Buyer.
(b)With respect to any portion of the Insurance Business that requires
Governmental Authorizations to operate the Acquired Assets, the applicable
Seller will maintain each such Governmental Authorization for the benefit of
Buyer and at Buyer’s expense until Buyer obtains its own required Governmental
Authorizations, at which point such portion of the Insurance Business will pass
from such Seller to Buyer. The Parties will continue to use their Best Efforts,
on and after the Closing Date, to obtain and to secure any such Governmental
Authorizations for Buyer as soon as reasonably practicable after the Closing
Date.
Section 2.6    Further Assurances; Records.
(a)At any time and from time to time after the Closing, the Parties will
cooperate with each other to execute and deliver any other documents,
instruments of transfer or assignment, and any files, books, and other Records
acquired under Section 1.1(e). Subject to the terms and conditions of this
Agreement, each of the Parties agrees to use Best Efforts to take, or cause to
be taken, all actions and to do, or cause to be done, all things necessary,
proper, or advisable under applicable Law to consummate and make effective the
Contemplated Transactions, including cooperating fully with the other Parties.
(b)Monthly Settlement Account.
(i)Without limiting the forgoing, during the transition of the Acquired Assets,
Buyer and Sellers’ Representative will maintain a monthly record (a “Monthly
Settlement Account”) of all (A) cash receipts by Buyer and Sellers of monies
that, under the terms of this Agreement, are the property of the other Party,
and (B) cash disbursements by Buyer or Sellers for expenses or Retained
Liabilities that, under the terms of this Agreement,

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are the other Party’s obligation (or “due to/due from account”). For each month
after Closing in which there is activity in the Monthly Settlement Account, each
Party will deliver to the other Party a written settlement statement regarding
the Monthly Settlement Account (each a “Settlement Statement”) for such month.
The Settlement Statement will be deemed to be accepted by the receiving Party
and conclusive for purposes of determining the settlement of the Monthly
Settlement Account for such month unless the receiving Party delivers, within
ten (10) Business Days following receipt of the Settlement Statement, a notice
(the “Settlement Objection Notice”) specifying the receiving Party’s objections
to the Settlement Statement in reasonable detail. The Parties will use
reasonable good faith efforts to resolve the matters in dispute, but if they do
not obtain a final resolution within thirty (30) days after receipt of the
Settlement Objection Notice, the Parties will submit the resolution of the
disputed matters to an Independent Accounting Firm. The provisions of Section
1.4(d)(ii) shall apply mutatis mutandis to any dispute regarding a Monthly
Settlement Account or the information set forth in a Settlement Statement.
(ii)For each month that the Monthly Settlement Account has a settlement balance,
Buyer or Sellers, as appropriate, will pay over the settlement balance to the
other Party, as appropriate, within three (3) Business Days following the
settlement date, by wire transfer of immediately available funds to one or more
accounts designated in writing by the recipient. Buyer and Sellers each agree to
maintain sufficient operating cash in their respective bank accounts to pay the
settlement balances in the Monthly Settlement Account that may become due.
(iii)The Parties acknowledge and agree that if the Closing Date is on a date
that is not the first or final date of the month then any revenue and expenses
shall be split pro rata between Buyer and Sellers based on the number of days in
the month in which the Closing Date occurs each of Buyer and Sellers are deemed
an owner of the Acquired Assets divided by the total number of days in such
month. Notwithstanding the foregoing, Buyer shall not be responsible for
expenses associated with the Sellers’ plane, the capital appreciation rights
program or any other adjustments agreed in writing between the parties.
(c)Also without limiting the generality of the foregoing, if and for so long as
any Party actively is contesting or defending against any Proceeding with any
Third Party in connection with (i) any of the Contemplated Transactions or (ii)
any fact, situation, circumstance, status, condition, activity, practice, plan,
occurrence, event, incident, action, failure to act, or transaction on or before
the Closing Date involving the Acquired Assets, the Insurance Business, or the
obligations and Liabilities assumed hereunder, the other Party will reasonably
cooperate with the contesting or defending Party and its counsel in the contest
or defense, reasonably make available its personnel, and provide such testimony
and access to its Records (including, as to any Seller, any Excluded Records) as
will be necessary in connection with the contest or defense, all at the sole
cost and expense of the contesting or defending Party (unless the contesting or
defending Party is entitled to indemnity therefor under Article 6 hereof).
(d)The Sellers’ Representative will promptly after the Closing prepare and file
all reports and returns required by Law relating to the Insurance Business as
conducted using the Acquired Assets, up to and including the Closing Date. After
the Closing Date, Buyer will retain for a period consistent with Buyer’s
Record-retention policies and practices (but no less than six years), those
Records of Sellers delivered to Buyer. Buyer also will provide the Sellers’
Representative and its Representatives reasonable access thereto, during normal
business hours and on at least three (3) Business Days’ prior written notice, to
enable them to prepare financial statements or Tax Returns or deal with Tax
audits, or for any other reasonable legal or business purpose. After the Closing
Date, Sellers’ Representative will provide Buyer and its Representatives
reasonable access to Excluded Records, during normal business hours and on at
least three (3) Business Days’ prior written notice, for any reasonable legal or
business purpose specified by Buyer in such notice.
(e)For clarity, no monies due under this Section 2.6 will be subject to any
limitations set forth in Article 6.
Section 2.7    Hired Employees.
(a)Buyer will hire those employees of Sellers listed on Schedule 2.7 as of
January 1, 2019 (“Hired Employees”), subject to Sellers assigning to Buyer
rights associated with those employment agreements

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between Sellers and each Hired Employee as of the Closing Date. The rate of pay,
location of employment at an Office Location, PTO liability, and state of
residence for each Hired Employee will be set out on Schedule 2.7.
(b)Bonus Payments.
(i)On or before December 31, 2018, Sellers will pay to the Hired Employees
certain bonus payments which have historically been paid prior to the end of a
calendar year for performance by those Hired Employees during that calendar year
identified Schedule 2.7(b) as “year-end bonus payments”. Buyer acknowledges that
Buyer shall be responsible to reimburse Sellers for its pro rata share of such
year-end bonus payments based on the number of days that from the Closing Date
through December 31, 2018 divided by 365. Buyer shall reimburse Sellers in
accordance with Section 2.6(b).
(ii)On or before December 31, 2018, Sellers will wire to Buyer the “Accrued
Bonus Amount” identified as “producer true-up amounts”, which equals the
aggregate portion of any annual or other bonus amounts earned and payable to
Hired Employees accrued by Sellers for any period prior to the Closing Date. As
soon as reasonably practicable following December 31, 2018, but in any event no
later than forty-five (45) days thereafter, Buyer will calculate (with
reasonable assistance from Sellers’ Representative) the actual bonuses payable
to Hired Employees, the amount of such bonuses payable through the Closing Date
(which will be allocated between the Seller and Buyer on a pro rata basis based
on the number of actual days elapsed in 2018 through the Closing Date), and
provide the Sellers’ Representative with a statement setting forth such
calculations with reasonable supporting documentation. No later than February
28, 2019, Sellers will transfer to Buyer additional amounts required to fund the
Sellers’ portion of the Accrued Bonus Amount. Buyer shall pay to the Hired
Employees their respective portion of the Accrued Bonus Amount at such time when
Buyer pays annual bonus payments to its employees, so long as such Hired
Employee is employed with Buyer at the time of such payment. Buyer shall return
to the Sellers within five (5) Business Days following payment of bonuses by
Buyer to the Hired Employees any amounts transferred by Sellers to Buyer
pursuant to this Section 2.7(b) in excess of (i) the aggregate bonuses allocated
to the Sellers under this Section 2.7(b), less (ii) bonus amounts paid by
Sellers to Hired Employees.
(c)Sellers will maintain the Hired Employees on Sellers’ payroll, 401(k) Plan
and Employee Welfare Benefit Plans from the period between the Closing Date
until December 31, 2018 (the “Payroll Transition Period”). Buyer will promptly
reimburse Sellers for all payments made by Sellers (in such amounts as directed
by Buyer), and all related withholdings and remittances that Sellers incur,
during the Payroll Transition Period pursuant to the Transition Services
Agreement.
(d)Buyer agrees to permit the respective Hired Employees to utilize and/or be
paid out upon termination of employment (if applicable Law requires) the Assumed
PTO Leave after the Closing. No later than March 31, 2019, the Sellers and Buyer
will promptly pay to the other Party amounts required to true-up the Assumed PTO
Liability Amount once finally determined.
(e)From and after the end of the Payroll Transition Period, with respect to the
Hired Employees, the Buyer shall use commercially reasonable efforts to cause
the Buyer’s Employee Welfare Benefit Plans to waive all limitations as to
pre-existing conditions and waiting periods with respect to participation and
coverage requirements applicable under Buyer’s Employee Welfare Benefit Plans
for the Hired Employees and their eligible dependents to the same extent that
such pre-existing conditions and waiting periods would not have applied or would
have been waived under the corresponding Sellers’ Employee Welfare Benefit Plans
in which such Hired Employee was a participant immediately prior to his or her
commencement of participation in Buyer’s Employee Welfare Benefit Plans.
(f)Effective as of January 1, 2019, in connection with the change of employment
of the Hired Employees, Buyer or one of its Subsidiaries will assume the
sponsorship of the 401(k) Plan, and the Parties will cooperate with each other
to take all actions and execute and deliver all documents and furnish all
notices necessary or advisable to effectuate such assumption. Nothing contained
herein (i) will alter or limit the ability of Buyer and its Subsidiaries to
amend, modify, freeze, merge, or terminate the 401(k) Plan in accordance with
the terms of the 401(k) Plan and the applicable provisions of ERISA and the
Code, (ii) is intended to confer upon any Hired Employee

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or any other current or former employee of Seller any right to employment or
continued employment for any period of time or any right to a particular term or
condition of employment, or (iii) is intended to confer upon any Hired Employee
or any other individual any right as a third-party beneficiary of this
Agreement.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF THE SELLERS
Effective as of the Closing Date (except with respect to the representations and
warranties set forth in Section 3.3(a), which are made as of the date hereof)
and except as set forth on the Disclosure Schedules (which will be attached as
an amendment to the Agreement at the Closing), the Sellers, jointly and
severally, represent and warrant to Buyer as follows:
Section 3.1    Organization; Governmental Authorizations.
(a)Each Seller is a limited liability company or corporation, as applicable,
duly organized, validly existing, and in good standing under the Law of the
State of Minnesota and its status is active.
(b)Schedule 3.1(b) sets forth a true and complete list of each jurisdiction in
which any Seller is qualified to do business as a foreign limited liability
company or corporation, as applicable. Each Seller is duly qualified to do
business and is in good standing as a foreign limited liability company or
corporation, as applicable, in each jurisdiction where the conduct of its
Business requires it to be so qualified, except where the failure to be so
licensed or in good standing would not result in a Material Adverse Change.
(c)Schedule 3.1(c) sets forth a true and complete list of any resident and
non-resident insurance license, including type of license, license number, and
expiration date, held by any Seller. Each Seller has all requisite
organizational power and authority and all necessary insurance licenses and
other Governmental Authorizations to own, lease, and operate its properties; to
carry on its Business as now being conducted; and to perform all its obligations
under the Seller Contracts.
Section 3.2    Capitalization. Schedule 3.2 sets forth the number of outstanding
membership interests, financial rights and governance rights or shares of
capital stock of each Seller directly held or beneficially owned by each equity
owner and the respective percentages of the total outstanding membership
interests, financial rights, and governance rights or shares of capital stock of
each Seller represented by such number of shares or membership interests,
financial rights, and governance rights, which constitute all of the outstanding
membership interests, financial rights, and governance rights or shares of
capital stock of each Seller. No other Person has any right or option to acquire
any shares of capital stock or membership interest or other interest or any
financial right or governance right or any financial interest or securities
convertible into capital stock, in any Seller.
Section 3.3    Enforceability; Authority; No Conflict.
(a)Upon the execution and delivery by the Sellers of the Seller Documents, each
Seller Document will constitute the legal, valid, and binding obligation of each
Sellers, as applicable, enforceable against each of them in accordance with its
terms, subject to applicable bankruptcy, insolvency, reorganization, or similar
applicable Law from time to time in effect relating to or affecting the
enforcement of creditors’ rights generally and general equitable principles.
Each Seller has the absolute and unrestricted right, power, and authority to
execute and deliver each Seller Document to which it is a party and to perform
its obligations under the Seller Documents, and such action has been duly
authorized by all necessary action by each Seller’s members and managers or
shareholders and board of directors, as applicable.
(b)Neither the execution or delivery of any Seller Document, nor the
consummation or performance of any of the Contemplated Transactions will,
directly or indirectly (with or without notice or lapse of time):

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(i)Breach (A) any provision of any of the Governing Documents of any Seller or
(B) any resolution adopted by the members or board of directors or managers or
the shareholders of any Seller;
(ii)Give any Governmental Body or other Person the right to challenge any of the
Contemplated Transactions or to exercise any remedy or obtain any relief under
any Law or any Order to which any Seller, or any of the Acquired Assets, may be
subject;
(iii)Contravene, conflict with or result in a violation or Breach of any of the
terms or requirements of, or give any Governmental Body the right to revoke,
withdraw, suspend, cancel, terminate, or modify, any Governmental Authorization
that is held by any Seller or that otherwise relates to the Acquired Assets or
to, the Insurance Business;
(iv)To the Knowledge of Sellers, other than with respect to Material Seller
Contracts that require Consent in connection with an assignment of such
Contract, breach in any material respect any provision of, or constitute a
material default under, or give any Person the right to accelerate the maturity
or performance of, or payment under, or to cancel, terminate, or modify in any
material respect, any Material Seller Contract; or
(v)To the Knowledge of Sellers, result in the imposition or creation of any
Encumbrance (other than Permitted Encumbrances) upon or with respect to any of
the Acquired Assets.
(c)Except for the approvals required under the Hart-Scott-Rodino Act or as set
forth in Schedule 2.2(d) and other than with respect to Material Seller
Contracts that require Consent in connection with the assignment of such
Contract, no Seller is required to give any notice to, make any filing with, or
obtain the Consent, authorization, permit or approval of any Third Party or
Governmental Body regarding any Seller’s entry into this Agreement, any of the
other Transaction Documents, or the Contemplated Transactions, where the failure
to give such notice, make such filing, or to obtain such Consent, authorization,
permit or approval could reasonably be expected to cause a Material Adverse
Change to Buyer, the Acquired Assets, or the Insurance Business after Closing.
Section 3.4    Financial Statements; No Material Adverse Change; No Undisclosed
Liabilities.
(a)Schedule 3.4(a) sets forth true and complete copies of (i) each Seller’s
balance sheet at December 31, 2017 (the “Year-End Balance Sheet”), and the
related statement of income for the fiscal year then ended, and (ii) each
Seller’s balance sheet (the “Interim Balance Sheet”) at September 30, 2018 (the
“Balance Sheet Date”) and the related statement of income for the nine (9)
months then ended (collectively, the “Financial Statements”). All such Financial
Statements were prepared in accordance with GAAP, subject, in the case of
interim period statements, to normal recurring audit adjustments. Such balance
sheets within the Financial Statements fairly present in all material respects
the consolidated financial position, assets, and Liabilities (whether accrued,
absolute, contingent, or otherwise) including, without limitation, the Estimated
Carrier Payables Amount and the Client Credit Balances, of Sellers at the dates
indicated and such statements of income fairly present the results of operations
for the periods then ended. Each Seller’s financial books and Records are true
and complete in all material respects.
(b)Since the Balance Sheet Date, there has not been any Material Adverse Change,
and no event has occurred or circumstance exists that could reasonably be
expected to result in a Material Adverse Change. No Seller has any Liabilities
of a nature that would be required under GAAP to be reflected on the Financial
Statements except for (i) Liabilities reflected or reserved against in the
Year-End Balance Sheet or the Interim Balance Sheet; (ii) current Liabilities
incurred in the Ordinary Course of Business of Sellers since the Balance Sheet
Date; and (iii) Liabilities that have not had and would not reasonably be
expected to result in a Material Adverse Change.
(c)Schedule 3.4(c) sets forth true and complete lists of all (i) Accounts
Receivable of Sellers as of September 30, 2018 (“Seller Accounts Receivable”),
including the aging of such Accounts Receivable, and (ii) all accounts payable
of Sellers as of September 30, 2018 (“Seller Accounts Payable”). All of Seller
Accounts Receivable represent sales actually made or services actually performed
in the ordinary and usual course of Sellers’ Business, consistent with past
practice. All of Seller Accounts Payable, including Estimated Carrier Payables
Amount, are

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current and reflected properly on its books and Records, and will be paid when
due in accordance with their terms at their recorded amounts.
(d)Each Seller maintains accurate Records reflecting its assets and Liabilities
and maintains proper and adequate internal accounting controls and procedures,
and no Seller has received written notification from any accountants,
independent auditors or other consultants, or Governmental Bodies challenging
the adequacy or requesting modification of such controls and procedures. Such
controls and procedures are reasonably designed to provide assurance that: (i)
transactions are executed with management’s authorization; (ii) transactions are
recorded as necessary to permit preparation of each Seller’s financial
statements and to maintain accountability for each Seller’s assets; (iii) access
to any Seller’s assets is permitted only in accordance with management’s
authorization; (iv) the reporting of each Seller’s assets is compared with
existing assets at regular intervals; and (v) accounts, notes, and other
receivables are recorded accurately, and proper and adequate procedures are
implemented to effect the collection thereof on a current and timely basis.
(e)Schedule 3.4(e) sets forth the name and position of each officer or manager
or director of each Seller to which such Seller has made a loan that remains
outstanding, including a summary of the original loan amount, the outstanding
balance, and the terms of repayment for each loan.
Section 3.5    Absence of Certain Changes and Events. Since the Balance Sheet
Date, each Seller has conducted its business only in the Ordinary Course of
Business, except as expressly required by the terms of any Transaction Document,
and there has not been any: (a) change in any Seller’s membership interest,
financial rights, or governance rights or issued capital stock, grant of any
option or right to purchase shares of capital stock or any membership interest,
financial rights, or governance rights of any Seller or issuance of any security
convertible into any such interest or right; (b) amendment to the Governing
Documents of any Seller; (c) payment (except in the Ordinary Course of Business)
or increase by any Seller of any bonuses, salaries, or other compensation to any
shareholder, director, member, manager, officer, or employee or entry into any
employment, severance, or similar Contract with any director, officer, member,
manager, officer, or employee; (d) adoption of, amendment to or increase in the
payments to or benefits under, any Employee Benefit Plan; (e) damage to or
destruction or loss of any Acquired Asset, whether or not covered by insurance;
(f) entry into, termination of or receipt of notice of termination of any
Contract or transaction involving a total remaining commitment by any Seller of
at least $10,000; (g) sale, lease, or other disposition of any Acquired Asset
(including the Intellectual Property Assets) or the creation of any Encumbrance
on any Acquired Asset; (h) written indication by any insurance broker, insurance
agent, program administrator, Carrier, Client, or other Third Party with a
material business relationship with any Seller of an intention to discontinue or
change the terms of its relationship with any Seller, which discontinuance or
change could reasonably be expected to cause a Material Adverse Change to any
Seller or the Insurance Business; (i) material change in the accounting methods
used by any Seller; or (j) Contract by any Seller to do any of the foregoing.
Section 3.6    Assets.
(a)The Acquired Assets (i) constitute all of the assets, tangible and
intangible, of any nature whatsoever, necessary to operate the Insurance
Business in the manner presently operated by Sellers, and (ii) include all of
the operating assets of Sellers. Except as set forth on Schedule 3.6(a), Sellers
own and hold, free and clear of any Encumbrances, restriction, or Third-Party
interest of any kind whatsoever (other than Permitted Encumbrances), sole and
exclusive right, title, and interest in and to the Acquired Assets, including
but not limited to the expiration Records for the Current Accounts, together
with the exclusive right to use such Records, and all Client Accounts, copies of
insurance policies and Contracts in force, and all files, invoices, and Records
pertaining to the Clients, Client Accounts, their Contracts, and insurance
policies, and all other information comprising the Total Book of Business, and
to any and all Commissions and other revenues and proceeds generated by the
Acquired Assets (other than applicable Commissions payable to producers). No
Seller is a party to, or bound by, any other agreement, instrument, or
understanding restricting the transfer of the Acquired Assets. There, are no
existing agreements, options, commitments, rights, or privileges, whether
preemptive or contractual, of any Person to acquire any of the assets,
properties, or rights included in the Acquired Assets or any interest therein.

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(b)To the Knowledge of the Sellers, since March 1, 2018, no Seller has received
written notice that any Client set forth in Schedule 1.1(a) has canceled or
non-renewed, or intends to cancel or non-renew, any Insurance Products or
Services with any Seller.
(c)To the Knowledge of Sellers, except as set forth in Schedule 3.6(c), none of
the Insurance Products or Services for Current Accounts set forth in Schedule
1.1(a) represents Retail Brokered Business.
(d)To the Knowledge of Sellers, during the twelve (12) months before the date of
this Agreement, none the Sellers or their respective employees or independent
contractors have placed or serviced any Securities Business for any Client set
forth in Schedule 1.1(a).
(e)To the Knowledge of Sellers, except as set forth on Schedule 3.6(e), no
Seller owns any interest in, is a member of, or is affiliated with any cluster,
joint venture, partnership, or similar association or arrangement with respect
to or in connection with the Insurance Business.
(f)Schedule 3.6(f) sets forth (i) each Sub-Rated Carrier with which any in-force
insurance policies are in place for any Current Account as of the Closing Date,
(ii) the amount of Commission received by Sellers from each such Sub-Rated
Carrier during the twelve (12)-month period ended September 30, 2018, and (iii)
the approval status, as provided by Parent’s Market Security Committee, of each
such Sub-Rated Carrier as of the Closing Date.
(g)To the Knowledge of Sellers, no in-force policy for any Current Account is in
place with any Ineligible Carrier.
(h)Except as set forth in Schedule 3.6(h), no Seller has entered into any
Contract relating to any acquisitions, mergers, and/or purchases or sales of
material assets (including purchases or sales of Client Accounts) within the
past seven (7) years.
(i)Except as set forth on Schedule 3.6(i), to the Knowledge of Sellers, no
employee of any Seller has any ownership interest (vested or unvested) in any
Client Account.
Section 3.7    Contracts; No Defaults.
(a)Schedule 3.7(a) contains a true and complete list, and Sellers have
previously delivered or made available to Buyer true and complete copies, of the
following Material Seller Contracts to which any Seller is a party:
(i)Any written Contract with any Carrier, general agent, insurance broker, or
other source for any Seller to write any Insurance Products or Services, the
termination of which could reasonably be expected to cause a Material Adverse
Change to any Seller, the Acquired Assets, or the Insurance Business;
(ii)Any Real Property Lease or any Lease pertaining to any Tangible Personal
Property of any Seller (regardless of whether Buyer is assuming any such Lease);
(iii)Any non-competition covenants granted in favor of any Seller from any Third
Party, other than any Contracts with current or former employees or independent
contractors described in Schedule 3.12(b); and
(iv)Any other Contract that is material to any Seller or the Insurance Business.
(b)To the Knowledge of the Sellers, the parties to all Seller Contracts are in
compliance, in all material respects, with the terms thereof.
(c)There are no Seller Contracts between any Seller and any manager, director or
officer of any Seller, or between any Seller and any Affiliate of any Key Owner,
or any manager, director or officer of any Seller.

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(d)To the Knowledge of the Sellers, no director, manager, officer, or Key Owner
of any Seller directly or indirectly owns more than 5% equity interest in;
serves as a director, officer, or manager of, or otherwise participates in the
business operations of, any Client of any Seller.
(e)No Seller has guaranteed the performance of any Person under any Contract
including, without limitation, any premium financing obligation on behalf of any
Client.
(f)To the Knowledge of the Sellers, no Seller is engaged in any risk-bearing or
risk-sharing activities, such as, for example but not by way of limitation, as a
party to any Contract whereby such Seller agrees (i) to return any portion of
its commissions to any Carrier based upon the loss ratios generated by any
insurance program that such Seller administers for such Carrier, and/or (ii) to
bear any portion of the total insurance risk placed through any insurance
program administered by such Seller for any Carrier.
(g)Except as set forth on Schedule 3.13(b), no Seller is a party to any Contract
that restricts such Seller’s ability to compete in the Insurance Business or to
solicit any Client Account or transact any such business with any Client or
prospective Client.
Section 3.8    Litigation and Claims. Except as disclosed in Schedule 3.8, there
is no Proceeding pending or, to the Knowledge of any Seller, threatened against
any Seller in connection with the Insurance Business. No Seller is subject to
any outstanding Order that, insofar as can be reasonably foreseen, individually
or in the aggregate, in the future, could reasonably be expected to cause a
Material Adverse Change to any Seller, the Acquired Assets, or the Insurance
Business, or would prevent any Seller from consummating the Contemplated
Transactions.
Section 3.9    Bankruptcy; Solvency. No voluntary or involuntary petition in
bankruptcy, receivership, insolvency or reorganization with respect to any
Seller, or petition to appoint a receiver or trustee of any Seller’s property,
has been filed by or against any Seller. No Seller has made any assignment for
the benefit of creditors or admitted in writing insolvency, or that its property
at fair valuation will not be sufficient to pay its debts, nor will any Seller
permit any judgment, execution, attachment, or levy against it or its properties
to remain outstanding or unsatisfied for more than ten (10) days. No Seller is
“insolvent” and no Seller will be rendered insolvent by any of the Contemplated
Transactions. As used in this section, “insolvent” means that the sum of the
debts and probable Liabilities of any Seller exceeds the present fair saleable
value of such Seller’s assets. Immediately after giving effect to the
consummation of the Contemplated Transactions: (i) each Seller will be able to
pay its Liabilities as they become due in the usual course of its business; (ii)
no Seller will have unreasonably small capital with which to conduct its present
or proposed business; (iii) each Seller will have assets (calculated at fair
market value) that exceeds its Liabilities; and (iv) taking into account all
pending and threatened Proceedings, final judgments against each Seller in
Proceedings for money damages are not reasonably to be rendered at a time when,
or in amounts such that, such Seller will be unable to satisfy such judgments
promptly in accordance with their terms (taking into account the maximum
probable amount of such judgments in any such Proceedings and the earliest
reasonable time at which such judgments might be rendered) as well as all other
obligations of such Seller. The cash available to each Seller, after taking into
account all other anticipated used of the cash, will be sufficient to pay all
such debts and judgments promptly in accordance with their terms.
Section 3.10    Compliance with Applicable Law. Since January 1, 2017, each
Seller and their respective predecessors and Affiliates has complied in all
material respects with all applicable Laws, and no Proceeding has been filed or
commenced against any of them alleging any failure to so comply. Without
limiting the generality of the foregoing, Sellers’ revenues as set forth in the
Financial Statements do not include any fees received in addition to, or in lieu
of, Commissions, except as permitted by applicable Law, and each Seller is
otherwise in compliance in all material respects with applicable Law regarding
rebating, excess fees and charges, and other unfair insurance trade practices.
Each Seller and to the Knowledge of Sellers, its respective employees and agents
hold all Governmental Authorizations (where the failure to hold such
Governmental Authorizations could reasonably be expected to cause a Material
Adverse Change to any Seller or the Insurance Business), including all resident
and nonresident insurance licenses in each jurisdiction where the conduct of the
Insurance Business requires such licensure, and are in compliance in all
material respects with the terms of the Governmental Authorizations. To the
Knowledge of the Sellers, each employee or independent contractor of any Seller
to whom any Seller pays Commissions, and any other Third Party

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to whom any Seller pays Commissions or with whom any Seller shares or splits any
Commissions, holds all insurance licenses required under applicable Law to
receive such Commissions.
Section 3.11    Tax Returns and Audits. Each Seller has timely filed all
federal, state, local, and foreign Tax Returns, including all amended returns,
in each jurisdiction where such Seller is required to do so or has paid or made
provision for the payment of any penalty or interest arising from the late
filing of any such return, has correctly reflected all Taxes required to be
shown thereon, and has fully paid or made adequate provision for the payment of
all Taxes that have been incurred or are due and payable pursuant to such
returns or pursuant to any assessment with respect to Taxes in such
jurisdictions, whether or not in connection with such returns. No Seller is
currently subject to any audits with respect to any federal, state, local, or
foreign Tax Returns required to be filed and there are no unresolved audit
issues with respect to prior years’ Tax Returns. There are no circumstances or
pending questions relating to potential Tax Liabilities nor claims asserted for
Taxes or assessments of any Seller that, if adversely determined, could result
in a Tax Liability that could reasonably be expected to cause a Material Adverse
Change to any Seller or, the Acquired Assets, or the Insurance Business for any
period. No Seller has executed an extension or waiver of any statute of
limitations on the assessment or collection of any Tax due that is currently in
effect. No Seller is holding any unclaimed property that it is required to
surrender to any state taxing authority including, without limitation, any
uncashed checks or unclaimed wages, and each Seller has timely filed all
unclaimed property reports required to be filed with such state taxing
authorities. No Seller purges its Records of uncashed checks.
Section 3.12    Insurance Coverage.
(a)Schedule 3.12(a) sets forth a complete and correct list of all currently
effective insurance policies or binders of insurance or programs of
self-insurance which relate to any Seller (including, without limitation, errors
and omissions (“E&O”), employment practices liability (“EPL”), and employee
theft or employee dishonesty coverage), along with the corresponding Carriers,
minimum Liability limits, deductibles, and expiration dates for each such policy
or binder. True and complete copies of such policies and binders have been
previously delivered or made available for review to Buyer. The coverage under
each such policy or binder is in full force and effect. No Seller has received
any written notice of cancellation or nonrenewal with respect to, or
disallowance of any claim under, or material increase in premium for, any such
policy or binder. Each Seller has complied with all the provisions of such
policies and binders in all material respects. 
(b)Except as set forth in Schedule 3.8, no Seller has incurred any Liability or,
to the Knowledge of Sellers, taken or failed to take any action that could
reasonably be expected to result in a Liability for E&O in the conduct of its
insurance business or EPL, except such Liabilities as are fully covered by
insurance, less any applicable deductible or retention. Each Seller has had the
same or higher levels of E&O and EPL coverage continuously in effect for at
least the past five (5) years.
(c)Schedule 3.12(c) sets forth a complete and correct list of all employee theft
or employee dishonesty losses incurred and/or claims made by any Seller in the
past five (5) years.
Section 3.13    Employees and Independent Contractors.
(a)With respect to the Insurance Business of Sellers:
(i)There is no collective bargaining agreement or relationship with any labor
organization; no labor organization or group of employees has filed any
representation petition or made any written or oral demand for recognition; no
labor strike, work stoppage, slowdown, or other material labor dispute has
occurred, and none is underway or, to the Knowledge of any Seller, threatened;
and, to the Knowledge of any Seller, no union organizing or decertification
efforts are underway or threatened and no other question concerning
representation exists;
(ii)To the Knowledge of any Seller, no executive or manager of any Seller (A)
has any present intention to terminate his or her employment, or (B) is a party
to any confidentiality, non-competition, proprietary rights, or other such
agreement between such employee and any Person besides Sellers that would be

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material to the performance of such employee’s employment duties, or the ability
of Sellers or Buyer to conduct the Insurance Business of Sellers;
(iii)To the Knowledge of Sellers, there is no workers’ compensation Liability,
experience, or matter outside the Ordinary Course of Business;
(iv)There is no employment-related charge, complaint, grievance, investigation,
inquiry, or obligation of any kind, of which Sellers have received written
notice, or, to the Knowledge of the Sellers, threatened in any forum, relating
to an alleged violation or breach by any Seller (or any of their respective
current or former members, shareholders, managers, directors, officers,
employees, independent contractors or agents) of any Law or Contract; and
(v)To the Knowledge of any Seller, no current or former members, managers,
shareholders, directors, officers, employees, independent contractors, or agents
has committed any act or omission giving rise to material Liability for any
violation or breach identified in subsection (iv) above.
(b)Except as set forth in Schedule 3.13(b), there are no: (i) employment
agreements, producer agreements, agent representation agreements,
non-competition agreements, non-solicitation agreements, non-disclosure
agreements, confidentiality agreements, or similar Contracts with any employees
of any Seller; (ii) severance agreements with any former employees of any
Seller; or (iii) to the Knowledge of Sellers, independent contractor agreements
with any independent contractors of any Seller. True and complete copies of all
such Contracts have been provided to Buyer before Closing Date.
(c)No employee of any Seller is on a paid or unpaid leave of absence, including,
without limitation, a leave of absence (i) under the federal Family and Medical
Leave Act (FMLA) or any similar state or local Law or (ii) for service in the
United States Armed Forces, Reserves, National Guard, or other “uniformed
services” as defined in the Uniformed Services Employment and Reemployment
Rights Act of 1994, as amended, or has given written notice of his or her intent
to take such leave within the ninety (90)-day period following the Closing Date.
(d)Within the past three (3) years, no Seller has implemented any plant closing
or layoff of employees that could implicate the Worker Adjustment and Retraining
Notification Act of 1988, as amended (the WARN Act), or any similar state,
local, or non-U.S. Law, and no such action will be implemented without advance
notification to Buyer.
Section 3.14    Employee Benefit Plans. Schedule 3.14 lists each Employee
Benefit Plan that any Seller or any Seller ERISA Affiliate maintains or to which
any Seller or any Seller ERISA Affiliate contributes or with respect to which
Seller or any Seller ERISA Affiliate has or may have any Liability.
(a)Each such Employee Benefit Plan (and each related trust, insurance contract,
or fund) has been maintained, funded, and administered in accordance with the
terms of such Employee Benefit Plan and the terms of any applicable collective
bargaining agreement and complies in form and in operation in all respects with
the applicable requirements of ERISA, the Code, and other applicable Laws.
(b)All required reports and descriptions (including IRS Form 5500 annual
reports, summary annual reports, and summary plan descriptions) have been timely
filed and/or distributed in accordance with the applicable requirements of ERISA
and the Code with respect to each such Employee Benefit Plan. The requirements
of COBRA have been met with respect to each such Employee Benefit Plan and each
Employee Benefit Plan maintained by a Seller ERISA Affiliate that is an Employee
Welfare Benefit Plan subject to COBRA.
(c)All contributions (including all employer contributions and employee salary
reduction contributions) that are due have been made within the time periods
prescribed by ERISA and the Code to each such Employee Benefit Plan that is an
Employee Pension Benefit Plan and all contributions for any period ending on or
before the Closing Date that are not yet due have been made to each such
Employee Pension Benefit Plan or accrued

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in accordance with the past custom and practice of Sellers. All premiums or
other payments for all periods ending on or before the Closing Date have been
paid with respect to each such Employee Benefit Plan that is an Employee Welfare
Benefit Plan.
(d)Each such Employee Benefit Plan that is intended to meet the requirements of
a “qualified plan” under Code Section 401(a) has received a determination from
the IRS that such Employee Benefit Plan is so qualified, and to the Knowledge of
Sellers, nothing has occurred since the date of such determination that could
adversely affect the qualified status of any such Employee Benefit Plan. All
such Employee Benefit Plans have been timely amended for all such requirements
and have been submitted to the IRS for a favorable determination letter within
the latest applicable remedial amendment period.
(e)To the Knowledge of Sellers, there have been no Prohibited Transactions with
respect to any such Employee Benefit Plan or any Employee Benefit Plan
maintained by a Seller ERISA Affiliate. To the Knowledge of Sellers, no
fiduciary of any such Employee Benefit Plan has any Liability for breach of
fiduciary duty or any other failure to act or comply in connection with the
administration or investment of the assets of any such Employee Benefit Plan. No
Proceeding with respect to the administration or the investment of the assets of
any such Employee Benefit Plan (other than routine claims for benefits) is
pending or, to the Knowledge of any Seller (or any employee of any Seller with
responsibility for employee benefits matters), threatened. No Seller (or any
employee of any Seller with responsibility for employee benefits matters) has
any Knowledge of any basis for any such Proceeding.
(f)Sellers have delivered to Buyer correct and complete copies of the plan
documents and summary plan descriptions; the most recent determination letter
received from the IRS; the three (3) most recent annual reports (IRS Form 5500,
with all applicable attachments); and all related trust agreements, insurance
contracts, and other funding arrangements that implement each such Employee
Benefit Plan.
(g)Neither Seller nor any Seller ERISA Affiliate contributes to or has ever
contributed to, has any obligation to contribute to, or has or may have any
Liability under or with respect to any Employee Pension Benefit Plan that is a
“defined benefit plan” (as defined in ERISA Section (35)). No asset of any
Seller is subject to any Encumbrance under ERISA or the Code. No accumulated
funding deficiency, whether or not waived, exists with respect to any Employee
Pension Benefit Plan; no event has occurred or circumstance exists that may
result in an accumulated funding deficiency as of the last day of the current
plan year of any such plan. The actuarial report for each Employee Pension
Benefit Plan that is a defined benefit plan fairly presents the financial
condition and the results of operations of each such plan in accordance with
GAAP. To the Knowledge of Sellers, no reportable event (as defined in ERISA
Section 4043 and in regulations issued thereunder) has occurred at any time.
(h)Neither Seller nor any Seller ERISA Affiliate contributes to or has ever
contributed to, has any obligation to contribute to, or has or may have any
Liability (including withdrawal Liability as defined in ERISA Section 4201)
under or with respect to any Multiemployer Plan.
(i)Except as set forth on Schedule 3.14, no Seller maintains an Employee Benefit
Plan or other arrangement that is subject to Section 409A of the Code. Each
Employee Benefit Plan or arrangement that is a nonqualified, deferred
compensation plan subject to Section 409A of the Code, has been operated and
administered in good faith compliance with Section 409A of the Code since
January 1, 2005, and in full operational and documentary compliance with final
regulations promulgated under Code Section 409A since January 1, 2009.
(j)Schedule 3.14 also sets forth (i) the number of outstanding loans for
participants in the 401(k) Plan and (ii) the outstanding loan balance for each
such participant as of the Balance Sheet Date.
Section 3.15    Intellectual Property.
(a)Schedule 3.15 sets forth each internet website, service mark registration and
application therefor, trademark registration and application therefor, copyright
registration and application therefor, patent, patent application, material
unregistered service mark, material unregistered trademark, and material trade
name, in each case owned and used by any Seller in its operation of the
Insurance Business.

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(b)Subject to the provisions of Section 3.15(c) below, Sellers have the right to
use the Intellectual Property used in the Insurance Business, and except as
otherwise set forth therein, the Intellectual Property is, and will be on the
Closing Date, free and clear of all royalty obligations and Encumbrances. There
are no Proceedings pending, or to the Knowledge of any Seller, threatened,
asserting that any Seller’s use of such Intellectual Property listed on Schedule
3.15 infringes the intellectual property rights of any Person. No Seller Party
has any Knowledge of any use by any Seller of such Intellectual Property
constituting an infringement thereof, and none of the Shareholders or Member has
any right, claim, or interest in or to such Intellectual Property.
(c)The current Software applications, other than to the extent the Software is
Public Software or “off-the-shelf” Software, used by any Seller in the operation
of the Business, are set forth and described on Schedule 3.15 (“Seller
Software”). To Seller’s Knowledge, Seller Software, to the extent it is licensed
from any Third-Party licensor or it constitutes “off-the-shelf” Software, is
held by Sellers under valid, binding, and enforceable licenses. The third-party
Software installed on each Seller’s computer hardware is validly licensed. No
Seller has sold, assigned, externally licensed, or distributed, or in any other
way encumbered Seller Software.
Section 3.16    Real Property.
(a)No Seller owns any of the Office Locations.
(b)Seller has provided to Buyer a true and complete copy of the Real Property
Lease for each Office Location. With respect to each Real Property Lease, to the
Knowledge of Sellers (i) such Real Property Lease is valid, binding and in full
force and effect with respect to the Seller who is the lessee or sublessee, as
applicable, thereunder, and the other parties thereto; (ii) all payments
required to have been made under such Real Property Lease by such Seller have
been made; (iii) there are no other defaults or events of default under, or
events which with due notice or lapse of time, or both, would constitute
defaults or events of default under, such Real Property Lease by such Seller,
or, the landlord or sub landlord, as applicable, under such Real Property Lease;
(iv) except as described in Schedule 3.16, the Contemplated Transactions do not
require the consent of any other party to any Real Property Lease, will not
result in a breach of or default under any Real Property Lease, and will not
otherwise cause any Real Property Lease to cease to be legal, valid, binding,
and in full force and effect on identical terms following Closing; (v) Sellers’
possession and quiet enjoyment of the real property subject of the Real Property
Leases has not been disturbed; (vi) no security deposit or portion thereof
deposited with respect to any Real Property Lease has been applied in respect of
a breach of or default under a Real Property Lease that has not been redeposited
in full; (vii) no Seller owes in the future any brokerage commissions or
finder’s fees with respect to any Real Property Lease; (viii) except as
described in Schedule 3.16, the other party to any Real Property Lease is not an
Affiliate of, and otherwise does not have, any economic interest in any Seller;
(ix) no Seller has collaterally assigned or granted any other Encumbrance in any
Real Property Lease or any interest therein; and (x) no Seller has subleased,
licensed, or otherwise granted any Person the right to use or occupy the real
property subject of the Real Property Leases or any portion thereof except as
detailed on Schedule 3.16.
Section 3.17    No Brokers or Finders. No agent, broker, investment banker,
financial advisor, or other firm or person is or will be entitled to any
broker’s or finder’s fee or any other commission or similar fee from any Seller
or any of their respective Affiliates in connection with the consummation of the
Acquisition or any of the other Contemplated Transactions.
Section 3.18    Schedules. Each of the Schedules delivered by the Seller
pursuant to this Agreement is true and complete in all material respects.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF BUYERS
Buyer represents and warrants to the Sellers as follows:
Section 4.1    Organization. Buyer is a corporation duly organized, validly
existing, and in good standing under the Law of the State of Minnesota and its
status is active. Buyer and Parent has all requisite power and

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authority and all necessary Governmental Authorizations to own, lease and
operate its properties and to carry on its business as now being conducted.
Section 4.2    Authority. Each of Buyer and Parent has the requisite corporate
power and authority to execute and deliver this Agreement and to consummate the
Contemplated Transactions. The execution, delivery, and performance of the
Buyer’s Documents have been duly authorized by all necessary action on the part
of Buyer or Parent. This Agreement and the Buyer’s Documents will be duly
executed and delivered, respectively, by the duly authorized representative of
Buyer and/or Parent, as applicable, on behalf of Buyer and/or Parent, as
applicable. This Agreement and the other Buyer’s Documents when executed and
delivered will constitute the legal, valid, and binding obligations of Buyer
and/or Parent, enforceable against Buyer and/or Parent, as applicable, in
accordance with their terms, subject to applicable bankruptcy, insolvency,
reorganization, or similar applicable Law from time to time in effect relating
to or affecting the enforcement of creditors’ rights generally and general
equitable principles.
Section 4.3    Consents and Approvals; No Violations. Neither the execution,
delivery, or performance of this Agreement by Buyer, or Parent nor the
consummation by Buyer or Parent of the Contemplated Transactions, nor compliance
by them, as and when due, with any of the provisions of the Buyer’s Documents
will: (a) conflict with or result in any Breach of any provision of Buyer’s or
Parent’s Governing Documents; (b) except for notices required under Parent’s E&O
insurance policy or Parent’s credit facilities, a press release that may be
required to fulfill Parent’s disclosure obligations as a New York Stock
Exchange-listed company regarding the Acquisition, or for the approvals required
under the Hart-Scott-Rodino Act, require any notice to, filing with, or permit,
authorization, Consent, or approval of, any Governmental Body; or (c) result in
a violation or Breach of, or constitute a default under, any of the terms,
conditions, or provisions of any agreement or other instrument or obligation to
which Buyer or Parent is a party or by which Buyer or Parent or any of their
respective properties or assets may be bound.
Section 4.4    No Brokers or Finders. No agent, broker, investment banker,
financial advisor, or other firm or person is or will be entitled to any
broker’s or finder’s fee or any other commission or similar fee from Buyer,
Parent, or any of their respective Affiliates in connection with the
consummation of the Acquisition or any of the other Contemplated Transactions.
Section 4.5    Capitalization.
(a)The authorized capital stock of Parent consists of 560,000,000 Parent Shares.
The number of issued and outstanding Parent Shares is as stated in the SEC
Reports as of the date(s) stated therein.
(b)Upon the Closing, the Parent Shares constituting the Closing Stock
Consideration will be duly authorized, validly issued, fully paid and
non-assessable, and shall be issued without violation of any preemptive rights
of any third party free and clear of all Encumbrances (other than restrictions,
if any, imposed by Law).
Section 4.6    SEC Reports.
(a)Parent has filed with the SEC all forms, reports, schedules and other
documents under the Exchange Act required to be filed by it with the SEC for the
12 months preceding the date hereof (the foregoing materials, including the
exhibits thereto and documents incorporated by reference therein being
collectively referred to herein as the “SEC Reports”), and will file all such
forms, reports, schedules and other documents required to be filed subsequent to
the date of this Agreement through the Closing. As of their respective dates,
the SEC Reports (i) were prepared in accordance, in all material respects, with
the Securities Act or the Exchange Act, as the case may be, as in effect on the
date so filed, and (ii) did not, at the time they were filed (or, if amended, as
of the date of such amendment), contain any untrue statement of a material fact
or omit to state a material fact required to be stated or incorporated by
reference therein or necessary in order to make the statements made therein, in
the light of the circumstances under which they were made, not misleading;
provided, that Parent makes no representation or warranty whatsoever concerning
any SEC Report as of any time other than the date or period with respect to
which it was filed. The certifications and statements required by (x) Rule
13a-14 under the Exchange Act and (y) 18 U.S.C. § 1350 relating to the SEC
Reports are accurate and complete and comply as to form and content with all
applicable Law in all material respects.

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(b)Each of the consolidated financial statements included in or incorporated by
reference into the SEC Reports was prepared in accordance with (i) GAAP, applied
on a consistent basis throughout the periods indicated, and (ii) Regulation S-X
or Regulation S-K, as applicable, subject, in the case of the unaudited
financial statements, to normal recurring year-end adjustments (the effect of
which will not, individually or in the aggregate, be materially adverse) and the
absence of notes (to the extent permitted by Regulation S-X or Regulation S-K,
as applicable). Each such financial statement fairly presents, in all material
respects, the consolidated financial position, results of operations and cash
flows of Parent as of the respective dates thereof and for the respective
periods indicated therein, except as otherwise noted therein.
Section 4.7    Listing. As of the date of this Agreement, the Parent Shares are
listed on the New York Stock Exchange. There is no Proceeding pending or, to
Buyer’s knowledge, threatened against Parent by the New York Stock Exchange with
respect to any intention by such entity to prohibit or terminate the listing of
the Parent Shares on the New York Stock Exchange.
Section 4.8    Investigation. Buyer acknowledges that it is relying solely on
its own independent investigation and analysis and the representations and
warranties of the Sellers set forth in Article 3 in entering into the
Contemplated Transactions. Buyer is knowledgeable about the industries in which
the Sellers operate and is capable of evaluating the merits and risks of the
Contemplated Transactions. Buyer has been afforded full access to the books and
records, facilities, and personnel of the Sellers for purposes of conducting a
due diligence investigation and has conducted a full due diligence investigation
of the Sellers.
ARITCLE 5
ADDITIONAL AGREEMENTS
Section 5.1    Expenses. Except as otherwise expressly set forth in this
Agreement, whether or not the Acquisition is consummated, all costs and expenses
incurred in connection with this Agreement and the Contemplated Transactions
will be paid by the Party incurring such expenses. For clarity and without
limiting the foregoing: (a) all filing fees incurred in connection with the
filing of name change documents on behalf of any Seller, or any other documents
necessary to affect the change each Seller’s corporate name with any applicable
Governmental Body, will be Sellers’ responsibility; and (b) all filing fees
incurred in connection with the filing of any fictitious name registration
documents on behalf of Buyer with any applicable Governmental Body, will be
Buyer’s responsibility, regardless of the Party that, for logistical reasons,
convenience or otherwise, actually submits such documents with any applicable
Governmental Body.
Section 5.2    Errors and Omissions and Employment Practices Liability Extended
Reporting Coverage.
(a)On or before the Closing Date, Sellers must arrange to purchase, at Sellers’
expense, extended reporting period (“tail”) coverage extensions for each of
Sellers’ E&O insurance policies and EPL insurance policies (the “Required Tail
Coverage”). The Required Tail Coverage will extend for a period of at least five
(5) years from the Closing Date, will have the same limits and deductibles
currently in effect, and will otherwise be in form reasonably acceptable to
Buyer. Evidence of Sellers’ arrangement to procure the Required Tail Coverage,
satisfactory to Buyer in its commercially reasonable discretion, will be
delivered to Buyer at or before Closing. Without limiting the generality of the
foregoing, the endorsement or policy evidencing the Required Tail Coverage will
not contain an “other insurance” or other provision that purports to make the
Required Tail Coverage excess rather than primary and non-contributory coverage
as to any error or omission or EPL occurrence arising before the Closing Date
(an “Excess Coverage Provision”). If the Required Tail Coverage is procured as
an endorsement to Sellers’ existing E&O policies or EPL insurance policies, and
the existing policy contains an Excess Coverage Provision, the Required Tail
Coverage endorsement will amend the existing policies to (i) remove the Excess
Coverage Provision and (ii) state expressly that the Required Tail Coverage will
be primary and non-contributory as to any error or omission or EPL occurrence
arising before the Closing Date.
(b)Notwithstanding the foregoing, it is the Parties’ intent that, subject to the
terms and conditions of Article 6 of this Agreement: (i) as between the Required
Tail Coverage and any coverage that might be available under Parent’s policies,
the Required Tail Coverage will be primary and non-contributory; (ii) the
Sellers, jointly and

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severally, will be solely liable for any deductibles or retentions under the
Required Tail Coverage; and (iii) in the event Parent’s policies must so
respond, the Sellers will remain jointly and severally liable to Buyer for any
deductibles or other related costs or expenses incurred by Parent.
(c)Within one (1) Business Day following the Closing Date, and thereafter during
the term of the Required Tail Coverage as Buyer may request from time to time,
Sellers will promptly provide Buyer with a certificate of insurance evidencing
the Required Tail Coverage. After the Closing, with respect to any Proceeding
that names or otherwise involves Buyer or its Affiliates as to which defense
and/or coverage may be available for Buyer or its Affiliates under the Required
Tail Coverage, Buyer may, at its option and sole discretion, directly pay any
applicable deductible under the Required Tail Coverage to the appropriate
Carrier (the “Required Tail Deductible”) and seek indemnity from the Sellers for
such Required Tail Deductible as a Retained Liability pursuant to Article 6.
Nothing in this Section 5.2 will limit or affect the Parties’ respective rights
and obligations under Article 6.
Section 5.3    Appointments. On or prior to the Closing Date, Parent shall
cause: (i) James C. Hays to be appointed to Parent’s board of directors and
appointed as an officer of Parent with the title Vice Chairman, and (ii) Mike
Egan to be appointed as an officer of Parent with the title Regional
President-Retail Division.
Section 5.4    Post-Closing Employee Matters.
(a)After the Closing, and at Buyer’s request, Sellers will (i) take all
reasonable measures to enforce the terms of those
non-compete/non-solicitation/confidentiality agreements with its existing or
former employees and/or independent contractors that either have not been or
cannot be assigned to Buyer, including pursuing legal and injunctive
Proceedings, and (ii) cooperate with Buyer in enforcing the terms of those
Contracts assigned to Buyer and will join in any legal or injunctive Proceedings
instituted by Buyer for such purpose. If the violating party was an employee of
Sellers providing services to Buyer pursuant to the Transition Services
Agreement after the Closing Date or became an employee of Buyer on the Closing
Date, any such action will be at Buyer’s cost and expense. If the violating
party was no longer an employee of a Seller providing services to Buyer pursuant
to the Transition Services Agreement after the Closing Date or did not become an
employee or contractor of Buyer on the Closing Date, any such action will be at
the Sellers’ cost and expense. Without Buyer’s prior written consent, which
Buyer may withhold in its sole and absolute discretion, Sellers will not amend,
modify, waive, release, or otherwise affect the terms of any such
non-compete/non-solicitation/confidentiality agreements with any Seller’s former
employees and/or independent contractors. Nothing in this Section 5.4(a) will be
deemed or construed to (x) impose any obligation or duty on Buyer to initiate
any such Proceeding, which may be initiated by Buyer in its sole discretion, or
(y) limit, modify, or otherwise affect Sellers’ indemnity obligations under
Section 6.2.
(b)Notwithstanding anything in this Agreement to the contrary, at Buyer’s
option, Buyer and Sellers will promptly, but in any event no later than ninety
(90) days following the Closing Date, reasonably cooperate and file such forms,
notices, reports, or other instruments with state taxing authorities as are
necessary to effect the transfer of each Seller’s state unemployment records,
unemployment rating account balance, state unemployment Taxes paid by each
Seller, each Seller’s existing State Unemployment Insurance (SUI) account number
(notwithstanding whether any Seller will continue in existence following
Closing, in which case, each such Seller is responsible for obtaining, at its
sole expense, a new SUI account number), and other aspects of each Seller’s
pre-Closing unemployment experience to Buyer, as successor employer of the Hired
Employees.
(c)For purposes of determining eligibility to participate, vesting and
entitlement to benefits where length of service is relevant under any benefit
plan or arrangement of Buyer, any Hired Employee who is employed by Sellers as
of the Payroll Transition Date will receive service credit for service with
Sellers to the same extent such service credit was granted under Sellers’
Employee Benefit Plans, subject to offsets for previously accrued benefits and
no duplication of benefits.
Section 5.5    Corporate Name, Tradenames, Service Marks, Etc.
(a)From and after Closing, the Sellers agree:

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(i)Not to use any tradename or service mark (whether or not registered)
identical or confusingly similar to any Seller’s corporate name, tradenames, and
service marks (whether or not registered), or any colorable imitations thereof,
and/or any mark, name, or any words or representations confusingly similar
thereto in connection with the advertising, offering for sale, and/or sale, of
any Insurance Products or Services (though each Seller will be entitled to the
use of such Seller’s corporate name in connection with the winding-down of such
Seller’s affairs or such Seller’s liquidation, including collecting the Seller
Accounts Receivable);
(ii)Otherwise not to infringe on any service mark and name (whether or not
registered by any Seller or Buyer) that Buyer is acquiring hereunder from any
Seller;
(iii)Not to use any Seller’s corporate name tradename, or any internet domain
name of any Seller, which Buyer is acquiring hereunder, to unfairly compete with
Buyer, pass off its Insurance Products or Services as those of Buyer, or
otherwise to cause any misunderstanding as to source, sponsorship, approval, or
certification with or by Buyer or its Insurance Products or Services.
(b)Promptly after the Closing, each Seller will file name change documents with,
and pay the accompanying filing fees to, the Minnesota Secretary of State.
(c)Notwithstanding the limitations set forth in this Section 5.5, Sellers and
their Affiliates may use such tradenames, service marks, internet domain names,
and e-mail addresses as are currently being used by Sellers and their Affiliates
in connection with businesses carried on by, relating to, or otherwise
incorporating, the Excluded Assets and for a reasonable transition period
following the Closing, all in accordance with the License Agreement.
(d)The Sellers’ covenants under this Section 5.5 will survive indefinitely after
the Closing.
Section 5.6    Post-Closing Payment of Liabilities; Waiver of Bulk Sales Laws.
Sellers in their commercially reasonable discretion will maintain sufficient
assets after the Closing to satisfy those Retained Liabilities that were not
otherwise satisfied out of the Secured Debt Amount at Closing. Without limiting
the generality of the foregoing:
(a)Taxes Resulting from Sale of Assets by Sellers. Sellers will pay in a timely
manner all Taxes resulting from or payable in connection with (i) Sellers’
ownership or operation of the Insurance Business before the Closing Date and/or
(ii) the sale of the Acquired Assets pursuant to this Agreement, regardless of
the Person who is liable for such Taxes under applicable Law. Without limiting
the generality of the foregoing, (A) the Sellers will, in a timely manner, file
all returns for and pay all (1) tangible personal property Taxes (or ad valorem
Taxes) in all applicable jurisdictions for each taxable year during which
Sellers owned or owns the Acquired Assets on the Tax Measurement Date for such
taxable year, and (2) all other Taxes in all applicable jurisdictions for all
periods before the Closing Date, and (B) the Sellers, jointly and severally,
will indemnify Buyer for any unpaid unemployment or other Taxes, interest, and
penalties, in accordance with Article 6.
(b)Payment of Other Retained Liabilities. Sellers will pay, or make adequate
provision for the payment, in the Ordinary Course of Business all of the
Retained Liabilities including, without limitation, outstanding Carrier payables
incurred before the Closing.
(i)After Closing, Sellers may transfer to Buyer amounts due for outstanding
Carrier payables and Buyer, on behalf of Sellers, will directly pay each
Seller’s pre-Closing Carrier payables in appropriate amounts.
(ii)After Closing Sellers may transfer to Buyer amounts held by Sellers on
behalf of Client Accounts. If any such funds are transferred, Buyer, on behalf
of and at the direction of Sellers, will remit the appropriate portions of the
Client Credit Balances Amount to the respective Clients and/or offset such
portions against future premiums due from such Clients, as appropriate. If any
monies that Buyer attempts to remit to a Client are returned as undeliverable to
the Client, Buyer will promptly remit the returned monies to Sellers’
Representative,

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which will be solely responsible for timely tendering such monies and related
forms to the appropriate Governmental Bodies as abandoned property;
(c)Waiver of Bulk Sales Laws. Buyer and Sellers hereby waive compliance with any
applicable Bulk Sales Laws in connection with the Contemplated Transactions.
Section 5.7    Client and other Business Relationships; Collection of Seller
Accounts Receivable.
(a)Client and other Business Relationships. After the Closing, the Sellers and
their Representatives will reasonably cooperate with Buyer in its efforts to
continue and maintain for the benefit of Buyer those business relationships of
each Seller existing before the Closing and relating to the business to be
operated by Buyer after the Closing, including relationships with lessors,
employees, Governmental Bodies, Clients, insurance brokers, insurance agents,
Carriers, administrators, licensors, and vendors, and Sellers will satisfy the
Retained Liabilities in a manner that is not reasonably expected to be
detrimental to any of such relationships. The Sellers will refer to Buyer all
inquiries relating to the Insurance Business. None of the Sellers or any
manager, director, officer, employee, or agent of any Seller will take any
action that would reasonably be expected to diminish the value of the Acquired
Assets after the Closing or that would reasonably be expected to interfere with
the business of Buyer to be engaged in after the Closing.
(b)Collection of Seller Accounts Receivable. Without limiting the foregoing, the
Sellers will use commercially reasonable efforts in collecting the Seller
Accounts Receivable and will avoid any action or omission that is reasonably
likely to cause any Current Account to cancel or non-renew any Insurance
Products or Services with Buyer.
Section 5.8    Life Insurance Policy. Buyer may, at its option and expense,
purchase a term life insurance policy on the life of each Key Owner, with a
limit and term to be determined in Buyer’s discretion and with benefits payable
to Buyer (each a “Key Owner Life Policy”). Sellers will cause each Key Owner to
reasonably cooperate with Buyer in connection with Buyer’s efforts to obtain
such insurance and take such actions (including, without limitation, obtaining
such Key Owner’s consent and submitting to physical examinations) as may
reasonably be required for such purpose.
Section 5.9    Termination of Access to Systems. Promptly following Closing,
Sellers will terminate access by any Third Party to Sellers’ agency management
system or Carriers through Sellers’ contracts with those Carriers.
Section 5.10    Operation of New Profit Center During Earn-Out Period.
(a)Management of New Profit Center During Earn-Out Period;
(i)The management of the New Profit Center will be generally consistent with the
past business practices and corporate policies of the Sellers, subject to
compliance with: Buyer’s and Parent’s quality control guidelines; Buyer’s and
Parent’s accounting methodology, procedures, guidelines, and internal controls;
the Sarbanes-Oxley Act of 2002, as amended, and other applicable Law; any
necessary information technology (IT) upgrades; and generally the requirement to
manage the New Profit Center for the long-term benefit of Buyer, Parent, and
Parent’s shareholders. Parent shall permit and enable management of the Earn-Out
Locations to operate following the Closing Date in substantially the same manner
as the Sellers operated the Insurance Business at the Earn-Out Locations prior
to the date hereof.
(ii)The leader of the New Profit Center, which will be James C. Hays for the
duration of the Earn-Out Period as long he remains an employee of Buyer/Parent;
provided if James C. Hays is not so employed, Mike Egan will be the leader of
the New Profit Center for the remaining duration of the Earn-Out Period as long
as he remains an employee of Buyer/ Parent, may not make any managerial
decision, including any decision to minimize the New Profit Center’s expenses in
the Earn-Out Period (including by implementing material staff reductions that
are not dictated by a corresponding reduction in business or, in individual
cases and with Buyer’s reasonable prior written approval, by a legitimate
business reason unrelated to the determination of the Purchase Price), for the
primary

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purpose of maximizing the Purchase Price. Conversely, Buyer may not take any
action, including any action to increase the New Profit Center’s expenses during
the Earn-Out Period, for the primary purpose of minimizing the Purchase Price.
(iii)In the event of the occurrence of any of the following events, the maximum
Earn-Out Payment shall be immediately due and payable in full, to the extent not
previously paid: (1) Parent or Buyer commences any proceeding in bankruptcy or
for dissolution, liquidation, winding-up, or other relief under state or federal
bankruptcy laws; (2) any such proceeding is commenced against Parent or Buyer,
or a receiver or trustee is appointed for Parent or Buyer or a substantial part
of its respective property, and such proceeding or appointment is not dismissed
or discharged within sixty (60) days after its commencement; (3) Parent or Buyer
makes an assignment for the benefit of creditors, or petitions or applies to any
tribunal for the appointment of a custodian, receiver or trustee for all or
substantially all of its assets or has a receiver, custodian or trustee
appointed for all or substantially all of its assets; or (4) the employment of
James C. Hays and Mike Egan is terminated by Buyer without Cause (as that term
is defined in their respective employment agreements with Buyer/Parent).
(b)Acquisitions or Transfers During Earn-Out Period.
(i)During the Earn-Out Period, no acquisitions by Buyer or the New Profit Center
will be merged into the New Profit Center unless mutually agreed by the Parties.
(ii)If Buyer elects to sell, transfer, assign, or remove (“Transfer”) any Client
Accounts from the Total Book of Business of the Earn-Out Locations (each a
“Transferred Account”) during the Earn-Out Period, the Transfer will be treated
as follows:
(A)If the Transfer is effective during the first twelve (12) months of the
Earn-Out Period, then an annualized amount equal to (1) the Core Revenue
attributable to the Transferred Account in the Pro Forma Operating Profit
(“Transferred Account Core Revenue”), less any such Core Revenue that Buyer has
already recognized before the effective date of the Transfer; times (2) the Pro
Forma Operating Profit Margin; will be credited for purposes of calculating
Operating Profit for the remainder of the Earn-Out Period; and
(B)If the Transfer is effective after the first twelve (12) months of the
Earn-Out Period, then an annualized amount equal to (1) the Core Revenue
recognized by Buyer from the Transferred Account during the twelve (12)-month
period before the effective date of such Transfer, times (2) the Operating
Profit margin generated by the New Profit Center during the twelve (12)-month
period before the effective date of such Transfer, will be credited for purposes
of calculating Operating Profit for the remainder of the Earn-Out Period. For
example, if Buyer transferred certain Transferred Accounts eighteen (18) months
after the Closing Date, the Core Revenue earned by Buyer from the Transferred
Accounts during the twelve (12)-month period before such Transfer equaled
$10,000, and the New Profit Center’s Operating Profit margin for such twelve
(12)-month period equaled thirty-five percent (35%), then $3,500 will be
credited on an annualized basis toward the Operating Profit.
Section 5.11    Sellers’ Restrictive Covenants.
(a)Non-Competition Covenant. Each Seller agrees that such Seller will not, for a
period of five (5) years following the Closing Date (the “Restricted Period”),
engage in, or be or become the owner of an equity interest in, or otherwise
consult with, be employed by, or participate in the business of any Person,
other than Buyer, Parent, or their Affiliates, successors, and assigns (each and
collectively, the “Buyer Group”) engaged in the Insurance Business within the
applicable Restricted Area, as defined below (the “Non-Compete Covenant”);
provided, however, that (A) ownership of less than three percent (3%) of the
outstanding market capitalization of any publicly traded corporation or (B)
those investments set out on Schedule 5.11 will not be deemed a violation of the
Non-Compete Covenant. The term “Restricted Area” means the United States.
(b)Non-Solicitation Covenants. Without limiting anything set forth in Section
5.11, during the Restricted Period:

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(i)No Seller will, directly or indirectly, in any capacity whatsoever, solicit,
divert, quote, propose, sell, place, provide, service, or renew any Insurance
Products or Services in respect of any Seller Account. Each Seller recognizes
and acknowledges that such Seller Accounts are not confined to any geographic
area. Therefore, each Seller acknowledges and understands that there is no
geographic restriction that applies to the non-solicitation covenant as
contained in this Section 5.11(b)(i) and that the scope of this covenant is
appropriately limited by the customer-based restriction.
(ii)No Seller will take any action intended to or which would reasonably be
expected to cause any Seller Account or other Person with a material business
relationship with Seller or Buyer, to cease, reduce, or refrain from transacting
business with Buyer.
(iii)No Seller will, directly or indirectly, solicit, hire, engage, or seek to
induce any Hired Employee to terminate such employee’s employment with Buyer for
any reason, including, without limitation, to work for any Seller or any
competitor of Buyer
(c)Confidentiality.
(i)Each Seller recognizes and acknowledges that, as part of this Agreement,
Buyer is purchasing from Sellers certain Confidential Information, which will
constitute valuable, secret, special, and unique assets of Buyer. Each Seller
covenants and agrees that such Seller will not disclose the Confidential
Information to any Person for any reason or purpose without the express written
approval of Buyer and will not use the Confidential Information except in the
businesses of Buyer and its Affiliates. It is expressly understood and agreed
that the Confidential Information is the property of Buyer and must be
immediately returned to Buyer upon demand.
(ii)Any trade secrets Buyer acquired from Sellers hereunder will also be
entitled to all of the protections and benefits under applicable trade secret
Law and any other applicable Law. If any information that Buyer deems to be a
trade secret is found by a court of competent jurisdiction not to be a trade
secret for purposes of this Agreement, such information will in any event still
be considered Confidential Information for purposes of this Agreement. In the
case of trade secrets, Sellers hereby waives any requirement that Buyer submit
proof of the economic value of any trade secret or post a bond or other
security.
(d)Scope of Covenants. Each Seller acknowledges and agrees that: (i) the
covenants set forth in this Agreement are being entered into (A) in connection
with, and as a material inducement for Buyer to enter into, the Acquisition and
(B) voluntarily and for adequate consideration; and (ii) given the nature and
geographic scope of the Insurance Business, the Restricted Period and the
Restricted Area are reasonable in time and geographic area.
(e)Remedies.
(i)In the event of a breach or threatened breach of the provisions of Section
5.11 of this Agreement, Buyer will be entitled to injunctive relief as well as
any other applicable remedies at law or in equity. Should a court of competent
jurisdiction declare any of the covenants set forth in this Agreement
unenforceable due to an unreasonable restriction, duration, geographical area or
otherwise, the Parties agree that such court will be empowered and will grant
Buyer or its Affiliates injunctive relief to the extent reasonably necessary to
protect their respective interests. Each Seller acknowledges that the covenants
set forth in this Agreement represent an important element of the value of the
Insurance Business and the Acquired Assets and are a material inducement for
Buyer to enter into this Agreement. Each Seller further acknowledges that
without such protection, Buyer’s business would be irreparably harmed, and that
the remedy of monetary damages alone would be inadequate.
(ii)If any Seller will violate the restrictions contained in Section 5.11 of
this Agreement, and if any court action is instituted by Buyer to prevent or
enjoin such violation, then the period of time during which such Seller’s
business activities will be restricted as provided in this Agreement will be
lengthened by a period of time equal to the period between the date upon which
such Seller is found to have first violated the restrictions, and the date on
which the decree of the court disposing of the issues upon the merits will
become final and not subject to further appeal.

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(iii)In addition to the foregoing, any damages suffered by Buyer or its
Affiliates as a result of any breach by any Seller of the provisions of Section
5.11 of this Agreement will be subject to such Seller’s indemnity obligations
set forth in this Agreement.
(iv)Each provision of Section 5.11 of this Agreement will be independent of any
and all other provisions of this Agreement, the other Transaction Documents, and
any other agreement entered into between the Parties. The real or perceived
existence of any claim or cause of action of any Seller against Buyer or its
Affiliates, whether predicated on this Agreement or some other basis, will not
relieve such Seller of its obligations under Section 5.11 of this Agreement and
will not constitute a defense to the enforcement by Buyer or Parent of the
restrictions and covenants contained in Section 5.11 of this Agreement.
(v)It is the Parties’ intent that the terms and provisions of Section 5.11 of
this Agreement be enforceable to the maximum extent permitted by applicable Law.
If a court of competent jurisdiction declare any of the covenants set forth in
Section 5.11 of this Agreement unenforceable, then such court will be authorized
to modify such covenants so as to render the remaining covenants and the
modified covenants valid and enforceable to the maximum extent possible, and as
so modified, to enforce Section 5.11 of this Agreement in accordance with its
terms. If any provision of this Agreement will be held to be excessively broad,
it will be limited to the extent necessary to comply with applicable Law.
(vi)If any of the provisions of Section 5.11 of this Agreement will otherwise
contravene or be determined to be invalid or unenforceable under the Laws of any
state, country, or other jurisdiction in which this Agreement may be applicable,
valid, and enforceable but for such contravention or invalidity or
unenforceability, then (A) such contravention or invalidity or unenforceability
(A) will not invalidate or otherwise affect the enforceability of all of the
provisions of Section 5.11 of this Agreement, but rather (B) Section 5.11 of
this Agreement (or the remaining provisions hereof, as applicable) will be
construed, insofar as the Laws of that state or other jurisdiction are
concerned, as not containing the provision or provisions contravening or invalid
under the Laws of that state or jurisdiction, and (B) the rights and obligations
created hereby will be construed and enforced to the maximum extent permitted
under applicable Law.
ARTICLE 6
INDEMNITY
Section 6.1    Survival of Representations, Warranties, Indemnities, and
Covenants.
(a)Subject to Section 6.1(c), the representations, warranties, and indemnities
set forth in this Agreement will survive for a period of three (3) years
following the Closing Date (the “Survival Period”). All post-Closing covenants
will survive the Closing for the period(s) specified in this Agreement or, if
not specified, for the Survival Period. The rights of the Indemnified Parties
(as defined in Section 6.4 below) to assert a claim under this Article 6 will
survive the Closing Date until the expiration of the Survival Period, except
with respect to Liability for any item as to which, before the expiration of the
Survival Period, an Indemnified Party has asserted a claim in writing as
required pursuant to the provisions of this Article 6, in which event the
Liability on the part of the Indemnifying Parties for such claim will continue
until such claim has been finally settled, decided, or adjudicated.
(b)If a Party (the Sellers, on the one hand, and Buyer, on the other hand, each
being considered one Party for purposes of this Section 6.1) has received
written notice of a potential Breach of a representation, covenant, or warranty
by the other Party, or the occurrence of an otherwise potentially-indemnifiable
event in favor of the other Party, under this Agreement within the applicable
period under this Section 6.1, such Party will give timely, complete, and
accurate written notice of such Breach or other potentially indemnifiable event
to the other Party.
(c)Notwithstanding Section 6.1(a) and Section 6.1(b):
(i)The indemnity obligations of a Party for any Special Matter will survive
until sixty (60) days following the expiration of all applicable statutes of
limitation or statutes of repose; and

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(ii)As to any Proceeding pending against a Party as of the Closing Date, such
Party’s indemnity obligation will continue through the final disposition of such
Proceeding, either by settlement or by a final, non-appealable judgment issued
by a court of competent jurisdiction.
Section 6.2    Indemnity Provisions for the Benefit of Buyer Indemnified
Parties. To the extent permitted by applicable Law, the Sellers each agree, from
and after the Closing, jointly and severally to indemnify, defend, and hold the
Buyer Indemnified Parties harmless from and against any Adverse Consequences
that any of the Buyer Indemnified Parties may suffer or incur resulting from,
arising out of, relating to, or caused by: (i) the Breach of any Seller’s
representations or warranties herein; (ii) the Breach of any Seller’s other
obligations or covenants contained herein; or (iii) the operation of the
Insurance Business or ownership of the Acquired Assets by any Seller before the
Closing Date, including, without limitation, (A) any Proceedings based on
conduct of any Seller occurring before the Closing or (B) any Retained
Liabilities (including any Employee/Owner-Related Liabilities and any
Liabilities arising from the administration or funding of any Employee Benefits
Plan sponsored or contributed to before the Closing by any Seller).
Section 6.3    Indemnity Provisions for the Benefit of Seller Indemnified
Parties. To the extent permitted by applicable Law, Buyer will indemnify,
defend, and hold the Seller Indemnified Parties harmless from and against any
Adverse Consequences that any of the Seller Indemnified Parties may suffer or
incur resulting from, arising out of, relating to, or caused by (a) the Breach
of any of Buyer’s representations or warranties herein, (b) the Breach of any of
Buyer’s other obligations or covenants contained herein, or (c) the operation or
ownership of the Acquired Assets by Buyer on or after the Closing Date (other
than the Retained Liabilities), including, without limitation, (i) any
Proceedings based on conduct of Buyer occurring after the Closing or (ii) any
Assumed Liabilities.
Section 6.4    Matters Involving Third Parties.
(a)If any Third Party will notify any Party (the “Indemnified Party”) with
respect to any matter (a “Third Party Claim”) that may give rise to a claim for
indemnity against the other Party (the “Indemnifying Party”) under this Article
6 (the Sellers, on the one hand, and Buyer, on the other hand, each being
considered one Party for purposes of this Section 6.4), then the Indemnified
Party will promptly notify (which the Indemnified Party will endeavor to
provide, by the sooner to occur of (i) fifteen (15) Business Days after receipt
of notice by it or (ii) five (5) Business Days before the date a responsive
pleading is due) the Indemnifying Party (or, if applicable, the appropriate tail
Carrier) thereof in writing; provided, however, that no delay on the part of the
Indemnified Party in notifying the Indemnifying Party (or, if applicable, the
Indemnifying Party’s appropriate tail Carrier) will relieve the Indemnifying
Party from any obligation hereunder unless (and then solely to the extent) that
the Indemnifying Party thereby is prejudiced by such delay.
(b)The Indemnifying Party will have the right to defend the Indemnified Party
against the Third Party Claim with counsel of its choice reasonably satisfactory
to the Indemnified Party so long as: (i) the Third Party Claim involves only
money damages and does not seek by way of a motion an injunction or other
equitable relief; (ii) settlement of, or an adverse judgment with respect to,
the Third Party Claim is not, in the good faith judgment of the Indemnified
Party, likely to establish a precedential custom or practice materially adverse
to the continuing business interests of the Indemnified Party; and (iii) the
Indemnifying Party conducts the defense of the Third Party Claim actively and
diligently; provided, however, such assumption of the defense will not
constitute a waiver of any argument relating to the obligation of the
Indemnifying Party to indemnify the Indemnified Party pursuant to, or of any
applicable condition or limitation applicable to such indemnification under,
this Article 6.
(c)So long as the Indemnifying Party is conducting the defense of the Third
Party Claim in accordance with Section 6.4(b) above, (i) the Indemnified Party
may retain separate co-counsel at its sole cost and expense and participate in
the defense of the Third Party Claim, (ii) the Indemnified Party will not
consent to the entry of any judgment or enter into any settlement with respect
to the Third Party Claim without the prior written consent of the Indemnifying
Party, and (iii) the Indemnifying Party will not consent to the entry of any
judgment or enter into any settlement with respect to the Third Party Claim
without the prior written consent of the Indemnified Party.

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(d)If any of the conditions in Section 6.4(b) above is or becomes unsatisfied,
however, (i) the Indemnified Party may defend against, and consent to the entry
of any judgment or enter into any settlement with respect to, the Third Party
Claim in any manner it may deem appropriate (and the Indemnified Party need not
consult with, or obtain any consent from, the Indemnifying Party in connection
therewith), (ii) the Indemnifying Party will reimburse the Indemnified Party
promptly and periodically (but no more frequently than monthly) for the costs of
defending against the Third Party Claim (including reasonable attorneys’ fees
and expenses), and (iii) the Indemnifying Party will remain responsible for any
Adverse Consequences the Indemnified Party may suffer resulting from, arising
out of, relating to, in the nature of, or caused by the Third Party Claim to the
fullest extent provided in this Article 6, subject to the conditions and
limitations under this Article 6.
Section 6.5    Limitations on Indemnity Undertaking.
(a)Notwithstanding anything contained in this Agreement to the contrary, (a) no
Indemnifying Party will be liable for any amounts for which Indemnified Parties
are otherwise entitled to indemnity for any Breach of a Party’s representations
or warranties pursuant to Section 6.2(i) or Section 6.3(a), as applicable, until
the aggregate amount for which Indemnified Parties are entitled to indemnity
under all such claims for indemnity under Section 6.2(i) or Section 6.3(a),
respectively, exceeds (i) $3,500,000 during the first twenty-four (24) months of
the Survival Period and (ii) $7,000,000 during final twelve (12) months of the
Survival Period (the “Basket”) (which Basket will be a true Basket and shall not
revert back to dollar one), and (b) the Indemnifying Party will not be required
to make indemnity payments pursuant to Section 6.2(i) or Section 6.3(a) to the
extent such indemnity payments would exceed $50,000,000 in the aggregate (the
“Cap”). Notwithstanding the foregoing, neither the Cap nor the Basket will limit
an Indemnifying Party’s Liability in respect of any claim under this Article 6
to the extent that such claim arises from or in connection with (x) any Special
Matter, (y) any Breach by Buyer of its obligations to pay any portion of the
Purchase Price when due, or any Breach by any Seller of such Seller’s
obligations under Section 5.11; provided, Sellers will not be required to
indemnify Buyer Indemnified Parties in respect of any Adverse Consequences for
which indemnity is claimed under Section 6.2 to the extent the aggregate of all
Adverse Consequences in excess of the Basket exceed an amount equal to the
Purchase Price (the “Super Cap”); provided, further that the Super Cap will not
apply to Adverse Consequences claimed under clause (a) of the definition of
“Special Matters.”
(b)In no event will the Buyer Indemnified Parties or Seller Indemnified Parties
be entitled to recover or make a claim for any amounts in respect of any (i)
indirect or consequential damages, (ii) damages based on diminution of value,
enterprise value, or any multiple or similar valuation theories, or (iii)
punitive or exemplary damages, in each case except to the extent awarded to a
third party. In addition, in no event will the Buyer Indemnified Parties be
entitled to recover for any Adverse Consequences that are its own general and
administrative time or other overhead expenses. Attorneys’ fees and
disbursements of a Buyer Indemnified Party or Seller Indemnified Party shall
constitute Adverse Consequences for purposes of this Article 6 if they are
reasonable.
(c)The calculation of any Adverse Consequence subject to indemnification under
this Article 6 will reflect: (i) the amount of any net tax benefit or net tax
cost actually recognized or incurred (after taking into account any correlative
adjustments) by the Indemnified Party for income Tax purposes (by reduction in
Tax paid in the year of the loss or in any prior Tax year to which such Adverse
Consequence is actually carried back); and (ii) the amount of any insurance
proceeds that are or may be received by the Indemnified Party in respect of such
Adverse Consequence (net of (i) the cost and expense of pursuing such proceeds,
(ii) the deductible associated with any insurance recovery and (iii) the amount
of reasonably anticipated premium increases resulting from such recovery). An
Indemnified Party will use commercially reasonable efforts to pursue any
available coverage under any available insurance policies maintained by such
Indemnified Party. If an Indemnified Party receives any amounts under applicable
insurance policies subsequent to its receipt of an indemnification payment by
the Indemnifying Party, then such Indemnified Party will, without duplication,
promptly reimburse the Indemnifying Party for any payment made by such
Indemnifying Party up to the amount received by the Indemnified Party.
Additionally, in the event an Indemnifying Party makes any payment to any
Indemnified Party for indemnification for which the Indemnified Party could have
collected on a claim against a third party (including under any contract or
insurance claims), such Indemnifying Party will be entitled to pursue claims and
conduct litigation on behalf of such Indemnified Party and any of its
successors, to pursue and collect on any indemnification or other remedy
available to such Indemnified

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Party thereunder with respect to such claim and generally to be subrogated to
the rights of such Indemnified Party. Except with the prior written consent of
the Indemnifying Party, the Indemnified Party will not waive or release any
contractual right to recover from a third party any Adverse Consequence subject
to indemnification hereunder, and the Indemnifying Party will, and will cause
its Affiliates to, cooperate with the Indemnifying Party with respect to any
such effort to pursue and collect with respect thereto.
(d)Each Buyer Indemnified Party or Seller Indemnified Party, as applicable, will
use commercially reasonable efforts to mitigate all Adverse Consequences after
becoming aware of any event which would reasonably be expected to give rise to
any Adverse Consequences that are indemnifiable or recoverable hereunder or in
connection herewith, it being understood that the reasonable costs of any such
mitigation will constitute Adverse Consequences. Each Buyer Indemnified Party or
Seller Indemnified Party, as applicable, will use commercially reasonable
efforts to address any Adverse Consequences that may provide a basis for an
indemnifiable claim such that each such Buyer Indemnified Party or Seller
Indemnified Party, as applicable, will respond to any Adverse Consequences in
the same manner it would respond to such Adverse Consequences in the absence of
the indemnification provisions of this Agreement.
(e)From and after the Closing, the remedies provided by this Article 6 will,
subject to the limitations set forth herein and therein, be the sole and
exclusive remedies of Buyer Indemnified Parties and the Seller Indemnified
Parties for the recovery of monetary Adverse Consequences resulting from,
relating to or arising out of this Agreement (save in the case of common Law
fraud on the part of a party with respect to the representations and warranties
of such party set forth herein) or in any agreement, document or certificate
furnished by Sellers, Buyer, or Parent pursuant to this Agreement. No current or
former member, stockholder, manager, director, officer, employee, Affiliate or
advisor of any Seller, Buyer, or Parent shall have any Liability of any nature
to any Buyer Indemnified Party or Seller Indemnified Party, as applicable, with
respect to any matter arising under or related to this Agreement or the
Contemplated Transactions. Without limiting the generality of this Section
6.5(e), each of the Buyer Indemnified Parties and the Seller Indemnified Parties
hereby waive any statutory, equitable, or common Law rights or remedies that
otherwise may be asserted by such party (save in the case of common Law fraud on
the part of a party with respect to the representations and warranties of such
party set forth herein). For purposes of clarity, this Section 6.5(e) will not
limit the availability of non-monetary equitable or injunctive relief as
contemplated in Section 10.10(b) below.
Section 6.6    Disputes. In the event of any dispute regarding any obligation to
indemnify any Adverse Consequences resulting from a claim (whether a Third Party
Claim or other claim), the Indemnified Party and the Indemnifying Party shall
attempt to resolve in good faith such dispute within 30 days after the
Indemnifying Party delivers written notice to the Indemnified Party of such
dispute. If such dispute is not so resolved within such 30-day period, then
either Party may initiate a Proceeding with respect to the subject matter of
such dispute in accordance with, and subject to Section 10.9.
ARTICLE 7
PRE-CLOSING COVENANTS
Section 7.1    Access to Information. From the date hereof and continuing
through the Closing Date, each Seller agrees that (except as expressly
contemplated or permitted by this Agreement), upon reasonable notice from Buyer,
to afford to the officers, employees, accountants, counsel, and other authorized
Representatives of Buyer reasonable access, during the period before the Closing
Date, to all of the properties, books, Contracts, commitments, Records, and
senior management of each Seller included in the Acquired Assets. Unless
otherwise required by applicable Law, Buyer will hold any such information that
is nonpublic in confidence, will not use such information in its business if the
Acquisition does not close, and will return such information if the Acquisition
does not close.
Section 7.2    Operations of Seller. From the date of this Agreement through the
Closing Date, Sellers agree that (except as expressly contemplated or permitted
by this Agreement) they will conduct the Insurance Business as follows:
(a)Ordinary Course. The Sellers will carry on the Insurance Business in the
Ordinary Course of Business, in substantially the same manner as conducted
before the date of this Agreement and will use Best Efforts

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to preserve intact each Seller’s present business organization, keep available
the services of each Seller’s present officers and employees, and preserve each
Seller’s relationships with Clients and others having business dealings with
Sellers to the end that the goodwill of Sellers and the Insurance Business will
not be impaired in any material respect at the Closing Date.
(b)No Dispositions. Other than (i) as may be required by applicable Law to
consummate the Contemplated Transactions, or (ii) sales or provision of services
in the Ordinary Course of Business consistent with prior practice of such
Seller, no Seller will sell, lease, license, encumber, or otherwise dispose of,
or agree to sell, lease, license, encumber, or otherwise dispose of, any of its
assets that are material to any Seller or the Insurance Business, either
individually or in the aggregate.
(c)No Acquisitions. No Seller will acquire or agree to acquire by merging or
consolidating with, or by purchasing a substantial equity interests in or
substantial portion of the assets of, or by any manner, any business or any
corporation, partnership, or other business organization or division thereof, or
otherwise acquire or agree to acquire any assets not in the Ordinary Course of
Business.
(d)No Equity Issuances. No Seller will issue any additional equity securities or
other financial interests in any Seller, or any options, warrants, or rights to
acquire any equity securities or other financial interests in any Seller.
(e)Indebtedness and Leases. No Seller will incur any indebtedness for borrowed
money, guarantee any such indebtedness, issue or sell any debt securities,
warrants, or rights to acquire any of its debt securities, or guarantee any debt
securities of others other than, in each case, in the Ordinary Course of
Business consistent with prior practice. In any event, no Seller will grant,
permit, or suffer any Encumbrances (other than Permitted Encumbrances) on any of
the Acquired Assets. No Seller will enter into any material Leases.
Section 7.3    Other Actions. No Seller will take any action that would, or
would be reasonably likely to, result in any of their representations and
warranties set forth in this Agreement being untrue, or in any of the conditions
set forth in Article 8 not being satisfied.
Section 7.4    Advise of Changes. The Sellers will confer on a regular and
frequent basis with Buyer, report on operational matters, and promptly advise
Buyer of any change or event having or which, insofar as can reasonably be
foreseen, would reasonably be expected to have, a Material Adverse Change to any
Seller, the Acquired Assets, or the Insurance Business.
Section 7.5    Required Approvals.
(a)As promptly as practicable after the date of this Agreement, the Sellers will
give all notices, make all filings, and obtain all Consents, authorizations,
permits and approvals required by Law to be made or obtained by it with or from
a Third Party or Governmental Body in order to consummate the Acquisition and
the Contemplated Transactions. The Sellers also will cooperate with Buyer and
its Representatives with respect to all filings that Buyer elects to make or,
pursuant to Law, will be required to make in connection with the Acquisition and
the Contemplated Transactions. The Sellers will also use their Best Efforts in
obtaining all Required Consents; provided that the Parties agree that no Consent
required in connection with the assignment of a Seller Contract will be a
Required Consent.
(b)As soon as reasonably practicable after the date hereof, the Parties shall
file the Notification and Report Forms and related materials that may be
required to be filed with the Federal Trade Commission and the Antitrust
Division of the United States Department of Justice under the Hart-Scott-Rodino
Act and any other filings required under applicable antitrust or merger control
Laws (the “HSR Filings”) and shall provide to any Governmental Body whose
consent, authorization, order or approval is required in connection with the
Acquisition and the Contemplated Transactions any additional information
required under any applicable antitrust or merger control Laws or otherwise
properly requested. Fees for the HSR Filings shall be borne 50% by Sellers and
50% by Buyer; provided, however, that each Party shall bear its own legal fees
and any other costs or fees incurred in the preparation of the

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HSR Filings and responses in respect of such HSR Filings. The Parties shall use
their Best Efforts to obtain an early termination of the applicable waiting
period under the Hart-Scott-Rodino Act.
(c)Subject to any applicable Law, the Parties and their respective counsel
shall: (i) to the extent practicable, each consult the other on any filing made
with, or written materials to be submitted to, any Governmental Body in
connection with the Acquisition and the Contemplated Transactions; (ii) promptly
inform each other of any communication (or other correspondence or memoranda)
received from, or given to, any Governmental Body in connection with the
Contemplated Transactions; (iii) consult with the other Party and consider in
good faith the views of the other Party prior to entering into any agreement
with any Governmental Body with respect to the Acquisition and the Contemplated
Transactions; and (iv) promptly inform each other of all correspondence, filings
and written communications between them or their subsidiaries or Affiliates, on
the one hand, and any Governmental Body or its respective staff, on the other
hand, with respect to the Acquisition and the Contemplated Transactions. The
Parties shall, to the extent practicable, provide each other and their
respective counsel with advance notice of and the opportunity to participate in
any in-person discussion or meeting with any Governmental Body in respect of any
filing, investigation or other inquiry in connection with the Acquisition and
the Contemplated Transactions and to participate in the preparation for such
discussion or meeting, subject to any restrictions on such participation by any
applicable Governmental Body.
(d)Notwithstanding the foregoing, nothing in this Section 7.5 shall require, or
be construed to require, Parent or any of its Affiliates to agree to (i) sell,
hold, divest, discontinue or limit, before or after the Closing Date, any
assets, businesses or interests of Parent or any of its Affiliates; (ii) any
conditions relating to, or changes or restrictions in, the operations of any
such assets, businesses or interests which, in either case, could reasonably be
expected to materially and adversely impact the economic or business benefits to
Parent of the Acquisition or the Contemplated Transactions; or (iii) any
material modification or waiver of the terms and conditions of this Agreement.
ARTICLE 8
CONDITIONS
Section 8.1    Conditions to Each Party’s Obligation. The respective obligations
of each Party to consummate the Contemplated Transactions will be subject to the
satisfaction before or on the Closing Date of the following conditions:
(a)Approvals. All authorizations, consents, orders, or approvals of, or
declarations or filings with, or expirations of waiting periods imposed by, any
Governmental Body, the failure to obtain which would reasonably be expected to
cause a Material Adverse Change to the Insurance Business or the Acquired
Assets, after the Closing, will have been filed, occurred, or been obtained.
(b)No Injunctions or Restraints. No temporary restraining order, preliminary or
permanent injunction, or other Order issued by any court of competent
jurisdiction or other legal restraint or prohibition preventing the consummation
of the Contemplated Transactions will be in effect.
Section 8.2    Conditions to Buyer’s and Parent’s Obligation to Close. The
obligation of Buyer or Parent to take the actions required to be taken by it at
the Closing is subject to the satisfaction or waiver, in whole or in part, in
Buyer’s reasonable discretion, of each of the following conditions at or before
the Closing:
(a)The representations and warranties of the Sellers contained in this Agreement
that are qualified by materiality will be true and correct and the
representations and warranties of the Sellers that are not so qualified will be
true and correct in all material respects on and as of the Closing with the same
force and effect as if made on and as of the Closing Date (except to the extent
such representations and warranties expressly relate to an earlier date, in
which case such representations and warranties will be true and correct as of
such earlier date);
(b)The Sellers will have performed and complied in all material respects with
its agreements contained in this Agreement, except to the extent that such
covenants are qualified by the term “material,” or contain

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terms such as “Material Adverse Change,” in which case the Sellers will have
performed and complied with all of such covenants (as so written, including the
term “material” or “Material”) in all respects through the Closing;
(c)Since the date of this Agreement, there will not have occurred and be
continuing any Material Adverse Change in the Acquired Assets or the Insurance
Business;
(d)Each Seller will have delivered each of the agreements, certificates,
instruments, and other documents that each is obligated to deliver pursuant to
Section 2.2 and such documentation will be in full force and effect; and
(e)All Encumbrances (other than Permitted Encumbrances) on the Acquired Assets
will have been satisfied and released before Closing (or will be satisfied and
released upon Buyer’s payment of the Secured Debt Amount).
Section 8.3    Conditions to the Sellers’ Obligation to Close. The obligation of
the Sellers to take the actions required to be taken by them at the Closing is
subject to the satisfaction or waiver, in whole or in part, in the Sellers’ sole
discretion, of each of the following conditions at or before the Closing:
(a)The representations and warranties of Buyer and Parent contained in this
Agreement that are qualified by materiality will be true and correct and the
representations and warranties of Buyer and Parent that are not so qualified
will be true and correct in all material respects as of the Closing Date as if
made on and as of the Closing Date (except to the extent such representations
and warranties expressly relate to an earlier date, in which case such
representations and warranties will be true and correct as of such earlier
date);
(b)Buyer and Parent will have performed and complied in all material respects
with each of their agreements contained in this Agreement, except to the extent
that such covenants are qualified by the term “material,” or contain terms such
as “Material Adverse Change,” in which case Buyer and Parent will have performed
and complied with all of such covenants (as so written, including the term
“material” or “Material”) in all respects through the Closing;
(c)Buyer will have paid the amounts required to be paid at the Closing pursuant
to Section 2.3;
(d)Buyer and/or Parent will have delivered each of the agreements, certificates,
instruments, and other documents that they are obligated to deliver pursuant to
Section 2.3 and such documentation so delivered will be in full force and
effect; and
(e)The shareholders or members, as applicable, of each Seller will have approved
this Agreement, the Transaction Documents, and the Contemplated Transactions.
Section 8.4    Closing Date. Upon satisfaction of all the conditions set forth
in this Article 8, the Contemplated Transactions shall be deemed closed and the
Closing shall be deemed to have occurred. The date of the Closing is referred to
in this Agreement as the “Closing Date.”
ARTICLE 9
TERMINATION AND AMENDMENT
Section 9.1    Termination. This Agreement may be terminated at any time before
the Closing Date:
(a)By mutual written consent of the Parties hereto;
(b)By Buyer, if there has been a violation or breach by the Sellers of any
covenant, agreement, representation, or warranty contained in this Agreement
which would constitute, if occurring or continuing on the Closing Date, the
failure of a condition set forth in Section 8.1 or Section 8.2, and such
violation or breach has not

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been cured by the Sellers within 10 days after written notice thereof from Buyer
or by its nature or timing cannot be cured during such period;
(c)By Sellers’ Representative; if there has been a violation or breach by Buyer
or Parent of any covenant, agreement, representation or warranty contained in
this Agreement which would constitute, if occurring or continuing on the Closing
Date, the failure of a condition set forth in Section 8.1 or Section 8.3, and
such violation or breach has not been cured by Buyer or Parent within 10 days
after written notice thereof by Sellers’ Representative or by its nature or
timing cannot be cured during such period;
(d)By either Buyer or Sellers’ Representative, if any Governmental Body that
must grant a Governmental Authorization has denied approval of the Contemplated
Transactions and such denial has become final and nonappealable or any
Governmental Body shall have issued a final nonappealable order, injunction or
decree permanently enjoining or otherwise prohibiting or making illegal the
consummation of the Contemplated Transactions; provided that neither Buyer nor
Sellers’ Representative will be entitled to terminate this Agreement pursuant to
this Section 9.1(d) if such Person’s knowing or willful breach of this Agreement
has resulted in the failure to obtain a required Governmental Authorization; or
(e)By either Buyer or Sellers’ Representative, if the Contemplated Transactions
have not been consummated by 5:00 p.m., Minneapolis, Minnesota time on January
1, 2019; provided that neither Buyer nor Sellers’ Representative will be
entitled to terminate this Agreement pursuant to this Section 9.1(e) if such
Person’s knowing or willful breach of this Agreement has prevented the
consummation of the Contemplated Transactions.
Section 9.2    Reverse Termination Fee. If the Contemplated Transactions have
not been consummated by 5:00 p.m., Minneapolis, Minnesota time on January 1,
2019, based on failure of Buyer to close the Contemplated Transactions despite
all conditions to Closing set forth in Section 8.1 and Section 8.2 being
satisfied, Buyer shall pay to Sellers’ Representative a reverse termination fee
of $35,000,000.
Section 9.3    Effects of Termination. In the event of a termination of this
Agreement by any Party as provided in Section 9.1, this Agreement will forthwith
become void and there will be no Liability or obligation on the part any Party
or any of their respective Affiliates, except to the extent that such
termination results from the Breach by a Party hereto of any of its
representations, warranties, covenants, or agreements set forth in this
Agreement. Nothing in this Article 9 will be deemed to impair the right of any
party to compel specific performance by another party of its obligations under
this Agreement.
Section 9.4    Extension; Waiver. At any time before the Closing Date, the
Parties may (a) extend the time for the performance of any of their obligations
or other acts, (b) waive any inaccuracies in the representations and warranties
contained herein or in any document delivered pursuant hereto, and (c) waive
compliance with any of the agreements or conditions contained herein. Any
agreement on the part of a Party hereto to any such extension or waiver will be
valid only if set forth in a written instrument signed on behalf of such Party.
ARTICLE 10
MISCELLANEOUS
Section 10.1    Notices. All notices, Consents, waivers, and other
communications required or permitted by this Agreement will be in writing and
will be deemed given to a Party when (a) delivered to the appropriate address by
hand or by nationally recognized overnight courier service (costs prepaid); (b)
sent by facsimile or e-mail with confirmation of transmission by the
transmitting equipment; or (c) received or rejected by the addressee, if sent by
certified mail, return receipt requested, in each case to the following
addresses, facsimile numbers, or e-mail addresses and marked to the attention of
the person (by name or title) designated below (or to such other address,
facsimile number, e-mail address, or Person as a Party may designate by notice
to the other Parties). The Parties acknowledge that the telephone numbers set
forth below are for convenience purposes only and telephonic notice alone will
not constitute valid notice under this Agreement:

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Buyer:
BBHG, Inc.
c/o Brown & Brown, Inc.
220 S. Ridgewood Avenue
Daytona Beach, FL 32114
Attention: Robert W. Lloyd, General Counsel
Telephone No.: (386) 239-5752
Facsimile No.: (386) 239-7293
E-mail Address: rlloyd@bbins.com
Sellers: (before the Closing)
The Hays Group, Inc.
IDS Center, Suite 700
80 South 8th Street
Minneapolis, MN 55402
Attention: Stephen Lerum
Telephone No.:  (612) 373-7273
Facsimile No.: (612) 313-1673
E-mail Address:  slerum@hayscompanies.com
With a mandatory copy to:
Fredrikson & Byron, P.A.
200 South Sixth Street, Suite 4000
Minneapolis, MN 55402
Attention: John Houston and Zachary Olson
Telephone No.: (612) 492-7392
Facsimile No.: (612) 492-7077
E-mail Address: jhouston@fredlaw.com; zolson@fredlaw.com
Sellers’ Representative (after the Closing):
Sellers’ Representative
IDS Center, Suite 700
80 South 8th Street
Minneapolis, MN 55402
Attention: Stephen Lerum
Telephone No.: (612) 373-7273
Facsimile No.: (612) 313-1673
E-mail Address: slerum@hayscompanies.com
With a mandatory copy to:
Fredrikson & Byron, P.A.
200 South Sixth Street, Suite 4000
Minneapolis, MN 55402
Attention: John Houston and Zachary Olson
Telephone No.: (612) 492-7392
Facsimile No.: (612) 492-7077
E-mail Address: jhouston@fredlaw.com; zolson@fredlaw.com

Section 10.2    Counterparts. The Parties may execute any Transaction Document
in any number of duplicate originals, each of which constitutes an original, and
all of which, collectively, constitute only one (1) agreement or document (as
the case may be), it being understood that all Parties need not sign the same
counterpart. Delivery of an executed counterpart signature page by facsimile or
e-mail transmission is as effective as executing and delivering such Transaction
Document in the presence of the other Parties to such Transaction Document. Any
Party delivering an executed counterpart of any Transaction Document by
facsimile or e-mail transmission will also deliver an executed original
counterpart of such Transaction Document, but the failure to do so does not
affect the validity, enforceability, or binding effect of such Transaction
Document. Each Transaction Document is effective upon delivery of one (1)
executed counterpart from each Party to the other Parties. In proving any
Transaction Document, a Party must produce or account only for the executed
counterpart of the other Parties to such Transaction Document.
Section 10.3    Entire Agreement. This Agreement supersedes all prior
agreements, whether written or oral, between the Parties with respect to its
subject matter (including any term sheet, letter of intent, and any
confidentiality or non-disclosure agreement between Buyer and Sellers) and
constitutes (along with the Schedules, Exhibits, and other Transaction
Documents) a complete and exclusive statement of the terms of the agreement
between the Parties with respect to its subject matter.

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Section 10.4    Waiver of Jury Trial. Each Party, to the extent permitted by
APPLICABLE LAW, knowingly, voluntarily, and intentionally waives its right to a
trial by jury in any proceeding arising out of or relating to this Agreement,
the OTHER Transaction DOCUMENTS, the CONTEMPLATED TRANSACTIONS, and any other
CONTRACTS or transactions between the Parties, whether occurring before or after
the date of this Agreement. This waiver applies to any proceeding, whether
sounding in contract, tort, or otherwise.
Section 10.5    Assignment and Successors; No Third Party Rights. Unless
otherwise set forth in a Transaction Document, no Party may assign any of its
rights or delegate any of its obligations under such Transaction Document
without the prior written consent of the other Parties, except that Buyer may
assign any of its rights and delegate any of its obligations under any
Transaction Document to any Affiliate of Buyer and may collaterally assign its
rights hereunder to any financial institution providing financing in connection
with the Contemplated Transactions. Subject to the preceding sentence, the
Transaction Documents will apply to, be binding in all respects upon, and inure
to the benefit of, the successors and permitted assigns of the Parties. Nothing
expressed or referred to in the Transaction Documents will be construed to give
any Person other than the parties to a Transaction Document any legal or
equitable right, remedy, or claim under or with respect to such Transaction
Document or any provision of such Transaction Document, except such rights as
will inure to a successor or permitted assignee pursuant to this Section 10.5.
Section 10.6    Headings. All paragraph headings herein are inserted for
convenience of reference only and will not modify or affect the construction or
interpretation of any provision of this Agreement.
Section 10.7    Severability. If any provision, covenant, section, subsection,
paragraph, or any portion thereof, of this Agreement is held by any court of
competent jurisdiction to be illegal, invalid, or unenforceable, either in whole
or in part, the legality, validity, or enforceability of the remaining
provisions, covenants, sections, subsections, paragraphs, or portions thereof
will not be affected thereby, and each such provision, covenant, section,
subsection, paragraph, or any portion thereof, will remain valid and enforceable
to the fullest extent permitted by applicable Law.
Section 10.8    Governing Law; Dispute Resolution.
(a)All matters arising under or relating to this Agreement, the other
Transaction Documents (except as otherwise set forth therein), and the
Contemplated Transactions will be governed by and construed and enforced in
accordance with the Law of the State of Florida, without giving effect to its
conflicts of law principles.
(b)Any judicial proceeding brought with respect to this Agreement must be
brought in a federal or state court of competent jurisdiction located in
Hennepin County, in the State of Minnesota, and, by execution and delivery of
this Agreement, each party (i) accepts and consents to, generally and
unconditionally, the jurisdiction of such courts and any related appellate
court, and irrevocably agrees to be bound by any judgment rendered thereby in
connection with this Agreement, the other Transaction Documents, and the
Contemplated Transactions, and (ii) irrevocably waives any objection it may now
or hereafter have as to the venue of any such suit, action or proceeding brought
in such a court or that such court is an inconvenient forum. Service of process,
summons, notice or other document by mail to such Party’s address set forth
herein will be effective service of process for any suit, action or other
proceeding relating to this Agreement, the other Transaction Documents, and the
Contemplated Transactions.
Section 10.9    Amendment; Waiver. This Agreement may not be amended, or any
provision waived, except by an instrument in writing signed on behalf of each of
the Parties.
Section 10.10    Remedies.
(a)Remedies Cumulative. Except as otherwise expressly provided in this
Agreement, any Person having any rights under any provision of this Agreement
will be entitled to enforce such rights specifically (without posting a bond or
other security), to recover damages by reason of any breach of any provision of
this Agreement and to exercise all other rights granted by any Laws. Except as
otherwise expressly provided in this Agreement, all such rights and remedies
will be cumulative and non-exclusive, and may be exercised singularly or
concurrently.

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(b)Equitable Relief. The parties acknowledge that any breach of this Agreement
may cause substantial irreparable harm to the other parties. Therefore, this
Agreement may be enforced in equity by specific performance, temporary
restraining order, and/or injunction. The rights to such equitable remedies are
in addition to all other rights or remedies that a party may have under this
Agreement or under applicable Law.
Section 10.11    No Other Representations and Warranties. NOTWITHSTANDING
ANYTHING TO THE CONTRARY IN THIS AGREEMENT, OTHER THAN THE REPRESENTATIONS MADE
IN Article 3, NO SELLER NOR ANY OTHER PERSON MAKES ANY EXPRESS OR IMPLIED
REPRESENTATION OR WARRANTY WITH RESPECT TO ANY SELLER, THE ACQUIRED ASSETS, THE
INSURANCE BUSINESS, OR THE CONTEMPLATED TRANSACTIONS, AND SELLERS HEREBY
DISCLAIM ANY SUCH REPRESENTATION OR WARRANTY. EXCEPT AS OTHERWISE EXPRESSLY
PROVIDED IN Article 3 BUYER WILL ACQUIRE THE ACQUIRED ASSETS WITHOUT ANY
REPRESENTATION OR WARRANTY AS TO THE MERCHANTABILITY OR FITNESS FOR A PARTICULAR
PURPOSE, IN AN “AS-IS” CONDITION AND ON A “WHERE-IS” BASIS. NOTWITHSTANDING
ANYTHING TO THE CONTRARY IN THIS AGREEMENT, OTHER THAN THE REPRESENTATIONS MADE
IN Article 4, NEITHER BUYER NOR ANY OTHER PERSON MAKES ANY EXPRESS OR IMPLIED
REPRESENTATION OR WARRANTY WITH RESPECT TO THE BUYER OR THE CONTEMPLATED
TRANSACTIONS, AND BUYER HEREBY DISCLAIMS ANY SUCH REPRESENTATION OR WARRANTY.
Section 10.12    Sellers’ Representative. Each Seller hereby irrevocably
appoints the Sellers’ Representative as such Seller’s sole and exclusive agent
and attorney-in-fact for such Seller, for and on behalf of such Seller, with
full power and authority to represent such Seller, such Seller’s successors and
assigns, with full power of substitution in the premises, with respect to all
matters arising under this Agreement and the Transaction Documents and to
receive all sums payable to such Seller, and all actions taken by the Sellers’
Representative under this Agreement or any of the Transaction Documents will be
binding upon such Seller and such Seller’s successors and assigns as if
expressly ratified and confirmed in writing by such Seller. The authority
conferred under this Agreement will be an agency coupled with an interest, and
all authority conferred hereby is irrevocable and not subject to termination by
any Seller, or by operation of law, whether by the death or incapacity of any
Seller, the termination of any trust or estate, or the occurrence of any other
event. If any Seller should die or become incapacitated, or if any other similar
event should occur, any action taken by the Sellers’ Representative will be as
valid as if such death, incapacity, termination or other event had not occurred,
regardless of whether or not the Sellers’ Representative had received notice of
such death, incapacity, termination or other event. Without limiting the
generality of the foregoing, the Sellers’ Representative shall have full power
and authority, on behalf of each Seller and such Seller’s successors and
assigns, to interpret the terms and provisions of this Agreement, to dispute or
fail to dispute any claim made under Article 6 of this Agreement or under the
Transaction Documents, to negotiate and compromise any dispute that may arise
under this Agreement or the Transaction Documents and to sign any releases or
other documents with respect to any such dispute. Each Seller will be deemed a
party or a signatory to any agreement, document, instrument or certificate for
which the Sellers’ Representative signs on behalf of such Seller for which the
Sellers’ Representative had authority. In performing any of its duties under
this Agreement or upon the claimed failure to perform its duties under this
Agreement, the Sellers’ Representative will not be liable to any Seller for any
Adverse Consequences that any Seller may incur as a result of any good faith act
or any inadvertent omissions by the Sellers’ Representative under this Agreement
(in the absence of any willful misconduct and/or gross negligence by the
Sellers’ Representative), and the Sellers’ Representative will be indemnified
and held harmless by the Sellers for all Adverse Consequences.
Section 10.13    Attorney-Client Privilege.
(a)Privileged Materials Excluded from Sale of Assets. Except as provided in
Section 10.13(e) below, the Acquired Assets exclude, and the Sellers shall
retain: (i) all attorney-client privileges and work-product protections of the
Sellers or associated with the Insurance Business as a result of legal counsel
representing the Sellers or the Insurance Business, including in connection with
the Contemplated Transactions; (ii) all documents or information subject to such
attorney-client privilege or work-product protection; and (iii) all expectations
of, and rights to enforce any duties of, confidentiality with respect to such
documents or information. Such documents and information are excluded from the
Acquired Assets even if copies of such documents are contained or stored in file
cabinets, computers, servers, or other storage media that is otherwise included
in the Acquired Assets.

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(b)Return of Information. The parties agree that any disclosure by the Sellers
to Buyer of documents or information described in Section 10.13(a) above is
unintentional and shall not waive any attorney-client privilege or attorney
work-product protection with respect thereto. If Buyer discovers that it has
received copies of any documents or information described in Section 10.13(a)
above, then Buyer shall promptly (i) notify Sellers’ Representative, (ii) return
or destroy (according to Sellers’ Representative’s request) all tangible copies
thereof, and (iii) delete all electronic copies thereof (except that any
electronic copies stored on inactive “back-up” tapes or other not readily
accessible storage media need not be deleted unless and until Buyer otherwise
retrieves and accesses such media).
(c)Assert Privilege Against Third Parties. If any Third Party seeks to obtain
disclosure of documents or information described in Section 10.13(a) above,
Buyer shall assert the attorney-client privilege on behalf of the Sellers to
prevent disclosure of privileged materials to such third party, and such
privilege may be waived only with the prior written consent of Sellers’
Representative.
(d)Common Interest. The parties acknowledge that, with respect to any Liability
of the Sellers or the Insurance Business that is assumed by Buyer or to which
Buyer or the Insurance Business becomes subject, Buyer and the Sellers have a
commonality of interest vis-à-vis the Third Party to whom such assumed Liability
is owed. Any disclosure by the Sellers to Buyer of documents or information
related to such Liability that may be subject to attorney-client privileges
and/or attorney work-product protections shall not constitute a waiver of such
privileges and/or protections.
(e)Privileged Materials Regarding Assumed Liability. Notwithstanding Section
10.13(a) and Section 10.13(b) above, if (i) Buyer assumes a Liability of the
Insurance Business owed to a Third Party, (ii) such assumed Liability is or
becomes subject to a dispute with such Third Party, and (iii) Buyer does not
have, or agrees not to assert, any indemnity claim against the Sellers with
respect to such assumed Liability, then the Acquired Assets shall include any
attorney-client privileges and attorney work-product protections specifically
related to such assumed Liability and any documents and information related
thereto. After the Closing, Buyer shall control the assertion or waiver of such
privileges and protections and shall not be obligated to return or destroy such
documents or information.
ARTICLE 11
DEFINITIONS AND USAGE
Section 11.1    Definitions.
(a)For purposes of this Agreement, the following terms and variations thereof
have the following meanings:
“401(k) Plan”-the “Hays Companies 401(k) Profit Sharing Plan.”
“Accounts Receivable”-(a) all trade accounts receivable and other rights to
payment from Clients and the full benefit of all security for such Client
Accounts or rights to payment, including all trade accounts receivable
representing amounts receivable in respect of products sold or services rendered
to Clients; (b) all other accounts or notes receivable and the full benefit of
all security for such accounts or notes; and (c) any claim, remedy, or other
right related to any of the foregoing.
“Adverse Consequences”-all charges, complaints, actions, suits, Proceedings,
hearings, investigations, claims, demands, judgments, Orders, decrees,
stipulations, injunctions, damages, dues, penalties, fines, costs, amounts paid
in settlement, Liabilities, obligations, Taxes, Encumbrances (other than
Permitted Encumbrances), losses, expenses, and fees, including all reasonable
attorneys’ fees and court costs.
“Affiliate”-with respect to a particular Person, any other Person that, directly
or indirectly through one (1) or more intermediaries, controls, or is controlled
by, or is under common control with, such particular Person.
“Assumed Liabilities”-collectively, (a) the ongoing obligation to service the
Total Book of Business on and after the Closing Date, (b) those Liabilities
arising on or after the Closing Date under the Assumed Seller Contracts assumed
by Buyer under this Agreement, other than those Liabilities arising in
connection with a Pre-Closing Breach, (c) those

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Liabilities arising on or after the Closing Date associated with the Acquired
Assets, other than those Liabilities arising in connection with a Pre-Closing
Breach, and (d) the Liabilities associated with the Assumed PTO Liability
Amount.
“Best Efforts”-the efforts that a prudent Person desirous of achieving a result
would use in similar circumstances to achieve that result as expeditiously as
reasonably possible, provided, however, that a Person required to use Best
Efforts under this Agreement will not be thereby required to take actions that
could reasonably be expected to cause a Material Adverse Change in the benefits
to such Person of this Agreement and the Contemplated Transactions, or to
dispose of any material assets or make any material change to its business,
expend any material funds, incur any other material burden, or undertake any
commercially unreasonable actions.
“Bill of Sale”-a mutually agreeable Bill of Sale and Assignment of Contract
Rights and Assumption of Liabilities.
“Breach”-any breach of, or any inaccuracy in, any representation or warranty or
any breach of, or failure to perform or comply with, any covenant or obligation,
in or of this Agreement or any other Contract, or any event which with the
passing of time or the giving of notice, or both, would constitute such a
breach, inaccuracy, or failure.
“Bulk Sales Laws”-the bulk-transfer provisions of the Uniform Commercial Code
(or any similar Law).
“Business Day”-any day other than (a) Saturday or Sunday or (b) any other day on
which banks in the State of Florida are permitted or required to be closed.
“Buyer Indemnified Parties”-Buyer; Parent; the Affiliates of Buyer and/or
Parent; and the respective officers, directors, managers, agents, employees,
successors, and permitted assigns of Buyer, Parent, and/or their Affiliates.
“Buyer’s Documents”-this Agreement and the other Transaction Documents required
to be delivered by Buyer and/or Parent in connection with the Contemplated
Transactions.
“Buyer’s/Parent’s Closing Certificate”-a Buyer’s/Parent’s Closing Certificate,
representing and warranting to the Sellers that: (a) each of Buyer’s and
Parent’s representations and warranties in this Agreement was accurate in all
material respects as of the date of this Agreement and is accurate in all
material respects as of the Closing Date as if made on the Closing Date (giving
full effect to any supplements to the Schedules that were delivered by Buyer and
Parent to the Sellers on or before the Closing Date), unless given as of a
specific date and then such representations and warranties are accurate in all
material respects as of such date; and (b) each of Buyer and Parent has
performed in all material respects all of the obligations to be performed by
Buyer or Parent under this Agreement on or before the Closing Date.
“Calculated Purchase Price Amount”-the mathematical result of the Purchase Price
formula set forth in Section 1.4(a).
“Carrier”-any insurance company, surety, benefit plan, insurance pool, risk
retention group, risk purchasing group, reinsurer, Lloyd’s of London syndicate,
ancillary employee benefit carrier, state fund or pool, or other risk assuming
entity or association in which any insurance, reinsurance, or bond has been
placed or obtained.
“Client”-any Person to whom any Insurance Products or Services have been
provided by an applicable Person.
“Client Account”-collectively, (a) the right to payment of a monetary
obligation, whether or not earned by performance, for the provision of any
Insurance Products or Services to any Client, and (b) the goodwill and business
relationship with such Client relating to the provision of any Insurance
Products or Services to such Client.
“Client Credit Balances Amount”-the aggregate amount of credit balances on
Sellers’ balance sheet(s) as of the Closing Date, as set forth on Schedule
11.1-CC, that are to be remitted to the appropriate Current Accounts or applied
to future premiums owed by the appropriate Current Accounts.
“Closing”-the consummation of the purchase and sale of the Acquired Assets and
the assumption of the Assumed Liabilities.

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“Closing Statement”-a mutually agreeable Closing Statement, setting forth the
payment and/or the allocation of the Closing Payment Amount at Closing.
“Closing Transaction Expenses”- all fees and expenses payable by the Sellers or
any of their respective Affiliates relating to the Contemplated Transactions or
the other Transaction Documents, including any tax, accounting, legal,
financial, and other advisory and consulting fees.
“COBRA”-the Consolidated Omnibus Budget Reconciliation Act of 1986, as amended.
“Code”-the Internal Revenue Code of 1986, as amended, or any successor statute,
and any rules or regulations promulgated thereunder.
“Commissions”-(a) commission revenues, including Overrides (if any), plus (b)
fees (other than Service Fees) in addition to or in lieu of commissions,
provided such fees are disclosed and otherwise permissible in accordance with
applicable Law, plus (c) premium financing commissions, provided such fees are
billed and received in accordance with applicable Law, in each case net of any
Commissions or referral fees paid to any Third Party producing or referring
agent or broker. Commissions do not include Contingent Revenues.
“Confidential Information”-any and all of the following information that has
been or may hereafter be disclosed in any form, whether in writing, orally,
electronically, or otherwise, or otherwise made available by observation or
inspection (provided, that the Recipient is informed in writing by the
Disclosing Party of the confidential nature of any such information that is not
in writing) by Buyer, Parent, or their Representatives (collectively, a
“Disclosing Party”) to another Person or its Representatives (collectively, a
“Recipient”):
(a)    Trade secrets concerning the business and affairs of Disclosing Party
(which includes the materials disclosed to Recipient prior to Closing pursuant
to any confidentiality or non-disclosure agreement among the Parties), product
specifications, data, know-how, formulae, compositions, processes, designs,
sketches, photographs, graphs, drawings, samples, inventions and ideas, past,
current, and planned research and development, current and planned manufacturing
or distribution methods and processes, customer lists, current and anticipated
customer requirements, price lists, supplier lists, market studies, business
plans, computer software and programs (including object code and source code),
computer software and database technologies, systems, structures and
architectures (and related processes, formulae, composition, improvements,
devices, know-how, inventions, discoveries, concepts, ideas, designs, methods
and information), and any other information, however documented, that is a trade
secret under applicable trade secret Law; and
(b)    information concerning the business and affairs of Disclosing Party
(which includes historical financial statements, financial projections and
budgets, historical and projected sales, capital spending budgets and plans, the
names and backgrounds of key personnel, and personnel training techniques and
materials), however documented, or is otherwise obtained from review of
Disclosing Party’s documents or property or discussions with Disclosing Party’s
Representatives or by Recipient’s Representatives (including current or
prospective financing sources) or Representatives of Recipient’s Representatives
irrespective of the form of the communication, and also includes all notes,
analyses, compilations, studies, summaries and other material prepared by
Recipient or Recipient’s Representatives containing or based, in whole or in
part, upon any information included in the foregoing.

Notwithstanding anything to the contrary in the foregoing, “Confidential
Information” does not include information that the Recipient can show (i) was in
the public domain at the time of disclosure, (ii) is published or otherwise
comes into the public domain after its disclosure through no violation of this
Agreement, (iii) is disclosed to the Recipient by a Third Party not under an
obligation of confidence, or (iv) is already known by the Recipient at the time
of its disclosure as evidenced by written documentation of the Recipient
existing prior to such disclosure.

“Consent”-any approval, consent, ratification, waiver, or other authorization.
“Contemplated Transactions”-all of the transactions contemplated by this
Agreement and the other Transaction Documents.

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“Contingent Revenues”-
(a)Contingent Revenues means all contingent, bonus, profit-sharing, subsidies,
GSCs, and similar incentive-based revenues.
(b)Contingent Revenues exclude:
(i)any specific percentage commission on premium to be paid by a Carrier set at
the time of purchase, renewal, placement or servicing of an insurance policy,
other than GSCs;
(ii)any specific fee, to the extent legally permissible, to be paid by the
Client Account in addition to or in lieu of such specific percentage commission;
(iii)a combination of such commissions and fees; and
(iv)Overrides.
“Contract”-any agreement, contract, Lease, consensual obligation, promise, or
undertaking (whether written or oral and whether express or implied), whether or
not legally binding.
“Core Revenue”- all Commissions and Service Fees earned from the Total Book of
Business of the Earn-Out Locations, including Contingent Revenues (subject to
the limitations set forth below).
(a)In calculating Core Revenue, Contingent Revenues will equal the Contingent
Revenues received from the Total Book of Business of the Earn-Out Locations over
the Earn-Out Period.
(b)Core Revenue excludes:
(i)Late fees charged to Clients;
(ii)First-year Commissions earned from any Individual Financial Products in
excess of $750,000;
(iii)Any Commissions earned from any (A) Individual Financial Products written
on the lives of any Key Owner, director, manager, officer, or key employee of a
Seller, or any family member of any Key Owner, director, manager, or officer of
a Seller; (B) individual life products sold to any such individuals or their
respective estates; or (C) Insurance Products or Services placed or provided for
a Seller or any Affiliate of a Seller;
(iv)Interest;
(v)Countersignature fees;
(vi)Commissions derived from any Insurance Product or Service written with any
Sub-Rated Carrier or Ineligible Carrier, except and to the extent otherwise set
forth in this Agreement;
(vii)Commissions accrued on Sellers’ or Buyer’s balance sheet and attributable
to direct bill policies;
(viii)Any non-recurring revenue during the Earn-Out Period directly related to a
change in Carrier or re-allocation of a book of business from one Carrier to
another;
(ix)Any revenues recognized during the Earn-Out Period under GAAP to reflect any
changes in the fair value of the “earn-out” or other contingent portions of the
Purchase Price;
(x)Any benefits paid to Buyer under any Owner Life Policy purchased by Buyer;
(xi)Any purchase price or other consideration that Buyer receives from any sale
or transfer of Client Accounts during the Earn-Out Period, except as otherwise
provided in this Agreement; and
(xii)Revenues from any Retail Brokered Business, except for those relationships
set out on Schedule 3.6(c) or unless otherwise mutually agreed upon by the
Parties in writing.

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(c)Core Revenue shall include an annual credit of $300,000 for investment
earnings for the New Profit Center.
(d)Core Revenue shall include amounts received from premium financing companies
for placements of premium financing for Client Accounts.
(e)Core Revenue shall include any rent or other monies paid to Buyer as
sublandlord under any sublease arrangement with any Third Party entered into or
assumed by Buyer in connection with this Agreement such rent or other monies
offsets an actual rental expense.
(f)Except with respect to Commissions or Services Fees generated from
endorsements or audits, no more than twelve (12) months of Core Revenue
generated from any one Client Account will be included in any twelve (12)-month
period.
(g)If any Premiums/Fees Receivable are written off as bad debt (in accordance
with the bad debt policy below), during the Earn-Out Period, any corresponding
Commissions or Service Fees that were previously recognized as revenue during
the Earn-Out Period, and not otherwise reduced (e.g., by cancellation credits),
will be excluded dollar-for-dollar from Core Revenue; provided, however, that if
such Premiums/Fees Receivable are later collected during the Earn-Out Period,
any corresponding Commissions or Services Fees will be included in Core Revenue.
No Commissions or Service Fees corresponding to Premiums/Fees Receivable that
were written-off as uncollectible bad debt before the Closing Date and are later
collected during the Earn-Out Period will be included in Core Revenue. The
Parties acknowledge and agree that any Premiums/Fees Receivable for purposes of
this Agreement shall be written off as bad debt after ninety (90) days.
(h)Billing and collection of Service Fees shall be consistent with past practice
during the thirty-six (36) month period prior to the Closing Date and revenue
shall be recognized in accordance with Section 1.5(e).
“Current Accounts”-the current, in-force Client Accounts of Sellers as of the
Closing Date, i.e., any Client Accounts that have not canceled or non-renewed
their Insurance Products or Services with Seller, and all renewals and
expirations thereof.
“Disclosure Schedules”-the Disclosure Schedules delivered by the Sellers to
Buyer concurrently with the Closing. Any disclosure in the Disclosure Schedules
shall be deemed to constitute an exception to or otherwise modify the
representations and warranties contained in the equivalently numbered section of
Article 3 and each other section of this Agreement where such information is
relevant on its face, regardless of whether such exception or modification is
explicitly stated in this Agreement.
“EBITDA”-Operating Profit calculation with the following adjustments to Expenses
remove charges to the New Profit Center for depreciation.
“Employee Benefit Plan”-any (a) nonqualified deferred compensation or retirement
plan or arrangement that is an Employee Pension Benefit Plan, (b) qualified
defined contribution retirement plan or arrangement that is an Employee Pension
Benefit Plan, (c) qualified defined benefit retirement plan or arrangement that
is an Employee Pension Benefit Plan (including any Multiemployer Plan), or (d)
Employee Welfare Benefit Plan or material fringe benefit plan or program.
“Employee Pension Benefit Plan”-as defined in ERISA Section 3(2).
“Employee Welfare Benefit Plan”-as defined in ERISA Section 3(1).
“Employee/Owner-Related Liabilities”-(a) any Liability under the Employee
Benefit Plans or relating to compensation, payroll, vacation, sick leave, PTO,
workers’ compensation, unemployment benefits, pension benefits, employee stock
option or profit-sharing plans, deferred compensation plans, health care plans
or benefits, or any other employee plans or benefits of any kind for any
Seller’s employees or former employees or both (including, without limitation,
any Liabilities arising under ERISA, the Code or the FLSA); (b) any Liability
under any employment,

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severance, retention, or termination agreement with any employee of any Seller
or any of their respective Affiliates; (c) any Liability arising out of or
relating to any employee grievance arising with respect to (i) any Seller before
the Closing Date or (ii) the termination of any employee’s employment with any
Seller in connection with the Acquisition, including, without limitation, any
purported violation by any Seller of any federal, state, or local labor or
employment Law, whether or not the affected employees are hired by Buyer, or any
failure-to-hire or similar claim against Buyer by any of any Seller’s employees
not hired by Buyer; (d) any Liability under the WARN Act or any similar state or
local Law that may result from an “Employment Loss”, as defined in 29 U.S.C. §
2101(a)(6), caused by any action of any Seller before the Closing or by Buyer’s
decision not to hire previous employees of any Seller; and (e) any Liability of
any Seller to any Affiliate of any Seller or any Affiliate or family member of
any Key Owner; (f) any Liability to indemnify, reimburse, or advance amounts to
any officer, director, employee, or agent of any Seller; (g) any Liability to
distribute to any Key Owner or otherwise apply all or any part of the
consideration received hereunder; and (h) any Liability or Adverse Consequences
arising, under, or resulting from, any dissenter’s rights exercised by any Key
Owner.
“Encumbrance”-any charge, claim, community or other marital property interest,
condition, equitable interest, lien, option, pledge, security interest,
mortgage, right of way, easement, encroachment, servitude, right of first
option, right of first refusal or similar restriction, including any restriction
on use, voting (in the case of any security or equity interest), transfer,
receipt of income, or exercise of any other attribute of ownership, including
any Leases for Tangible Personal Property.
“Environmental, Health, and Safety Laws”-the Comprehensive Environmental
Response, Compensation and Liability Act of 1980; the Resource Conservation and
Recovery Act of 1976; and the Occupational Safety and Health Act of 1970; each
as amended, together with all other applicable Law (including rules,
regulations, codes, plans, injunctions, judgments, orders, decrees, rulings, and
charges thereunder) of federal, state, local, and foreign governments (and all
agencies thereof) concerning pollution or protection of the environment, public
health and safety, or employee health and safety, including applicable Law
relating to emissions, discharges, releases, or threatened releases of
pollutants, contaminants, or chemical, industrial, hazardous, or toxic materials
or wastes into ambient air, surface water, ground water, or lands or otherwise
relating to the manufacture, processing, distribution, use, treatment, storage,
disposal, transport, or handling of pollutants, contaminants, or chemical,
industrial, hazardous, or toxic materials or wastes.
“ERISA”-the Employee Retirement Income Security Act of 1974, as amended, or any
successor statute, and any rules or regulations promulgated thereunder.
“Estimated Carrier Payables Amount”-the estimated aggregate amount, as set forth
in Schedule 11.1-EC, of accounts payable due by Sellers to their Carriers after
the Closing Date.
“Exchange Act” -the Securities Exchange Act of 1934, as amended, and any
applicable rules and regulations promulgated thereunder, and any successor to
such statute, rules or regulations.
“Excluded Business”-the business of the Sellers and their Affiliates conducted
with the Excluded Assets, including the business of The Hays Financial Group,
LLC.
“Excluded Contracts”-(a) any Contract between any Seller and any Third Party
concerning any merger, stock acquisition, or other consolidation or acquisition,
by or involving any Seller with respect to any insurance intermediary, Client
Accounts (books of business), or other assets (except for (i) any Seller’s
ownership rights in such Client Accounts or assets and (ii) to the extent
assignable, any confidentiality, non-solicitation, non-competition, or other
restrictive covenants in favor of any Seller, arising under such Contracts,
which ownership rights and restrictive covenants will be included within the
Acquired Assets); (b) any Contract between any Seller and any current or prior
employee of any Seller (except for any restrictive covenants in favor of any
Seller, to the extent assignable by Seller, arising under such Contracts, which
restrictive covenants will be included within the Acquired Assets); (c) any
vehicle or equipment Leases; (d) any loan facilities or any Encumbrances related
thereto of any Seller; and (e) any Contract listed on Schedule 1.2(j).
“Expenses”-For purposes of determining Operating Profit and the resulting
Purchase Price:

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(a)Expenses means all expenses actually incurred by the New Profit Center in
connection with the Earn-Out Locations, including:
(i)A total corporate overhead charge of seven percent (7.0%) of Core Revenue,
which includes a charge for insurance;
(ii)A charge, consistent with the charge to Buyer’s other profit centers, for
the first $10,000 of each new workers’ compensation claim (medical, indemnity
and expense) opened on or after January 1, 2018, for any employee directly
employed by the New Profit Center at an Earn-Out Location;
(iii)Charges for actual legal and other professional fees paid to Third-Party
service providers and incurred by or on behalf of the New Profit Center with
respect to Earn-Out Locations;
(iv)A charge for actual costs attributable to attendance at Buyer’s annual sales
meeting (the “Annual Meeting Charge”) (which Annual Meeting Charge will be
estimated in calculating the Pro Forma Operating Profit), provided, however,
that during the first twelve (12) months following the Closing Date, the Annual
Meeting Charge will be (i) excluded as an Expense for purposes of calculating
Operating Profit and the resulting Purchase Price hereunder, but (ii) included
as an operating expense of the New Profit Center for financial reporting and all
other purposes;
(v)A charge for the full amount of any judgment or settlement (in the case of
any errors and omissions (E&O) or employment practices liability (EPL) claim, up
to a maximum of $100,000), and the full amount of all related legal fees, costs,
and expenses (regardless of the type of claim), with respect to any claim
arising on or after the Closing Date against the New Profit Center, net of any
applicable insurance proceeds actually paid (Sellers will be liable for the full
amount of any applicable deductibles, any judgment or settlement amount, and all
related legal fees, costs, and expenses for any Proceeding pending as of, or any
claim arising before, the Closing Date);
(vi)Charges for the total compensation expense (including direct compensation,
group health plan and other employee benefit plan-related expenses, expense
accruals for paid time off (PTO) for applicable employees, and all
compensation-related Tax Liabilities) for all employees of the New Profit
Center, provided that as to new hires whose direct compensation qualifies for
subsidization under Buyer’s corporate assistance program, such subsidized direct
compensation will not be included within Expenses. For the second twelve
(12)-month period (“Year Two”) and third twelve (12)-month period (“Year Three”)
of the Earn-Out Period, the direct compensation expense charge will include an
increase of three and one-half percent (3.5%) of the total direct compensation
expense of non-commissioned New Profit Center employees over the prior twelve
(12)-month period (such increase, the “Salary Increase Pool”).  The Salary
Increase Pool will be distributed in Year Two and Year Three as annual salary
increases among the non-commissioned New Profit Center employees in such amounts
as the New Profit Center Leader may determine in his or her discretion.
Notwithstanding the foregoing, Buyer may elect in its sole discretion (1) to
forego any such direct compensation increase for non-commissioned New Profit
Center employees for Year Two and/or Year Three, or (2) to charge an increase of
less than three and one-half percent (3.5%) for Year Two and/or Year Three;
(vii)A charge of $100,000 annually for audit fees associated with the New Profit
Center;
(viii)Expenses will also include charges for depreciation of computers,
furniture and other tangible personal property (i) acquired from Sellers or (ii)
acquired by the New Profit Center on or after the Closing Date. Tangible
Personal Property acquired (A) from Sellers will be depreciated on a
straight-line method over three (3) years following the Closing Date, and (B) on
or after the Closing Date will be depreciated in accordance with Buyer’s
standard accounting methodology and practices; and
(ix)Expenses for optional marketing materials, programs, and services offered by
Parent that the New Profit Center orders with respect to Earn-Out Locations or
in which the New Profit Center elects to participate with respect to the
Earn-Out Locations.

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(b)The following are excluded from “Expenses”:
(i)Buyer’s acquisition amortization expense;
(ii)Buyer’s income tax expense;
(iii)Interest expense;
(iv)Buyer’s cost of capital;
(v)Costs of any stock incentive grants to Hired Employees issued at Closing;
(vi)(A) Costs incurred by Buyer to effect the Acquisition and/or (B)
restructuring costs incurred by Buyer that Buyer expected but was not obligated
to incur as a result of the Acquisition;
(vii)Any premiums incurred by Buyer to purchase, at its election under Section
5.8, any Owner Life Policy; and
(viii)Any expenses recognized during the Earn-Out Period under GAAP to reflect
any changes in the fair value of the “earn-out” or other contingent portions of
the Purchase Price.
“FINRA”-the Financial Industry Regulatory Authority or any successor thereto.
“FLSA”-collectively, (a) the federal Fair Labor Standards Act, as amended, or
any successor statute, (b) any equivalent state or local Law, and (c) and any
rules or regulations promulgated thereunder.
“GAAP”-generally accepted accounting principles for financial reporting in the
United States of America, applied on a consistent basis.
“Governing Documents”-with respect to any particular entity, (a) if a
corporation, the articles or certificate of incorporation and the bylaws; (b) if
a general partnership, the partnership agreement and any statement of
partnership; (c) if a limited partnership, the limited partnership agreement and
the certificate of limited partnership; (d) if a limited liability company, the
articles of organization and operating agreement; (e) if another type of Person,
any other charter or similar document adopted or filed in connection with the
creation, formation, or organization of the Person; (f) all equityholders’
agreements, voting agreements, voting trust agreements, joint venture
agreements, registration rights agreements, or other agreements or documents
relating to the organization, management, or operation of any Person or relating
to the rights, duties, and obligations of the equityholders of any Person; and
(g) any amendment or supplement to any of the foregoing.
“Governmental Authorization”-any Consent, license, registration, permit,
variance, exemption, Order, or approval issued, granted, given, or otherwise
made available by or under the authority of any Governmental Body or pursuant to
any Law.
“Governmental Body”-any: (a) nation, state, county, city, town, borough,
village, district, or other jurisdiction; (b) federal, state, local, municipal,
foreign, or other government; (c) governmental or quasi-governmental authority
of any nature (including any agency, branch, department, board, commission,
court, tribunal, or other entity exercising governmental or quasi-governmental
powers); (d) multinational organization or body; (e) body exercising, or
entitled or purporting to exercise, any administrative, executive, judicial,
legislative, police, regulatory, or taxing authority or power; or (f) official
of any of the foregoing.
“GSCs”-guaranteed supplemental commissions.
“Hart-Scott-Rodino Act” -means the Hart-Scott-Rodino Antitrust Improvements Act
of 1976, as amended.
“Hired Employees”-the employees of any Seller providing services to Buyer
pursuant to the Transition Services Agreement and/or hired by Buyer as of
January 1, 2019.

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“Independent Accounting Firm”- an independent accounting firm, not used by any
Party as an auditor or consultant in the previous twenty-four (24) months, and
otherwise mutually and reasonably acceptable to the Buyer and Sellers’
Representative, acting as an expert on accounting matters and as an arbitrator
with respect to resolution of any disputes relating to operation of the New
Profit Center. If the Buyer and Sellers’ Representative are unable to agree on
an Independent Accounting Firm, the dispute will be settled by three independent
accounting firms, one of whom will be chosen by the Buyer, one by Sellers’
Representative, and the third arbitrator by the two so chosen. The Party
desiring to have the dispute submitted to the Independent Account Firm shall
promptly select its appointee and notify the other Party thereof. When so
notified, the other Party will within 15 days likewise select its appointee and
give notice thereof. If the two independent accounting firms so selected are
unable to agree within a period of 15 days on the selection of a third
independent accounting firm, any Party may petition the District Court for
Hennepin County, Minnesota, for the appointment of the third arbitrator.
“Individual Financial Product”-any individual life, long-term care, annuity,
disability, accident, cancer, dental, or hospital confinement insurance
policies, or any other insurance, financial, or estate planning product sold to
individuals or their estates (either directly or through a group arrangement),
whereby forty percent (40%) or more of the policy premium is paid during the
first year of the policy term.
“Ineligible Carrier”-a Carrier that, as of the Closing Date, is not admitted,
authorized, licensed, or otherwise eligible to write insurance coverage on a
surplus lines basis in the jurisdiction in which the covered risk is located.
“Insolvent Carrier Liabilities”-any Liabilities arising out of, directly or
indirectly resulting from, in consequence of, or in any away involving the
insolvency, receivership, bankruptcy, liquidation, or financial inability to pay
of any Carrier.
“Insurance Business”-the business of quoting, placing, providing, servicing,
and/or renewing Insurance Products or Services.
“Insurance Products or Services”- (a) Employee Benefits Products or Services,
(b) Insurance-Related Services, and/or (c) P&C Products or Services, as such
terms are defined below:
(a)“Employee Benefits Products or Services”-(i) employer-sponsored benefits
accounts with programs, whether self-insured or fully insured, such as group
life, group health, group dental, group disability, group long-term care,
ancillary benefits sold to groups, and similar or related products and services,
and (ii) insurance procured for individual, natural persons (e.g., life, health,
annuities, long-term care, and similar or related products and services).
(b)“Insurance-Related Services”-any services provided to a Client, either
directly or by a Third-Party service provider, whether or not for a fee and
whether or not pursuant to a written Contract, including but not limited to:
third-party administration (TPA); risk management; loss control; compliance or
other consulting services; claims analysis; insurance program administration;
enrollment services; COBRA, Section 125 Cafeteria Plan, Health Savings Account
(HSA) Plan, Health Reimbursement Arrangement (HRA) Plan, Health Flexible
Spending Account (FSA) Plan, and/or Premium Reimbursement Arrangement (PRA) Plan
administration; preparation, review, and/or filing of IRS Form 5500s; referrals
to on-site medical clinics, attorneys, or other Third-Party service providers
(whether or not a referral fee or other remuneration is paid by such providers
for such referrals); or other services.
(c)“P&C Products or Services”-(i) commercial lines or personal lines property
and casualty insurance products, and/or (ii) commercial or individual bond or
suretyship products.
“Intellectual Property” and “Intellectual Property Assets”- (a) all patents and
patent applications, together with all reissuances, continuations,
continuations-in-part, revisions, extensions, and reexaminations thereof; (b)
each Seller’s corporate trade names, trademarks, service marks, trade dress,
logos, and including all goodwill associated therewith, and all applications,
registrations, and renewals in connection therewith; (c) all copyrightable
works, all copyrights, and all applications, registrations, and renewals in
connection therewith; (d) all mask works and all applications, registrations,
and renewals in connection therewith; (e) all trade secrets and Confidential
Information, including ideas, research and development, know-how, formulas,
compositions, manufacturing and production processes and

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techniques, technical data, designs, drawings, specifications, Client and
supplier lists, pricing and cost information, and business and marketing plans
and proposals; (f) all computer software (including data and related
documentation); (g) all registered domain names and website content; and (h) all
copies and tangible embodiments thereof (in whatever form or medium).
“IRS”-the United States Internal Revenue Service and, to the extent relevant,
the United States Department of the Treasury, or any successor thereto.
“Key Owner”-means the individuals set forth on Schedule 11.1-KO.
“Key Owner Employment Agreements”-mutually agreed Employment Agreements between
Buyer and each Key Owner.
“Knowledge”-(a) an individual will be deemed to have “Knowledge” of a particular
fact or other matter if such individual is actually aware of such fact or other
matter; and (b) a Person other than an individual will be deemed to have
“Knowledge” of a particular fact or other matter if any individual who is
serving as Chief Executive Officer, Chief Financial Officer or Chief Operating
Officer of such Person has Knowledge of such fact or other matter.
“Landlord”-the landlord under each Lease as set forth on Schedule 11.1-LL, or
its duly appointed agent.
“Law”-any federal, state, local, municipal, foreign, international,
multinational or other constitution, law, ordinance, principle of common law,
code, rule, regulation, statute, or treaty.
“Lease”-any Real Property Lease or any lease or rental agreement, license, right
to use, or installment and conditional sale agreement to which any Seller is a
party, and any other Seller Contract pertaining to the leasing or use of any
Tangible Personal Property.
“Lease Assignment”-a mutually agreeable Assignment and Assumption of Lease with
respect to the Real Property Lease for the Office Locations.
“Liability”-with respect to any Person, any liability or obligation of such
Person of any kind, character or description, whether known or unknown; absolute
or contingent; accrued or unaccrued; disputed or undisputed; liquidated or
unliquidated; secured or unsecured; joint or several; due or to become due;
vested or unvested; executory; determined; determinable; or otherwise; and
whether or not the same is required to be accrued on the financial statements of
such Person.
“License Agreement”-a mutually agreed License Agreement regarding use of certain
Intellectual Property of the Sellers by or in connection with the Excluded
Business.
“Material Adverse Change”-with respect to any Seller or Buyer, a material
adverse change in the business, operations, prospects, assets, Liabilities,
results of operations, or condition (financial or other) of a Party and its
subsidiaries on a consolidated basis, except any adverse change related to or
resulting from: (i) general business or economic conditions affecting the
industry in which the specified Person operates, except to the extent any such
condition has a disproportionate effect on the specified Person compared to the
other participants in the industry in which the specified Person participates;
(ii) national or international political or social conditions, including the
engagement by the United States in hostilities or the escalation thereof,
whether or not pursuant to the declaration of a national emergency or war, or
the occurrence or the escalation of any military or terrorist attack upon the
United States, or any of its territories, possessions, or diplomatic or consular
offices or upon any military installation, equipment or personnel of the United
States, except to the extent any such condition has a disproportionate effect on
the specified Person compared to the other participants in the industry in which
the specified Person participates; (iii) events, changes, facts, conditions,
circumstance or occurrences generally affecting the economy or the financial,
banking, or securities markets in the United States, or worldwide (including any
disruption thereof and any decline in the price of any security or any market
index), but only to the extent that such events, changes, facts, conditions,
circumstances or occurrences do not have a disproportionate effect on the
specified Person as compared to other participants in the industry in which

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the specified Person participates; (iv) changes or proposed changes in GAAP;
(v) changes or proposed changes in Laws, or (vi) the announcement of this
Agreement or the Contemplated Transactions.
“Multiemployer Plan”-as defined in ERISA Section 3(37).
“Name Change Documents”-(a) duly authorized and executed Articles of Amendment
or similar documents as required under applicable Law, amending each Seller’s
Governing Documents to change each Seller’s name to one sufficiently dissimilar
to such Seller’s name immediately prior to Closing, in Buyer’s judgment, to
avoid confusion, and (b) if applicable, such other duly authorized and executed
documents as may be necessary or desirable to effect the transfer, the
ownership, and use of each Seller’s fictitious names to Buyer.
“New Profit Center”- the new profit center formed by Buyer to operate the
Acquired Assets.
“Operating Profit”- the excess of Core Revenue over Expenses for a given period.
(a)Operating Profit will be determined in accordance with Buyer’s standard
accounting methodology and procedures, consistently applied. Notwithstanding the
foregoing, if there is any conflict between Buyer’s standard accounting
methodology and practices and the terms of this Agreement, then solely for
purposes of calculating the Purchase Price hereunder, the terms of this
Agreement will govern.
(b)Operating Profit will include an application of marketing allocation, other
allocation and cross-sell allocation consistent with Sellers’ historical
practice prior to Closing, unless any modification is mutually agreed upon by
Buyer and Sellers’ Representative.
(c)Without limiting the foregoing:
(i)Operating Profit will be computed without regard to: (A) “extraordinary
items” of gain or loss as that term shall be defined in GAAP, or (B)
modification to Core Revenue or Expenses due to certain changes in accounting
standards that became effective in 2018 in connection with the FASB’s adoption
of ASU 2014-09, “Revenue from Contracts with Customers (Topic 606)” and/or the
IASB’s adoption of IFRS 15, as amended, unless otherwise agreed among the
Parties;
(ii)Operating Profit will not include any gains, losses or profits realized from
the sale of any assets;
(iii)Notwithstanding any GAAP requirement that Sellers or Buyer post accruals
for (A) direct bill Commissions or (B) Contingent Revenues (including, without
limitation, GSCs and Overrides) on its balance sheet or Section 1.5(c), for
purposes of determining the Purchase Price, direct bill Commissions and
Contingent Revenues (including, without limitation, GSCs and Overrides) are
recognized when received (i.e., on a cash basis).
(iv)Agency bill Commissions are recognized as follows:
(A)For agency bill policies for which premiums are paid in full at inception
rather than in installments, such Commissions are recognized on the later of the
policy effective date (as indicated in the policy) or the date that the premium
was billed to the Client (as indicated in the premium invoice).
(B)For agency bill policies for which premiums are paid in installments during
the policy period, such Commissions are recognized on the later of the payment
due date for each installment (as indicated in the policy) or the date each
installment was billed to the Client (as indicated in the invoice for each
installment).
“Order”-any order, injunction, judgment, decree, ruling, assessment, or
arbitration award of any Governmental Body or arbitrator.
“Ordinary Course of Business”- an action taken by a Person will be deemed to
have been taken in the Ordinary Course of Business only if that action: (a) is
consistent in nature, scope, and magnitude with the past practices of such
Person

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and is taken in the ordinary course of the normal, day-to-day operations of such
Person; (b) does not, by virtue of an applicable Law or the terms of such
Person’s Governing Documents, require authorization by the members, managers,
board of directors, or shareholders of such Person (or by any Person or group of
Persons exercising similar authority) and does not require any other separate or
special authorization of any nature; and (c) is similar in nature, scope and
magnitude to actions customarily taken, without any separate or special
authorization, in the ordinary course of the normal, day-to-day operations of
other Persons that are in the same line of business as such Person.
“Overrides”-“override”, “bonus”, or similar volume-based commissions paid by
life and health Carriers on Employee Benefits Products or Services.
“Permitted Encumbrances”- means (i) statutory Encumbrances for current Taxes or
other charges by a Government Entity not yet due and payable or the amount or
validity of which is being contested in good faith by appropriate proceedings by
the applicable Person (such proceedings, as disclosed on Schedule 11.1-PE), (ii)
mechanic’s, carriers’, workers’, repairers’ and similar statutory Encumbrances
arising or incurred in the Ordinary Course of Business for amounts that are not
delinquent and that are not, individually or in the aggregate, significant or
the amount or validity of which is being contested in good faith by appropriate
proceedings by the applicable Person (such proceedings, as disclosed on Schedule
11.1-PE), (iii) Encumbrances granted under leases of real property, (iv)
Encumbrances arising under worker’s compensation, unemployment insurance, social
security, retirement and similar legislation, and (v) liens securing rental
payments under capital lease arrangements.
“Person”-an individual, partnership, corporation, business trust, limited
liability company, limited liability partnership, joint stock company, trust,
unincorporated association, joint venture, or other entity, or a Governmental
Body.
“Pre-Closing Breach”-any Liability of any Seller arising out of or relating to a
Breach of any such Seller Contract that occurred before the Closing Date.
“Premiums/Fees Receivable”-any Accounts Receivable for Premiums or Service Fees
due from a Client.
“Proceeding”-any action, arbitration, audit, hearing, investigation, litigation,
or suit (whether civil, criminal, administrative, judicial, or investigative,
whether formal or informal, whether public or private) commenced, brought,
conducted, or heard by or before, or otherwise involving, any Governmental Body
or arbitrator.
“Pro Forma Operating Profit”-the pro forma Operating Profit, based upon Seller’s
Operating Profit for the twelve (12)-month period ended September 30, 2018, for
the New Profit Center for the twelve (12)-month period beginning on the Closing
Date, as mutually agreed upon by the Parties at Closing (it being understood
that, except as otherwise set forth in this Agreement, the Parties make no
representation or warranty as to the performance of the Total Book of Business
or the New Profit Center after the Closing).
“Pro Forma Operating Profit Margin”-an amount, expressed as a percentage, equal
to (a) Pro Forma Operating Profit divided by (b) the Core Revenue component of
Pro Forma Operating Profit.
“Prohibited Transaction”-as defined in ERISA Section 406 and Code Section 4975,
or any successor statutes.
“Public Software”-any software that contains, or is derived in any manner (in
whole or in part) from, any software that is distributed as free software, open
source software (e.g., Linux), or similar licensing or distribution models,
including without limitation any model that requires the distribution of source
code to licensees, including software licensed or distributed under any of the
following licenses or distribution models, or licenses or distribution models
similar to any of the following: (a) GNU’s General Public License (GPL) or
Lesser/Library GPL (LGPL); (b) the Artistic License (e.g., PERL); (c) the
Mozilla Public License; (d) the Netscape Public License; (e) the Sun Community
Source License (SCSL); (f) the Sun Industry Standards License (SISL); (g) the
BSD License; and (h) the Apache License.
“Real Property Lease”-any (a) long-term lease of land in which most of the
rights and benefits comprising ownership of the land and the improvements
thereon or to be constructed thereon, if any, are transferred to the tenant for
the

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term thereof, or (b) any lease or rental agreement pertaining to the occupancy
of any improved space on any parcels and tracts of land in which any Seller has
an ownership interest.
“Record”-information that is inscribed on a tangible medium or that is stored in
an electronic or other medium and is retrievable in perceivable form.
“Representative”-with respect to a particular Person, any director, officer,
manager, employee, agent, consultant, advisor, accountant, financial advisor,
attorney, or other representative of that Person.
“Restrictive Covenants”-collectively, the restrictive covenants of the Sellers
set forth in Section 5.11 and the restrictive covenants of each Restrictive
Covenant Party set forth in the respective Restrictive Covenant Agreement
delivered by such Restrictive Covenant Party.
Restrictive Covenant Agreement”-a Restrictive Covenant Agreement, substantially
in the form of Exhibit C.
“Restrictive Covenant Party”-each Key Owner and certain other Hired Employees
mutually agreed upon by Buyer and Sellers.
“Retail Brokered Business”-any retail Insurance Products or Services that (a)
any Seller or Buyer has co-brokered or sub-brokered with or on behalf of any
Third Party insurance intermediary, or (b) any Third Party has referred to any
Seller or Buyer insurance intermediary. For clarity, “Retail Brokered Business”
(i) includes Insurance Business placed through any Seller by any independent
contractor, unless a written Contract between such Seller and such contractor
exists as of Closing that (A) provides for such Seller’s exclusive ownership of
such Insurance Business and all files, records, and other information related
thereto, and/or (B) prohibits such contractor from soliciting or diverting away
such Insurance Business, but (ii) does not include any Insurance Business that
any Seller or Buyer places on behalf of a Client through any wholesale or excess
and surplus lines insurance broker, managing general agent, managing general
underwriter, insurance program, or similar insurance intermediary.
“Return Premiums”-any insurance premiums, net of Commissions, returned by a
Carrier as a result of an insurance policy cancellation, a reduction in benefits
under an insurance policy, or a reduction in premium for an insurance policy.
“Satisfaction Agreement and Release”-a Satisfaction Agreement and Release,
substantially in the form of Exhibit A.
“Secured Debt Amount” -the aggregate amount, as set forth in Section
1.4(c)(i)(B), of those Liabilities for funded indebtedness of any Seller
outstanding as of Closing and secured by the Acquired Assets.
“Secured Debt Payoff Letters”-letters from those secured creditors of any
Seller, setting forth wire transfer instructions and the secured debt payoff
balances due to such secured creditors as of the Closing Date.
“Seller Account”-any (a) Current Account, (b) Person that was Client Account of
any Seller within the twenty-four (24)-month period before the Closing Date, and
(c) Person to whom any Seller has quoted, proposed, or solicited the sale of any
Insurance Products or Services within the twenty-four (24)-month period before
the Closing Date.
“Securities Act”-the Securities Act of 1933, as amended.
“Securities Business”-the business of soliciting, selling, servicing, and/or
providing investment advice as to any equities, mutual funds, bonds, variable
annuities, equity-indexed annuities, or any other investment product deemed
“securities” under applicable Law.
“Seller ERISA Affiliate”-any trade or business, whether or not incorporated,
that together with any Seller, would be deemed a “single employer” within the
meaning of Section 4001 of ERISA.
“Sellers’ Closing Certificate”-a Seller’s Closing Certificate for each Seller,
representing and warranting to Buyer and Parent that: (a) each Seller’s
representations and warranties in this Agreement was accurate in all material
respects as of the date of this Agreement and is accurate in all material
respects as of the Closing Date as if made on the Closing

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Date (giving full effect to any supplements to the Schedules that were delivered
by the Seller Parties on or before the Closing Date), unless given as of a
specific date and then such representations and warranties are accurate in all
material respects as of such date; and (b) the Seller Parties have performed in
all material respects all of the obligations to be performed by the Seller
Parties under this Agreement on or before the Closing Date.
“Seller Contract”-any Contract in connection with the Insurance Business: (a)
under which any Seller has or may acquire any rights or benefits; (b) under
which any Seller has or may become subject to any obligation or Liability; or
(c) by which any Seller or any of the assets owned or used by any Seller is or
may become bound, unless part of the Excluded Assets and/or the Retained
Liabilities.
“Seller Documents”-this Agreement and the other Transaction Documents required
to be delivered by any Seller in connection with the Contemplated Transactions.
“Seller Indemnified Parties”-the Sellers, their respective managers, officers,
directors, agents, employees, successors, permitted assigns, and Affiliates, and
the officers, managers, directors, agents, and employees, successors and assigns
of their respective Affiliates.
“Seller Resolutions”-duly adopted resolutions of the shareholders or members, as
applicable, of each Seller, satisfactory to Buyer in its sole discretion: (a)
approving the Seller Documents and the Contemplated Transactions, in accordance
with applicable Law regarding the sale of assets other than in the Ordinary
Course of Business; (b) approving the name change contemplated by Section 5.5
and accompanied by the requisite documents for amending the relevant Governing
Documents of each Seller required to effect such name change in form sufficient
for filing with the appropriate Governmental Body.
“Seller Schedules”-the Disclosure Schedules, the Schedules required to be
delivered by the Sellers under Article 1, and each other Schedule required to be
delivered by the Schedules pursuant to this Agreement.
“Service Fees”-fees charged for services such as consulting, program design and
implementation, risk management, or other services not directly related to the
placement of insurance coverage, pursuant to the terms of a written Contract
with the Client.
“Software”-all computer software and subsequent versions thereof, including
source code, object, executable or binary code, objects, comments, screens, user
interfaces, report formats, templates, menus, buttons and icons and all files,
data, materials, manuals, design notes and other items and documentation related
thereto or associated therewith.
“Special Matter”-any one or more of the following indemnity matters:
(a)    Fraud, including any determination by a court of competent jurisdiction
that the Acquisition constitutes a fraudulent conveyance by any Seller;
(b)    Any Adverse Consequences incurred or suffered by any Seller Indemnified
Party in connection with any Breach of Buyer’s or Parent’s representations and
warranties contained in Section 4.4 (No Brokers or Finders);
(c)    Any Adverse Consequences incurred or suffered by any Buyer Indemnified
Party in connection with:
(i)    Any Tax Liabilities of any Seller, including any (A) Taxes assessed on or
after the Closing Date for any period before the Acquisition or (B) Successor
Tax Liabilities;
(ii)    Any Breach by any Seller of its covenants under Section 5.4(a)
(Post-Closing Employee Matters), Section 5.5 (Corporate Name, Tradenames,
Service Marks, Etc.), Section 5.6(a) (Taxes Resulting from Sale of Assets by
Seller), Section 5.7(b) (Collection of Seller Accounts Receivable), or Section
5.11 (Seller Parties’ Restrictive Covenants);

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(iii)    Any Breach by any Seller of those representations and warranties
contained in Section 3.2 (Capitalization); Section 3.4(b) (Financial Statements;
No Material Adverse Change; No Undisclosed Liabilities), Section 3.6 (Assets),
Section 3.9 (Bankruptcy; Solvency), or Section 3.16 (No Brokers or Finders);
(iv)    Any Employee/Owner-Related Liabilities;
(v)    Any Liabilities arising under any Environmental, Health, and Safety Laws;
(vi)    Any Insolvent Carrier Liabilities arising prior to the Closing;
(i)Any Unclaimed Property Matters arising prior to the Closing; and
(ii)Any Proceeding that as of the Closing Date is pending (including those
Proceedings listed on Schedule 11.1-SM), threatened, or based upon written
notice received by any Seller, is reasonably likely to be commenced against any
Seller.
“Staff Employment Agreements”-Buyer’s standard Employment Agreement, between
Buyer and the Hired Employees.
“Stop Loss Carrier Disclosure Statement”-the disclosure statement, as provided
by Buyer to Sellers before Closing, together with any documentation called for
thereunder.
“Sub-Rated Carrier”-a Carrier that, as of the Closing Date, is not rated by A.M.
Best Company or is rated less than “A-” by A.M. Best Company.
“Successor Tax Liability”-any Liability imposed upon Buyer for the unpaid Taxes
of any Person (including any Seller): (a) under United States Treasury
Regulation Section 1.1502-6, or any similar local, state, or federal Law,
including any Bulk Sales Laws; (b) as a transferee or successor; (c) by
Contract; or (d) otherwise.
“Tangible Personal Property”-all machinery, equipment, tools, furniture, office
equipment, computer hardware, supplies, materials, vehicles, and other items of
tangible personal property of every kind owned or leased by any Seller (wherever
located and whether or not carried on any Seller’s books), together with any
express or implied warranty by the manufacturers or sellers or lessors of any
item or component part thereof and all maintenance Records and other documents
relating thereto, unless part of the Excluded Assets.
“Tax”-collectively, (a) any income; gross receipts; license; payroll;
employment; excise; severance; stamp; occupation; premium; property;
environmental; windfall profit; customs; vehicle; airplane, boat, vessel or
other title or registration; capital stock; franchise; employees’ income
withholding; foreign or domestic withholding; social security; unemployment;
disability; real property; personal property; sales; use; transfer; value added;
alternative; add-on minimum; and other tax, fee, assessment, levy, tariff,
charge or duty of any kind whatsoever; and (b) any interest, penalty, addition
or additional amount thereon imposed, assessed, or collected, by or under the
authority of, any Governmental Body or payable under any tax-sharing agreement
or any other Contract.
“Tax Clearance Certificate”-a tax clearance certificate or similar instrument
duly issued by any applicable Governmental Body in accordance with applicable
Law regarding the outstanding and unpaid Tax Liability of each Seller as of the
Closing Date.
“Tax Measurement Date”-the date on which a Tax jurisdiction sets as the
measurement date for determining the ownership of Tangible Personal Property in
assessing Taxes on Tangible Personal Property.
“Tax Return”-any return (including any information return), report, statement,
schedule, notice, form, declaration, claim for refund, or other document or
information filed with or submitted to, or required to be filed with or
submitted to, any Governmental Body in connection with the determination,
assessment, collection, or payment of any Tax or in connection with the
administration, implementation, or enforcement of or compliance with any Law
relating to any Tax.
“Third Party”-a Person that is not a Party to this Agreement.

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“Total Book of Business”--collectively:
(a)the Current Accounts; and
(b)any new, renewal, or replacement Insurance Products or Services written or
provided for any:
(i)Current Account, or
(ii)new Client Account produced by any Hired Employee during the Earn-Out
Period,
(iii)including any “cross-selling” new Insurance Products or Services,
“up-selling” existing Insurance Products or Services, or otherwise
“rounding-out” of Insurance Products or Services for any Current Account or new
Client Account; but
(c)excluding any:
(i)any business enterprise or Client Account (other than the Current Accounts)
purchased or acquired for any form of consideration after the Closing by Buyer
or any of Buyer’s Affiliates,
(ii)Securities Business, or
(iii)Client Account of Buyer or any of Buyer’s Affiliates.
“Trademark Assignment”-a mutually agreed Assignment of Trademark regarding
Seller’s registered trademark and a mutually agreed Assignment of Trademark
Application regarding Seller’s pending trademark application, as described in
Schedule 3.14.
“Transaction Documents”-this Agreement and all documents, agreements, and
instruments, as amended, supplemented, or otherwise modified from time to time,
executed in connection with this Agreement or the Contemplated Transactions.
“Transition Services Agreement”-a mutually agreed upon agreement between Sellers
and Buyer for services provided by Sellers or employees of Seller between the
Closing Date and the January 1, 2019.
“Unclaimed Property Matters”-any Adverse Consequences, whether or not resulting
from the breach of any representation or warranty by any Seller under this
Agreement, arising from the failure of any Seller or any Affiliate of any Seller
to pay an amount to any Governmental Body, and/or to file any applicable report
or return with, any Governmental Body pursuant to any unclaimed or abandoned
property, escheat or similar Law.
“WARN Act”-the Worker Adjustment and Retraining Notification Act, as amended, or
any successor statute, and any rules or regulations promulgated thereunder.
(b)Other Definitions. Each of the following terms and variations thereof is
defined in the Section or paragraph set forth below opposite such term:
Acquired Assets
Section 1.1
Acquisition
Background Paragraph
Agreement
Introductory Paragraph
Assumed Seller Contract
Section 1.1(c)
Assumed PTO Leave
Section 2.2(a)
Assumed PTO Liability Amount
Section 2.2(a)
Balance Sheet Date
Section 3.4(a)
Basket
Section 6.5
Business
Background Paragraph

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Buyer
Introductory Paragraph
Buyer Group
Section 5.11
Cap
Section 6.5
Closing Date
Section 8.4
Closing Payment Amount
Section 1.4(c)(i)
Current Account
Section 1.1(a)
E&O
Section 3.12(a)
Earn-Out Period
Section 1.4(a)
Earn-Out Statement
Section 1.4(d)
EPL
Section 3.12(a)
Excess Coverage Provision
Section 5.2(a)
Excluded Assets
Section 1.2
Excluded Records
Section 1.1(e)
Financial Statements
Section 3.4(a)
Hired Employees
Section 2.7
Indemnified Party
Section 6.4(a)
Indemnifying Party
Section 6.4(a)
Interim Balance Sheet
Section 3.4(a)
Key Owner Life Policy
Section 5.8
Material Seller Contracts
Section 1.1(c)
Maximum Purchase Price Amount
Section 1.4(a)
Minimum Purchase Price Amount
Section 1.4(a)
Monthly Settlement Account
Section 2.6(b)(i)
Non-Compete Covenant
Section 5.11
Objection Notice
Section 1.4(d)
Office Locations
Section 1.1(i)
Parent
Introductory Paragraph
Party/Parties
Introductory Paragraph
Payroll Transition Period
Section 2.7(c)
Pre-Closing E&O
Section 5.2(a)
Purchase Price
Section 1.4(a)
Required Consents
Section 2.2(d)
Required Tail Coverage
Section 5.2(a)
Required Tail Deductible
Section 5.2(c)
Restricted Area
Section 5.11
Restricted Period
Section 5.11
Retained Liability/Retained Liabilities
Section 1.3
Seller/Sellers
Introductory Paragraph
Seller Accounts Payable
Section 3.4(c)
Seller Accounts Receivable
Section 3.4(c)
Seller Software
Section 3.15(c)
Settlement Objection Notice
Section 2.6(b)(i)
Settlement Statement
Section 2.6(b)(i)
Special Matter
Section 6.1(c)(i)
Stock Recipients
Section 1.4(c)(ii)
Survival Period
Section 6.1(a)

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Third Party Claim
Section 6.4(a)
Transfer
Section 5.10(a)(ii)
Transferred Account
Section 5.10(a)(ii)
Transferred Account Core Revenue
Section 5.10(b)(ii)(A)
W-9s
Section 2.2(m)
Year-End Balance Sheet
Section 3.4(a)

Section 11.2    Incorporation of Background Paragraph. The provisions of the
Background paragraph set forth above are hereby incorporated into this Agreement
as if set forth herein at length.
Section 11.3    Usage.
(a)Interpretation. In this Agreement, unless a clear contrary intention appears:
(i) the singular number includes the plural number and vice versa; (ii)
reference to any Person includes such Person’s successors and assigns but, if
applicable, only if such successors and assigns are not prohibited by this
Agreement, and reference to a Person in a particular capacity excludes such
Person in any other capacity or individually; (iii) reference to any gender
includes either gender; (iv) reference to any agreement, document, or instrument
means such agreement, document, or instrument as amended or modified and in
effect from time to time in accordance with the terms thereof; (v) reference to
any Law means such Law as amended, modified, codified, replaced, or reenacted,
in whole or in part, and in effect from time to time, including rules and
regulations promulgated thereunder, and reference to any section or other
provision of any Law means that provision of such Law from time to time in
effect and constituting the substantive amendment, modification, codification,
replacement, or reenactment of such section or other provision; (vi)
“hereunder,” “hereof,” “hereto,” and words of similar import will be deemed
references to this Agreement as a whole and not to any particular Article,
Section, or other provision hereof; (vii) “including” (and with correlative
meaning “include”) means including without limiting the generality of any
description preceding such term; (viii) with respect to the determination of any
period of time, “from” means “from and including” and “to” means “to but
excluding”; and (ix) references to documents, instruments or agreements will be
deemed to refer as well to all addenda, exhibits, schedules, or amendments
thereto.
(b)Accounting Terms and Determinations. Unless otherwise specified herein, all
accounting terms used herein will be interpreted and all accounting
determinations hereunder will be made in accordance with GAAP.
(c)Joint Efforts. This Agreement is the result of the joint efforts and
negotiations of the Parties hereto, with each Party being represented, or having
the opportunity to be represented, by legal counsel of its own choice, and no
singular Party is the author or drafter of the provisions hereof. Each of the
Parties assumes joint responsibility for the form and composition of this
Agreement and each Party agrees that this Agreement will be interpreted as
though each of the Parties participated equally in the composition of this
Agreement and each and every provision and part hereof; provided, however, that
notwithstanding the foregoing, with respect to any Tax Liabilities that may
arise or result from the Contemplated Transactions, the Sellers acknowledge and
agree that: (i) Buyer has made no representation or warranty, or otherwise
provided any advice to any Seller, regarding such potential Tax Liabilities; and
(ii) they have relied solely upon the advice of their Tax advisors and have not
entered into the Contemplated Transactions in reliance upon any communication
made by Buyer regarding such potential Tax Liabilities. The Parties agree that
the rule of judicial interpretation to the effect that any ambiguity or
uncertainty contained in an agreement is to be construed against the Party that
drafted the agreement will not be applied in the event of any disagreement or
dispute arising out of this Agreement.
* * * * * * * * * *

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[Remainder of Page Intentionally Left Blank - Signature Page Follows]

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IN WITNESS WHEREOF, the Parties have signed or caused this Asset Purchase
Agreement to be signed by their duly authorized respective officers as of the
date first written above.

BUYER:
 
 
BBHG, Inc.

By: /s/ J. Scott Penny                                                   
Name: J. Scott Penny                                                        
Title: Chief Acquisitions Officer                                    
PARENT:
 
 
Brown & Brown, Inc.

By: /s/ J. Scott Penny                                                 
Name: J. Scott Penny                                                      
Title: Chief Acquisitions Officer                                   

 
 
 
 
 
 
SELLERS:
 
 
The Hays Group, Inc.

By: /s/ Stephen Lerum                                                
Name: Stephen Lerum                                                     
Title: Chief Financial Officer                                        
 
The Hays Group of Wisconsin, LLC

By: /s/ Stephen Lerum                                                
Name: Stephen Lerum                                                     
Title: Chief Financial Officer                                         
The Hays Benefits Group, LLC

By: /s/ Stephen Lerum                                                
Name: Stephen Lerum                                                     
Title: Chief Financial Officer                                         

Signature Page to Asset Purchase Agreement

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FINAL EXECUTION VERSION

 

PlanIT, LLC

By: /s/ Stephen Lerum                                                
Name: Stephen Lerum                                                     
Title: Chief Financial Officer                                         

The Hays Benefits Group of Wisconsin, LLC

By: /s/ Stephen Lerum                                                
Name: Stephen Lerum                                                     
Title: Chief Financial Officer                                         
Claims Management of Missouri, LLC

By: /s/ Stephen Lerum                                                
Name: Stephen Lerum                                                     
Title: Chief Financial Officer                                         

The Hays Group of Illinois, LLC

By: /s/ Stephen Lerum                                                
Name: Stephen Lerum                                                     
Title: Chief Financial Officer                                         
SELLERS’ representative:
 
 
The Hays Group, Inc.

By: /s/ Stephen Lerum                                                
Name: Stephen Lerum                                                     
Title: Chief Financial Officer                                         
 
 

Signature Page to Asset Purchase Agreement

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FINAL EXECUTION VERSION

Schedules and Exhibits to Asset Purchase Agreement
SCHEDULES AND EXHIBITS
Schedule 1.1(a) - Client Accounts
Schedule 1.1(b) - Tangible Personal Property
Schedule 1.1(h) - Claims Against Third Parties
Schedule 1.1(i) - Office Locations
Schedule 1.2(a) - Cash, Cash Equivalents, etc.
Schedule 1.2(j) - Excluded Contracts
Schedule 1.4(a)(ii) - Earn-Out Payment Calculation
Schedule 1.4(b)(ii) - Earn-Out Locations
Schedule 1.4(c)(i) - Closing Payment Amount Allocation
Schedule 1.4(c)(i)(B) - Secured Debt Amount
Schedule 1.4(c)(i)(C) - Closing Transaction Expenses
Schedule 1.4(e) - Purchase Price Allocation
Schedule 1.5(f) - Commissions
Schedule 2.2(a) - Assumed PTO Liability Amount
Schedule 2.2(d) - Required Consents
Schedule 2.7 - Hired Employees
Schedule 2.7(b) Accrued Bonus Amounts
Schedule 3.1(b) - Organization
Schedule 3.1(c) - Governmental Authorizations
Schedule 3.2 - Capitalization
Schedule 3.4(a) - Financial Statements
Schedule 3.4(c) - Seller Accounts Receivable and Accounts Payable
Schedule 3.4(e) - Related Party Loans
Schedule 3.6(a) - Encumbered Assets
Schedule 3.6(c) - Retail Brokered Business
Schedule 3.6(e) - Insurance Business Associations
Schedule 3.6(f) - Sub-Rated Carrier
Schedule 3.6(h) - Merger, Acquisitions, Purchases or Sales
Schedule 3.6(i) - Employee-Owned Client Accounts
Schedule 3.7(a) -Material Contracts
Schedule 3.8 - Litigation and Claims
Schedule 3.12(a) - Insurance Policies
Schedule 3.12(c) - Employee Thefts, Dishonesty Losses
Schedule 3.13(b) - Employment Agreements
Schedule 3.14 - Employee Benefit Plans
Schedule 3.15 - Intellectual Property
Schedule 3.16 - Real Property
Schedule 5.11- Investments of Sellers
Schedule 11.1-CC - Client Credit Balances Amount
Schedule 11.1-EC - Estimated Carrier Payables Amount
Schedule 11.1-KO - Key Owners
Schedule 11.1-LL - Landlords
Schedule 11.1-PE - Permitted Encumbrances
Schedule 11.1-SM - Special Matters

Exhibit A:        Form of Satisfaction Agreement and Release
Exhibit B:        Form of Restrictive Covenant Agreement

Schedules and Exhibits to Asset Purchase Agreement