Exhibit 10.1

EXECUTION VERSION

 

 

ASSET PURCHASE AGREEMENT

by and among

BARCLAYS CAPITAL INC.,

LABRANCHE & CO. LLC,

and

LABRANCHE & CO INC.,

dated as of January 13, 2010

 

 

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TABLE OF CONTENTS

 

     Page ARTICLE I   DEFINITIONS    1   Section 1.1.    Defined Terms    1  
Section 1.2.    General Interpretive Principles    10 ARTICLE II   THE TRANSFER
AND SALE    11   Section 2.1.    Assets to be Transferred    11   Section 2.2.
   Net Position Amount Purchase    11   Section 2.3.    Background License    12
  Section 2.4.    Further Assurances    13 ARTICLE III   CONSIDERATION AND
CLOSING    13   Section 3.1.    Consideration    13   Section 3.2.    Closing
Date    13   Section 3.3.    Seller Parties’ Obligations at the Closing    14  
Section 3.4.    Purchaser’s Obligations at the Closing    14   Section 3.5.   
Actions at the Closing    15 ARTICLE IV   ASSUMED LIABILITIES    15   Section
4.1.    Liabilities Assumed by Purchaser    15   Section 4.2.    Liabilities
Retained by Seller    15   Section 4.3.    Purchase Price Allocation    17
ARTICLE V   REPRESENTATIONS AND WARRANTIES OF SELLER PARTIES    17   Section
5.1.    Organization    17   Section 5.2.    Authority    18   Section 5.3.   
Title to Transferred Assets    18   Section 5.4.    No Conflict; Required
Filings and Consents    18   Section 5.5.    Financial Statements    19  
Section 5.6.    Absence of Certain Changes or Events    20   Section 5.7.   
Undisclosed Liabilities    20   Section 5.8.    Permits; Compliance    20  
Section 5.9.    Compliance with Laws    20   Section 5.10.    Absence of
Litigation    21

 

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TABLE OF CONTENTS

(continued)

 

              Page   Section 5.11.    Material Contracts    21   Section 5.12.
   Real Property; Personal Property; Condition of Property    22   Section 5.13.
   Employee Benefit Matters    23   Section 5.14.    Employee Benefit Plans   
24   Section 5.15.    Labor Matters    25   Section 5.16.    Intellectual
Property    25   Section 5.17.    Taxes    27   Section 5.18.    Insurance    27
  Section 5.19.    Sufficiency of Assets    27   Section 5.20.    DMM Securities
   27   Section 5.21.    Solvency    27   Section 5.22.    Brokers    28  
Section 5.23.    Investigation    28   Section 5.24.    Disclaimer    28
ARTICLE VI   REPRESENTATIONS AND WARRANTIES OF PURCHASER    29   Section 6.1.   
Organization    29   Section 6.2.    Authority    29   Section 6.3.    No
Conflict; Required Filings and Consents    29   Section 6.4.    Permits;
Compliance with Laws    30   Section 6.5.    Litigation    30   Section 6.6.   
Brokers    30   Section 6.7.    Investigation    31   Section 6.8.    Disclaimer
   31 ARTICLE VII   COVENANTS    32   Section 7.1.    Conduct of Business by
Seller    32   Section 7.2.    Access    34   Section 7.3.    Records;
Additional Information    35   Section 7.4.    Consents    36   Section 7.5.   
No Negotiation    36

 

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TABLE OF CONTENTS

(continued)

 

                

Page

  Section 7.6.    Non-Competition and Non-Solicitation    36   Section 7.7.   
Confidentiality    37   Section 7.8.    Reasonable Best Efforts; Obtaining
Consents; Further Action    39   Section 7.9.    Corporate Name    40  
Section 7.10.    Notifications    40 ARTICLE VIII   CONDITIONS    41   Section
8.1.    Conditions Precedent to Obligation of Seller Parties    41   Section
8.2.    Conditions Precedent to Closing Obligation of Purchaser    42 ARTICLE IX
  TERMINATION; FAILURE TO CLOSE    44   Section 9.1.    Termination    44  
Section 9.2.    Effect of Termination    44 ARTICLE X   EMPLOYEE BENEFITS
MATTERS    45   Section 10.1.    Employment    45   Section 10.2.   
Post-Closing Benefits    45   Section 10.3.    Welfare Plan Liability    46  
Section 10.4.    Bonus    46   Section 10.5.    Accrued Vacation    46   Section
10.6.    COBRA    46   Section 10.7.    Qualified Plans    46   Section 10.8.   
WARN Obligations    47   Section 10.9.    No Amendment or Modification    47
ARTICLE XI   TAX MATTERS    47   Section 11.1.    Tax Indemnification    47  
Section 11.2.    Liability for Taxes    47   Section 11.3.    Tax Returns and
Tax Payments    47   Section 11.4.    Apportionment of Taxes    48   Section
11.5.    Transfer Tax    49   Section 11.6.    Other Taxes    49

 

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TABLE OF CONTENTS

(continued)

                 

Page

     Section 11.7.    Survival    49    Section 11.8.    Tax Effect of
Indemnification Payments    49    Section 11.9.    Exclusivity    49 Article XII
   INDEMNIFICATION    50    Section 12.1.    Indemnification by Seller Parties
   50    Section 12.2.    Indemnification by Purchaser    50    Section 12.3.   
Procedures    51    Section 12.4.    Exclusive Remedy    53    Section 12.5.   
Limitations    53    Section 12.6.    Mitigation    53 Article XIII    GENERAL
PROVISIONS    53    Section 13.1.    Notices    53    Section 13.2.   
Severability    53    Section 13.3.    Entire Agreement; Assignment; Execution
   55    Section 13.4.    Parties in Interest    55    Section 13.5.   
Amendment    55    Section 13.6.    Waiver    56    Section 13.7.    Governing
Law; Jurisdiction    56    Section 13.8.    Specific Performance    57   
Section 13.9.    Captions    57    Section 13.10.    Counterparts    57   
Section 13.11.    Expenses    57

 

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ASSET PURCHASE AGREEMENT

ASSET PURCHASE AGREEMENT, dated as of January 13, 2010, by and among Barclays
Capital Inc., a Connecticut corporation (“Purchaser”), LaBranche & Co. LLC, a
New York limited liability company (“Seller”), and LaBranche & Co Inc., a
Delaware corporation (“Seller Parent” and together with Seller, the “Seller
Parties”). Unless otherwise indicated, capitalized terms used herein are used as
defined in Section 1.1 hereof.

W I T N E S S E T H :

WHEREAS, Seller conducts a designated market maker business on the New York
Stock Exchange (“NYSE”), which includes providing advisory services to help
companies whose securities are DMM listed securities understand market dynamics
impacting their stocks (as conducted as of the date hereof, the “Acquired
Business”);

WHEREAS, Purchaser wishes to acquire the Acquired Business from Seller; and

WHEREAS, Seller is willing to sell and transfer to Purchaser all of Seller’s
right, title and interest in certain assets relating to the Acquired Business in
exchange for cash and the assumption by Purchaser of certain Liabilities
relating to the Acquired Business, upon the terms and conditions set forth in
this Agreement;

NOW, THEREFORE, in consideration of the premises and the mutual representations,
warranties, covenants and agreements hereinafter set forth, the parties hereto
hereby agree as follows:

ARTICLE I

DEFINITIONS

Section 1.1. Defined Terms. As used in this Agreement, the following terms shall
have the following meanings:

“Acquired Employees” has the meaning set forth in Section 10.1.

“Acquired Business” has the meaning set forth in the Recitals.

“Action” means any Order, or any litigation, claim, proceeding, action
(including any individual, joined or class action), cause of action, assertion,
allegation, demand, suit, inquiry, investigation, examination, hearing or
complaint whatsoever of or by any Person (including any Governmental Authority),
including, with respect to the Seller Parties or their Affiliates, the Employees
or the Acquired Business, any Actions arising out of, in connection with, or
relating in any manner to, (i) the operation of the Acquired Business or the use
or ownership of the Transferred Assets on or prior to the Closing Date, or
(ii) any act or omission of the Seller Parties relating to the Acquired Business
(including without limitation, (x) any violation or breach of any applicable
Laws and (y) all of the Actions referred to in Section 5.10(a) and
Section 5.10(b) of the Seller Disclosure Letter).

 

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“Affiliate” means, with respect to any Person, a Person that controls, is
controlled by, or is under common control with such Person (it being understood
that a Person shall be deemed to “control” another Person, for purposes of this
definition, if such Person directly or indirectly has the power to direct or
cause the direction of the management and policies of such other Person, whether
through holding beneficial ownership interests in such other Person, through
contracts or otherwise).

“Agreement” means this agreement, including the Exhibits and Seller Disclosure
Letters attached hereto (which for all purposes are incorporated herein and
expressly made a part of this Agreement as fully as though completely set forth
herein), and, if amended, modified, supplemented or restated, as the same may be
so amended, modified, supplemented or restated from time to time.

“Allocations” has the meaning set forth in the definition of “Transferred
Assets”.

“Apportioned Obligations” has the meaning set forth in Section 11.14.

“Assignment and Assumption Agreement” means the Assignment and Assumption
Agreement by and between Seller and Purchaser and dated as of the Closing Date,
substantially in the form of Exhibit A.

“Basis” means any past or present fact, situation, circumstance, status,
condition, activity, practice, plan, occurrence, event, incident, action,
failure to act or transaction that forms or could form the basis for any
specified consequence.

“Basket” has the meaning set forth in Section 12.1.

“Broker” has the meaning set forth in Section 5.22.

“Business Day” means a day, other than a Saturday, Sunday or national holiday,
when banks in the City of New York are open for business.

“Cap” has the meaning set forth in Section 12.1.

“Claim” means any asserted claim or any Action commenced.

“Closing” has the meaning set forth in Section 2.1.

“CNS system” has the meaning set forth in Section 2.2.

“Closing Date” means the date on which the Closing occurs.

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

“Confidential Information” has the meaning set forth in Section 7.7(b).

 

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“Confidentiality Agreement” means the confidentiality agreement dated as of
December 9, 2009, by and between Seller Parent and Barclays Bank PLC.

“Contract” means any binding written or oral note, bond, mortgage, indenture,
contract, agreement, lease, license, permit or other instrument or obligation of
any kind.

“Cut Off Time” means 4:02 PM (Eastern Time), or such later time (but no later
than 4:30 PM (Eastern Time) in any event) as the last transaction in any of the
Allocations takes place, on the Closing Date.

“DMM” or “DMM Organization” means “designated market maker” and “designated
market maker unit” respectively, as such terms are used in the rules of the
NYSE.

“DMM Employee” means any Employee who is actively and primarily employed by
Seller as a trader or designated market maker on the NYSE trading floor in
connection with the Acquired Business.

“DMM Securities” means the specified securities allocated by the NYSE to Seller
and DMMs associated with Seller pursuant to the Allocations.

“DTCC” means the Depository Trust & Clearing Corporation.

“Effective Time” means the time of the Closing, which shall occur after the Cut
Off Time.

“Employees” has the meaning set forth in Section 5.13(a).

“ERISA” means the Employee Retirement Income Security Act of 1974, as the same
may be amended from time to time, as well as any rules and regulations
promulgated thereunder.

“ERISA Affiliate” means with respect to any Person, each business or entity
which is a member of a “controlled group of corporations,” under “common
control” or a member of an “affiliated service group” with such Person within
the meaning of Sections 414(b), (c) or (m) of the Code, or required to be
aggregated with such Person under Section 414(o) of the Code, or under “common
control” with such Person within the meaning of Section 4001(a)(14) of ERISA.

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and all of
the rules and regulations promulgated thereunder.

“Excluded Assets” means all rights, title and interest in and to any assets,
properties and rights of Seller other than the Transferred Assets, including,
without limitation, (i) any cash, cash equivalents, bank deposits or similar
cash items of Seller Parties; (ii) any shares of the NYSE Euronext, Inc. stock
owned by Seller Parties; (iii) any deposits of Seller Parties at DTCC or NSCC
(including any bonds, deposits or

 

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similar security relating thereto); (iv) any interest that Seller Parties may
own or hold in Twin Oaks L.P.; (v) all minute books, organizational documents,
stock registers and such other books and records of Seller Parties as pertain to
ownership, organization or existence of Seller Parties and duplicate copies of
such records as are necessary to enable Seller Parties to file Tax returns and
reports, in each case other than the Records; (vi) any personnel files
pertaining to any employee or former employee of the Company (other than the
Records, including any files pertaining to any of the Acquired Employees or to
the extent necessary for Purchaser to comply with any requirements of any
Governmental Authority); (vii) any Intellectual Property rights of Seller
Parties other than as specifically (a) included in the Transferred Intellectual
Property, (b) received pursuant to a Transferred Contract or (c) licensed to
Purchaser pursuant to Section 2.3 herein; (viii) any claim, right or interest of
Seller Parties in or to any refund, rebate, abatement or other recovery for
Taxes, together with any interest due thereon or penalty rebate arising
therefrom; (ix) all insurance policies or rights to proceeds thereof relating to
the assets, properties, business or operations of Seller Parties; (x) any
rights, claims or causes of action, credits, demands or rights of set-off of
Seller Parties against third parties (A) relating to assets, properties,
business or operations of Seller Parties arising out of events occurring on or
prior to the Closing Date or (B) to the extent related to any Excluded Asset;
(xi) all Tax returns and financial statements of Seller Parties and the Acquired
Business and all records (including working papers) related thereto, provided
that Purchaser shall promptly receive duplicate copies of the portions thereof
relating to the Acquired Business or the Transferred Assets upon reasonable
request by Purchaser; (xii) all of the Contracts set forth in Section 1.1(a) of
the Seller Disclosure Letter (the “Excluded Contracts”); and (xiii) all rights
that accrue to Seller Parties under this Agreement and the Related Documents.

“Excluded Contracts” has the meaning set forth in the definition of “Excluded
Assets”.

“Excluded Liabilities” has the meaning set forth in Section 4.2.

“FINRA” means the Financial Industry Regulatory Authority.

“Fundamental Representation” has the meaning set forth in Section 8.2(a).

“GAAP” means United States generally accepted accounting principles, as in
effect from time to time and applied consistently.

“Governmental Authority” means any domestic or foreign governmental, regulatory
or self-regulatory authority, organization, agency, court, tribunal, stock
exchange, commission or other governmental, regulatory or self-regulatory
entity.

“Illiquid Positions” has the meaning set forth in Section 2.2.

“Indebtedness” means, without duplication, all Liabilities of Seller, or in
connection with the Acquired Business, any Affiliate of Seller: (a) for borrowed
money or in respect of loans or advances; (b) evidenced by bonds, debentures,
notes or other similar instruments; (c) for any accrued interest, prepayment
premiums or penalties or

 

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other costs or expenses related to any items referenced in clauses (a) and (b);
(d) in respect of letters of credit, whether or not drawn, and bankers’
acceptances issued for the account of Seller; and (e) in respect of any
guarantees of Seller in connection with any of the foregoing.

“Indemnified Party” has the meaning set forth in Section 12.3(a).

“Indemnifying Party” has the meaning set forth in Section 12.3(a).

“Intellectual Property” means (a) all inventions (whether patentable or
unpatentable and whether or not reduced to practice), all improvements thereto,
and all patents, patent applications and patent disclosures, together with all
reissuances, continuations, continuations-in-part, divisionals and
reexaminations thereof, (b) all trademarks, service marks, trade dress, logos,
trade names, and domain names, including all common law rights, applications,
registrations and renewals in connection therewith and all goodwill associated
therewith, and, (c) all copyrightable works, copyrights and all applications,
registrations and renewals in connection therewith, (d) all trade secrets and
confidential information (including, without limitation, know-how, technology,
data, databases, designs, drawings, flowcharts, specifications, customer lists,
and business and marketing plans and proposals), (e) all computer software and
technology (including, without limitation, all source code and related
documentation), (f) any similar or equivalent rights to any of the foregoing
throughout the world, and (g) all rights to sue and recover for any past,
present, or future infringement thereof.

“Knowledge”, when used to qualify any representation or warranty, means that
such applicable Party has no actual knowledge after reasonable inquiry that such
representation or warranty is not true and correct to the same extent as
provided in the applicable representation or warranty. For the purpose of this
definition, the “Knowledge” of Seller shall mean the actual knowledge of any of
the individuals specified in Section 1.1(b) of the Seller Disclosure Letter, in
each case after reasonable inquiry (it being understood that such inquiry with
respect to the General Counsel of Seller Parent shall include inquiry of the
Chief Regulatory Counsel of Seller Parent and Chief Compliance Officer of Seller
as to regulatory matters and the Treasurer of Seller Parent as to employment and
employee benefits matters). For purposes of this definition, the “Knowledge” of
Purchaser shall mean the actual knowledge of any of the individuals specified in
Section 1.1(b) of the Purchaser Disclosure Letter, in each case after reasonable
inquiry.

“Law” means, with respect to any Person, any law, ordinance, statute, order,
treaty, rule, regulation, published interpretive guidance, administrative
pronouncements and judicial decisions of any Governmental Authority (including
the rules and regulations of the SEC, FINRA and NYSE and interpretive guidance
issued by the respective staff thereof), in each case binding on or applicable
to that Person or its property or operations.

“Liability” means any debt, liability, commitment or obligation of any kind
whatsoever, whether due or to become due, known or unknown, accrued or fixed,
absolute or contingent or otherwise and whether or not required to be recorded
or reflected on a balance sheet (or footnotes thereto) prepared in accordance
with GAAP.

 

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“Lien” means any pre-emptive right, mortgage, charge, pledge, security interest,
encumbrance, lien (statutory or contractual), hypothecation, assignment for
security, claim, preference, priority, charge or other restriction of any kind.

“Losses” means any and all losses, damages, liabilities, interest, penalties,
costs and expenses (including reasonable out of pocket disbursements and
reasonable attorneys’ fees) imposed upon or incurred by any Person entitled to
be indemnified under this Agreement.

“Material Adverse Effect” means a material adverse effect on the business,
properties, financial condition or results of operations of the Acquired
Business, taken as a whole, individually or in the aggregate; provided that the
term “Material Adverse Effect” shall not include any change or effect relating
to or resulting from: (a) any changes in the United States or foreign economies
or securities or financial markets in general, (b) any events or circumstances
that generally affect the industries in which Seller operates, (c) any changes
arising as a result of earthquakes, hostilities, acts of war, sabotage or
terrorism or military actions or any material escalation or worsening of any
such hostilities, acts of war, sabotage or terrorism or military actions
existing or underway as of the date hereof, (d) the consummation of the
transactions contemplated by, or the announcement of the execution of, this
Agreement, (e) any action taken at the written request of Purchaser or which
Purchaser has consented to in writing or that is required by the terms of this
Agreement, (f) any changes in Law or accounting standard (or interpretation
thereof) applicable to the Acquired Business and/or (g) additional regulatory
requirements or rules imposed by the NYSE and changes in the NYSE’s technology
that affect all NYSE DMM firms (provided that with respect to (a), (b), (c),
(f) or (g), Seller or the Acquired Business is not disproportionately affected
by any such changes as compared to any other NYSE DMM firm).

“Multiemployer Plan” has the meaning assigned to that term in Section 3(37) of
ERISA.

“Net Position Amount” has the meaning set forth in Section 2.2.

“NSCC” has the meaning set forth in Section 2.2.

“NYSE” has the meaning set forth in the Recitals to this Agreement.

“NYSE Release” has the meaning set forth in Section 7.7(d).

“Order” means any applicable order, injunction, judgment, decree, ruling, writ,
assessment or arbitration award.

“Organizational Documents” has the meaning set forth in Section 5.4(a).

 

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“Permitted Liens” means statutory liens for current Taxes, assessments or other
governmental charges not yet delinquent or the amount or validity of which is
being contested in good faith by appropriate proceedings.

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

“Policies” has the meaning set forth in Section 5.18.

“Positions” means, collectively, and as calculated in accordance with
Section 2.2, all long and short stock positions (including rights and
obligations in respect of Unsettled Trades) maintained by Seller in connection
with the conduct of the Acquired Business and related to the Allocations (as
such term is defined in the definition of “Transferred Assets” in this
Section 1.1).

“Post-Signing Claims” has the meaning set forth in Section 12.3(c).

“Pre-Acquisition Action Liabilities” has the meaning set forth in
Section 4.2(g).

“Proposed Allocation” has the meaning set forth in Section 4.3.

“Proration Amount” has the meaning set forth in Section 11.14.

“Purchase Price” has the meaning set forth in Section 3.1(a).

“Purchaser” has the meaning set forth in the Preamble.

“Purchaser Disclosure Letter” has the meaning set forth in the opening paragraph
of Article VI.

“Purchaser Indemnified Persons” has the meaning set forth in Section 12.1.

“Purchaser Permits” has the meaning set forth in Section 6.4.

“Qualified Employees” has the meaning set forth in Section 8.2(f).

“Records” means all books and records used in or maintained in connection with
the Acquired Business under Law or Regulatory Order (including (i) all books and
records required to be kept and maintained in accordance with Rules 17a-3 and
17a-4 of the Exchange Act, (ii) copies of all manuals, compliance manuals,
procedures and policies used in or prepared for the Acquired Business and in
effect as of the Closing Date, (iii) and all mailing lists, distribution lists,
stock sale, purchase ledgers and all surveillance reports as used in the
Acquired Business and in effect as of the Closing Date), and (iv), subject to
applicable Law, any personnel files (A) pertaining to the Acquired Employees or
(B) to the extent necessary for Purchaser to comply with any requirements of any
Governmental Authority.

 

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“Regulatory Order” means, with respect to Seller or any officer, manager,
director or employee of Seller, any Contract, order, decree, agreement,
memorandum of understanding or similar arrangement with, or commitment letter or
similar submission by, a Governmental Authority, stock exchange or self
regulatory organization governing the Acquired Business.

“Related Documents” means the Assignment and Assumption Agreement, and each
other agreement or instrument delivered at the Closing as required hereunder.

“Related Persons“ means, with respect to a Person, its executive officers,
managers and directors, or any members of his or her immediate family or their
respective Affiliates.

“Restricted Period” has the meaning set forth in Section 7.6(a).

“S&P” means Standard & Poor’s Ratings Group, a division of McGraw Hill, Inc., a
New York corporation, and any successor thereto.

“SEC” means the Securities and Exchange Commission.

“Seller” has the meaning set forth in the Preamble.

“Seller Disclosure Letter” has the meaning set forth in the opening paragraph of
Article V.

“Seller Indemnified Persons” has the meaning set forth in Section 12.2.

“Seller Licensed Intellectual Property” has the meaning set forth in
Section 2.3.

“Seller Names” has the meaning in Section 7.9.

“Seller Parent” has the meaning set forth in the Preamble.

“Seller Party” and “Seller Parties” have the meaning set forth in the Preamble.

“Seller Permit” has the meaning set forth in Section 5.8(b).

“Seller Plan” means any “employee benefit plan” as defined in Section 3(3) of
ERISA, including any Multiemployer Plan, any written or oral employment,
compensation, consulting, severance, separation or similar contract, plan,
arrangement or policy, or any other contract, plan, arrangement or policy
providing for compensation, severance benefits, insurance coverage (including
any self insured arrangements), disability benefits, medical benefits,
supplemental unemployment benefits, vacation

 

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benefits, personal time off (PTO) days, retirement benefits, retention or change
in control bonuses or payments, deferred compensation, profit sharing, bonuses,
stock options, stock appreciation rights or other form of equity- or non-equity
based incentive compensation or post retirement insurance, compensation or
benefits (i) that is entered into, sponsored or maintained, as the case may be,
by Seller Parent, on behalf of Seller and its Affiliates and covers any current
or former Employee (or a dependent thereof), and/or (ii) with respect to which
Seller or any Subsidiary of Seller has or may have any Liability.

“Sub-Basket” has the meaning set forth in Section 12.1.

“Subsidiary” means, with respect to any Person, any other Person of which such
Person (either alone or through or together with any other Subsidiary) owns or
has rights to acquire, directly or indirectly, more than 50% of the stock or
other equity interests the holders of which are generally entitled to vote for
the election of the board of directors or other governing body of such other
Person.

“Tax” or “Taxes” means all taxes, however denominated, including any federal,
state, local or foreign income, gross income, gross receipts, value-added, goods
and services, windfall profit, severance, property, production, sales, use,
license, excise, franchise, employment, payroll, withholding, alternative or
add-on minimum, ad valorem, transfer, stamp, or environmental tax, or any other
tax, custom, duty or other like assessment or charge of any kind whatsoever,
together with any interest or penalty, addition to tax or additional amount
imposed by any Governmental Authority (including by reason of any failure or
delay in the payment of such taxes); provided that, without limiting the
foregoing, the terms “Tax” and “Taxes” shall include all United States and
non-United States taxes, and federal, state and local taxes, whether owing to
any taxing authority or to other Persons; and shall include any transferee
Liability in respect of any taxes, including any taxes incurred as a result of
being a member of any affiliated, consolidated, combined, or unitary group under
Treasury Regulations Section 1.1502-6 or any similar provision of foreign, state
or local Law.

“Tax Return” means a report, return or other information (including any
amendments) required to be supplied to a Governmental Authority with respect to
Taxes, including, where permitted or required, combined or consolidated returns
for any group of entities that includes the Companies or any Subsidiary of any
of the Companies.

“Third-party Claim” has the meaning set forth in Section 12.3(b).

“Transfer Taxes“ has the meaning set forth in Section 11.5.

“Transferred Assets” shall mean all rights, title and interest in and to the
following assets, properties and rights of Seller, free and clear of all Liens,
other than Permitted Liens:

(a) any and all rights, permits or any other authorizations held by Seller and
granted by the NYSE to act as the NYSE DMM in the securities listed on
Section 5.20 of the Seller Disclosure Letter, for which it acts as an NYSE DMM
as of the

 

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date hereof (the “Allocations”), and any and all authority granted by the NYSE
to Seller to occupy and utilize the NYSE floor post in connection with the
conduct of the Acquired Business;

(b) the Intellectual Property specified in Section 1.1(c) of the Seller
Disclosure Letter, provided that no rights to the name “LaBranche” or any
trademarks that contain the name “LaBranche” shall be included in Transferred
Assets (collectively, the “Transferred Intellectual Property”);

(c) all claims, rights, interests and benefits of Seller under the contracts set
forth on Section 1.1(d) of the Seller Disclosure Letter (collectively, the
“Transferred Contracts”);

(d) all long and short stock positions (including rights and obligations in
respect of Unsettled Trades) maintained by Seller in connection with the conduct
of the Acquired Business and related to the Allocations (collectively, the
“Positions”) in accordance with Section 2.2;

(e) all Records, including those set forth on Section 1.1(e) of the Seller
Disclosure Letter;

(f) all rights, claims, credits, causes of action or rights of set-off against
third parties relating to the Transferred Assets that arise after the Closing
Date;

(g) such other assets used in connection with the operation of the Acquired
Business that are listed on Section 1.1(g) of the Seller Disclosure Letter.

“Unaudited Financial Statements” has the meaning set forth in Section 5.5(a).

“Unsettled Trades” means purchases or sales of DMM Securities by Seller that
(i) for purposes of Section 5.20, as of the Business Day immediately preceding
the date hereof, and (ii) for all other purposes, as of the Cut Off Time, have
been executed but not yet settled.

“WARN Act” has the meaning set forth in Section 10.8.

Section 1.2. General Interpretive Principles.

(a) Whenever used in this Agreement, except as otherwise expressly provided or
unless the context otherwise requires, any noun or pronoun shall be deemed to
include the plural as well as the singular and to cover all genders.

(b) When a reference is made in this Agreement to “Articles,” “Sections,”
“Annexes,” “Schedules” or “Exhibits” such reference shall be to an Article or
Section of, or Annex, Schedule or Exhibit to, this Agreement unless otherwise
indicated.

 

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(c) The table of contents and headings contained in this Agreement are for
reference purposes only and are not part of this Agreement.

(d) A “party” shall mean a party to this Agreement.

(e) Whenever the words “include,” “includes” or “including” are used in this
Agreement, they shall be deemed followed by the words “without limitation.”

(f) Whenever the words “herein,” “hereby,” “hereof” and “hereunder” and other
words of similar import are used in this Agreement, they shall be deemed to
refer to this Agreement as a whole and not to any particular section, paragraph
or subdivision.

(g) All references to “$” or “dollars” mean the lawful currency of the United
States of America.

ARTICLE II

THE TRANSFER AND SALE OF ASSETS

Section 2.1. Assets to be Transferred. Except as otherwise provided herein,
subject to and upon the terms and conditions hereof, at the closing of the
transactions contemplated hereby (“Closing”) Seller shall transfer, assign,
convey and deliver to Purchaser, and Purchaser shall receive and accept from
Seller, all of the right, title and interest of Seller in the Transferred Assets
as of the Cut Off Time, free and clear of all Liens, other than Permitted Liens.
Notwithstanding anything to the contrary contained herein, Seller shall not
transfer, assign, convey and deliver to Purchaser, and Purchaser shall not
acquire, receive or accept any assets other than the Transferred Assets.

Section 2.2. Net Position Amount Purchase. Subject to Section 8.2(g) and
Section 8.2(h), at the Cut-Off Time Seller shall sell, assign, convey and
deliver to Purchaser, free and clear of all Liens, through the Continuous Net
Settlement System (the “CNS system”) of the National Securities Clearing
Corporation (“NSCC”), and Purchaser shall receive and accept from Seller upon
the settlement thereof through the CNS system, all Positions as of the Cut Off
Time, for an amount equal to the difference between (i) the aggregate sum of the
closing national prices for each long stock Position (including any Unsettled
Trades) as such closing prices are displayed on the NYSE as of the Cut Off Time
and (ii) the aggregate sum of the closing national prices for each short stock
Position (including any Unsettled Trades) as such closing prices are displayed
on the NYSE as of the Cut Off Time (the “Net Position Amount”), which amount if
positive shall be paid on the settlement date of the Positions (the “Settlement
Date”) by Purchaser to Seller through its clearing bank to an account designated
by NSCC in accordance with the requirements of the CNS system; provided that in
the event that the Net Position Amount is negative, Seller shall pay on the
Settlement Date to Purchaser an amount equal to the absolute value of the Net
Position Amount (in addition to making the transfer, assignment, conveyance and
delivery of the Positions in accordance with this Section 2.2),

 

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which amount shall be paid by Seller through its clearing bank to an account
designated by NSCC in accordance with the requirements of the CNS system.
Notwithstanding the foregoing, no later than the first (1st) Business Day
following the Closing, the parties shall amend the Net Position Amount as of the
Cut Off Time to the extent that the calculation of the Net Position Amount as of
the Cut Off Time was inaccurate. Any difference resulting from such amendment
shall be reflected in the Net Position Amount on the Settlement Date. On the
close of business on the day immediately prior to the Closing Date, Seller shall
provide to Purchaser a list of Positions for all DMM Securities that have not
traded on a national securities exchange at any time during the immediately
preceding four (4) trading days (the “Illiquid Positions”). On the Closing Date,
the parties shall cooperate and work together in good faith to determine
reasonably the fair market value of such Illiquid Positions, which shall be used
in lieu of the “closing national price” for purposes of this Section 2.2 and
Section 8.2(g). Promptly after the date hereof, the parties shall discuss and
mutually agree on trade reporting and trade submission responsibilities to the
extent applicable.

Section 2.3. Background License. To the extent Seller or its Affiliates own or
have the right to license as provided herein (and to the extent any such right
to license requires consent from a third party, subject to obtaining such
consent) any Intellectual Property that is used in or necessary for the
operation of the Acquired Business but that is not included in the Transferred
Intellectual Property (collectively, but excluding any rights to the name
“LaBranche” or any trademarks that contain the name “LaBranche”, the “Seller
Licensed Intellectual Property”) Seller, on behalf of itself and its Affiliates,
hereby grants to Purchaser a non-exclusive, worldwide, irrevocable, perpetual,
fully paid-up, royalty-free, sublicensable (as provided herein), transferable
(in connection with the sale of the Acquired Business) license to use, have
used, make, have made, sell, offer or import, reproduce, distribute, publish,
prepare derivative works of, display and perform, and otherwise fully exploit
the Seller Licensed Intellectual Property in connection with Purchaser’s
operation and integration of the Acquired Business. The foregoing license to
Seller Licensed Intellectual Property includes the right to grant sublicenses to
Affiliates of Purchaser solely so long as they remain Affiliates and to service
providers solely for use on behalf of Purchaser and Purchaser’s Affiliates.
Purchaser hereby grants to Seller and its Affiliates a non-exclusive, worldwide,
irrevocable, perpetual, fully paid-up, transferable (in connection with the sale
of the relevant business) license to use, have used, make, have made, sell,
offer or import, reproduce, distribute, publish, prepare derivative works of,
display and perform, and otherwise fully exploit the Compliance Algorithms (as
listed in Section 1.1(c) of the Seller Disclosure Letter) solely in connection
with (a) any regulatory investigation of Seller or (b) an Action or Claim
relating to the pre-Closing operations of the Acquired Business. The foregoing
license granted to Seller and its Affiliates (i) includes the right to grant
sublicenses to service providers solely for use on behalf of Seller and Seller’s
Affiliates; and (ii) does not extend to any Transferred Intellectual Property
other than the Compliance Algorithms.

 

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Section 2.4. Further Assurances.

(a) After the Closing Seller shall from time to time and Seller Parent shall
cause Seller to, at Purchaser’s request and without further cost or expense to
Purchaser, prepare, execute, acknowledge and deliver to Purchaser all such
further conveyances, transfer (including additional assignments suitable for
recording), notices, assumptions, releases and acquittances and such other
instruments, and shall take such other actions (including delivery of possession
of the Transferred Assets for which title has passed hereunder) as Purchaser may
reasonably request so as more effectively to transfer, assign and deliver and
vest in Purchaser all of the rights, titles, interests and possessions intended
to be conveyed to Purchaser under this Agreement of the Transferred Assets as
provided in this Agreement, and to implement the covenants hereunder that are to
be performed by Seller after the Closing, and to otherwise make effective the
transactions contemplated hereby (including the transfer of the Acquired
Employees).

(b) After the Closing Purchaser shall from time to time, at Seller’s written
request and without further cost or expense to Seller, prepare, execute and
deliver to Seller such other instruments of assumption and security and take
such other action as Seller may reasonably request to implement the covenants,
including the assumption of the Assumed Liabilities, hereunder that are to be
performed by Purchaser after the Closing, and to otherwise make effective the
transactions contemplated hereby.

ARTICLE III

CONSIDERATION AND CLOSING

Section 3.1. Consideration.

(a) In consideration of the transfer to Purchaser of the Transferred Assets
(other than the Positions) effective as of the Closing Date and in consideration
of the other undertakings of Seller and Seller Parent hereunder, Purchaser shall
pay and deliver to Seller at the Closing an amount in cash of $25,000,000 (the
“Purchase Price”) and assume the Assumed Liabilities, as set forth in Article
IV. The Purchase Price will be paid in the manner and at the time as set forth
in Section 3.2 and Section 3.3.

(b) In consideration of the sale and transfer to Purchaser of the Positions,
effective as of the Effective Time and in consideration of the other
undertakings of Seller hereunder, Seller or Purchaser, as the case may be, shall
make the payments called for pursuant to and in accordance with Section 2.2,
subject to adjustment as described in such section. Payments made by Seller or
Purchaser, as applicable, pursuant to Section 2.2 shall be in addition to, and
separate from, the payment of the Purchase Price and the Assumption of the
Assumed Liabilities pursuant to Section 3.1(a).

Section 3.2. Closing Date.

(a) The Closing shall take place at the offices of Cleary Gottlieb Steen &
Hamilton LLP, at 4:30 p.m., Eastern Time, on the first (1st) Business Day that
is a Friday following the satisfaction (or, to the extent permitted, the waiver
in writing by each party entitled to the benefit thereof) of the conditions set
forth in Article VIII (other

 

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than any condition which by its nature is to be satisfied at the Closing, but
subject to such conditions), or at such other place, time and date as may be
agreed in writing by Seller and Purchaser. The date on which the Closing occurs
is referred to in this Agreement as the “Closing Date.”

(b) The parties shall use their commercially reasonable efforts to cause the
Closing Date to occur as soon as reasonably practicable after the date hereof
and no later than on the fourth (4th) Friday after the date hereof; provided,
that the foregoing shall not require any party to waive any condition to Closing
set forth in Article VIII.

Section 3.3. Seller Parties’ Obligations at the Closing. At the Closing (or, in
the case of Section 3.3(g) or Section 3.3(h), on the Settlement Date and no
later than the third (3rd) Business Day following the Closing), Seller shall
deliver to Purchaser:

(a) a duly executed copy of each of the Related Documents;

(b) a duly executed certificate of each of Seller and Seller Parent, dated as of
the Closing Date, as contemplated in Section 8.2(i);

(c) appropriate receipt to Purchaser for the Purchase Price to be paid at the
Closing;

(d) any additional documents or instruments of assignment and assumption as
shall be reasonably necessary or appropriate to transfer the Transferred Assets
to Purchaser;

(e) documentary confirmation delivered by the NYSE as evidence of its approval
of the reallocation of the Allocations to Purchaser as a DMM in the DMM
Securities;

(f) all Records in accordance with Section 7.3;

(g) pursuant to Section 2.2, if the Net Position Amount is negative, an amount
equal to the absolute value of the Net Position Amount; and

(h) pursuant to Section 2.2, if the Net Position Amount is positive, appropriate
receipt to Purchaser for any Net Position Amount paid by Purchaser under
Section 2.2.

Section 3.4. Purchaser’s Obligations at the Closing. At the Closing (or, in the
case of Section 3.4(d) or Section 3.4(f), on the Settlement Date and no later
than the third (3rd) Business Day following the Closing), Purchaser shall
deliver to Seller:

(a) the Closing Purchase Price by wire transfer to a bank account designated in
writing by Seller to Purchaser (such designation to be made at least two
Business Days prior to the Closing Date), in immediately available funds;

 

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(b) a duly executed copy of each of the Related Documents;

(c) a duly executed certificate of Purchaser, dated as of the Closing Date, as
contemplated in Section 8.1(e);

(d) any additional documents or instruments of assignment and assumption as
shall be reasonably necessary or appropriate to effect the assumption of the
Assumed Liabilities;

(e) pursuant to Section 2.2, if the Net Position Amount is positive, an amount
equal to the absolute value of the Net Position Amount; and

(f) pursuant to Section 2.2, if the Net Position Amount is negative, appropriate
receipt to Seller for any Net Position Amount paid by Seller under Section 2.2.

Section 3.5. Actions at the Closing. All actions and proceedings to be taken (or
caused to be taken) and all documents to be executed and delivered (or caused to
be executed and delivered) by the parties at the Closing shall be deemed to have
taken, executed and delivered simultaneously and no actions or proceedings shall
be deemed taken nor any documents deemed executed or delivered until all have
been taken, executed and delivered.

ARTICLE IV

ASSUMED LIABILITIES

Section 4.1. Liabilities Assumed by Purchaser. Upon the terms and subject to the
conditions of this Agreement, effective at the Closing the following, and only
the following, Liabilities (the “Assumed Liabilities”) shall be assumed by
Purchaser, and no other Liabilities whatsoever whether arising from the
operation of the Acquired Business prior to or following the Closing Date shall
be assumed by Purchaser:

(a) all Liabilities arising after the Closing Date with respect to the
Allocations and Positions that shall be transferred to Purchaser as part of the
Transferred Assets;

(b) all Liabilities arising after the Closing Date with respect to the
Transferred Assets, including Liabilities arising after the Closing Date
relating to each of the Transferred Contracts other than any Liabilities arising
out of (i) the performance, default or breach of a Transferred Contract or
(ii) any Basis for breach thereof, in each case occurring on or prior to the
Closing Date; and

(c) Liabilities in respect of Taxes for which Purchaser is liable pursuant to
Article XI.

Section 4.2. Liabilities Retained by Seller. Notwithstanding any provision of
this Agreement or any other writing to the contrary, Purchaser is assuming

 

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only the Assumed Liabilities and is not assuming, nor shall it for any reason be
deemed to have assumed, any other Liability of the Acquired Business, Seller or
any of its Affiliates of whatever nature, whether or not of, associated with or
arising from the Acquired Business or the operation thereof or any Transferred
Assets, that are not Assumed Liabilities. Seller shall retain all such other
Liabilities (all such Liabilities not being assumed being herein referred to as
the “Excluded Liabilities”). Without limiting the generality of the foregoing,
the Excluded Liabilities shall include the following:

(a) all Indebtedness of Seller or Seller Parent;

(b) all Liabilities to Seller Parent or other Affiliates of Seller;

(c) all Liabilities associated with any Contract of Seller that (i) arises out
of (A) the performance, default or breach thereof or (B) any Basis for breach
thereof, in each case occurring on or prior to the Closing Date, or (ii) is not
a Transferred Contract;

(d) all Liabilities associated with the termination on, prior to or (except for
any Transferred Contract) after the Closing Date of any Contract;

(e) all Liabilities relating to any Excluded Assets;

(f) all Liabilities of Seller relating to linkage fees assessed against the
Acquired Business for directing trades to other exchanges on or prior to the
Closing Date;

(g) all Liabilities relating to Claims or Actions of or by any Person (including
any Governmental Authority) relating to any Transferred Assets, the Employees,
the Acquired Business, any of the Seller Parties or any of their Affiliates,
arising out of, in connection with, or relating in any manner to, (i) the
operation of the Acquired Business or the use or ownership of the Transferred
Assets on or prior to the Closing Date, or (ii) any act or omission of Seller or
Seller Parent (including without limitation, (x) any violation or breach of any
applicable Law by any of the Seller Parties and (y) all of the Actions referred
to in Section 5.10(a) and Section 5.10(b) of the Seller Disclosure Letter) (such
Liabilities, “Pre-Acquisition Action Liabilities”);

(h) all Liabilities relating to any claim of a third party alleging infringement
or misappropriation of Intellectual Property of third parties by Seller, to the
extent that such claim relates to, or was incurred during or in respect of, the
time period on or prior to Closing;

(i) all Liabilities relating to the employment, potential employment or
termination of employment by Seller or any of its Affiliates of any Person
relating to or arising out of any period, including without limitation any
Liability by Seller or any of its Affiliates under or relating to any employee
benefit plan, program, agreement or arrangement, including in respect of bonus
plans, agreements or arrangements, equity compensation plans and tax-qualified
or not tax-qualified pension or saving plans or otherwise arising under or
relating to any Seller Plans as to which the parties agree there shall be no
transfer to or assumption of Liabilities by Purchaser, except as expressly
assumed pursuant to Article X; and

 

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(j) all Liabilities in respect of Taxes for which Seller is liable pursuant to
Article XI.

Section 4.3. Purchase Price Allocation. Within thirty (30) days after the
Closing Date, Purchaser shall prepare and deliver to Seller an allocation of the
Purchase Price and Assumed Liabilities among the Transferred Assets in
accordance with Section 1060 of the Code and the Treasury Regulations
promulgated thereunder (the “Proposed Allocation”). Seller shall have thirty
(30) days after receipt of the Proposed Allocation to notify Purchaser in
writing of any objections. If Seller does not object in writing during such
thirty (30) day period, the Proposed Allocation shall be final and binding on
all parties. If Seller objects in writing during such thirty (30) day period,
the parties shall cooperate in good faith to reach a mutually agreeable
allocation of the Purchase Price, which allocation shall be binding on all
parties. If the parties are unable to reach an agreement within sixty (60) days
of Seller’s receipt of the Proposed Allocation, any disputed items shall be
referred to an independent accounting firm for resolution, and the determination
of the independent accounting firm shall be final and binding on all parties.
The fees and expenses of the accounting firm shall be paid fifty percent
(50%) by Seller and fifty percent (50%) by Purchaser. Purchaser and Seller agree
to file IRS Form 8594 and all other Tax Returns consistent with the foregoing.
No Party shall take any position inconsistent with such final allocation on any
Tax Return or in any discussion with or proceeding before any Governmental
Authority or otherwise except as required by a “determination” within the
meaning of Section 1313(a) of the Code (or a similar provision of state, local
or foreign Tax law).

ARTICLE V

REPRESENTATIONS AND WARRANTIES OF SELLER PARTIES

Except as (i) disclosed in Seller Parent’s Annual Report on Form 10-K for the
year ended December 31, 2008 filed with the SEC on March 16, 2009 or any
Quarterly Report on Form 10-Q filed with the SEC thereafter, and in each case
publicly available prior to the date of this Agreement (to the extent reasonably
apparent from the text of such disclosure that such disclosure applies to or
qualifies such representation or warranty), excluding any forward looking
disclosures set forth in any “risk factor” section or under the heading
“Forward-Looking Statements” or any similar sections containing disclaimers or
cautionary forward looking disclosure in any of such reports filed with the SEC
or (ii) set forth in the correspondingly numbered section of the Seller
Disclosure Letter, including in the financial statements, schedules and notes
included in such letter (provided, however, that a matter disclosed in a section
of the Seller Disclosure Letter with respect to one representation or warranty
shall also be deemed to be disclosed with respect to each other representation
or warranty to the extent reasonably apparent from the text of such disclosure
that such disclosure applies to or qualified such other representation or
warranty), Seller represents and warrants to Purchaser as of the date hereof
(except to the extent that any such representation or warranty speaks as of a
particular date, in which case it shall be true as of such date) as follows:

Section 5.1. Organization. Each Seller Party is a corporation or a limited
liability company, as the case may be, duly organized, validly existing and, if
applicable, in good standing under the laws of the jurisdiction of its
organization and has all requisite corporate power and authority to carry on its
business as now being conducted. Each Seller Party is duly qualified or licensed
to do business in each jurisdiction in which the property owned, leased or
operated by it or the nature of the business conducted by it makes such
qualification or licensing necessary, except where the failure to be so
qualified or licensed would not have a Material Adverse Effect.

 

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Section 5.2. Authority.

(a) Each Seller Party has all requisite power and authority to execute, deliver
and perform its obligations under this Agreement and to consummate the other
transactions contemplated hereby. The execution and delivery by each Seller
Party of this Agreement and the consummation by each Seller Party of the
transactions contemplated hereby have been duly authorized by all necessary
corporate or similar action. This Agreement has been duly executed and delivered
by each Seller Party, constitutes a legal, valid and binding obligation of each
Seller Party and is enforceable against each Seller Party in accordance with its
terms.

(b) Each Seller Party has, or will prior to the execution thereof have, all
requisite power and authority to enter into and deliver each Related Document to
which it is, or will be, a party, to perform its obligations thereunder and to
consummate the transactions contemplated thereby. Each Related Document, when
executed and delivered by such Seller Party, constitutes a legal, valid and
binding obligation of such Seller Party and is enforceable against such Seller
Party in accordance with its terms.

Section 5.3. Title to Transferred Assets. Except as listed in Section 5.3 of the
Seller Disclosure Letter, Seller exclusively owns all of the Transferred Assets
and has sole and exclusive good and marketable title in and to, and beneficial
ownership of, all of the Transferred Assets, free and clear of any Lien other
than Permitted Liens, and, subject to (i) securing the required consents,
approvals and authorizations set forth in Section 5.4(a) and Section 5.4(b) of
the Seller Disclosure Letter and (ii) the representations and warranties of
Purchaser in Article VI being true and correct, upon consummation of the
transactions contemplated hereby, Purchaser shall have sole and exclusive good
and marketable title in and to, and beneficial ownership of, each of the
Transferred Assets, free and clear of any Lien other than Permitted Liens.

Section 5.4. No Conflict; Required Filings and Consents.

(a) Except as listed in Section 5.4(a) of the Seller Disclosure Letter, none of
the execution, delivery or performance of this Agreement by each Seller Party or
the consummation by each Seller Party of the transactions contemplated hereby
will (i) conflict with or violate any provisions of any of the certificate of
incorporation, bylaws, partnership agreement, limited liability company
agreement, trust agreement or other similar governing documents (any such
document, an “Organizational Document“) of either Seller Party; (ii) result in
any breach or violation of or constitute a default (or an

 

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event which with notice or lapse of time or both would become a default), or
result in the loss of a benefit under, or give rise to any right of termination,
cancellation, amendment or acceleration of any Contract to which either Seller
Party is a party or by which a Seller Party or any of its respective assets are
bound or affected; (iii) result in the creation or imposition of any Lien (other
than a Permitted Lien) on any of the Transferred Assets; or (iv) assuming that
all consents, approvals and authorizations contemplated by, and all filings
described in, Section 5.4(b) of the Seller Disclosure Letter are obtained or
made, conflict with or violate any Law to which a Seller Party is subject or by
which any of the Transferred Assets are bound or affected, except in the case of
clause (ii) for any such breaches, violations, defaults, terminations,
cancellations, amendments or accelerations of any Contracts other than any of
the Transferred Contracts that would not have or reasonably be expected to have
a Material Adverse Effect. As a result of the consummation of the transactions
contemplated hereby, Seller will not be prohibited from exercising any of its
rights under any Transferred Contract to which Seller is a party, and none of
the Seller Parties will be required to pay any additional amounts or
consideration other than ongoing fees or payments, which such Seller Party would
otherwise be required to pay pursuant to the terms of such Transferred Contract
had the consummation of the transactions contemplated not occurred.

(b) Except as listed in Section 5.4(b) of the Seller Disclosure Letter, the
execution, delivery and performance by each Seller Party of this Agreement and
of any Related Document by either of the Seller Parties to which such Person is,
or will be, a party and the consummation by each Seller Party of the
transactions contemplated hereby and by either of the Seller Parties of the
transactions contemplated thereby, do not and will not require any consent,
approval, authorization or permit of, action by, filing with or notification to,
any Governmental Authority, except for such consents, approvals, authorizations,
permits, actions, filings or notifications that failure of which to be obtained
or made would not reasonably be expected, individually or in the aggregate, to
prevent or delay the performance by such Seller Party of its obligations
hereunder or the consummation of the transactions contemplated hereby. None of
the Seller Parties is subject to any agreement with, or Order of any
Governmental Authority, that would prevent consummation by such Seller Party of
the transactions contemplated by this Agreement or any Related Document.

Section 5.5. Financial Statements.

(a) True, complete and correct copies of: (i) the unaudited financial statements
of Seller as of and for the years ended December 31, 2008 and December 31, 2007
(collectively, the “Unaudited Financial Statements”), and (ii) the unaudited
interim balance sheets and profit and loss statements of Seller, as of and for
the month ended November 30, 2009 (the “Interim Financial Statements” and,
together with the Unaudited Financial Statements, the “Financial Statements”)
have been made available to Purchaser.

(b) The Financial Statements are complete and correct, have each been prepared
in conformity with GAAP (except that the Financial Statements do not contain all
the footnotes required for audited financial statements), and present fairly, in
accordance with GAAP, in all material respects, the financial position and
results of operations of Seller as of the dates and for the periods covered
thereby, subject, in the case of the Interim Financial Statements, to normal
year-end adjustments.

 

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(c) The books of account and other financial records of Seller have been
maintained in accordance with business and accounting practices customary in the
securities trading business in all material respects and are true and correct in
all material respects, except for such matters which have been reconciled or
corrected in the Financial Statements.

Section 5.6. Absence of Certain Changes or Events. Except as listed in
Section 5.6 of the Seller Disclosure Letter, since December 31, 2008, (a) Seller
has conducted the Acquired Business only in the ordinary course consistent with
past practice, (b) there have been no facts, changes, conditions, circumstances
or occurrences or non-occurrences of any events that, have had, or are
reasonably likely to have, a Material Adverse Effect, (c) there have been no
material disposition of any assets of the Company, and (d) no action that would
have been prohibited by Section 7.1 has been taken.

Section 5.7. Undisclosed Liabilities. Except (a) as set forth in the Financial
Statements, (b) for Liabilities incurred in the ordinary course of business
since November 30, 2009, or (c) as set forth in Section 5.7 of the Seller
Disclosure Letter, Seller does not have any Liabilities that would have, or
would be reasonably likely to have, a Material Adverse Effect.

Section 5.8. Permits; Compliance.

(a) As of the date hereof, Seller is an NYSE-registered DMM with respect to the
securities set forth on Section 5.8 of the Seller Disclosure Letter.

(b) Seller is in possession of all material franchises, grants, authorizations,
licenses, permits, easements, variances, exceptions, consents, certificates,
approvals and Regulatory Orders of any Governmental Authority legally necessary
for it to carry on its business as it is now being conducted (the “Seller
Permits”), and no suspension or cancellation of any of the Seller Permits is
pending or, to the Knowledge of Seller, threatened. Seller is not in conflict
with, or in default or violation of, or, with the giving of notice or lapse of
time or both, would be in conflict with, or in default or violation of, (i) any
Law applicable to Seller or by which any of the Transferred Assets are bound or
(ii) any of the Seller Permits that would have or reasonably be expected to have
a Material Adverse Effect or to materially impair Seller’s ability to satisfy
its obligations under Section 8.2.

Section 5.9. Compliance with Laws. Except as set forth in Section 5.9 of the
Seller Disclosure Letter, Seller is, and since January 1, 2007, has been, and to
the Knowledge of Seller, all Employees are, and since January 1, 2007, have
been, in compliance with all requirements of Law applicable to the Acquired
Business, except where such failure to be in compliance would not have, or would
not reasonably be expected to have, a Material Adverse Effect.

 

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Section 5.10. Absence of Litigation. Except as set forth in Section 5.10(a) of
the Seller Disclosure Letter, there is no Action, Order or Regulatory Order
outstanding or claim, suit, litigation, proceeding, labor dispute, arbitral
action or investigation pending or, to the Knowledge of Seller, threatened,
against or relating to the Seller Parties or, to the Knowledge of Seller, any of
the employees of the Acquired Business (in their capacity as employees), in each
case with respect to or relating to the Acquired Business. Section 5.10(b) of
the Seller Disclosure Letter sets forth a true, correct and complete list of all
Actions resolved or settled from January 1, 2006 to the date hereof.

Section 5.11. Material Contracts.

(a) Except for the contracts disclosed in Section 5.11 of the Seller Disclosure
Letter or, with respect to Section 5.11(a)(iv), any license for generally
available off-the-shelf software with a license fee of less than $5,000, as of
the date hereof, Seller is not a party to or bound by:

(i) any lease (whether of real or personal property) providing for annual
rentals of $50,000 or more;

(ii) any agreement for the purchase of materials, supplies, goods, services,
equipment or other assets providing for either annual payments by Seller of
$50,000 or more;

(iii) any agreement relating to the acquisition or disposition of any material
business (whether by merger, sale of stock, sale of assets or otherwise);

(iv) any license of a third party’s Intellectual Property;

(v) any license to a third party of any Transferred Intellectual Property;

(vi) any agreement that contains a non-compete clause, obligation of
exclusivity, or other restriction on the ability to operate the Acquired
Business in any manner or territory;

(vii) any agreement providing for the lending of money, whether as borrower,
lender or guarantor;

(viii) any agreement between Seller, on the one hand, and Seller Parent or one
of its Affiliates or their respective Related Persons, on the other hand, other
than in the ordinary course of business and that involves annual payments of
less than $ 50,000, provided that such agreements on an aggregated basis would
not involve an aggregated annual expenditure of $500,000 or greater;

(ix) any material employment agreements (other than ordinary course offer
letters providing for “at-will” employment) entered into with any employee of
Seller;

 

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(x) any agreement with a labor union (including any collective bargaining
agreement);

(xi) any settlement agreement entered into since January 1, 2006, other than
releases entered into in the ordinary course of business with former employees
of Seller in connection with the cessation of any such employee’s employment;

(xii) any agreement for consulting services or outsourcing employment services;

(xiii) any agreement under which Seller has advanced or loaned any amount to any
of its officers, members, directors, managers or employees;

(xiv) any partnership, joint venture or other similar agreement; or

(xv) any other agreement, commitment, arrangement or plan not made in the
ordinary course of business that is material to the Acquired Business.

All of the foregoing are collectively referred to in this Agreement as the
“Material Contracts.” With respect to each such Material Contract: (i) the
agreement is, in all material respects, legal, valid, binding, enforceable, and
in full force and effect in accordance with its terms (subject in each case to
the effect of any applicable bankruptcy, reorganization, insolvency, moratorium,
rehabilitation, liquidation, fraudulent conveyance, preferential transfer or
similar Law now or hereafter in effect relating to or affecting creditors’
rights and remedies generally and subject, as to enforceability, to the effect
of general equitable principles (regardless of whether enforcement is sought in
a proceeding in equity or at law)); (ii) subject to obtaining the consents set
forth in Section 5.4(a) of the Seller Disclosure Letter, Seller is not in breach
or default, and no event has occurred which with notice or lapse of time would
constitute a breach or default by Seller, or permit termination, modification,
or acceleration by the other party, under the agreement; and (iii) to the
Knowledge of Seller, no other party to the agreement is in breach or default,
and no event has occurred which with notice or lapse of time would constitute a
breach or default on the part of the other party, or permit termination,
modification or acceleration by Seller, under the agreement.

(b) Seller has made available to Purchaser (or its counsel) a true and complete
copy of each Material Contract, including any amendments thereto, required to be
disclosed pursuant to this Section 5.11.

Section 5.12. Real Property; Personal Property; Condition of Property.

(a) Seller does not own any real property.

(b) Seller is in possession of and have good title to, or have valid leasehold
interests in, all tangible personal property used in the Acquired Business. All
such tangible personal property is owned by Seller free and clear of all Liens
other than those which do not materially interfere with the current use of such
property, or is leased under a valid and subsisting lease, and in any case, is
in all material respects adequate and suitable for the purpose for which it is
currently being used.

 

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(c) All of the equipment, machinery, furniture, fixtures and other tangible
assets owned or leased by Seller currently in use and necessary for the
operation of the Acquired Business and being transferred to Purchaser under this
Agreement are adequate and suitable, in all material respects, for the purposes
for which they are currently being used.

Section 5.13. Employee Benefit Matters.

(a) Section 5.13(a)(i) of the Seller Disclosure Letter sets forth the base
salary, commissions, incentive and bonus compensation and other compensation
paid or payable to each of the officers and employees employed on a
substantially full-time Basis in the Acquired Business (the “Employees”) for
each of the three (3) most recently completed calendar years. In addition,
Section 5.13(a)(ii) of the Seller Disclosure Letter describes the incentive and
bonus compensation arrangements for the Employees and welfare plans in which any
Employee participated for the calendar year ending December 31, 2009, including
any compensation payable in connection with the transactions contemplated by
this Agreement in the form of stay bonuses, change in control payments or
similar compensation.

(b) Except as set forth in Section 5.13(b) of the Seller Disclosure Letter, all
current and former employees of Seller or its Subsidiaries have been, or will
have been on or before the Closing Date, paid in full all material wages,
salaries, commissions, bonuses, vacation pay, severance and termination pay,
sick pay and other compensation for all services performed by them that was
payable to such employee either pursuant to the terms and conditions of a Seller
Plan (in accordance with the applicable payroll practices of Seller or Seller
Parent) or required by Applicable Law, as applicable, in each case, prior to the
Closing Date. Except as set forth in Section 5.13(b) of the Seller Disclosure
Letter, all material wages, salaries, commissions, bonuses, vacation pay,
severance and termination pay, sick pay and other compensation for all services
performed by all current and former employees of Seller or its Subsidiaries that
was not payable prior to the Closing Date, is, or will be on or before the
Closing Date, fully reflected on the accounting books of Seller to the extent
required by GAAP and under, and consistent with, the past accounting practices
of Seller.

(c) Each of the Employees who is or who is required to be registered as a
broker, a dealer, a registered representative, a registered principal, a sales
person or in any similar capacity with any Governmental Authority is duly
registered. Section 5.13(c) of the Seller Disclosure Letter sets forth a true,
correct and complete list of the Employees and their respective registrations
and licenses.

(d) Since January 1, 2006, Seller has complied in all material respects with its
reporting obligations under NYSE Rule 345.12 with respect to the current Form
U4s of the Employees.

 

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(e) None of the Employees is subject to “statutory disqualification” (as such
term is defined in the Exchange Act).

Section 5.14. Employee Benefit Plans.

(a) Section 5.14(a) of the Seller Disclosure Letter sets forth each Seller Plan
in which any of the Employees participates for the calendar year ending
December 31, 2009. Neither Seller Parent nor Seller sponsors, maintains or
contributes (on a contingent basis or otherwise) to any employee benefit plan
other than the Seller Plans. Neither Seller, Seller Parent nor any Subsidiary or
ERISA Affiliate thereof, has received a notice of, or incurred, or reasonably
expects to incur, any withdrawal liability with respect to a Multiemployer Plan
on account of or in respect to any period on or prior to the Closing Date that
has or could result in the imposition of any Liability on Seller or any
Subsidiary or ERISA Affiliate thereof. No Seller Plan is or has been subject to
Title IV of ERISA or Section 412 of the Code and neither Seller, Seller Parent
nor any of their Affiliates contributes, or has contributed in the prior six
years, to a Multiemployer Plan. Except as required by COBRA or similar state or
local law, neither Seller, Seller Parent nor any Subsidiary of Seller Parent is
obligated to provide any post-employment health or other welfare benefits to any
current or former Employees (or dependents or beneficiaries thereof).

(b) Each Seller Plan (and each related trust, insurance contract or fund) was
established, and has been maintained and administered in compliance in form and
in operation, with the terms thereof and applicable requirements of ERISA and
the Code and other Applicable Law, except where failure to do so would not be
material to Seller, Seller Parent and any of their Affiliates taken as a whole.

(c) Each Seller Plan that is intended to be a “qualified plan” within the
meaning of Section 401(a) of the Code has received a favorable determination
letter from the Internal Revenue Service with respect to its qualified status
under Section 401(a) of the Code and the exempt status of any related trust
under Section 501(a) of the Code or has pending or has time remaining in which
to file an application for such determination from the IRS, and to the Knowledge
of Seller there is no existing fact or circumstance that could reasonably be
expected to affect adversely the qualified status of any such employee benefit
plan or related trust.

(d) All contributions (including all employer contributions and employee salary
reduction contributions) and all premiums or other payments due with respect to
each current or former employee for all periods ending on or before the Closing
Date under each Seller Plan that is an “employee benefit plan” within the
meaning of Section 3(3) of ERISA have been paid or have been reflected in the
Financial Statements except where any failure to do so would not be material to
Seller, Seller Parent or any of their Affiliates taken as a whole.

(e) No Seller Plan exists that, as a result of the execution of this Agreement,
shareholder approval of this Agreement or the transactions contemplated by this
Agreement (whether alone or in connection with any other event(s)), could result
in: (i) severance pay (or other compensation or benefits) or any increase in
severance pay (or other compensation or benefits) upon any termination of
employment, (ii) acceleration of the time of payment or vesting, or any payment
or funding (through a grantor trust or otherwise) of any compensation or
benefits, or an increase of the amount payable or any other material obligation,
or (iii) any limitation or restriction on the right of Purchaser or Affiliate of
Purchaser to merge, amend or terminate any of the Seller Plans.

 

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(f) Except as set forth in Section 5.14(f) of the Seller Disclosure Letter, none
of Seller, Seller Parent nor any Affiliates thereof maintains any plan, program
or arrangement or is a party to any contract that provides any benefits or
provides for payments to any Employee, based on or measured by the value of, any
equity security of, or interest in, Seller, Seller Parent or any Affiliates
thereof.

Section 5.15. Labor Matters.

(a) No Employee is represented by any labor organization or is otherwise subject
to any collective bargaining agreement or labor contract. No labor organization
or group of Employees has made a pending demand for recognition or
certification, and there are no representation or certification proceedings or
petitions seeking a representation proceeding currently pending or, to the
Knowledge of Seller, threatened, to be brought or filed with the National Labor
Relations Board or any other labor relations tribunal or authority. There are no
organizing activities, strikes, work stoppages, slowdowns, lockouts, material
arbitrations or material grievances or other material labor disputes pending or
to the Knowledge of Seller, threatened against or involving Seller. Seller is in
compliance with all applicable Law and Regulatory Orders applicable to it with
respect to employment and employment practices, terms and conditions of
employment, classification of workers, wages and hours and occupational safety
and health.

(b) In the year prior to the date hereof, Seller has not effectuated (i) a
“plant closing” (as defined in the Worker Adjustment and Retraining Notification
Act (the “WARN Act”) or any similar state, local or foreign law) affecting any
site of employment or one or more facilities or operating units within any site
of employment or facility of Seller or any of its Subsidiaries or (ii) a “mass
layoff” (as defined in the WARN Act, or any similar state, local or foreign law)
affecting any site of employment or facility of Seller or any of its
Subsidiaries.

Section 5.16. Intellectual Property.

(a) None of the Transferred Intellectual Property is the subject of a
registration or an application for registration with any Governmental Authority.
Seller has good and exclusive title to the Transferred Intellectual Property,
free and clear of any Liens.

(b) None of the Seller Parties have granted to any third party, by license or
otherwise, any right or interest in any Transferred Intellectual Property.
Seller has taken all reasonable actions to protect and maintain the validity,
enforceability, and

 

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ownership of all Transferred Intellectual Property. None of the Seller Parties
have Knowledge of any facts or circumstances that would render any Transferred
Intellectual Property invalid or unenforceable.

(c) Seller has a valid right to use all Intellectual Property owned by a third
party that is necessary for, or used in, the operation of the Acquired Business
as currently conducted.

(d) The Transferred Intellectual Property together with the Seller Licensed
Intellectual Property is all of the Intellectual Property necessary for or used
in connection with the conduct or operation of the Acquired Business as
currently conducted and as currently planned to be conducted, other than (i) any
trademarks that include “LaBranche” or (ii) as set forth in Section 5.16(d) of
the Seller Disclosure Letter. The Excluded Assets do not include any
Intellectual Property that is material to the conduct and operation of the
Acquired Business.

(e) The conduct and operation of the Acquired Business as currently conducted
does not infringe or misappropriate the Intellectual Property of any third party
in any material respect, nor constitute unfair competition or unfair trade
practices under the laws of any jurisdiction. Without limiting the foregoing,
none of the Seller Parties nor any of their respective Affiliates have received
any notice from any third party as of the date hereof, and, to the Knowledge of
the Seller Parties and their respective Affiliates, there is no other assertion
or pending threat from any third party, that the operation of the Acquired
Business infringes or misappropriates the Intellectual Property of any third
party or constitutes unfair competition or unfair trade practices under the laws
of any jurisdiction. None of the Seller Parties or any of their Affiliates are
subject to any Order that restricts or impairs the use of any Transferred
Intellectual Property. None of the Seller Parties or any of their respective
Affiliates have brought or have been a party to any Action with respect to the
Intellectual Property used in the Acquired Business. To the Knowledge of the
Seller Parties and their Affiliates, as of the date hereof no person is
infringing or misappropriating any Intellectual Property used in the Acquired
Business.

(f) Seller and its Affiliates have not incorporated, distributed or used, in
connection with any software included in the Transferred Intellectual Property
or Seller Licensed Intellectual Property, any Open Source Materials that grant
to any third party any ownership of or license rights or immunities under any
Intellectual Property owned or developed by Seller or that would create material
obligations with respect to any software derived therefrom or otherwise used in
connection with the Acquired Business, whether with respect to obligations of
disclosure, redistribution, licensing or otherwise. For the purposes of this
Section 5.16(f), “Open Source Materials” means all software, documentation or
other material that is distributed as “free software,” “open source software” or
under a similar licensing or distribution model, including, but not limited to,
the GNU General Public License (GPL), GNU Lesser General Public License (LGPL),
Mozilla Public License (MPL), or any other license described by the Open Source
Initiative as set forth on www.opensource.org.

 

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(g) Seller and its Affiliates have complied with and are complying with all
applicable Laws, contractual obligations and internal policies applicable to
privacy, business records, data security and data protection, including in
connection with, as applicable, the collection and use of personal information
in connection with the conduct and operations of the Acquired Business. Since
January 1, 2007, there have been no data security breaches or material losses of
data in connection with the Acquired Business.

Section 5.17. Taxes. All material Tax Returns, including, without limitation,
consolidated federal income tax returns, withholding tax returns and
declarations of estimated tax and tax reports, required to be filed on or prior
to the Closing Date by Seller or Seller Parent with respect to any Tax that, if
not paid, might result in a Lien upon any of the Transferred Assets have been
duly and timely filed and are true, correct and complete in all material
respects, and all Taxes due or claimed to be due pursuant thereto have been
paid.

Section 5.18. Insurance. The insurance policies covering Seller, its Affiliates
and their respective officers, directors, managers, employees and members
relating to or covering assets used in the Acquired Business (the “Policies”)
are in full force and effect, all premiums with respect to the Policies covering
all periods up to and including the Closing Date have been paid and no notice of
cancellation or termination has been received with respect to any such Policy.
The Policies provide for insurance coverage in amounts which are sufficient to
cover losses that a reasonably prudent DMM Organization would expect to incur in
connection with any pending or threatened Actions against Seller, its Affiliates
and their respective officers, directors, managers, employees and members.

Section 5.19. Sufficiency of Assets. Except as set forth in Section 5.19 of the
Seller Disclosure Letter, the Transferred Assets, together with the Seller
Licensed Intellectual Property, constitute, in all material respects, all the
assets, properties and rights of Seller (i) currently used in conducting the
Acquired Business and (ii) necessary to conduct the Acquired Business as
currently conducted.

Section 5.20. DMM Securities. Section 5.20 of the Seller Disclosure Letter sets
forth an accurate list, as of the close of the NYSE on the Business Day
immediately preceding the date hereof, of the number and designation of Seller’s
DMM Securities (including detail as to both its long- and short- Positions
therein). Seller’s investment account is the only account through which Seller
is maintaining DMM Securities.

Section 5.21. Solvency. Each Seller Party is, and immediately following the
Closing will be, solvent and will be in compliance with any minimum net capital
requirements imposed under applicable Law. The value of the assets of each
Seller Party is, and immediately following the Closing will be, greater than the
sum of such Seller Party’s Liabilities and outstanding equity. Each Seller Party
is, and immediately following the Closing will be, able to satisfy its
Liabilities as they come due in the ordinary course of business, consistent with
past practice. The Seller Parties presently

 

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intend (i) to not dispose (or cause to dispose) of a material portion of the
assets of Seller (other than the Acquired Business or transfers to another
Seller Party or one of its Affiliates (subject to clause (ii) below)) or
liquidate or wind up their respective affairs and (ii) to maintain ownership of
the shares of NYSE Euronext, Inc. stock directly owned by Seller as of the date
hereof (or, alternatively, maintain an equivalent value of cash or other assets
at Seller).

Section 5.22. Brokers. None of the Seller Parties and their Affiliates have
employed any broker, finder, consultant or other intermediary (each, a “Broker”)
in connection with the transactions contemplated by this Agreement or any of the
Related Documents, which Broker shall be entitled to a fee or commission in
connection with such transactions (other than any fee the full amount of which
shall be paid by Seller).

Section 5.23. Investigation. Seller Parties acknowledge and agree that (i) the
only representations, warranties, covenants and agreements made by Purchaser,
any of its Affiliates or their respective representatives are the
representations, warranties, covenants and agreements made in this Agreement
and/or any Related Document and (ii) except as set forth in this Agreement or
any Related Document, none of Purchaser, any of its Affiliates or their
respective representatives makes any other representation or warranty of any
kind or nature whatsoever, oral or written, express or implied, with respect to
Purchaser, its respective Affiliates or the transactions contemplated by this
Agreement, including any relating to the financial condition, results of
operations, probable success, future performance, assets or Liabilities of any
of the foregoing entities. Except for the representations and warranties
contained in this Agreement or any Related Document, (i) none of Seller Parties
have relied upon any other representations or warranties or any other
information made or supplied by or on behalf of Purchaser, its Affiliates or
their representatives, and (ii) Seller Parties agree that none of Purchaser, its
Affiliates or any of their representatives has any Liability or responsibility
for any other representation, warranty, opinion, projection, forecast, advice,
statement or information made, communicated or furnished (orally or in writing)
to Seller Parties.

Section 5.24. Disclaimer. Except for the representations and warranties
contained in Article V of this Agreement or in any Related Document, none of
Seller Parties or any of their respective Affiliates or their respective
representatives makes any other representation or warranty of any kind or nature
whatsoever, oral or written, express or implied, with respect to Seller or the
Acquired Business or the transactions contemplated hereby, including any
relating to the financial condition, results of operations, assets or
Liabilities of any of the foregoing entities. Seller Parties disclaim, on behalf
of themselves, their Affiliates and any of their respective representatives, all
Liability and responsibility for any other representation, warranty, opinion,
projection, forecast, advice, statement or information made, communicated or
furnished (orally or in writing) to Purchaser or its representatives.

 

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ARTICLE VI

REPRESENTATIONS AND WARRANTIES OF PURCHASER

Except as otherwise set forth in the disclosure letter delivered by Purchaser to
Seller before the date hereof (the “Purchaser Disclosure Letter”), Purchaser
represents and warrants to Seller:

Section 6.1. Organization. Purchaser is a corporation duly organized, validly
existing and, if applicable, in good standing under the laws of the jurisdiction
of its organization and has all requisite corporate power and authority to carry
on its business as now being conducted. Purchaser is duly qualified or licensed
to do business in each jurisdiction in which the property owned, leased or
operated by it or the nature of the business conducted by it makes such
qualification or licensing necessary, except where the failure of Purchaser to
be so qualified or licensed would not reasonably be expected, individually or in
the aggregate, to prevent or delay the performance by Purchaser of its
obligations hereunder or the consummation of the transactions contemplated
hereby.

Section 6.2. Authority.

(a) Purchaser has all requisite power and authority to execute, deliver and
perform its obligations under this Agreement and to consummate the transactions
contemplated hereby. This Agreement has been duly executed and delivered by
Purchaser, constitutes a legal, valid and binding obligation of Purchaser and is
enforceable against Purchaser in accordance with its terms.

(b) Purchaser has, or will prior to the execution thereof have, all requisite
power and authority to enter into and deliver each Related Document to which it
is, or will be, a party, to perform its obligations thereunder and to consummate
the transactions contemplated thereby. Each Related Document, when executed and
delivered by Purchaser, constitutes a legal, valid and binding obligation of
Purchaser and is enforceable against Purchaser in accordance with its terms.

Section 6.3. No Conflict; Required Filings and Consents.

(a) The execution, delivery and performance by Purchaser of this Agreement and
each Related Document to which Purchaser is, or will be, a party, and the
consummation by Purchaser of the transactions contemplated hereby and thereby,
do not and will not: (i) conflict with or violate any provision of the
Organizational Documents of Purchaser; (ii) result in any breach or violation of
or constitute a default (or an event which with notice or lapse of time or both
would become a default), or result in the loss of a benefit under, or give rise
to any right of termination, cancellation, amendment or acceleration of any
Contract to which Purchaser is a party or by which Purchaser or any of its
respective assets are bound or affected, or (iii) assuming that all consents,
approvals and authorizations contemplated by, and all filings described in,
Section 6.3(b) of the Purchaser Disclosure Letter are obtained or made, conflict
with or violate any Law to

 

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which Purchaser is subject or by which any of its assets are bound or affected,
except, in each case, as would not reasonably be expected, individually or in
the aggregate, to prevent or delay the performance by Purchaser of its
obligations hereunder or the consummation of the transactions contemplated
hereby.

(b) Except as set forth in Section 6.3(b) of the Purchaser Disclosure Letter,
the execution, delivery and performance by Purchaser of this Agreement and each
Related Document to which Purchaser is, or will be a party, and the consummation
by Purchaser of the transactions contemplated hereby and thereby, do not and
will not require any consent, approval, authorization or permit of, action by,
filing with or notification to, any Governmental Authority, except for such
consents, approvals, authorizations, permits, actions, filings or notifications
that failure of which to be obtained or made would not reasonably be expected,
individually or in the aggregate, to prevent or delay the performance by
Purchaser of its obligations hereunder or the consummation of the transactions
contemplated hereby.

Section 6.4. Permits; Compliance with Laws. Purchaser is an NYSE-registered DMM
and has all necessary power and authority to act as the NYSE-registered DMM with
respect to the Allocations being transferred to it by Seller pursuant to this
Agreement. Purchaser is in possession of all franchises, grants, authorizations,
licenses, permits, easements, variances, exceptions, consents, certificates,
approvals and Regulatory Orders of any Governmental Authority legally necessary
for it to carry on its NYSE-registered DMM business following the transfer of
the Allocations of Seller to it pursuant to this Agreement (the “Purchaser
Permits”), and no suspension, cancellation or injunction with respect to of any
of the Purchaser Permits is pending or, to the Knowledge of Purchaser,
threatened. Purchaser is not in conflict with, or in default or violation of,
or, with the giving of notice or lapse of time or both, would be in conflict
with, or in default or violation of, (i) any Law applicable to Purchaser in
connection with its NYSE-registered DMM business or (ii) any of the Purchaser
Permits, in each case which would reasonably be expected, individually or in the
aggregate, to prevent or delay the performance by Purchaser of its obligations
hereunder or the consummation of the transactions contemplated hereby.

Section 6.5. Litigation. Except as set forth on Section 6.5 of the Purchaser
Disclosure Letter, there is no Action by any Governmental Authority or any third
party pending or, to the Knowledge of Purchaser, threatened against Purchaser or
its officers, directors or members that relates to Purchaser’s NYSE-registered
DMM business or would otherwise reasonably be expected, individually or in the
aggregate, to prevent or delay the performance by Purchaser of its obligations
hereunder or the consummation of the transactions contemplated hereby.

Section 6.6. Brokers. None of Purchaser and its Affiliates has employed any
Broker in connection with the transactions contemplated by this Agreement or any
of the Related Documents, which Broker shall be entitled to a fee or commission
in connection with such transactions.

 

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Section 6.7. Investigation. Purchaser acknowledges and agrees that it (a) has
made its own inquiry and investigation into, and, based thereon, has formed an
independent judgment concerning, Seller, the Transferred Assets, the Assumed
Liabilities and the Acquired Business and (b) has been furnished with or given
adequate access to such information about Seller, the Transferred Assets, the
Assumed Liabilities and the Acquired Business as it has requested. Purchaser
further acknowledges and agrees that (i) the only representations, warranties,
covenants and agreements made by Seller Parties, their Affiliates or their
respective representatives or any other Person are the representations,
warranties, covenants and agreements made in this Agreement or Related
Documents, (ii) except as set forth in this Agreement or any Related Document,
none of the Seller Parties or any of their respective Affiliates or
representatives makes any other representation or warranty of any kind or nature
whatsoever, oral or written, express or implied, with respect to Seller, the
Transferred Assets, the Assumed Liabilities, the Acquired Business, this
Agreement or the transactions contemplated by this Agreement, including any
relating to the financial condition, results of operations, probable success,
future performance, assets or Liabilities of any of the foregoing entities and
(iii) none of the Seller Parties or any of their respective Affiliates or their
respective representatives makes any representation or warranty as to (A) the
post-closing operation of the Acquired Business by Purchaser or its Affiliates
in any manner or (B) the future success, performance or profitability of the
Transferred Assets or the Acquired Business. Except for the representations and
warranties contained in this Agreements or any Related Document, (1) Purchaser
has not relied upon any other representations or warranties or any other
information made or supplied by or on behalf of Seller Parties any of their
respective Affiliates or their respective representatives, and (2) Purchaser
acknowledges and agrees that none of the Seller Parties, their respective
Affiliates or their respective representatives has any liability or
responsibility for any other representation, warranty, opinion, projection,
forecast, advice, statement or information made, communicated or furnished
(orally or in writing) to Purchaser its Affiliates or their respective
representatives.

Section 6.8. Disclaimer. Except for the representations and warranties contained
in Article VI of this Agreement or in any Related Document, none of Purchaser or
any of its respective Affiliates or their respective representatives makes any
other representation or warranty of any kind or nature whatsoever, oral or
written, express or implied, with respect to themselves, their Affiliates, their
respective businesses, or the transactions contemplated by this Agreement.
Except for the representations and warranties contained in this Article VI or
any Related Document, Purchaser disclaims, on behalf of itself, its Affiliates
and their respective representatives, (a) any other representations or
warranties, whether made by Purchaser or any of its Affiliates or their
respective representatives or any other Person, and (b) all Liability and
responsibility for any other representation, warranty, opinion, projection,
forecast, advice, statement or information made, communicated or furnished
(orally or in writing) to Seller Parties or their Affiliates or their respective
representatives.

 

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ARTICLE VII

COVENANTS

Section 7.1. Conduct of Business by Seller. From the date hereof until the
Closing, except for matters set forth in Section 7.1 of the Seller Disclosure
Letter or otherwise to the extent to which has been consented in writing by
Purchaser (which consent shall not be unreasonably withheld, except with respect
to actions described in clauses (a), (e) and (g) below), Seller shall conduct
the Acquired Business and manage the Allocations and the DMM Securities in the
ordinary course, consistent with past practice, and in compliance with
applicable Law, and shall use commercially reasonable efforts to preserve intact
the business organizations and relationships with third parties relevant to the
Acquired Business (including, without limitation, the NYSE in respect of the
Allocations and the issuers of the DMM Securities). As soon as reasonably
practicable following the date hereof, Seller shall (A) make available to
Purchaser contact information of each issuer of the DMM Securities covered by
the Allocations and (B) use commercially reasonable efforts to facilitate and
participate in communications with such issuers as Purchaser may reasonably
request. In addition, and subject to applicable Law, from the date hereof until
the Closing, Seller shall take reasonable steps to promptly inform Purchaser of,
and cooperate with Purchaser with respect to, any material developments relating
to the NYSE, the Allocations and the DMM Securities of which Seller receives
notice, including any request by an issuer of DMM Securities to be reallocated
to another DMM. Without limiting the generality of the foregoing, and except as
expressly provided in or contemplated by this Agreement, from the date hereof
until the Closing Date, without the prior written consent of Purchaser (which
consent shall not be unreasonably withheld, except with respect to actions
described in clauses (a), (e) and (g) below), Seller shall not:

(a) agree to any reallocation either by the NYSE or any issuer in any of the DMM
Securities, to the extent any Seller is required or entitled to agree or consent
to a reallocation;

(b) allow to lapse, or fail to make any applications for renewal as and when
required, or otherwise or fail to maintain valid and in good standing any Seller
Permits necessary for the conduct of the Acquired Business or the operation of
Seller;

(c) commence an Action against any customer of the Acquired Business;

(d) fail to comply, in all material respects, with the minimum net capital
requirements applicable to Seller under the Exchange Act, and those applicable
to it under the rules of the NYSE relating to DMMs or any other similar
requirement of any applicable Governmental Authority, provided that failure to
maintain an amount of net capital equal to or greater than any minimum net
capital requirements applicable to Seller under the Exchange Act or the rules of
the NYSE shall be deemed to be a violation of this clause (d);

 

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(e) sell, lease, license, sell and leaseback, or otherwise dispose of any assets
relating to the Acquired Business or any interest therein other than assets sold
in the ordinary course of business consistent with past practice;

(f) terminate a Transferred Contract or waive, release, cancel or assign any
material rights or claims thereunder other than in the ordinary course of
business consistent with past practice;

(g) issue, deliver, sell, grant, pledge or authorize or otherwise incur any Lien
(other than a Permitted Lien, which shall be removed prior to the Closing) upon
any of the Transferred Assets;

(h) take any action to, or that would reasonably be likely to discourage,
prevent or interfere with (x) the offers of employment made pursuant to
Section 10.1 by Purchaser to Employees or (y) such Employees’ decisions to
accept such offers of employment, including but not limited to offering other
positions of employment to, hiring, increasing the compensation of or entering
into contracts with any Employee;

(i) with respect to any Transferred Asset (x) make or revoke any Tax election or
change any Tax accounting method, except as required by applicable Tax Law or
(y) settle, compromise or concede any audit, claim, deficiency or proceeding
relating to Taxes;

(j) acquire, by merger or consolidation, by purchase of, investments in, or
otherwise, all or substantially all the assets, capital stock, voting interests
or other equity interests of any business, or any corporation, limited liability
company, partnership, joint venture, association or other business organization
or division thereof, or any other Person, or create any Subsidiary of Seller;

(k) except as set forth in Section 7.1(k) of the Seller Disclosure Letter,
settle or agree to settle any Action or pay, discharge or satisfy or agree to
pay, discharge or satisfy any Claim or Liability of Seller, Seller Parent or any
of its other Affiliates other than the payment, discharge or satisfaction of
Liabilities reflected or reserved against in the Financial Statements or
incurred in the ordinary course of business subsequent to the date of the
Financial Statements;

(l) other than as may be required by Law or any Seller Plan, (i) increase the
present base salary, hourly wage or commission rate of (or accelerate the
vesting of, or increase, any payment or benefits in respect of) any of the
Employees, other than customary annual base salary increases made at the same
time in prior years and otherwise in the ordinary course of business consistent
with past practice for Employees with annual base salary of less than $100,000,
(ii) authorize, guarantee or pay any bonuses or other special payments to any
Employee (other than any such payments payable in accordance with any Seller
Plan), (iii) amend the current terms of any Seller Plan to the extent applicable
to any Employee, in a manner that would increase the cost or obligations of
Purchaser under Article X of this Agreement, (iv) adopt or enter into

 

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any new contract, plan or arrangement providing potential compensation or
employee benefits that would be considered an employee benefit plan in a manner
that would increase the cost or obligations of Purchaser under Article X of this
Agreement, in each case, if in effect on the date hereof, (v) transfer the
employment of any Employee to or from Seller or any Subsidiary thereof
(including transfers of employment to or from Seller’s other Affiliates) or
otherwise materially change the job functions of any Employee so as to either
(1) cause such Employee to cease to be related to the Acquired Business or
(2) cause any Employee who is not related to the Acquired Business to become
related to the Acquired Business and (vi) except in the ordinary course of
business consistent with past practice with respect to Persons whose total
annual compensation would not exceed $100,000, on an individual basis, hire or
terminate the employment of (other than for cause, as determined in Sellers’
discretion) any Person who would be an Employee

(m) grant any equity-related, performance or similar awards or bonuses;

(n) enter into any collective bargaining agreement or other labor contract;

(o) enter into any transaction with or for the benefit of any Related Party
other than in the ordinary course of practice consistent with past practice;

(p) fail to maintain the Policies and other insurance upon the assets and
properties of Seller in such amounts and of such kinds comparable to that in
effect since August 31, 2009;

(q) adopt a plan of complete or partial liquidation, dissolution, merger,
consolidation, restructuring, recapitalization or other reorganization of Seller
or Seller Parent;

(r) fail to maintain the Transferred Assets in their current physical condition,
except for ordinary wear and tear and damage; or

(s) propose, resolve, authorize, or commit or agree to take, any of the
foregoing actions.

Section 7.2. Access. Until the Closing, subject to applicable Law, Seller shall:

(a) make available for inspection by Purchaser and its counsel, financial
advisers, auditors and other authorized representatives of Purchaser, during
normal business hours, corporate records, books of accounts, Contracts and all
other Records reasonably requested by any of them,

(b) promptly furnish or make available, and cause its Affiliates to promptly
furnish or make available, to Purchaser information pertaining to Seller as
Purchaser may reasonably request in writing,

 

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(c) permit Purchaser and its counsel, financial advisers, auditors and other
authorized representatives reasonable access to the properties of Seller upon
reasonable advance notice, and

(d) cause the directors, managers, officers, employees, accountants and auditors
of each of the Seller Parties and its Affiliates to reasonably cooperate with
Purchaser in its investigation of Seller as Purchaser may reasonably request and
shall take reasonable steps to assist Purchaser in communicating with Persons
having business relationships, agreements and arrangements with Seller regarding
the transactions contemplated by this Agreement and the Related Documents, to
the extent reasonably necessary to maintain relationships with third parties
relevant to the Acquired Business; provided that the Seller Parties shall have
no obligation pursuant to this Section 7.2 or otherwise to cause Seller to
disclose any information to Purchaser if such disclosure would require the
disclosure of trade secrets of third parties or trade secrets unrelated to
Seller; provided, further, that compliance by Seller Parties with their
obligations under this Section 7.2 shall not unreasonably interfere with the
day-to-day operations of the Acquired Business.

Section 7.3. Records; Additional Information

(a) Physical delivery of the Records (other than stock trade records) by Seller
to Purchaser in connection with the assignment and transfer of the ownership
thereof pursuant to this Agreement, shall be made at the Closing to such
location and on such schedule as agreed between Seller and Purchaser. For a
period of three (3) years after the Closing Date, or the period required by
applicable Law, whichever period is greater, Seller shall maintain the Records
not otherwise physically transferred to Purchaser in a location and manner that
complies with applicable Law (including Rules 17a-3 and 17a-4 under the Exchange
Act). At the Closing, Seller shall file with the SEC a written undertaking in
compliance with Rule 17a-4(i) under the Exchange Act. Without limiting the
foregoing, for so long as such Records, books and documents are maintained by
Seller, Seller shall make such Records, books and documents available to
Purchaser and its authorized representatives, promptly upon the reasonable
written request of Purchaser and at Purchaser’s sole cost and expense. At the
end of such three- (3-) year period, or the period required by applicable Law,
whichever period is greater, if Seller wishes to destroy such Records, then
Seller shall first give sixty (60) days prior written notice to Purchaser.
Purchaser shall then have the right at its option, prior to the expiration of
such sixty (60) day period, to notify Seller in writing of Purchaser’s election
to take possession of said Records or portions thereof at Purchaser’s sole cost
and expense. In the event Purchaser does not notify Seller that Purchaser is
exercising its option to reacquire documents hereunder, Seller may destroy such
Records without further obligation hereunder.

(b) Seller shall promptly (and no later than seven (7) Business Days prior to
the Closing Date) provide Purchaser with (i) the applicable serial or other
model numbers that are reasonably sufficient to identify all of the Transferred
Assets listed in Section 1.1(c) and 1.1(g) of the Seller Disclosure Letter and
(ii) the applicable identification or license number for all of the Seller
Licensed Intellectual Property embedded in the items listed in Section 1.1(c)
and 1.1(g) of the Seller Disclosure Letter.

 

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Section 7.4. Consents. Each Seller Party shall provide reasonable assistance to
Purchaser in respect of obtaining all licenses, permits, certificates, approvals
or other similar authorizations to conduct the Acquired Business as currently
conducted, including any required consents and approvals set forth in
Section 8.1(f) of the Seller Disclosure Letter and Section 8.2(j) of the
Purchaser Disclosure Letter.

Section 7.5. No Negotiation. Until such time as this Agreement shall be
terminated pursuant to Section 9.1, the Seller Parties shall not, and shall
cause their Affiliates not to, directly or indirectly, solicit, initiate,
encourage or entertain any inquiries or proposals from, discuss or negotiate
with, provide any information to, or consider the merits or any inquiries or
proposals from any Person other than Purchaser relating to (i) any business
combination transaction involving Seller, (ii) the merger or consolidation of
Seller, (iii) the sale of Seller or all or any equity securities of Seller, or
(iv) the sale of any of the Transferred Assets or the Acquired Business. Seller
shall promptly (and in any case no later than within twenty four (24) hours of
receipt or awareness of the same by Seller or any of its Affiliates) notify
Purchaser of all material details of any such inquiry or proposal.

Section 7.6. Non-Competition and Non-Solicitation

(a) For a period of three (3) years from and after the Closing Date (the
“Restricted Period”), none of the Seller Parties and their Affiliates shall act
directly or indirectly (through their Affiliates or otherwise) as a DMM on the
NYSE.

(b) During the Restricted Period, none of the Seller Parties and their
Affiliates shall, or shall permit any of their Affiliates to, recruit, solicit
or hire, or attempt to recruit, solicit or hire, any Employee, or induce or
attempt to induce, or in any manner assist a third party to induce or attempt to
induce any Employee to terminate his or her employment by, or otherwise cease
his or her relationship with, Purchaser or any of its Affiliates or commence
employment with any other entities that compete with the Acquired Business;
provided, however, that this Section 7.6(b) shall not apply to any Employee
(A) solicited by an independent agency that has not been instructed to
specifically target employees described in this Section 7.6(b), (B) solicited
through general advertisements or similar conduct, (C) who contacts or
approaches Seller or any of its Affiliates without any solicitation by Seller or
any of its Affiliates (provided that the employment of such Employee was
terminated by such Employee at least three (3) months prior to recruitment,
solicitation or hiring by the Seller Parties) or (D) whose employment was
terminated by Purchaser or any of its Affiliates.

(c) If the final judgment of a court of competent jurisdiction declares that any
term or provision of this Section 7.6 is invalid or unenforceable, the parties
agree that the court making the determination of invalidity or unenforceability
shall have the power to reduce the scope, duration, or area of the term or
provision, to delete specific words or phrases, or to replace any invalid or
unenforceable term or provision with a term

 

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or provision that is valid and enforceable and that comes closest to expressing
the intention of the invalid or unenforceable term or provision, and this
Agreement shall be enforceable as so modified after the expiration of the time
within which the judgment may be appealed.

Section 7.7. Confidentiality.

(a) The terms of the Confidentiality Agreement are incorporated into this
Agreement by reference and shall continue in full force and effect until the
Closing, at which time the confidentiality obligations under the Confidentiality
Agreement shall terminate; provided, however, that the confidentiality
obligations of Purchaser shall not terminate with respect to any Evaluation
Material (as defined in the Confidentiality Agreement) relating to Seller or
Seller Parent to the extent it does not relate in any respect to the Acquired
Business, the Transferred Assets or the Assumed Liabilities; provided, further,
that all of Purchaser’s non-solicitation obligations under Section 7 and
standstill obligations under Section 11 of the Confidentiality Agreement shall
remain in full force and effect pursuant to the terms of the Confidentiality
Agreement. If, for any reason, the transactions contemplated by this Agreement
are not consummated, the Confidentiality Agreement shall nonetheless continue in
full force and effect in accordance with its terms. Notwithstanding any other
provision of this Section 7.7, none of the transactions contemplated hereby
(including the hiring by Purchaser of the Acquired Employees) shall be deemed to
be in breach of the terms of the Confidentiality Agreement.

(b) The Seller Parties acknowledge that prior to the Closing Date, the Seller
Parties and their Affiliates have had, and may continue to have, access to
confidential information relating to the Acquired Business and its actual or
anticipated operation, including without limitation technical data, trade
secrets, know-how, research, product plans or other information regarding
products or services and markets therefor, customer lists and customers,
software, processes, formulas, methodologies, data, databases, algorithms,
technology, designs, engineering, hardware configuration information, marketing,
finances or other business information (collectively, “Confidential
Information”). Each of the Seller Parties agrees that, following the Closing, it
will not, and will cause its Affiliates not to, without the prior express
written permission of Purchaser, disclose to any other Person or use (except as
permitted herein) any Confidential Information of the Acquired Business which
the Seller Parties or their Affiliates may have obtained at any time, whether
prior to the Closing Date or otherwise, including this Agreement and the Related
Documents, except to the extent that Confidential Information of the Acquired
Business is (x) previously known on a non-confidential basis by the Seller
Parties and their Affiliates, (y) in the public domain through no fault of a
Seller Party or any of its Affiliates or their employees, officers, directors,
managers, accountants, counsel, consultants, advisers and agents or of any third
party under confidentiality obligations or (z) later lawfully acquired by the
Seller Parties or their Affiliates on a non-confidential basis from sources
other than Purchaser or its Affiliates; provided that Seller may disclose
Confidential Information of the Acquired Business (1) to Governmental
Authorities where requested by them or required by applicable Law and (2) to its
officers, directors, managers, employees, accountants,

 

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counsel, consultants, advisers and agents, so long as such Persons are informed
by Seller of the confidential nature of such information and agree to hold such
information confidentially in accordance with this Section 7.7(b). In all cases,
the Seller Parties and their Affiliates shall be responsible for any breach by
such Persons of this Section 7.7(b).

(c) Prior to the Closing Date and after any termination of this Agreement, the
Seller Parties and their Affiliates will, and will use their commercially
reasonable efforts to cause their respective employees, officers, directors,
managers, accountants, counsel, consultants, advisers and agents, to hold in
confidence, unless compelled to disclose by requirements of Applicable Law, and
not use (except as permitted herein) any Confidential Information of Purchaser
(which, for the avoidance of doubt, shall include all confidential documents
concerning Purchaser or any of its Affiliates furnished to a Seller Party or
their Affiliates or their respective employees, officers, directors, managers,
accountants, counsel, consultants, advisers and agents in connection with the
transactions contemplated by this Agreement and the Related Documents, including
without limitation the terms of this Agreement and the other Related Documents),
except to the extent that such information is (w) previously known on a
non-confidential basis by the Seller Parties and their Affiliates, (x) in the
public domain through no fault of a Seller Party or any of its Affiliates or
their employees, officers, directors, managers, accountants, counsel,
consultants, advisers and agents or of any third party under confidentiality
obligations, (y) later lawfully acquired by the Seller Parties or their
Affiliates on a non-confidential basis from sources other than Purchaser or its
Affiliates, or (z) disclosed in accordance with Section 7.7(b); provided,
however, that the Seller Parties and their Affiliates may disclose Confidential
Information of Purchaser (1) to Governmental Authorities where requested by them
by the requirements of applicable Law, or (2) to their respective employees,
officers, directors, managers, accountants, counsel, consultants, advisers and
agents, so long as such Persons are informed by Seller of the confidential
nature of such information and agree to hold such information confidentially in
accordance with this Section 7.7(c). In all cases, the Seller Parties and their
Affiliates shall be responsible for any failure to treat such information
confidentially by such Persons. The obligation of the Seller Parties and their
Affiliates to hold any such information in confidence shall be satisfied if they
exercise the same care with respect to such information as they would take to
preserve the confidentiality of their own similar information but with no less
than a reasonable standard of care. If this Agreement is terminated, upon the
written request of Purchaser, the Seller Parties and their Affiliates will, and
will cause their respective employees, directors, managers, accountants,
counsel, consultants, advisers and agents to, destroy or deliver to Purchaser
all documents and other materials, and all copies thereof, obtained by any of
the Seller Parties or their Affiliates or on their behalf from Purchaser or its
Affiliates in connection with this Agreement that are subject to the
confidentiality obligations of Seller and its Affiliates under this Section 7.7.

(d) No party hereto or any Affiliate or representative of such party shall issue
or cause the publication of any press release or public announcement or
otherwise communicate with any news media in respect of this Agreement or any
Related Document or the transactions contemplated by this Agreement or any
Related Document prior to the Closing without the prior written consent of the
other party hereto (which

 

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consent shall not be unreasonably withheld, conditioned or delayed), except if
such disclosure is otherwise permitted herein or as may be required by
applicable Law or requested by a Governmental Authority, in which case the party
hereto required to publish such press release or public announcement shall allow
the other party hereto a reasonable opportunity to comment on such press release
or public announcement in advance of such publication (unless the disclosing
party is not reasonably able to consult in a timely manner with, or obtain the
approval of, the other party hereto and such disclosure is required by
applicable Law); provided, however, if any press release or public announcement
in respect of this Agreement or the transactions contemplated by this Agreement
is made by the NYSE prior to the Closing (the “NYSE Release”), the parties may
issue or cause the publication of a press release or public announcement that
is, and no more than, duplicative of such NYSE Release.

Section 7.8. Reasonable Best Efforts; Obtaining Consents; Further Action.

(a) Each of the parties hereto agrees to use its commercially reasonable efforts
to take, and to cause its officers, employees, representatives, advisors and
agents to take, all action and to do, or cause to be done, all things necessary,
proper or advisable to consummate and make effective as promptly as practicable
the transactions contemplated by this Agreement and to cooperate with each other
in connection with the foregoing, including using commercially reasonable
efforts (i) to obtain promptly all necessary waivers, consents and approvals
from other parties to material agreements, leases and other contracts or
agreements, (ii) to make promptly all filings and obtain promptly all necessary
consents, approvals and authorizations as are required to be obtained under any
Law, (iii) to defend all Actions challenging this Agreement or the consummation
of the transactions contemplated hereby, (iv) to cause to be lifted or rescinded
any injunction or restraining order or other order adversely affecting the
ability of the parties to consummate the transactions contemplated by this
Agreement, (v) to effect promptly all necessary registrations and other filings
and submissions of information requested by Governmental Authorities in
connection with this Agreement and the transactions contemplated hereby and
(vi) to cause and facilitate the prompt satisfaction of all conditions in
Article VIII.

(b) The parties shall keep each other apprised of the status of matters relating
to the completion of the transactions contemplated hereby and work cooperatively
in connection with obtaining the requisite approvals, consents or orders of each
applicable Governmental Authority, including promptly notifying each other of
any communications from or with any Governmental Authority with respect to the
transactions contemplated by this Agreement.

(c) If any party or any Affiliate thereof receives a request for additional
information or documentary material from any Governmental Authority with respect
to this Agreement or the transactions contemplated by this Agreement, then such
party will endeavor in good faith to make, or cause to be made, as soon as
practicable and after consultation with the other parties, an appropriate
response in compliance with such request.

 

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(d) At any time and from time to time, each party to this Agreement agrees,
subject to the terms and conditions of this Agreement, to take such actions and
to execute and deliver such documents as may be necessary to effectuate the
purposes of this Agreement at the earliest practicable time.

Section 7.9. Corporate Name. From and after the Closing Date, the Seller Parties
shall continue to own all rights to the name “LaBranche”, including all names,
marks, trade names, logos, and trademarks that incorporate “LaBranche” by itself
or in combination with any other marks or designs (collectively, “Seller
Names”), and no rights thereto or goodwill represented thereby are being
transferred or granted herein. To the extent the Transferred Assets or Seller
Licensed Intellectual Property include any materials bearing any of the Seller
Names, Purchaser shall remove or replace such Seller Names prior to any public
use thereof immediately following the Closing and in any event within ninety
(90) days following the Closing except that Purchaser may make historical
reference to the Acquired Business having been previously owned by the Company.

Section 7.10. Notifications.

(a) Seller shall, until the earlier of the termination of this Agreement and the
Closing Date, promptly inform in writing Purchaser of:

(i) any notice or other communication from any Person alleging that the consent
of such Person is or may be required in connection with the transactions
contemplated by this Agreement or any Related Document;

(ii) any notice or other communication from any Governmental Authority in
connection with the transactions contemplated by this Agreement or any Related
Document;

(iii) any Action commenced relating to a Seller Party or the Acquired Business;

(iv) any notice or other communication from any Person that any DMM Security
will be removed from Seller’s Allocations;

(v) any notice or other communication from any issuer of any DMM Security that
relates to any negative developments with respect to, or otherwise may
negatively impact, such DMM Security or the operation of Business with respect
to such DMM Security in any material respect; or

(vi) any notice, inquiry or other communication from any Person relating to any
Employee, including any notice, inquiry or other communication relating to an
Employee that could reasonably be expected to lead to a disciplinary action by
any Governmental Authority, including any disciplinary action that could provide
a Basis for a “statutory disqualification” (as such term is defined in the
Exchange Act).

 

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(b) Purchaser shall, until the earlier of the termination of this Agreement and
the Closing Date, promptly inform in writing Seller of:

(i) any written notice or other written communication from any Person alleging
that the consent of such Person is or may be required in connection with the
transactions contemplated by this Agreement or any Related Document that has, or
would reasonably be expected to have, a material adverse effect on the ability
of the parties to consummate the transactions contemplated by this Agreement; or

(ii) any written notice or other written communication from any Governmental
Authority in connection with the transactions contemplated by this Agreement or
any Related Document that has, or would reasonably be expected to have, a
material adverse effect on the ability of the parties to consummate the
transactions contemplated by this Agreement.

Delivery of any notice to Purchaser or Seller (as applicable) pursuant to this
Section 7.10 shall not limit or otherwise affect the remedies available to
Purchaser or Seller (as applicable) hereunder or under applicable Law.

ARTICLE VIII

CONDITIONS

Section 8.1. Conditions Precedent to Obligation of Seller Parties. The
obligation of the Seller Parties to consummate the transactions contemplated by
this Agreement at the Closing is subject to the satisfaction at or prior to the
Closing of each of the following conditions (unless satisfaction of any such
condition is expressly waived in a writing delivered by Seller to Purchaser):

(a) Accuracy of Representations and Warranties. Each of the representations and
warranties of Purchaser contained in this Agreement (which for purposes of this
paragraph shall be read as though none of them contained any materiality
qualifications) shall be true and correct in all respects except for breaches of
representations and warranties that would not be reasonably expected,
individually or in the aggregate, to have a material adverse effect on the
ability of Purchaser to consummate the Closing, when made and at and as of the
Closing, with the same force and effect as if made as of the Closing, other than
such representations and warranties as are made as of another date, which shall
be true and correct for purposes hereof as of such date.

(b) Compliance with Covenants. The covenants and agreements contained in this
Agreement to be complied with by Purchaser on or before the Closing shall have
been complied with in all material respects.

(c) No Injunctions. No Governmental Authority shall have enacted, issued,
promulgated, enforced or entered any Law or Regulatory Order (whether temporary,
preliminary or permanent) that has the effect of (i) making the transactions
contemplated by this Agreement illegal or (ii) otherwise restraining or
prohibiting the consummation of the transactions contemplated hereby.

 

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(d) Due Execution and Delivery of the Related Documents. Each of the Related
Documents to be executed by Purchaser (or its designee) at the Closing shall
have been properly executed and delivered.

(e) Officer’s Certificate. Purchaser shall have delivered to Seller a
certificate, signed by a duly authorized officer of Purchaser, certifying that
the conditions set forth in Section 8.1(a) and Section 8.1(b) have been
fulfilled with respect to Purchaser.

(f) Consents of Governmental Authorities. The consents set forth on
Section 8.1(f) of the Seller Disclosure Letter shall have been obtained and no
other U.S. Governmental Authority with regulatory authority over the parties
shall have objected to the transactions contemplated hereby.

Section 8.2. Conditions Precedent to Closing Obligation of Purchaser. The
obligation of Purchaser to consummate the transactions contemplated by this
Agreement at the Closing is subject to the satisfaction at or prior to the
Closing of each of the following conditions (unless satisfaction of any such
condition is expressly waived in a writing, in whole or in part, delivered by
Purchaser to Seller):

(a) Accuracy of Representations and Warranties. Each of the representations and
warranties of the Seller Parties in Section 5.1 (Organization), Section 5.2
(Authority), Section 5.3 (Title to Transferred Assets), Section 5.20 (DMM
Securities), Section 5.21 (Solvency), or Section 5.22 (No Brokers) (each, a
“Fundamental Representation,” which for purposes of this paragraph shall be read
as though none of them contained any materiality, Material Adverse Effect or
similar qualifications) shall be true and correct in all respects and any other
representations and warranties of the Seller Parties contained in this Agreement
(which for purposes of this paragraph shall be read as though none of them
contained any materiality, Material Adverse Effect or similar qualifications)
shall be true and correct in all respects except for breaches of representations
and warranties that would not be reasonably expected, individually or in the
aggregate, to have a Material Adverse Effect, in each case when made and at and
as of the Closing, with the same force and effect as if made as of the Closing,
other than such representations and warranties as are made as of another date,
which shall be true and correct for purposes hereof as of such date.

(b) Compliance with Covenants. The Seller Parties shall have performed and
complied with, in all material respects, all agreements, covenants and
obligations required by this Agreement to be performed or complied with by it
prior to or at the Closing.

(c) No Injunctions. No Governmental Authority shall have enacted, issued,
promulgated, enforced or entered any Law or Regulatory Order (whether temporary,
preliminary or permanent) that has the effect of (i) making the transactions

 

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contemplated by this Agreement illegal, (ii) otherwise restraining or
prohibiting the consummation of the transactions contemplated hereby, or
(iii) modifying or amending the rules relating to DMMs in a way that would have,
or would be reasonably likely to have, a Material Adverse Effect.

(d) Due Execution and Delivery of the Related Documents. Each of the Related
Documents to be executed by Seller, Seller Parent and/or any of their Affiliates
at the Closing shall have been properly executed and delivered to Purchaser.

(e) Registration; Permits. Purchaser shall have received (subject to
Section 8.2(h)) such evidence to its satisfaction that the reallocation of the
DMM Securities from Seller to Purchaser has been approved by the NYSE and that
it has been authorized by the NYSE, and has all such other rights,
authorizations and approvals necessary, to trade as a DMM in the DMM Securities.

(f) DMM Employees. (i) No less than fifteen (15) of the DMM Employees shall have
satisfied the pre-employment requirements of Purchaser (including having passed
customary internal and external screening requirements of Purchaser) (the
“Qualified Employees”) and (ii) at least fifteen (15) Qualified Employees to
whom Purchaser shall have made an offer of employment (provided that Purchaser
shall use its commercially reasonable efforts to make an offer of employment to
at least fifteen (15) Qualified Employees) (A) shall have agreed to continue to
operate the Acquired Business as employees of Purchaser and (B) shall not have
been subject to “statutory disqualification” (as such term is defined in the
Exchange Act), shall not have a Basis for such “statutory disqualification” and
shall not have been subject to any other formal disciplinary action by any
Governmental Authority except a disciplinary action related to an inquiry listed
in Section 5.9 of the Seller Disclosure Letter (it being understood that to the
extent any of the Qualified Employees to whom Purchaser has made an offer of
employment (x) becomes subject to a “statutory disqualification”, (y) has a
Basis for such “statutory disqualification”, or (z) becomes subject to a formal
disciplinary action except a disciplinary action related to an inquiry listed in
Section 5.9 of the Seller Disclosure Letter, Purchaser shall be entitled to
withdraw its offer of employment to such Qualified Employee and Purchaser shall
not be deemed to have made an offer of employment to such Qualified Employee for
the purpose of this clause (ii)). Purchaser shall have been provided with
complete and accurate copies of all filings made with any Governmental Authority
for each DMM Employee, in form and substance reasonably satisfactory to
Purchaser in its sole discretion.

(g) Positions. As of the Cut-Off Time, (x) the total net absolute value of
Seller’s long and short positions in DMM Securities (including any Unsettled
Trades) shall be no greater than $10,000,000, (y) the total net absolute value
of Seller’s long positions or short positions in any individual DMM Security
(including any Unsettled Trades) shall be no greater than $2,000,000 (any
positions in excess of the amounts in clauses (x) or (y), the “Excess
Positions”), and (z) Seller shall have provided evidence thereof to Purchaser as
soon as practicable after such time in form and substance reasonably
satisfactory to Purchaser; provided that at the option of Seller, to the extent
Seller has provided written notice of exercise thereof to Purchaser and has
provided

 

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Purchaser the opportunity to waive this condition, Seller may cause this
condition to be satisfied by acquiring, or causing one of its Affiliates to
acquire, the Excess Positions, which shall then not be considered part of the
Positions.

(h) DMM Securities. All Allocations set forth on Section 5.20 of the Seller
Disclosure Letter shall be transferred as of the Closing Date by Seller to
Purchaser (and the reallocation of the right to trade in the DMM Securities to
Purchaser shall have been confirmed by the NYSE); provided, however, that the
condition set forth in this Section 8.2(h) shall be deemed satisfied if no more
than ten (10) DMM Securities included in the S&P 500 Index and no more than
thirty (30) DMM Securities in the aggregate are not transferred to Purchaser
pursuant hereto (and the reallocation thereof to Purchaser is not confirmed by
the NYSE).

(i) Officer’s Certificate. Each Seller Party shall have delivered to Purchaser a
certificate, signed by a duly authorized officer of such Seller Party,
certifying that the conditions set forth in Section 8.2(a) and Section 8.2(b)
have been fulfilled.

(j) Consents of Governmental Authorities. The consents set forth on
Section 8.2(j) of the Purchaser Disclosure Letter shall have been obtained and
no other U.S. Governmental Authority with regulatory authority over the parties
shall have objected to the transactions contemplated hereby.

ARTICLE IX

TERMINATION; FAILURE TO CLOSE

Section 9.1. Termination. This Agreement shall terminate before the Closing upon
notice of termination by any party to the other party if:

(a) the Closing has not occurred by the fourth (4th) Friday after the date
hereof, so long as the failure to close on or before such date is not caused by
any breach of this Agreement by the party electing to terminate pursuant to this
Section 9.1(a); or

(b) any condition set forth in Section 8.1 or Section 8.12, as the case may be,
to such party’s Closing obligations shall become incapable of being satisfied by
the date set forth in Section 9.1(a) and is not waived, provided that the right
to terminate this Agreement pursuant to this Section 9.1(b) shall not be
available to any party that has not used its commercially reasonable efforts to
cause such condition to be satisfied, including, in the case of Section 8.1(c)
or Section 8.2(c), as the case may be, by using its commercially reasonable
efforts to lift, overturn or otherwise repeal any Law with the effect described
in Section 8.1(c) or Section 8.2(c), as the case may be.

Section 9.2. Effect of Termination. If this Agreement is terminated by either
party in accordance with Section 9.1, then such termination shall not terminate
(i) the rights or remedies of any party with respect to any breach of any
provision of this Agreement prior to termination, including any breach of the
obligation to close, or (ii) the obligations of the parties under the
Confidentiality Agreement.

 

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ARTICLE X

EMPLOYEE BENEFITS MATTERS

Section 10.1. Employment. Purchaser shall make offers of employment to the
Employees designated by Purchaser on a schedule to be provided prior to the
Closing to Seller and Seller Parent by Purchaser, subject to each such
Employee’s satisfaction of Purchaser’s standard policy requirements and
conditions applicable to new hires. All Employees who accept such offers of
employment and become employed by Purchaser as of the Closing Date shall be
referred to as “Acquired Employees.” The parties acknowledge and agree that no
contracts of employment with Seller shall be assumed by Purchaser as a result of
the transactions contemplated by this Agreement or the hiring of the Acquired
Employees hereunder. From and after the date hereof, neither Seller nor Seller
Parent shall engage in any activity intended to discourage any Employee from
accepting an offer of employment from Purchaser. Upon the execution of this
Agreement by the parties, the Seller Parties shall provide Purchaser access to
any personnel files pertaining to the Employees to facilitate Purchaser’s
determination of which Employees to whom offers of employment shall be made
pursuant to this Section 7.5(a); provided that such personnel files shall be
provided in such a manner as to maintain confidentiality of the information
contained therein.

Section 10.2. Post-Closing Benefits.

(a) Except as otherwise provided in this Agreement, for the twelve (12) month
period following the Closing Date, Purchaser shall provide the Acquired
Employees with salary, wages and employee benefits that are no less favorable in
the aggregate than those provided to similarly situated employees of Purchaser
while such Acquired Employees remain employed by Purchaser. For the avoidance of
doubt, nothing in this provision shall entitle any Acquired Employee to any
particular bonus or other incentive payment or compensation level. Seller Parent
acknowledges and agrees that any Employee that receives an offer that is
consistent with this Section 10.2(a) shall not be eligible for or receive
severance from Purchaser or any of its Affiliates under any severance plan,
policy, arrangement or agreement of Seller, Seller Parent, Purchaser or such
Affiliates.

(b) Purchaser shall credit the Acquired Employees for their service with Seller
and its Affiliates to the same extent recognized by Seller or its Affiliates
immediately prior to the Closing Date for all purposes under the employee
benefit plans or arrangements maintained by Purchaser or any of its Affiliates
(including any welfare plan, pension plan, vacation program or severance
program) in which any such Acquired Employees participate post-Closing, except:
(1) for purposes of benefit accrual under any defined benefit retirement plan(s)
maintained by Purchaser or its Affiliates; (2) for purposes of vesting under any
tax qualified or excess or supplemental plan maintained by Purchaser or its
Affiliates; and (3) to the extent such credit would result in an unintended
duplication of benefits.

 

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Section 10.3. Welfare Plan Liability. Seller Parent shall be responsible for
providing those welfare benefits in effect for Acquired Employees as of the
Closing Date to Acquired Employees for all claims incurred and benefits earned
on or prior to the Closing Date under and subject to the generally applicable
terms and conditions of the employee benefit plans, programs and arrangements in
which such employees were entitled to participate prior to the Closing Date as
amended from time to time. Purchaser shall be responsible for providing welfare
benefits for claims incurred and benefits earned after the Closing Date under
and subject to the generally applicable terms and conditions of Purchaser’s
employee benefit plans, programs and arrangements as in effect from time to
time. For purposes of this Section 10.3, a claim shall be deemed to be incurred
on the date that the event that gives rise to such claim occurs, except that any
claim that relates to a continuous period of hospitalization shall be deemed to
be incurred at the commencement of such period of hospitalization. Without
limiting the generality of the foregoing, and for purposes of clarification, a
claim for disability benefits shall be deemed to be incurred at the time that
the event that gives rise to the disability occurs, and the responsibility for
all future disability benefits payable with respect to such disability shall be
determined based on the date on which such event occurs.

Section 10.4. Bonus. Seller shall be responsible for, pay and retain all
liability related to, all bonuses and incentive compensation due to Employees
(including all Acquired Employees), in respect of the 2009 fiscal year,
including any taxes payable by Seller thereon. Purchaser shall be responsible
for all bonuses and incentive compensation, if any, for Acquired Employees for
the 2010 fiscal year and thereafter, including any taxes payable by Purchaser
thereon.

Section 10.5. Accrued Vacation. With respect to any accrued but unused vacation
time to which any Acquired Employee is entitled under any Seller Party’s
vacation policy immediately prior to the Closing Date (the “Vacation Policy”),
Seller Parent shall be liable for and pay in cash to such Acquired Employee, on
the Closing Date an amount equal to such vacation time in accordance with the
Vacation Policy.

Section 10.6. COBRA. Seller Parent shall be responsible for all legally mandated
continuation of health care coverage for all Acquired Employees and any of their
covered dependents who experience qualifying event occurring on or prior to the
Closing Date. Purchaser shall be responsible for all legally mandated
continuation of health care coverage for all Acquired Employees and any of their
covered dependents who experience a qualifying event occurring following the
Closing Date.

Section 10.7. Qualified Plans. Seller or Seller Parent, as applicable, shall
vest each Retained Employee in his or her account under the LaBranche & Co Inc.
Retirement Plan (nonstandardized 401(k) plan) effective as of the Closing Date,
and distribute such amounts to the Acquired Employees in accordance with the
forms of such 401(k) plan. After the Closing Date, all Acquired Employees shall
be eligible to participate in any Section 401(k) plan maintained by Purchaser
and Purchaser shall take any and all necesssary action to cause the trustee of
such plan to accept direct rollover contributions (within the meaning of
Section 401(a)(31) of the Code) in respect of any Acquired Employee, subject to
receipt by the plan recordkeeper of any applicable records

 

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or documentation regarding the LaBranche & Co. Inc. Retirement Plan
(nonstandardized 401(k) plan), reasonable requested bysuch plan recordkeeper.
For the avoidance of doubt, Purchaser’s obligations under this Section 10.7
excludes assumption of loans and promissory notes under the LaBranche & Co Inc.
Retirement Plan.

Section 10.8. WARN Obligations. Purchaser agrees to provide any required notice
under and to comply otherwise with any requirements or obligations imposed by
the Worker Adjustment and Retraining Notification Act (“WARN Act”), or any
similar statute, with respect to any event affecting Acquired Employees
occurring after the Closing Date.

Section 10.9. No Amendment or Modification. Nothing herein shall be construed as
the creation, amendment or modification of any employee benefit plan, program,
arrangement or agreement of Seller or Seller Parent or prevent the creation,
amendment or termination of any such plan, program, arrangement or agreement.
Nothing in this Article X shall limit the right of Purchaser or any of its
Affiliates to terminate the employment of any Acquired Employee at any time from
and after the Closing.

ARTICLE XI

TAX MATTERS

Section 11.1. Tax Indemnification. Seller and Seller Parent shall be responsible
for and shall pay, and shall jointly and severally indemnify and save Purchaser
harmless from, any and all Taxes levied or imposed on Seller in respect of the
Transferred Assets (A) that are allocated to Seller pursuant to this Article XI
or (B) which arise from or relate to the breach or inaccuracy of any
representation or warranty contained in Section 5.17 (Taxes). Purchaser shall be
responsible for and shall pay, and shall indemnify and save Seller and Seller
Parent harmless from, any and all Taxes that are allocated to Purchaser pursuant
to this Article XI.

Section 11.2. Liability for Taxes. Notwithstanding anything in this Agreement to
the contrary, Seller shall be liable for and shall pay, all Taxes (whether
assessed or unassessed) (i) applicable to the Transferred Assets or the Acquired
Business, to the extent attributable to taxable years or periods (or portions
thereof) ending on or prior to the Closing Date or (ii) imposed on Seller, or
for which Seller may otherwise be liable, attributable to any taxable years or
periods (including, without limitation, any Taxes resulting from the sale or
transfer of the Transferred Assets pursuant to this Agreement but excluding
Taxes for which Purchaser is liable under this Section 11.2) thereafter, and
Purchaser shall be liable for and shall pay all Taxes (whether assessed or
unassessed) attributable to the Transferred Assets or the Acquired Business, to
the extent attributable to taxable years or periods (or portions thereof)
beginning after the Closing Date.

Section 11.3. Tax Returns and Tax Payments. Seller shall be responsible for the
timely filing (taking into account any extensions received from the relevant tax

 

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authorities) of all Tax Returns required by law to be filed in respect of the
Transferred Assets (or the Acquired Business) on or prior to the Closing Date.
All Taxes indicated as due and payable on such returns shall be paid or will be
paid by Seller as and when required by law, and Purchaser shall reimburse Seller
for any portion of such Taxes for which Purchaser is responsible under this
Article XI. Purchaser shall be responsible for the timely filing (taking into
account any extensions received from the relevant tax authorities) of all Tax
Returns required by law to be filed in respect of the Transferred Assets or the
Acquired Business after the Closing Date.

Section 11.4. Apportionment of Taxes. The parties hereto agree that all personal
property Taxes and similar ad valorem obligations that are levied with respect
to the Transferred Assets or the Acquired Business for assessment periods within
which the Closing Date occurs (collectively, the “Apportioned Obligations”)
shall be apportioned between Seller and Purchaser as of the Closing Date based
on the number of days in any such period falling on or before the Closing Date,
on the one hand, and after the Closing Date, on the other hand (it being
understood that Purchaser is responsible for the portion of each such
Apportioned Obligation attributable to the number of days after the Closing Date
in the relevant assessment period). Purchaser shall cooperate in assuring that
Apportioned Obligations the payment of which is due on or prior to the Closing
Date are billed directly to and paid by Seller, and that Apportioned Obligations
whose payment is due after the Closing Date shall be billed directly to and paid
by Purchaser. On the Closing Date, Seller shall deliver to Purchaser any bill
received by it in respect of any Apportioned Obligations not yet due and payable
together with payment in an amount equal to Seller’s pro rata share of such
bill. Seller and Purchaser shall each present or cause to be presented a
statement to the other setting forth the amount of reimbursement to which each
is entitled under this Article XI as of the most recent practicable date
(together with such supporting evidence as may be reasonably requested), and
they shall calculate the amount by which such reimbursement owed to one party
exceeds that owed to the other (the “Proration Amount”), and on such date the
Proration Amount so determined shall be paid by the party owing it to the other.
Thereafter, Seller shall notify Purchaser upon receipt of any bill for
Apportioned Obligations, part or all of which are attributable to any period
following the Closing Date, and shall promptly deliver such bill to Purchaser
who shall pay the same to the appropriate taxing authority or other obligee,
provided that if such bill covers any Apportioned Obligations for any period on
or before the Closing Date, Seller shall also remit to Purchaser, prior to the
due date of such bill, payment of the proportionate amount of such bill that is
attributable to such period on or before the Closing Date. In the event that any
party shall thereafter make a payment for which it is entitled to reimbursement
under this Article XI, the party so obligated to make such reimbursement under
this Article XI shall make such reimbursement promptly upon the presentation of
such supporting evidence as may be reasonably requested. The parties hereto
shall cooperate, including, without limitation, during times of audit by taxing
authorities, to avoid payment of duplicate or inappropriate Taxes or other ad
valorem obligations of any kind or description which relate to the Transferred
Assets or the Acquired Business, and each of Purchaser and Purchaser shall
furnish, at the request of the other, proof of payment of any such Taxes or ad
valorem obligations or other documentation that is a prerequisite to avoiding
payment of a duplicate or inappropriate tax or other ad valorem obligations. In
the event that it is determined subsequent to the

 

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Closing Date that additional personal property Taxes or similar ad valorem
obligations which are Apportioned Obligations are required to be paid for the
assessment period in which the Closing Date falls, the parties hereto agree that
such additional Taxes will be apportioned between Seller and Purchaser on the
basis of each respective ownership of the taxed asset during the assessment
period.

Section 11.5. Transfer Tax. Seller shall pay directly, or reimburse Purchaser
promptly upon demand and delivery of proof of payment for, all excise, sales,
transfer, real estate transfer, documentary, filing, recordation, conveyance,
recording and other similar taxes, levies, fees and charges (collectively,
“Transfer Taxes“), that may be imposed upon, or be payable or collectible or
incurred in connection with, this Agreement and the transactions contemplated
hereby. Seller shall be responsible for preparing and timely filing any Tax
Returns required with respect to any such Transfer Taxes.

Section 11.6. Other Taxes. Except as otherwise provided in this Agreement, as
among the parties hereto, (i) Seller shall be responsible for and pay all Taxes
levied or imposed upon, or in connection with, the Transferred Assets (or the
conduct or operation of the Acquired Business) on or before the Closing Date;
(ii) Purchaser shall be responsible for and pay all taxes levied or imposed
upon, or in connection with, the Transferred Assets (or the conduct or operation
of the Acquired Business) after the Closing Date; and (iii) Seller and Purchaser
will each be responsible for its own income and franchise Taxes, if any, arising
from the transactions contemplated by this Agreement.

Section 11.7. Survival. All obligations under this Article XI and the
representations and warranties contained in Section 5.17 (Taxes) shall survive
the Closing hereunder and continue until sixty (60) days following the
expiration of the statute of limitations on assessment of the relevant Tax.
Notwithstanding the foregoing, any claim for indemnification shall survive such
termination date if any party, on or prior to such termination date, shall have
advised the other party in writing of facts that constitute or may give rise to
a claim for indemnification under this Article XI, specifying in reasonable
detail the basis under this Agreement for such claim.

Section 11.8. Tax Effect of Indemnification Payments. All indemnification
payments made pursuant to Article XI and Article XII below shall be treated for
all Tax purposes as adjustments to the Purchase Price.

Section 11.9. Exclusivity. The indemnification provided for in this Article XI
shall be the sole remedy for any claim in respect of Taxes, including any claim
arising out of or relating to a breach or inaccuracy of any representation or
warranty contained in Section 5.17 (Taxes). In the event of a conflict between
the provisions of this Article XI, on the one hand, and the provisions of
Article XII, on the other, the provisions of this Article XI shall control.
Without limiting the generality of the foregoing, neither the Sub-Basket nor the
Basket shall apply to any claim in respect of Taxes.

 

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ARTICLE XII

INDEMNIFICATION

Section 12.1. Indemnification by Seller Parties. From and after the Closing, but
subject to the conditions and limitations set forth in this Agreement, Seller
and Seller Parent shall jointly and severally indemnify and hold Purchaser, its
Affiliates and their respective directors, managers, officers, employees and
agents (collectively, the “Purchaser Indemnified Persons”) harmless from and
against any and all Losses incurred or required to be paid by any Purchaser
Indemnified Person to the extent arising out of, relating to or caused by
(i) the breach of any representation or warranty of a Seller Party contained in
this Agreement; (ii) the breach of any covenant or agreement of a Seller Party
contained in this Agreement; (iii) the Excluded Liabilities (including, without
limitation, any Pre-Acquisition Action Liabilities or Permitted Liens); or
(iv) the ownership of the Transferred Assets or the operation by Seller of the
Business as of or prior to the Closing; provided that the Seller and Seller
Parent shall have no obligation to indemnify or hold harmless any Purchaser
Indemnified Person from and against (A) any individual Loss or series of related
Losses (arising from the same event or circumstance) pursuant to Section 12.1(i)
(other than with respect to breaches of any of the Fundamental Representations)
that is less than twenty thousand dollars ($20,000.00) (calculated in the
aggregate for a series of related Losses) (the “Sub-Basket”) and (B) any
individual Loss or series of related Losses (arising from the same event or
circumstance) pursuant to Section 12.1(i) (other than with respect to breaches
of any of the Fundamental Representations) where the Loss relating thereto is
equal to or greater than the Sub-Basket, unless the aggregate amount of all such
Losses exceeds $350,000.00 (the “Basket”). In no event shall the aggregate
indemnification paid by Seller and Seller Parent pursuant to Section 12.1(i) and
Section 12.1(ii) (other than with respect to a breach of any covenant to
indemnify for amounts in excess of the Cap under this Section 12.1) exceed the
Purchase Price (the “Cap”).

Section 12.2. Indemnification by Purchaser. From and after the Closing, but
subject to the conditions and limitations set forth in this Agreement, Purchaser
shall indemnify and hold Seller, its Affiliates and their respective directors,
managers, officers, employees and agents (collectively, the “Seller Indemnified
Persons”) harmless from and against any and all Losses incurred or required to
be paid by any Seller Indemnified Person to the extent arising out of, relating
to or caused by (i) the breach of any representation or warranty of Purchaser
contained in this Agreement, (ii) the breach of any covenant or agreement of
Purchaser contained in this Agreement, (iii) any Assumed Liability and (iv) the
ownership of the Transferred Assets from and after the Closing Date or the
operation of Purchaser’s business with respect thereto after the Closing Date;
provided that Purchaser shall have no obligation to indemnify or hold harmless
any Seller Indemnified Persons from and against (a) any individual Loss or
series of related Losses pursuant to Section 12.2(i) (other than with respect to
breaches of representations and warranties set forth in Sections 6.1, 6.2 and
6.6) (arising from the same event or circumstance) that is less than the
Sub-Basket and (b) any individual Loss or series of related Losses pursuant to
Section 12.2(i) (other than with respect to breaches of representations and
warranties set forth in Sections 6.1, 6.2 and 6.6) (arising from the

 

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same event or circumstance) where the Loss relating thereto is equal to or
greater than the Sub-Basket, unless the aggregate amount of all such Losses
exceeds the Basket. In no event shall the aggregate indemnification paid by
Purchaser pursuant to Section 12.2(i) and Section 12.2(ii) (other than with
respect to a breach of any covenant to indemnify for amounts in excess of the
Cap under this Section 12.2) exceed the Cap.

Section 12.3. Procedures.

(a) A party claiming indemnification hereunder (an “Indemnified Party”) shall
promptly give the party from whom indemnification is sought (an “Indemnifying
Party”) written notice of any matter which an Indemnified Party has determined
has given or could give rise to a right of indemnification under this Agreement,
stating in reasonable detail to the extent known, (i) the basis for any such
claim for indemnification, (ii) the amount of the Loss and the method of
computation thereof, (iii) and containing a reference to the provisions of this
Agreement in respect of which such right of indemnification is claimed or
arises; provided that the failure to provide such notice shall not release the
Indemnifying Party from any of its obligations under this Article XII except to
the extent that such failure actually materially prejudices the Indemnifying
Party.

(b) If an Indemnified Party shall receive notice of any claim of a third party
that would give rise to a right of indemnification hereunder (a “Third Party
Claim”), then the Indemnified Party shall give the Indemnifying Party written
notice of such Third Party Claim (stating in reasonable detail the basis for
claiming such right of indemnification); provided that the failure to provide
such notice shall not release the Indemnifying Party from any of its obligations
under this Article XII except to the extent that such failure actually
materially prejudices the Indemnifying Party. In the event of a Third Party
Claim, the Indemnifying Party may elect to assume the defense of such Third
Party Claim and elect to retain counsel of its choice, reasonably acceptable to
the relevant Indemnified Parties, to represent such Indemnified Parties in
connection with such Proceeding and shall pay the fees, charges and
disbursements of such counsel and other defense costs. The Indemnified Parties
may participate, at their own expense and through legal counsel of their choice,
in any such Proceeding; provided that (i) the Indemnifying Party shall have the
right to defend such Third Party Claim by all appropriate proceedings and, so
long as it diligently pursues such defense, shall have full control of such
defense and such proceedings, and (ii) the Indemnified Parties and their counsel
shall cooperate with the Indemnifying Party and its counsel in connection with
such Proceeding. The Indemnifying Party shall not settle any such Proceeding
without the relevant Indemnified Parties’ prior written consent (which shall not
be unreasonably withheld or delayed), unless the terms of such settlement
contain a complete and unconditional release of the Indemnified Party of any
Liability.

(c) Notwithstanding the foregoing, if (i) the Indemnifying Party elects not to
assume control of such defense, (ii) both the Indemnifying Party and any
Indemnified Party are parties to or subjects of such claim and conflicts of
interests exist between the Indemnifying Party and such Indemnified Party, or
(iii) the claim is reasonably likely to establish a precedential custom or
practice that is detrimental to the

 

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continuing business interests of the Indemnified Party, then the Indemnified
Parties may retain counsel reasonably acceptable to the Indemnifying Party in
connection with such claim and assume control of the defense in connection with
such claim, and the fees, charges and disbursements of no more than one such
counsel per jurisdiction selected by the Indemnified Parties shall be reimbursed
by the Indemnifying Party. Under no circumstances will the Indemnifying Party
have any Liability in connection with any settlement of any Proceeding that is
entered into without its prior written consent (which shall not be unreasonably
withheld or delayed). Notwithstanding any other provisions of this Article XII
and regardless of whether it is an Indemnified Party or Indemnifying Party,
Purchaser shall have the right to assume the full control of defense against any
claim giving rise to a right of indemnification under this Agreement that
relates to any Losses relating to or arising from the period subsequent to the
date hereof (a “Post-Signing Claim”) and may elect to retain counsel of its
choice reasonably acceptable to the Seller Parties, so long as Purchaser
diligently pursues such defense. The fees, charges and disbursements of no more
than one such counsel per jurisdiction selected by Purchaser with respect to any
such Post-Signing Claim shall be reimbursed by the Indemnifying Party.

(d) If there is a litigation or proceeding at any time that concerns the
Acquired Business or Transferred Assets before the Closing Date and a notice of
claim in accordance with Section 12.3(a) or Section 12.3(b), as the case may be,
is not submitted with respect to such litigation or proceeding, then, at the
reasonable request of Purchaser, the Seller Parties shall make the employees of
the Seller Parties and their Subsidiaries available to cooperate with Purchaser
and its Affiliates (including by making such employees available to provide
information, discovery and testimony), to the extent reasonable and without
interrupting the business or operations of the party receiving such request and
of its Subsidiaries, in each case solely for purposes of permitting the
preparation for, defense of and participation in such litigation or proceeding
by any of the requesting party, its Affiliates or their respective agents,
directors, officers and employees; provided that the requesting party shall
reimburse all reasonable out-of-pocket expenses incurred by the party receiving
such request, its Affiliates and their respective agents, directors, officers
and employees in complying with this undertaking and, since such payments, if
any, will not be made pursuant to an indemnity claim, such payments shall not be
taken into account for purposes of the limitations set forth in Section 12.1 or
Section 12.2.

(e) Survival of Representations and Warranties. Except as otherwise provided in
this Agreement, the representations and warranties of the Seller Parties and
Purchaser contained in this Agreement (and the rights to indemnification in
respect thereof) shall terminate on the date that is eighteen (18) months
following the Closing Date; provided that (x) the Fundamental Representations
shall survive indefinitely; and (y) if a claim for indemnification hereunder
arises, and the Indemnified Party notifies in writing the Indemnifying Party
with respect thereto, on or prior to the expiration of such period, the
Indemnified Party’s right to indemnification hereunder shall continue until the
claim is finally resolved and any related Losses are paid.

 

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Section 12.4. Exclusive Remedy. The provisions of this Article XII are intended
to be the exclusive monetary remedy between the parties following the Closing
for the matters covered by this Agreement (including any Liabilities arising
prior to the Closing, but excluding any claim in respect of Taxes, which shall
be governed exclusively by Article XI), and no party shall seek recovery from
the other party with respect to such matters under theories of strict liability,
negligence or other theory of recovery, whether under contract or tort or at Law
or in equity.

Section 12.5. Limitations.

(a) Notwithstanding anything to the contrary contained herein, none of the
parties shall have any Liability under any provision of this Agreement for any
punitive, incidental, consequential, special or indirect damages, or loss of
value except to the extent that (i) any such damages are awarded to a third
party in connection with a Third Party Claim against an Indemnified Party and
(ii) such Indemnified Party is entitled to be indemnified hereunder as a result
of the facts or circumstances giving rise to such Third Party Claim.

(b) The amount of any Losses for which indemnification is provided under this
Article XII shall be net of any amounts actually recovered through insurance or
otherwise with respect to such Losses (net of any Tax or expenses incurred in
connection with such recovery).

Section 12.6. Mitigation. Each of the parties hereto agrees to take all
commercially reasonable steps to mitigate their respective Losses upon and after
becoming aware of any event or condition that would, individually or in the
aggregate, reasonably be expected to give rise to any Losses that are
indemnifiable hereunder.

ARTICLE XIII

GENERAL PROVISIONS

Section 13.1. Notices. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given (and shall be
deemed to have been duly given upon receipt) by delivery in person, by overnight
courier or by facsimile (with confirmation copies delivered personally or by
courier on or before the third Business Day after such facsimile delivery) to
the respective parties at the following addresses (or at such other address for
a party as shall be specified by like notice):

(a) If to Purchaser or, after the completion of the Closing, Seller, to:

 

If to Purchaser:   

Barclays Capital Inc.

745 Seventh Avenue

New York, NY 10019

Attention: Richard D. Smith

Facsimile: 212-412-7300

  

 

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And to:   

Barclays Group

1 Churchill Place

Canary Wharf

London E14 5HP, England

Attention: Company Secretary

Facsimile: 011-44-1452-628-157

   With a copy to:   

Cleary Gottlieb Steen & Hamilton LLP

One Liberty Plaza

New York, NY 10006

Attention: Duane McLaughlin, Esq.

Facsimile: 212-225-3999

   If to Seller:   

LaBranche & Co. LLC

33 Whitehall Street

New York, NY 10004

Attention: Michael LaBranche

Facsimile: 212-785-0396

   With a copy to:   

LaBranche & Co. LLC

33 Whitehall Street

New York, NY 10004

Attention: Stephen H. Gray, General

Counsel and Corporate Secretary

Facsimile: 212-952-9280

 

Weil, Gotshal & Manges LLP

767 Fifth Avenue

New York, NY 10153

Attention: Michael J. Aiello, Esq.

Facsimile: 212-310-8007

   If to Seller Parent:   

LaBranche & Co Inc.

33 Whitehall Street

New York, NY 10004

Attention: Michael LaBranche

Facsimile: 212-785-0396

   With a copy to:   

LaBranche & Co. LLC

33 Whitehall Street

New York, NY 10004

Attention: Stephen H. Gray, General

Counsel and Corporate Secretary

Facsimile: 212-952-9280

 

Weil, Gotshal & Manges LLP

767 Fifth Avenue

New York, NY 10153

Attention: Michael J. Aiello, Esq.

Facsimile: 212-310-8007

  

 

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Copies to be sent as indicated above shall be courtesy copies and failure to
deliver any such courtesy copies shall not invalidate any notice properly
delivered to Purchaser, Seller or Seller as set forth above.

Section 13.2. Severability. If any term or other provision of this Agreement is
invalid, illegal or incapable of being enforced by any rule of law or public
policy, all other conditions and provisions of this Agreement shall nevertheless
remain in full force and effect so long as the economic or legal substance of
the transactions contemplated hereby is not affected in any manner materially
adverse to any of the parties. Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforced, the parties shall
negotiate in good faith to modify this Agreement so as to effect the original
intent of the parties as closely as possible in an acceptable manner to the end
that the transactions contemplated hereby are fulfilled to the fullest extent
possible.

Section 13.3. Entire Agreement; Assignment; Execution. This Agreement, together
with the Confidentiality Agreement and the Related Documents, constitutes the
entire agreement among the parties with respect to the subject matter hereof and
supersedes all prior agreements and undertakings, both written and oral, among
the parties, or any of them, with respect to the subject matter hereof. This
Agreement shall not be assigned and no obligations hereunder may be transferred
by any party, provided, however, that Purchaser may transfer any of its rights
and obligations to any Affiliate of Purchaser, but no such assignment shall
relieve Purchaser of its obligations hereunder. Any attempted assignment or
transfer which does not comply with the provisions of this Section 13.3 shall be
null and void ab initio. This Agreement shall be binding upon a party hereto
only upon the manual execution and delivery (which delivery may be by telecopy
or facsimile or electronic mail) of a signature page to a counterpart hereto.

Section 13.4. Parties in Interest. This Agreement shall be binding upon and
inure to the benefit of each party, its successors in interest and permitted
assigns, and nothing in this Agreement, express or implied, is intended to or
shall confer upon any other Person, other than the Indemnified Parties who shall
have rights to the extent provided under Article XII, any rights, benefits or
remedies of any nature whatsoever under or by reason of this Agreement.

Section 13.5. Amendment. This Agreement may not be amended or modified except by
an instrument in writing signed by Seller and Purchaser.

 

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Section 13.6. Waiver. At any time prior to the Closing Date, any party hereto
may (a) extend the time for the performance of any of the obligations or other
acts of the other parties, (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 such extension or waiver shall be valid only if set forth in an instrument
in writing signed by the Persons to be bound thereby. The failure or delay of
any party to this Agreement to assert any of its rights under this Agreement or
otherwise shall not constitute a waiver of such rights.

Section 13.7. Governing Law; Jurisdiction.

(a) This Agreement and any dispute arising out of, in connection with or
relating to this Agreement shall be governed by, and construed in accordance
with, the laws of the State of New York applicable to agreements made and to be
performed entirely within that state.

(b) Each of the parties irrevocably and unconditionally submits to the exclusive
jurisdiction of the United States District Court for the Southern District of
New York located in the borough of Manhattan in the City of New York, or if such
court does not have jurisdiction, the Supreme Court of the State of New York,
New York County, for the purposes of any suit, action or other proceeding
arising out of this Agreement or any transaction contemplated hereby. Each of
the parties further agrees that service of any process, summons, notice or
document by U.S. registered mail to such Party’s respective address set forth in
Section 13.1 shall be effective service of process for any action, suit or
proceeding in New York with respect to any matters to which it has submitted to
jurisdiction as set forth above in the immediately preceding sentence. Each of
the parties irrevocably and unconditionally waives any objection to the laying
of venue of any action, suit or proceeding arising out of this Agreement or any
transaction contemplated hereby or thereby in (a) the United States District
Court for the Southern District of New York or (b) the Supreme Court of the
State of New York, New York County, and hereby further irrevocably and
unconditionally (i) waives, and agrees not to assert, by way of motion, as a
defense, counterclaim or otherwise, in any such litigation or proceeding, any
claim that it is not personally subject to the jurisdiction of the aforesaid
courts for any reason other than the failure to serve process in accordance with
this Section 13.7, that it or its property is exempt or immune from jurisdiction
of any such court or from any legal process commenced in such courts (whether
through service of notice, attachment prior to judgment, attachment in aid of
execution of judgment, execution of judgment or otherwise), and to the fullest
extent permitted by law, that the litigation in any such court is brought in an
inconvenient forum and (ii) agrees not to commence any action, claim, cause of
action or suit, in contract, tort or otherwise arising out of this Agreement and
the transactions contemplated hereby and thereby other than in (A) the United
States District Court for the Southern District of New York or (B) the Supreme
Court of the State of New York, New York County. The parties intend that any
judgment of either such court shall be enforceable in all other jurisdictions.

(c) Each of the parties irrevocably and unconditionally waives, to the fullest
extent permitted by applicable Law, any and all rights to trial by jury in
connection with any litigation or proceeding arising out of this Agreement or
the transactions contemplated hereby.

 

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Section 13.8. Specific Performance. Each party to this Agreement shall be
entitled to compel specific performance of this Agreement and to seek other
applicable equitable relief in the event of any breach or threatened breach of
this Agreement by another Party and the parties hereby waive for such purposes
the defense of adequate remedy at law.

Section 13.9. Captions. The captions, headings and arrangements used in this
Agreement are for convenience only and do not in any way affect, limit or
amplify the terms and provisions hereof. References in this Agreement to
Articles or Sections shall mean Articles or Sections of this Agreement unless
specifically otherwise provided. Any of the terms defined in this Agreement may
be used in the singular or plural, as applicable.

Section 13.10. Counterparts. This Agreement may be executed in two or more
counterparts, and by the different parties in separate counterparts, each of
which when executed shall be deemed to be an original but all of which taken
together shall constitute one and the same agreement.

Section 13.11. Expenses. Except as otherwise expressly provided in this
Agreement, each party shall bear and pay its own costs and expenses (other than
Taxes) incurred in connection with the transactions contemplated by this
Agreement.

[SIGNATURE PAGE FOLLOWS]

 

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IN WITNESS WHEREOF, each of the parties hereto has duly executed this Agreement
effective as of the date first above written.

 

BARCLAYS CAPITAL INC. By:  

/s/ Joseph Corcoran

Name:   Joseph Corcoran Title:   Managing Director LABRANCHE & CO INC. By:  

/s/ George M.L. LaBranche, IV

Name:   George M.L. LaBranche, IV Title:   Chairman, Chief Executive Officer and
President LABRANCHE & CO. LLC By:  

/s/ Alfred O. Hayward, Jr.

Name:   Alfred O. Hayward, Jr. Title:   Chief Executive Officer

 

Signature Page to the Asset Purchase Agreement

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EXHIBIT A

TO

ASSET PURCHASE AGREEMENT

ASSIGNMENT AND ASSUMPTION AGREEMENT

THIS ASSIGNMENT AND ASSUMPTION AGREEMENT (this “Assignment and Assumption
Agreement”), dated as of                     , is being entered into between
LaBranche & Co. LLC, a limited liability company organized under the laws of the
State of New York (“Assignor”), and Barclays Capital Inc., a corporation
organized under the laws of the State of Connecticut (“Assignee”). Certain other
capitalized terms used herein without definition will have the meanings given to
them in that certain Asset Purchase Agreement dated as of January 13, 2010, by
and among Assignor, Assignee and LaBranche & Co Inc., a corporation organized
under the laws of State of Delaware (the “Purchase Agreement”).

RECITALS

WHEREAS, the Purchase Agreement provides that, in accordance with the terms and
subject to the conditions of the Purchase Agreement, Assignee will purchase from
Assignor certain assets of the designated market maker business Assignor
conducts on the New York Stock Exchange, which includes providing advisory
services to help clients understand market dynamics impacting their stocks and
offers communication programs to provide information flow to assist with
investor relations (the “Acquisition”);

WHEREAS, this Assignment and Assumption Agreement is being entered into pursuant
to the Purchase Agreement;

NOW, THEREFORE, the parties hereby agree as follows:

AGREEMENT

1. In accordance with the Purchase Agreement, (i) Assignor hereby transfers,
assigns, conveys and delivers to Assignee as of the Effective Time, and Assignee
hereby receives and accepts from Assignor, all of the right, title and interest
of Assignor in the Transferred Assets, and (ii) Assignee hereby assumes and
agrees to pay, discharge and perform the Assumed Liabilities, in accordance with
and subject to the terms of the Purchase Agreement.

2. Except as set forth in paragraph 1(i) hereof, this Assignment and Assumption
Agreement does not transfer, assign, convey or deliver to Assignee, and Assignee
does not hereby receive or accept from Assignor, any right, title or interest of
Assignor or any of its Affiliates in any other asset. Except as set forth in
paragraph 1(ii) hereof, this Assignment and Assumption Agreement does not convey
or deliver to Assignee, and Assignee does not hereby receive, accept, assume or
agree to pay, discharge or perform any other Liability of Assignor or any of its
Affiliates, whether known or unknown, absolute or contingent or otherwise, and
of any nature, kind or description whatsoever.

 

Exhibit A – Page 1

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3. This Assignment and Assumption Agreement is intended to evidence the
consummation of certain transactions contemplated by the Purchase Agreement. In
the event of any conflict or other difference between the Purchase Agreement and
this Assignment and Assumption Agreement, the provisions of the Purchase
Agreement shall control.

4. This Assignment and Assumption Agreement is made and entered into under the
Laws of the State of New York that are applicable to contracts made and to be
performed in that state, and the internal Laws of that state shall govern
validity and interpretation of this Assignment and Assumption Agreement and the
performance by the parties of their respective duties and obligations under this
Assignment and Assumption Agreement.

5. Subject to the terms of the Purchase Agreement, all terms and provisions of
this Assignment and Assumption Agreement shall be binding upon and shall inure
to the benefit of Assignor and Assignee and their respective transferees,
successors and permitted assigns. Nothing in this Assignment and Assumption
Agreement, express or implied, is intended to confer, nor shall anything herein
confer, on any Person other than the parties and their respective successors or
permitted assigns, any rights, remedies, obligations or liabilities.

6. This Assignment and Assumption Agreement may be executed in multiple
counterparts, each of which shall be deemed an original for all purposes and all
of which shall be deemed, collectively, one agreement. Any or all of such
counterparts may be delivered by facsimile or other electronic transmission.

7. This Assignment and Assumption Agreement may not be amended, modified,
altered, or supplemented except by means of a written instrument executed on
behalf of each party hereto.

[The remainder of this page is intentionally left blank.]

 

Exhibit A – Page 2

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IN WITNESS WHEREOF, Assignor and Assignee have executed this Assignment as of
the date first written above.

 

ASSIGNOR: LaBranche & Co. LLC By  

 

Name:   Title:   ASSIGNEE: Barclays Capital Inc. By  

 

Name:   Title: