Exhibit 10.1

PURCHASE AGREEMENT

BETWEEN

AON CORPORATION

AND

WARRIOR ACQUISITION CORP.

 

Dated as of June 30, 2006

 

--------------------------------------------------------------------------------

TABLE OF CONTENTS

 

 

 

Page

ARTICLE I DEFINITIONS

 

1

Section 1.1

 

Definitions

 

1

Section 1.2

 

Interpretation

 

15

 

 

 

 

 

ARTICLE II PURCHASE AND SALE

 

15

Section 2.1

 

Purchase and Sale of the Shares

 

15

 

 

 

 

 

ARTICLE III PURCHASE PRICE

 

16

Section 3.1

 

Purchase Price

 

16

 

 

 

 

 

ARTICLE IV CLOSING

 

 

 

16

Section 4.1

 

Closing Date.

 

16

Section 4.2

 

Payment on the Closing Date

 

16

Section 4.3

 

Buyer’s Additional Closing Date Deliveries

 

17

Section 4.4

 

Aon’s Closing Date Deliveries

 

17

Section 4.5

 

Determination of the Net Worth Adjustment Amount

 

18

 

 

 

 

 

ARTICLE V REPRESENTATIONS AND WARRANTIES OF AON

 

19

Section 5.1

 

Organization of the Companies.

 

19

Section 5.2

 

Capital Structure.

 

20

Section 5.3

 

Subsidiaries and Investments.

 

20

Section 5.4

 

Authority; Conflicts.

 

20

Section 5.5

 

Financial Statements.

 

22

Section 5.6

 

Operations Since Financial Statements Date

 

23

Section 5.7

 

Taxes.

 

23

Section 5.8

 

Governmental Permits.

 

23

Section 5.9

 

Real Property.

 

23

Section 5.10

 

Personal Property.

 

24

Section 5.11

 

Intellectual Property.

 

24

Section 5.12

 

Title to Property.

 

25

Section 5.13

 

No Violation, Litigation or Regulatory Action

 

25

Section 5.14

 

Contracts.

 

25

Section 5.15

 

Status of Contracts

 

26

Section 5.16

 

ERISA.

 

26

Section 5.17

 

Environmental Matters.

 

27

Section 5.18

 

Employee Relations and Agreements

 

28

Section 5.19

 

No Undisclosed Liabilities

 

29

Section 5.20

 

Sufficiency of Assets

 

29

Section 5.21

 

Insurance.

 

29

Section 5.22

 

Reserves.

 

29

Section 5.23

 

Regulatory Filings

 

30

Section 5.24

 

Ratings.

 

30

--------------------------------------------------------------------------------

 

Section 5.25

 

Reinsurance

 

30

Section 5.26

 

No Brokers

 

30

Section 5.27

 

Transaction with Affiliates

 

30

Section 5.28

 

Certain Business Practices

 

30

Section 5.29

 

Warranty Business

 

31

Section 5.30

 

Actuarial Reports

 

31

Section 5.31

 

Clients.

 

31

 

 

 

 

 

ARTICLE VI REPRESENTATIONS AND WARRANTIES OF BUYER

 

31

Section 6.1

 

Organization of Buyer

 

31

Section 6.2

 

Authority of Buyer; Conflicts

 

31

Section 6.3

 

No Violation, Litigation or Regulatory Action

 

32

Section 6.4

 

Investment Intent

 

33

Section 6.5

 

Financial Ability

 

33

Section 6.6

 

No Brokers.

 

33

 

 

 

 

 

ARTICLE VII ACTION PRIOR TO THE CLOSING DATE

 

33

Section 7.1

 

Access to Information

 

33

Section 7.2

 

Notification

 

34

Section 7.3

 

Consents of Third Parties; Governmental Approvals

 

34

Section 7.4

 

Operations Prior to the Closing Date

 

36

Section 7.5

 

Termination of Certain Intercompany Indebtedness

 

39

Section 7.6

 

Facilitating Transactions

 

39

Section 7.7

 

Transferred Business

 

40

Section 7.8

 

Exclusivity.

 

40

Section 7.9

 

Success Bonus Payments

 

40

Section 7.10

 

Financial and Statutory Statements

 

40

Section 7.11

 

P&C Business

 

41

Section 7.12

 

Actuarial Review

 

41

Section 7.13

 

Additional Capital

 

42

 

 

 

 

 

ARTICLE VIII ADDITIONAL AGREEMENTS

 

42

Section 8.1

 

Tax Matters

 

42

Section 8.2

 

Employee Matters

 

46

Section 8.3

 

Securities Law Legends

 

49

Section 8.4

 

Insurance; Risk of Loss

 

49

Section 8.5

 

Release of Guaranties

 

49

Section 8.6

 

Noncompetition and Nonsolicitation

 

50

Section 8.7

 

Use of Names

 

52

Section 8.8

 

Financial Information

 

53

Section 8.9

 

Reissuance of FFG Policies

 

54

Section 8.10

 

Certain Deposits

 

54

Section 8.11

 

Existing Client Schedule

 

54

 

 

 

 

 

ARTICLE IX CONDITIONS PRECEDENT TO OBLIGATIONS OF BUYER

 

54

Section 9.1

 

No Misrepresentation or Breach of Covenants and Warranties

 

54

Section 9.2

 

HSR Act and EU Merger Control.

 

55

--------------------------------------------------------------------------------

 

Section 9.3

 

Necessary Governmental Approvals

 

55

Section 9.4

 

No Restraint

 

55

Section 9.5

 

No Governmental Proceedings

 

55

Section 9.6

 

[Intentionally Omitted.]

 

55

Section 9.7

 

FIRPTA Certificate

 

55

Section 9.8

 

Ratings

 

55

Section 9.9

 

No MAE

 

56

 

 

 

 

 

ARTICLE X CONDITIONS PRECEDENT TO OBLIGATIONS OF AON

 

56

Section 10.1

 

No Misrepresentation or Breach of Covenants and Warranties

 

56

Section 10.2

 

HSR Act and EU Merger Control

 

56

Section 10.3

 

Necessary Governmental Approvals

 

57

Section 10.4

 

No Restraint

 

57

Section 10.5

 

No Governmental Proceedings

 

57

 

 

 

 

 

ARTICLE XI INDEMNIFICATION

 

57

Section 11.1

 

Indemnification by Aon

 

57

Section 11.2

 

Indemnification by Buyer

 

59

Section 11.3

 

Notice of Claims

 

61

Section 11.4

 

Determination of Amount

 

61

Section 11.5

 

Third Person Claims

 

61

Section 11.6

 

Limitations

 

63

Section 11.7

 

No Effect of Knowledge

 

64

Section 11.8

 

Mitigation

 

64

Section 11.9

 

Facilitating Transactions

 

64

 

 

 

 

 

ARTICLE XII TERMINATION

 

 

Section 12.1

 

Termination

 

64

Section 12.2

 

Notice of Termination

 

65

Section 12.3

 

Effect of Termination

 

65

Section 12.4

 

Specific Performance

 

65

 

 

 

 

 

ARTICLE XIII GENERAL PROVISIONS

 

65

Section 13.1

 

Survival of Representations and Warranties

 

66

Section 13.2

 

No Public Announcement

 

66

Section 13.3

 

Notices

 

66

Section 13.4

 

Successors and Assigns

 

68

Section 13.5

 

Access to Records after Closing

 

68

Section 13.6

 

Entire Agreement; Amendments

 

69

Section 13.7

 

Interpretation

 

69

Section 13.8

 

Waivers

 

69

Section 13.9

 

Expenses

 

69

Section 13.10

 

Partial Invalidity

 

70

Section 13.11

 

Execution in Counterparts

 

70

Section 13.12

 

Further Assurances

 

70

Section 13.13

 

Disclaimer of Warranties

 

70

Section 13.14

 

Governing Law; Submission to Jurisdiction

 

71

Section 13.15

 

Waiver of Jury Trial

 

71

 

 

 

 

 

Annex A Parent Entities

 

1

 

 

 

 

 

Annex B Subsidiaries

 

1

 

--------------------------------------------------------------------------------

 

[To be updated]

List of Annexes

 

Annex

 

 

 

Annex A

Parent Entities

Annex B

Subsidiaries

 

 

List of Exhibits

 

Exhibit

 

Exhibit A-1

Form of Transition Services Agreement (Buyer as Service Provider)

Exhibit A-2

Form of Transition Services Agreement (Seller as Service Provider)

Exhibit B

Form of FIRPTA Certificate

Exhibit C

Form of Real Estate Agreements

Exhibit D

Form of Joinder Agreement

 

 

List of Schedules

 

 

Schedule

 

 

 

1.1(A)

Agreed Accounting Principles

1.1(C)

Designated AWG Employees

1.1(D)

Excluded Subsidiaries and Excluded Liabilities

1.1(E)

Facilitating Transactions

1.1(F)

P&C Business

1.1(G)

Permitted Encumbrances

5.1

Organization of the Companies

5.4

Conflicts

5.5(a)

Financial Statements

5.5(b)

Statutory Statements

5.6

Operations Since Financial Statements Date

5.7

Taxes

5.8

Governmental Permits

5.9

Real Property

5.10

Personal Property

5.11(a)

List of Intellectual Property

5.11(b)

Software

5.11(c)

Right, Title and Interest in Copyrights, Patent Rights and Trademarks

5.11(d)

Registrations of Copyrights, Patent Rights, Trademarks and Software

5.11(e)

Infringement of Copyrights, Patent Rights and Trademarks

5.11(f)

Challenge to Copyrights, Patent Rights and Trademarks

 

--------------------------------------------------------------------------------

 

5.13

Violation, Litigation or Regulatory Action of Companies

5.14

Contracts

5.15

Status of Contracts

5.16(a)

Welfare Plans and Pension Plans

5.16(b)

Other Material Employee Benefits

5.16(c)

Material International Employee Benefit Plans

5.17

Environmental Matters

5.18

Employee Relations and Agreements

5.19

No Undisclosed Liabilities

5.20

Sufficiency of Assets

5.21

Insurance

5.22

Reserves

5.23

Regulatory Filings

5.24

Ratings

5.25

Reinsurance

5.27

Transactions with Affiliates

5.31

Clients

6.2

Conflicts

6.3

Violation, Litigation or Regulatory Action of Buyer

7.4

Operations Prior to Closing Date

7.10(b)(i)

Sample Income Statement

7.10(b)(ii)

Sample Balance Sheet

8.2(c)

Company Plans

8.2(e)

Individual Employment Contracts

8.10

Certain Deposits

8.11

Existing Clients

9.3

Necessary Governmental Approvals

10.3

Necessary Governmental Approvals

 

 

--------------------------------------------------------------------------------

 

PURCHASE AGREEMENT

PURCHASE AGREEMENT (the “Agreement”), dated as of June 30, 2006, by and between
Aon Corporation, a Delaware corporation (“Aon”), and Warrior Acquisition Corp.,
a Delaware corporation (“Buyer”).

PRELIMINARY STATEMENT:

WHEREAS, Aon is the direct or indirect owner of 100% of the issued and
outstanding capital stock or similar equity interests of each of those entities
set forth in Annex A (except as otherwise set forth therein) (collectively, the
“Parent Entities”);

WHEREAS, the Parent Entities are the owners, directly or indirectly, of 100% of
the issued and outstanding capital stock or similar equity interests of each of
those entities set forth in Annex B (except as otherwise set forth therein)
(collectively, the “Subsidiaries”);

WHEREAS, prior to the Closing, Aon shall cause each of the Facilitating
Transactions (as defined herein) to be consummated to the extent required by
Exhibit A;

WHEREAS, Aon desires to sell, and Buyer desires to purchase, all of the issued
and outstanding capital stock or similar equity interests of the Parent Entities
owned as indicated on Annex A (the “Shares”); and

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

ARTICLE I

DEFINITIONS

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

“Accounting Firm” has the meaning specified in Section 4.5(a).

“Acquired Business” has the meaning specified in Section 8.6.

“Actuary” has the meaning specified in Section 7.12.

“Administrative Authority” means any foreign, federal, state, local or other
governmental authority or regulatory body or stock exchange or listing
authority, including any applicable department of insurance.

“Affiliate” means, with respect to any Person, any other Person which, at the
time of determination, directly or indirectly through one or more intermediaries
Controls, is Controlled by or is under Common Control with such Person.

1

--------------------------------------------------------------------------------

 

“After-Tax Basis” means that, in determining the amount of the payment necessary
to indemnify any party against, or reimburse any party for, Losses, the amount
of such Losses shall be determined net of any Tax benefit derived by the
Indemnified Party (or any Affiliate thereof) as the result of sustaining or
paying such Losses (including as the result of facts or circumstances due to
which the Indemnified Party sustained or paid such Losses) and shall be
increased by the Tax detriment to the Indemnified Party (or any Affiliate
thereof) resulting from the receipt of such payment. Such Tax benefits and
detriments shall be computed assuming that the Indemnified Party (or such
affiliate) is subject to taxation at an invariant income tax rate equal to an
appropriate marginal tax rate for the respective legal entity, and that: 
(i) with respect to Losses that are fully deductible, such Tax benefits are
fully utilized in the taxable period during which such Losses are sustained or
paid; (ii) with respect to Losses that result in additions to Tax basis which
basis is recoverable through deductions over time, such Tax benefits are
realized as cost recovery deductions may be claimed by the Indemnified Party (or
its relevant Affiliate) and have a value equal to the present value of such
deductions, as of the date the Losses are incurred, calculated using the actual
relevant recovery period and a discount rate equal to the applicable federal
rate (as such term is defined in Section 1274(d) of the Code) that would apply
to a debt instrument with a term to maturity equal to the relevant recovery
period; and (iii) with respect to any Losses that result in additions to Tax
basis which basis is not recoverable through deductions over time, any such Tax
benefit is equal to an appropriate percentage of the Tax benefit that would have
been realized had the Losses been fully deductible in the year in which they
were incurred based on the assumed rate specified above and reasonable
assumptions as to when such benefit will be ultimately realized.

“Agreed Accounting Principles” means the accounting principles, practices and
methodologies applied in the preparation of the Balance Sheet, as modified by
the adjustments of the type set forth in the balance sheet attached hereto as
Schedule 1.1(A); provided, however, that the parties acknowledge and agree that
Closing Date Net Worth shall (i) be calculated using currency exchange rates in
effect on the date of this Agreement, (ii) not include or reflect any matter for
which Aon is obligated to indemnify the Buyer Group Members under this Agreement
(including the reinsured balances relating to the P&C Business and/or the LGI
Excluded Business), regardless of whether such matter would be required to be
included or reflected by GAAP and (iii) be calculated using the Market Value of
the Investment Assets (excluding the Other Assets which shall be calculated at
book value).

“Aon” has the meaning set forth in the first paragraph of this Agreement.

“Aon UK” means Aon Warranty Group Europe Limited, a corporation organized under
the laws of the United Kingdom.

“ASC” means Aon Service Corporation, an Illinois corporation.

“Audited Financial Statements” has the meaning specified in Section 5.5(a).

“Balance Sheet” has the meaning specified in Section 5.5(a).

“Base Purchase Price” has the meaning set forth in Section 3.1.

“Business Agreements” has the meaning specified in Section 5.15.

2

--------------------------------------------------------------------------------

 

“Business Day” means any day that is not a Saturday, a Sunday or other day on
which commercial banks in the State of Illinois or the State of New York are
required or authorized to be closed.

“Buyer” has the meaning specified in the first paragraph of this Agreement.

“Buyer Ancillary Agreements” means all agreements, instruments and documents
being or to be executed and delivered by Buyer or an Affiliate of Buyer
(including the Companies on or after the Closing Date) under this Agreement or
in connection herewith, including the Transition Services Agreement (Seller as
Service Provider) and the Transition Services Agreement (Buyer as Service
Provider).

“Buyer Consideration Period” has the meaning specified in Section 8.6(e).

“Buyer Group Member” means (i) Buyer and its Affiliates, (ii) their respective
directors, officers and employees, and (iii) the successors and assigns of the
foregoing.

“Buyer Plans” has the meaning specified in Section 8.2(h).

“Buyer’s Accountant” has the meaning specified in Section 4.5(a).

“Change of Control” means a transaction pursuant to which Control of Aon
(including by ownership of more than 50% of the voting equity securities of Aon)
or ownership of more than 50% of the consolidated assets of Aon is acquired,
directly or indirectly, by a Person not already an Affiliate of Aon as of the
Closing Date through (x) a tender or exchange offer, merger, consolidation,
share exchange or other business combination, (y) a sale of securities,
recapitalization, liquidation or dissolution or (z) a sale of assets.

“Charter” means, with respect to a corporation, the Articles or Certificate of
Incorporation of such corporation.

“CICA Warranty Business” means the underwriting by Combined and its Affiliates
of credit life and credit accident and health insurance policies in respect of
the Warranty Business.

“CLAC” means Combined Life Assurance Company Limited, an insurance company
organized under the laws of the United Kingdom.

“Claim Notice” has the meaning specified in Section 11.3.

“Client Agreement” means, with respect to the provision of Warranty TPA Services
by Aon or any of its Affiliates (other than the Companies), (a) an executed
written definitive agreement relating to the provision of such services, (b) a
series of invoices describing such services together with evidence of payment
for such services by the client, or (c) other written documentation clearly
demonstrating the provision of such services by Aon or any of its Affiliates,
the payment received thereof, and in all cases indicating the geography and
program provided.

3

--------------------------------------------------------------------------------

 

“Closing” means the closing of the transfer of the Shares from Aon to Buyer in
exchange for the Preliminary Purchase Price.

“Closing Date” has the meaning specified in Section 4.1.

“Closing Date Net Worth” means Net Worth, as of the close of business on the day
before the Closing Date, after giving effect to (i) the Facilitating
Transactions, including any adjustments of the type set forth in the balance
sheet attached hereto as Schedule 1.1(A) and (ii) the transactions contemplated
by Section 7.5. For the avoidance of doubt, as of December 31, 2005, the Net
Worth for the Warranty Business (after giving effect to the adjustments set
forth in Schedule 1.1(A)) was $420,011,470.

“COBRA” has the meaning specified in Section 8.2(l).

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

“Combined” means Combined Insurance Company of America, an Illinois corporation.

“Companies” means, collectively, the Parent Entities and the Subsidiaries;
provided, however, for the purpose of Article V and Article VII of this
Agreement (other than Sections 5.2, 5.3 and 7.5, unless specifically referenced
therein), the Companies shall include FFG and Combined only with respect to the
Transferred Business, until such Transferred Business is transferred as part of
the Facilitating Transactions.

“Company Intellectual Property” means all Copyrights, Patent Rights, Trademarks,
trade names, service marks, domain names, Trade Secrets, Software, and other
intellectual property rights and all applications therefor owned or licensed by
any of the Companies.

“Company Plan” has the meaning specified in Section 5.16(a).

“Confidentiality Agreement” means the letter agreement dated December 12, 2005
between an Affiliate of Buyer and Aon.

“Contaminant” means any waste, contaminant, pollutant, or hazardous or toxic
substance or waste, as such terms are defined in Environmental Laws and
includes, for purposes of this Agreement, any petroleum or petroleum wastes.

“Control” means, as to any Person, the ownership of more than 50% of the voting
equity securities of such Person. The terms “Controlled by” and “under Common
Control with” shall have correlative meanings.

“Copyrights” means United States and foreign registered copyrights, and pending
applications to register the same.

“Court Order” means any judgment, order, award or decree of any foreign,
federal, state, local or other court or tribunal and any award in any
arbitration proceeding.

4

--------------------------------------------------------------------------------

 

“CPI” means the Consumer Price Index for All Urban Consumers (CPI-U) for
Chicago-Gary-Kenosha as published by the United States Department of Labor’s
Bureau of Labor Statistics (or any successor Administrative Authority).

“Designated AWG Employee” means those employees specified in Schedule 1.1(C).

“Encumbrance” means any lien, adverse claim, charge, security interest,
mortgage, pledge, easement, conditional sale or other title retention agreement,
defect in title or other restrictions of a similar kind.

“Environmental Laws” means all federal, state, local and foreign statutes,
regulations, ordinances and other provisions having the force or effect of law,
in each case, concerning worker health and safety and pollution or protection of
the environment (including those relating to the presence, use, production,
generation, handling, transport, treatment, storage, disposal, distribution,
labeling, testing, processing, discharge, Release, threatened Release, control
or cleanup of any Contaminant), each as amended and in effect as of the date
hereof.

“ERISA” means the Employee Retirement Income Security Act of 1974.

“ERISA Affiliate” means any trade or business (whether or not incorporated)
which would be considered a single employer with the Company pursuant to
Section 414(b), (c), (m) or (o) of the Code and the regulations promulgated
under those Sections.

“Estimated Closing Date Net Worth” has the meaning specified in Section 4.2(b).

“Estimated Net Worth Adjustment Amount” means the Estimated Closing Date Net
Worth minus $420,011,470.

“Excluded Assets” means any and all rights, properties or assets of VSC, LGI,
LGH and CLAC of any kind, whether known or unknown, and whether absolute,
contingent, accrued or otherwise, to the extent not related to the Warranty
Business, excluding any rights, properties or assets expressly retained by Buyer
or its Affiliates (including the Companies after the Closing) pursuant to the
terms of any Facilitating Transaction Agreement (including all deposits held
with or for the benefit of any Administrative Authority, whether or not related
to the Warranty Business).

“Excluded Liabilities” means any and all liabilities or obligations of (i) VSC,
LGI, LGH and CLAC of any kind, whether known or unknown, and whether absolute,
contingent, accrued or otherwise, to the extent arising from or relating to
(A) the Excluded Assets, (B) any business, activities or actions of VSC, LGI,
LGH and CLAC at any time prior to the Closing, excluding any business,
activities or actions to the extent arising from or relating to the Warranty
Business but including the P&C Business and the LGI Excluded Business or (C) any
breach by any reinsurer with respect to policies or other risks constituting
Excluded Liabilities under clause (i)(B) above or any failure by such a
reinsurer to perform any of its covenants or obligations in any agreement or
undertaking with respect to such policies or risks,

5

--------------------------------------------------------------------------------

 

(ii) the Companies with respect to the Success Bonus Agreements, (iii) the
Excluded Subsidiaries (other than FFG with respect to the FFG Warranty
Business), and (iv) each of the matters set forth in Schedule 1.1(D)(2).
Notwithstanding the foregoing, Excluded Liabilities shall not include (x) any
liabilities or obligations that Seller or its Affiliates are expressly excused
from paying or performing pursuant to the terms of any Facilitating Transaction
Agreement, (y) any liabilities or obligations that Buyer or its Affiliates
(including the Companies after the Closing) are required to pay or perform
pursuant to the terms of any Facilitating Transaction Agreement or (z) any
liabilities or obligations to the extent caused by the breach or non-performance
of Buyer or its Affiliates (including the Companies after the Closing) under a
Facilitating Transaction Agreement.

“Excluded Subsidiaries” means the entities identified as “Excluded Subsidiaries”
in Schedule 1.1(D)(1).

“Excluded Taxes” has the meaning specified in Section 8.1(a)(i).

“Exempt Business Activities” means (i) engaging in any Warranty TPA Services for
any client which is both a Scheduled Client and an Existing Client only within
the geographic areas and for the programs within each such geographic area set
forth for such client in the Existing Client Schedule, (ii) any TPA Services to
the extent not Warranty TPA Services, (iii) debt cancellation and/or trip
cancellation products and related TPA Services, (iv) administrative and
underwriting services (other than TPA Services that are Warranty TPA Services),
(v) captive management services and (vi) administration of maintenance and
repair programs for automobile fleets owned and used by corporate clients, in
which neither Aon nor its Affiliates assumes risk. For the avoidance of doubt,
“Exempt Business Activities” includes any insurance or reinsurance brokerage
services (together with any related services) (in respect of the Warranty
Business or otherwise), any consulting services and any business activities
relating to supplemental accident, health and life insurance or specialty
individual accident, disability, health and life insurance products. For
purposes of this definition, the definitions of Client Agreement and Existing
Client Schedule and Section 8.11, (a) the provision of TPA Services with respect
to each of the product lines and classes of products described in each of
clauses (i), (ii), (iii), (iv), (v), (vi) and (vii) of the definition of
Warranty Business is a separate “program,” (b) with respect to clause (i) of the
definition of Warranty Business, extended warranty, mechanical repair and
service contracts are a product line and prepaid maintenance agreements are a
different product line, and (c) each of the types of products listed in clause
(i) of the definition of Warranty Business is a separate class. For the
avoidance of doubt and as an example, providing TPA Services with respect to
extended warranty, mechanical repair and service contracts for motor vehicles is
a program and providing TPA Services with respect to extended warranty,
mechanical repair and service contracts for motor homes is a different program.

“Existing Client” means a client of Aon or its Affiliates (other than the
Companies) who has a Client Agreement that is in effect on the date hereof.

“Existing Client Schedule” means a schedule listing each Existing Client and the
geographic area(s) and within each such geographic area the program(s) for which
Aon or its Affiliates (other than the Companies) is providing Warranty TPA
Services to such Existing

6

--------------------------------------------------------------------------------

 

Client under a Client Agreement with such client on the date hereof, as such
schedule may have been amended from time to time in accordance with Section 8.11
hereof.

“Expenses” means any and all reasonable out-of-pocket expenses actually incurred
in connection with defending or asserting any claim, action, suit or proceeding
incident to any matter indemnified against hereunder (including reasonable fees
and disbursements of legal counsel).

“Facilitating Transactions” means the transactions detailed in Schedule 1.1(E).

“Facilitating Transaction Agreements” means those agreements utilized in
connection with the implementation of the Facilitating Transactions, which shall
be substantially in the form specified in Schedule 1.1(E) for any agreement
attached to such schedule.

“Facilitating Transaction Taxes” means any Taxes that are imposed, at any time,
on any of Aon, Buyer or any of their Affiliates, as a result of the consummation
or implementation of the Facilitating Transactions; provided, however, that
Facilitating Transaction Taxes shall not include any Reserved Taxes or any
incremental Taxes that are imposed on any of Aon, Buyer or any of their
Affiliates at any time after the Closing Date due to the reduction, as a
consequence of and as of the date of the consummation or implementation of the
Facilitating Transactions, of (a) tax basis for any asset of Aon, Buyer or any
such Affiliate or (b) any other tax attribute of Aon, Buyer or any such
Affiliate.

“FFG” means FFG Insurance Company, a Texas insurance company.

“FFG Warranty Business” means all of the rights, properties, assets and
liabilities of FFG of any kind, whether known or unknown, and whether absolute,
contingent, accrued or otherwise, other than rights, properties, assets and
liabilities expressly retained by FFG pursuant to the Facilitating Transaction
Agreements (including all deposits held with or for the benefit of any
Administrative Authority).

“Financial Statements” has the meaning specified in Section 5.5(a).

“Financial Statements Date” means March 31, 2006.

“GAAP” means United States generally accepted accounting principles,
consistently applied.

“Governmental Permits” has the meaning specified in Section 5.8.

“Guaranties” has the meaning specified in Section 8.5.

“Healthcare Spending Account Opening Balance” has the meaning specified in
Section 8.2(k).

“Hedge Agreement” means any interest rate swap, cap, collar or similar agreement
and any agreement designed to protect a Person against foreign currency exchange
rate fluctuations.

7

--------------------------------------------------------------------------------

 

“HSR Act” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976.

“Indebtedness” means, with respect to any Person, (a) indebtedness of such
Person for borrowed money, (b) other indebtedness of such Person evidenced by
notes, bonds or debentures, (c) capitalized leases classified as indebtedness of
such Person under GAAP, (c) any obligation of such Person for the deferred
purchase price of property or services (other than trade payables and other
current liabilities), (d) all obligations of such Person pursuant to or
evidenced by Hedge Agreements, (e) all Indebtedness of another Person referred
to in clauses (a) through (d) above guaranteed directly or indirectly in any
manner by such Person, or in effect guaranteed directly or indirectly and
(f) all obligations under any acquisition agreements pursuant to which such
Person is responsible for any earn-out or other contingent payments.

“Indemnified Party” has the meaning specified in Section 11.3.

“Indemnitor” has the meaning specified in Section 11.3.

“Insurance Policies” has the meaning specified in Section 5.21.

“Investment Assets” means (i) with respect to VSC (except with respect to any
foreign “branches” of VSC) the liquid fixed income and maturity debt securities
held or acquired by VSC as investments in the ordinary course of business,
(ii) with respect to any Company other than VSC, any foreign “branches” of VSC),
and any other Person operating a portion of the Transferred Business with
respect to such portion of the Transferred Business, any investments held or
acquired by such Person in the ordinary course of business (it being understood
that, in the case of (i) and (ii), a portion of the investments are being held,
and must be retained, as deposits with or for the benefit of an Administrative
Authority) and (iii) Other Assets.

“Knowledge of Aon” means, as to a particular matter, the actual knowledge of the
following persons:  Aon’s Executive Chairman, Chief Executive Officer, Chief
Financial Officer and Senior Vice President/Treasurer and each of the
following:  David L. Cole, Mark H. Mishler, Mike Frosch, Roger Powell, David R.
Scott, James Donaldson, Chuck LaMantia, Perry Kupferman, C. Steve Hayes, Tony
Jackovich, John Serafin and Geoffrey Witt.

“Knowledge of Buyer” means, as to a particular matter, the actual knowledge of
the following persons:  Robert M. LeBlanc, Andrea E. Daly and Adam W. Reinmann.

“Leased Real Property” has the meaning specified in Section 5.9.

“LGH” means London General Holdings Limited, a company organized under the laws
of the United Kingdom.

“LGI” means London General Insurance Company Limited, an insurance company
organized under the laws of the United Kingdom.

“LGI Excluded Business” means (i) the Irish Contractors program (with lines of
business including general liability, employers’ liability and contractors all
risks) and (ii) the underwriting by LGI of life and accident and health
insurance policies in Spain and Portugal.

8

--------------------------------------------------------------------------------

 

“Losses” means any and all losses, costs, settlement payments, awards,
judgments, fines, penalties, damages, expenses, deficiencies or other charges.

“Market Value” means, as of the applicable date, the value as determined by
Interactive Data Corporation or, in the case of securities issued outside of the
U.S. for which Interactive Data Corporation does not regularly provide the
requested information, by Bloomberg Financial or an internationally recognized
broker agreed upon by the parties.

“Material Adverse Effect” means a material adverse effect on the business,
assets, results of operations or condition (financial or otherwise) of the
Warranty Business taken as a whole, other than any such effect (i) resulting
from changes in generally applicable economic, political or regulatory
conditions or the Companies’ industry in general (including changes in GAAP or
SAP) to the extent not having a disproportionate effect on the Companies
compared to its peers in the warranty business or (ii) arising out of or
relating to the identity of Buyer or its Affiliates. Notwithstanding the
foregoing, the parties hereto acknowledge and agree that in no event shall any
matter that is or would be an Excluded Asset, Excluded Subsidiary or Excluded
Liability constitute or give rise to, in whole or in part, a Material Adverse
Effect except to the extent it has an effect on the business, assets, results of
operations or condition (financial or otherwise) of the Warranty Business. For
the avoidance of doubt, the actuarial review described in Section 7.12 and any
result, consequences or actions arising out of such review shall under no
circumstances be taken into account in the determination of a Material Adverse
Effect.

“Multiemployer Plan” means a “multiemployer plan,” as defined in
Section 4001(a)(3) of ERISA.

“Net Worth” means an amount equal to (i) the value of the assets of the Warranty
Business determined in accordance with the Agreed Account Principles (excluding,
for the avoidance of doubt, goodwill) minus (ii) the value of the liabilities of
the Warranty Business determined in accordance with the Agreed Accounting
Principles, in each case, as of the date of determination.

“Net Worth Adjustment Amount” means the Closing Date Net Worth minus
$420,011,470.

“Net Worth Adjustment Report” has the meaning specified in Section 4.5.

“Net Worth Adjustment Report Finalization Date” means the date which is 30 days
after the date on which the Net Worth Adjustment Report is delivered by Aon to
Buyer; provided, however, that if Buyer or Buyer’s Accountant delivers a notice
of exception within such 30-day period, and if any change to the Net Worth
Adjustment Report is agreed to by Buyer and Aon in accordance with Section 4.5,
then the date on which Buyer and Aon agree in writing to such change shall be
the Net Worth Adjustment Report Finalization Date; and, provided, further, that
if Aon and Buyer cannot agree upon the Net Worth Adjustment Amount, then the
date on which the Accounting Firm delivers its decision with respect to such
dispute in accordance with Section 4.5 shall be the Net Worth Adjustment Report
Finalization Date.

9

--------------------------------------------------------------------------------

“Obligor” means a business entity other than an insurer that assumes the
obligation to repair, replace or maintain a consumer product under an extended
warranty, service contract or prepaid maintenance agreement.

“Organizational Documents” has the meaning specified in Section 5.1.

“Other Assets” means dealer loans in the ordinary course of business and the
owned real estate in Dallas, Texas.

“Owned Real Property” has the meaning specified in Section 5.9.

“Parent Entities” has the meaning specified in the Preliminary Statement of this
Agreement.

“Patent Rights” means United States and foreign patents, patent applications,
continuations, continuations-in-part, divisions or reissues.

“P&C Business” means the accounts and programs identified in Schedule 1.1(F).

“P&C Underwriting” has the meaning specified in Section 7.12.

“Pension Plan” means any pension plan, as defined in Section 3(2) of ERISA,
applied without regard to the exceptions from coverage contained in
Section 4(b)(4) or 4(b)(5) thereof.

“Permitted Encumbrances” means (i) liens for Taxes and other governmental
charges and assessments which are not yet due and payable, (ii) liens of
landlords and liens of carriers, warehousemen, mechanics and materialmen and
other like liens arising in the ordinary course of business for sums not yet due
and payable, (iii) Encumbrances identified in Schedule 1.1 (G) of this
Agreement, (iv) other Encumbrances or imperfections on property which are not
material in amount or do not materially detract from the value of or materially
impair the existing use of the property affected by such Encumbrance,
imperfection or such other matter, agreement or exception, and (v) Encumbrances
that are set forth on the Balance Sheet or Statutory Statements.

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

“Potential Transaction” has the meaning specified in Section 7.8.

“Preliminary Purchase Price” has the meaning specified in Section 4.2.

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

“Real Estate Agreements” means the real estate agreements substantially in the
forms attached hereto as Exhibit C.

10

--------------------------------------------------------------------------------

“Real Property” has the meaning specified in Section 5.9.

“Release” means the release, spill, emission, leaking, pumping, injection,
deposit, disposal, discharge, dispersal, leaching or migration of a Contaminant
into the environment.

“Remedial Action” means actions required by any Environmental Law to (i) clean
up, remove, treat or in any other way address Contaminants in the environment,
(ii) prevent the Release or threatened Release or minimize the further Release
of Contaminants or (iii) investigate and determine if Remedial Action is
required, and to design and implement such Remedial Action, including any
necessary post-remedial investigation, monitoring, operation and maintenance and
care.

“Requirements of Law” means any foreign, federal, state and local laws,
statutes, regulations, rules, codes or ordinances enacted, adopted, issued or
promulgated by any Administrative Authority.

“Reserved Consolidated Taxes” has the meaning specified in Section 8.1(a).

“Reserved Taxes” has the meaning specified in Section 8.1(a).

“Restricted Business” means any business of the type described in the first
sentence of the definition of Warranty Business (other than clause (ix) thereof)
as conducted by the Companies and FFG and Combined and its Affiliates (with
respect to the Transferred Business) as of the date hereof or the immediately
preceding 12 month period, other than any Exempt Business Activities.

“Restricted Period” has the meaning specified in Section 8.6.

“RLIC” means Resource Life Insurance Company, an Illinois insurance company.

“SAP” means the statutory accounting principles and practices prescribed or
permitted by applicable insurance regulatory authorities.

“Scheduled Client” means any client of Aon or its Affiliates listed on the
Existing Client Schedule.

“Securities Act” means the Securities Act of 1933.

“Seller Ancillary Agreements” means all agreements, instruments and documents
being or to be executed and delivered by any Seller Group Members under this
Agreement or in connection herewith, including the Transition Services Agreement
(Seller as Service Provider), the Transition Services Agreement (Buyer as
Service Provider), the Facilitating Transaction Agreements and the Real Estate
Agreements.

“Seller Group Member” means (i) Aon and its Affiliates, (ii) the directors,
officers and employees of Aon and its Affiliates, and (iii) the successors and
assigns of the foregoing.

11

--------------------------------------------------------------------------------

“Sellers” means Aon, Aon UK, Combined and Sterling.

“Shares” has the meaning set forth in the fifth paragraph of this Agreement.

“Software” means computer software programs and related documentation and
materials, whether in source code, object code or human readable form; provided,
however, that Software does not include software that is (i) available generally
through retail stores, distribution networks or is otherwise subject to
“shrink-wrap” or “click-through” license agreements, including any software
pre-installed in the ordinary course of business as a standard part of hardware
purchased by any of the Companies or (ii) made available pursuant to the
Transition Services Agreement.

“Statutory Statements” has the meaning specified in Section 5.5(b).

“Sterling” means Sterling Life Insurance Company, an Illinois corporation.

“Straddle Period” means any taxable year or period beginning on or before and
ending after the Closing Date.

“Subsidiaries” has the meaning set forth in the Preliminary Statement of this
Agreement.

“Success Bonus Agreements” means those agreements identified in Item 4 of
Schedule 5.18.

“Success Bonus Payments” means any and all payments required to be made under
the Success Bonus Agreements as a result of the consummation of the transactions
contemplated hereby.

“Tax” means (i) any federal, state, local or foreign income, gross receipts,
property, sales, use, license, excise, franchise, employment, payroll,
withholding, alternative or add-on minimum, ad valorem, value added, transfer or
excise tax, premium, windfall profit, severance, production, stamp or
environmental tax, (ii) any other tax, custom, duty, governmental fee or other
like assessment or charge of any kind whatsoever, (iii) any interest or penalty,
addition to tax or additional amount imposed by any taxing authority of any
Administrative Authority with respect to or in connection with liability for any
of the amounts described in clauses (i) or (ii) of this definition, or (iv) any
amounts described in clauses (i), (ii) or (iii) of this definition for which a
party is liable under any statute or regulation that imposes joint or several
liability for such amounts on members of an affiliated, combined, consolidated
or unitary group of corporations or entities.

 

12

--------------------------------------------------------------------------------

 

“Tax Package” has the meaning set forth in Section 8.1(b)(iii).

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

“TPA Services”  means third party administrative services, such as customer
relationship management, financial services administration, claims management,
captive management and call center management.

“Trade Secrets” has the meaning set forth in §2(d) of the Illinois Trade Secrets
Act (765 ILCS 1065).

“Trademarks” means registered United States federal, state and foreign
trademarks, service marks and trade names, and pending applications to register
the foregoing.

“Transferred Business” shall mean the FFG Warranty Business and the CICA
Warranty Business (including the Warranty Business described in Schedule
1.1(E)).

“Transferred Employees” has the meaning specified in Section 8.2(a).

“Transition Services Agreement (Buyer as Service Provider)” means the Transition
Services Agreement in the form attached hereto as Exhibit  A-1. If, at least 30
days prior to the Closing Date, Aon determines and notifies Buyer in writing
that it has inadvertently omitted from Annex A to the Transition Services
Agreement (Buyer as Service Provider) services which prior to the Closing were
provided by the Companies to Aon or its Affiliates and are reasonably necessary
to the operations of the business being conducted by Aon or its Affiliates,
Buyer shall evaluate such notice in good faith and, provided that the provision
of such Services would not impose any unreasonable burden or additional cost on
the Companies, Annex A thereto shall be amended to add such services and the
cost and length of the transition period for such services shall be determined
in the same manner that the cost and length of the transition period for the
other services was determined.

“Transition Services Agreement (Seller as Service Provider)” means the
Transition Services Agreement in the form attached hereto as Exhibit  A-2.
Notwithstanding the foregoing, Buyer may, upon written notice to Aon delivered
at least thirty days prior to the Closing Date, update Annex A thereto to remove
any Service(s) listed therein; provided that, in such case, Buyer shall pay Aon
the lesser of (i) Aon’s actual incremental costs incurred through the date of
Buyer’s notice in connection with its preparation to provide the affected
Service(s) to the Companies after the Closing and (ii) the cost of the affected
Service(s) for 30 days. As soon as reasonably practicable following receipt of
any such notice, but in no event later than five Business Days thereafter, Aon
shall advise Buyer as to whether removal of such Service(s) would require the
removal or partial removal of, or otherwise affect the provision of, any other
Services. If such is the case, Buyer may withdraw its notice to remove any
service within three days of being so advised by Aon. In addition, if, at least
30 days prior to the Closing Date, Buyer determines and notifies Aon in writing
that it has inadvertently omitted from Annex A to the Transition Services
Agreement (Seller as Service Provider) services which prior to the Closing were
provided by Aon or its Affiliates to the Companies and are reasonably necessary
to the operations of the Warranty Business, Aon shall evaluate such notice in
good faith and, provided that the provision of such Services would not impose
any unreasonable burden or additional cost on Aon or its Affiliates, Annex A
shall be amended to add such services and the cost and length of the transition
period for such services shall be determined in the same manner that the cost
and length of the transition period for the other services was determined.

13

--------------------------------------------------------------------------------

 

“Treasury Regulation” means the regulations promulgated under the Code by the
U.S. Treasury Department.

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

“Underwriting Companies” means Resource Life Insurance Company, an Illinois
insurance company, Virginia Surety Company, Inc., an Illinois insurance company,
Virginia Surety Compania de Seguros, an Argentina insurance company, Rockford
Life Insurance Company, an Arizona insurance company, Automotive Warranty
Services of Florida Inc., a Florida corporation, ServiceSaver, Incorporated, a
Florida corporation, ServicePlan of Florida, Inc, a Florida corporation, First
Extended Service Corporation of Florida, a Florida corporation, Combined
Insurance Company de Argentina S.A. Compania de Seguros, an Argentina insurance
company, Combined Seguros Brazil SA, a Brazil insurance company, Combined Life
Assurance Company Limited, a United Kingdom insurance company, and London
General Insurance Company Limited, a United Kingdom insurance company, and FFG
Insurance Company.

“VSC” means Virginia Surety Company, Inc., an Illinois insurance company.

“Warranty Business” means the world-wide business conducted by the Companies
(including FFG and Combined and its Affiliates with respect to the Transferred
Business) of (i) underwriting by an insurer or an Obligor of extended warranty,
mechanical repair, service contracts or pre-paid maintenance agreements covering
repair, replacement or scheduled maintenance for motor vehicles, motorcycles,
motor homes, motorized recreational vehicles, personal watercraft, electronic
products, appliances, personal computers and peripherals, home heating,
ventilation, air conditioning  plumbing and electrical systems and appliances
and other consumer products, (ii) underwriting by an insurer of credit life and
credit disability insurance and involuntary unemployment insurance or
underwriting by an unaffiliated insurer of credit life and credit disability
insurance and involuntary unemployment insurance for which one of the Companies
acts as an agent with respect to such insurance in connection with performing
other activities described in the other clauses of this definition,
(iii) underwriting by an insurer or an Obligor of travel protection and travel
related protection programs and of  membership programs to the extent related to
Warranty Business products, (iv) underwriting by an insurer or an Obligor of
credit card enhancement programs, (v)  underwriting by an insurer or an Obligor
of guaranteed asset protection (GAP) products for loans and leases on motor
vehicles, motorcycles, motor homes, motorized recreational vehicles and personal
watercraft separate from standard motor vehicle, motorcycle, motor home,
motorized recreational vehicle or personal watercraft coverage,
(vi) underwriting by an insurer of stop loss or failure to perform insurance
coverage for Obligors or for motor vehicle dealers, (vii) underwriting by an
insurer or an Obligor of vehicle replacement insurance (VRI), accidental damage
to consumer products, identity theft and virus protection, (viii) providing TPA
Services to the extent solely with respect to clauses (i) through (vii) above
(“Warranty TPA Services”), and (ix) providing training and consulting services
for motor vehicle manufacturers and dealers related to variable operations,
automobiles sales activities and fixed operations activities at the point of
sale, customer satisfaction activities and including, for the avoidance of
doubt, the arrangement of client captive reinsurers for any Warranty Business
client with respect to clauses (i) through (vii) above and excluding, for the
avoidance of doubt, the P&C Business and the LGI Excluded Business. In

14

--------------------------------------------------------------------------------

 

addition, the “Warranty Business” includes all other business, products,
services, programs, arrangements and activities (including marketing,
distribution and administration arrangements and activities) described as being
part of the Warranty Business in that certain Confidential Offering Memorandum
of the Aon Warranty Group dated December 2005, including customer loyalty
programs and the Resource Variable Income Partners program.  The phrase
“underwriting by an insurer or an Obligor” or “underwriting by an insurer” means
that such underwriting is performed by one of the Companies. The term “consumer
products” includes such products also used for or by a business.

“Welfare Plan” means any welfare plan, as defined in Section 3(1) of ERISA,
applied without regard to the exceptions from coverage contained in
Sections 4(b)(4) or 4(b)(5) thereof.

Section 1.2            Interpretation. For purposes of this Agreement, (i) the
words “include,” “includes” and “including” shall be deemed to be followed by
the words “without limitation,” (ii) the word “or” is not exclusive, (iii) the
words “herein”, “hereof”, “hereby”, “hereto” and “hereunder” refer to this
Agreement as a whole, including all schedules, exhibits and annexes attached to
this Agreement and (iv) information will be considered to have been “made
available” to Buyer only to the extent that such information was posted to the
DataSite maintained by Merrill Corporation for “Project Warrior 2005” or
delivered to Buyer or its counsel no later than 24 hours prior to the date
hereof. Unless the context otherwise requires, references herein:  (i) to
Articles, Sections, Exhibits and Schedules mean the Articles and Sections of,
and the Exhibits and Schedules attached to, this Agreement; (ii) to an
agreement, instrument or other document means such agreement, instrument or
other document as amended, supplemented and modified from time to time to the
extent permitted by the provisions thereof and by this Agreement; and (iii) to a
statute means such statute as amended from time to time and includes any
successor legislation thereto and any regulations promulgated thereunder. The
schedules, exhibits and annexes referred to herein shall be construed with and
as an integral part of this Agreement to the same extent as if they were set
forth verbatim herein. Titles to Articles and headings of Sections are inserted
for convenience of reference only and shall not be deemed a part of or to affect
the meaning or interpretation of this Agreement. Unless expressly indicated to
the contrary, all dollar amounts are expressed in United States funds, and all
amounts payable hereunder shall be paid in United States funds.

ARTICLE II

PURCHASE AND SALE

Section 2.1            Purchase and Sale of the Shares. Upon the terms and
subject to the conditions of this Agreement, on the Closing Date, Aon shall (and
shall cause the other Sellers to) sell, transfer, assign, convey and deliver to
Buyer, free and clear of all Encumbrances, and Buyer shall purchase and accept
from Sellers, the Shares.

15

--------------------------------------------------------------------------------

 

ARTICLE III

PURCHASE PRICE

Section 3.1            Purchase Price. The purchase price for the Shares shall
be equal to $710,000,000 (Seven Hundred Ten Million Dollars) (the “Base Purchase
Price”), plus (or, if a negative amount, minus the absolute value of) the Net
Worth Adjustment Amount (the Base Purchase Price, as adjusted by the Net Worth
Adjustment Amount, the “Purchase Price”). The Purchase Price shall be paid
pursuant to Article IV.

ARTICLE IV

CLOSING

Section 4.1            Closing Date. The Closing shall be consummated on a date
and at a time agreed upon by Buyer and Aon, but in no event later than the fifth
Business Day after the date on which the conditions set forth in Articles IX and
X have been satisfied or waived, at the offices of Kaye Scholer LLP, 425 Park
Avenue, New York, New York, or at such other time and place as shall be agreed
upon by Buyer and Aon; provided, however, that to the extent that one or more
landlord consents required in order to effectuate the transactions contemplated
by the Real Estate Agreements identified on Schedule 4.1 hereto shall not have
been obtained prior to the Closing Date established in accordance with the
foregoing, Buyer may upon notice to Aon, delay the Closing for a period not to
exceed forty-five (45) days in order to make alternate arrangements with respect
to the operations to have otherwise been located in the applicable unavailable
property; provided, further, however, that in no event shall any such delay
cause the Closing Date to be later than December 31, 2006. The date on which the
Closing is actually held is referred to herein as the “Closing Date” and the
Closing shall be deemed to occur at 12:01 a.m. Central Standard Time on the
Closing Date.

Section 4.2            Payment on the Closing Date. (a)  Subject to fulfillment
or waiver (where permissible) of the conditions set forth in Article IX, at the
Closing, Buyer shall pay to Aon (or other Sellers as directed by Aon), an amount
equal to the Base Purchase Price, plus (or, if a negative amount, minus the
absolute value of) the Estimated Net Worth Adjustment Amount (the “Preliminary
Purchase Price”), by wire transfer of immediately available funds to the bank
account or accounts specified by Aon in accordance with paragraph (b) hereof.

(B)           NOT LESS THAN FIVE (5) BUSINESS DAYS PRIOR TO THE CLOSING DATE,
AON SHALL PREPARE AND DELIVER TO BUYER (I) AON’S ESTIMATE OF CLOSING DATE NET
WORTH (“ESTIMATED CLOSING DATE NET WORTH”) AND (II) THE AMOUNT OF THE
PRELIMINARY PURCHASE PRICE CALCULATED BASED THEREUPON AND THE WIRE TRANSFER
INSTRUCTIONS FOR AON.

(C)           NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED HEREIN, IN THE
EVENT THAT BUYER DELIVERS A WRITTEN NOTICE TO AON NOT LESS THAN TWO (2) BUSINESS
DAYS PRIOR TO THE CLOSING DATE OF ITS GOOD FAITH DISAGREEMENT WITH AON’S
CALCULATION OF THE ESTIMATED CLOSING DATE NET WORTH AND AON AND BUYER FAIL TO
RESOLVE SUCH OBJECTIONS PRIOR TO THE CLOSING DATE, THE ESTIMATED CLOSING DATE
NET WORTH SHALL BE DETERMINED AS FOLLOWS:  (I) IF THE ESTIMATED CLOSING DATE NET
WORTH CALCULATED BY EACH OF BUYER AND AON EXCEEDS $420,011,470, THE ESTIMATED
CLOSING DATE NET WORTH SHALL BE DEEMED TO BE EQUAL TO THE SMALLER OF SUCH
AMOUNTS, (II) IF THE ESTIMATED CLOSING DATE NET WORTH CALCULATED BY EACH OF
BUYER AND AON IS LESS THAN $420,011,470, THE ESTIMATED CLOSING DATE NET WORTH
SHALL BE

16

--------------------------------------------------------------------------------

 

deemed to be equal to the greater of such amounts and (iii) in all other cases,
the Estimated Closing Date Net Worth shall be deemed to be equal to $420,011,470
(and the corresponding Estimated Net Worth Adjustment Amount equal to zero).

Section 4.3            Buyer’s Additional Closing Date Deliveries. Subject to
fulfillment or waiver (where permissible) of the conditions set forth in
Article IX, at the Closing Buyer shall deliver to Aon, in addition to the
Preliminary Purchase Price, all of the following:

(A)           CERTIFICATE OF THE SECRETARY OR AN ASSISTANT SECRETARY OF BUYER,
DATED THE CLOSING DATE, IN FORM AND SUBSTANCE REASONABLY SATISFACTORY TO AON, AS
TO (I) THE CHARTER OF BUYER; (II) THE BY-LAWS OF BUYER; (III) THE RESOLUTIONS OF
THE BOARD OF DIRECTORS OF BUYER AUTHORIZING THE EXECUTION AND PERFORMANCE OF
THIS AGREEMENT, ANY BUYER ANCILLARY AGREEMENT AND THE TRANSACTIONS CONTEMPLATED
HEREBY AND THEREBY; AND (IV) INCUMBENCY AND SIGNATURES OF THE OFFICERS OF BUYER
EXECUTING THIS AGREEMENT AND ANY BUYER ANCILLARY AGREEMENT;

(B)           THE TRANSITION SERVICES AGREEMENT (SELLER AS SERVICE PROVIDER) AND
THE TRANSITION SERVICES AGREEMENT (BUYER AS SERVICE PROVIDER), IN EACH CASE DULY
EXECUTED BY BUYER;

(C)           THE CERTIFICATE CONTEMPLATED BY SECTION 10.1, DULY EXECUTED BY A
DULY AUTHORIZED OFFICER OF BUYER;

(D)           THE JOINDER AGREEMENT IN THE FORM OF EXHIBIT D, DULY EXECUTED BY
EACH OF THE PARENT ENTITIES AND EACH OF THE SUBSIDIARIES IN EACH CASE TO THE
EXTENT THAT SUCH PERSONS ARE BOTH INCORPORATED IN THE UNITED STATES AND ARE NOT
UNDERWRITING COMPANIES; AND

(E)           ANY CONSENTS AND APPROVALS THAT MAY BE OBTAINED BY BUYER WITH
RESPECT TO THE CONSUMMATION OF THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT.

Section 4.4            Aon’s Closing Date Deliveries. Subject to fulfillment or
waiver (where permissible) of the conditions set forth in Article X, at the
Closing Aon shall deliver (or cause to be delivered) to Buyer all of the
following:

(A)           CERTIFICATE OF THE SECRETARY OR AN ASSISTANT SECRETARY OF AON AND
ASC, DATED THE CLOSING DATE, IN FORM AND SUBSTANCE REASONABLY SATISFACTORY TO
BUYER, AS TO (I) THE CHARTER OF AON AND ASC; (II) THE BY-LAWS OF AON AND ASC;
(III) THE RESOLUTIONS OF THE BOARD OF DIRECTORS OF AON AND ASC AUTHORIZING THE
EXECUTION AND PERFORMANCE OF THIS AGREEMENT, ANY SELLER ANCILLARY AGREEMENT TO
WHICH AON OR ASC IS A PARTY AND THE TRANSACTIONS CONTEMPLATED HEREBY AND
THEREBY; AND (IV) INCUMBENCY AND SIGNATURES OF THE OFFICERS OF AON AND ASC
EXECUTING THIS AGREEMENT AND ANY SELLER ANCILLARY AGREEMENT;

(B)           STOCK CERTIFICATES REPRESENTING ALL OF THE SHARES, DULY EXECUTED
IN BLANK OR ACCOMPANIED BY DULY EXECUTED INSTRUMENTS OF TRANSFER;

(C)           THE TRANSITION SERVICES AGREEMENT (SELLER AS SERVICE PROVIDER),
DULY EXECUTED BY ASC, THE TRANSITION SERVICES AGREEMENT (BUYER AS SERVICE
PROVIDER), DULY EXECUTED BY COMBINED, AND THE REAL ESTATE AGREEMENTS, DULY
EXECUTED BY THE APPLICABLE PARTIES THERETO;

17

--------------------------------------------------------------------------------

 

(D)           EACH OF THE FACILITATING TRANSACTIONS AGREEMENTS REQUIRED TO BE
COMPLETED AS OF THE CLOSING, IN EACH CASE DULY EXECUTED BY THE APPLICABLE
PARTIES THERETO;

(E)           ANY CONSENTS, WAIVERS OR APPROVALS THAT MAY BE OBTAINED BY AON
WITH RESPECT TO THE CONSUMMATION OF THE TRANSACTIONS CONTEMPLATED BY THIS
AGREEMENT;

(F)            EVIDENCE OF THE TERMINATION AND FULL SATISFACTION AND DISCHARGE
OF ANY LIABILITIES AND OBLIGATIONS UNDER OF EACH OF THE AGREEMENTS GIVING RISE
TO ANY INDEBTEDNESS IDENTIFIED IN ITEMS 1 AND 5 OF SCHEDULE 5.27, AND OF THE
AGREEMENTS IDENTIFIED IN ITEM (VII) OF SCHEDULE 5.7 WITH RESPECT TO THE
COMPANIES;

(G)           THE CERTIFICATES CONTEMPLATED BY SECTIONS 9.1 AND 9.7, DULY
EXECUTED BY A DULY AUTHORIZED OFFICER OF AON; AND

(H)           THE WRITTEN RESIGNATIONS OF THE DIRECTORS OF THE COMPANIES THAT
ARE EMPLOYEES OF AON AND ITS AFFILIATES (OTHER THAN THE COMPANIES).

Section 4.5            Determination of the Net Worth Adjustment Amount. On or
before 60 days following the Closing Date, Aon shall prepare and deliver to
Buyer a report (the “Net Worth Adjustment Report”) setting forth Aon’s
computation of the Closing Date Net Worth. Buyers shall reasonably assist Aon in
the preparation of the Net Worth Adjustment Report and shall provide Aon
reasonable access during normal business hours, upon reasonable advance notice
to the relevant personnel, books and records of the Companies for such purpose.

(A)           AFTER DELIVERY OF THE NET WORTH ADJUSTMENT REPORT TO BUYER, BUYER
AND/OR A FIRM OF INDEPENDENT PUBLIC ACCOUNTANTS DESIGNATED BY BUYER (“BUYER’S
ACCOUNTANT”) WILL BE ENTITLED TO REASONABLE ACCESS DURING NORMAL BUSINESS HOURS
UPON REASONABLE ADVANCE NOTICE TO THE RELEVANT PERSONNEL, RECORDS AND WORKING
PAPERS OF AON AND ITS ACCOUNTANTS TO AID IN THEIR REVIEW OF THE NET WORTH
ADJUSTMENT REPORT. THE NET WORTH ADJUSTMENT REPORT WILL BE DEEMED TO BE ACCEPTED
BY AND SHALL BE CONCLUSIVE FOR PURPOSES OF DETERMINING THE NET WORTH ADJUSTMENT
AMOUNT EXCEPT TO THE EXTENT, IF ANY, THAT BUYER OR BUYER’S ACCOUNTANT SHALL HAVE
DELIVERED WITHIN 30 DAYS AFTER THE DATE ON WHICH THE NET WORTH ADJUSTMENT REPORT
IS DELIVERED TO BUYER, A WRITTEN NOTICE TO AON SPECIFYING IN REASONABLE DETAIL
THE NATURE AND EXTENT OF ANY OBJECTIONS IT HAS TO THE NET WORTH ADJUSTMENT
REPORT AND ITS CALCULATION OF THE CLOSING DATE NET WORTH (IT BEING UNDERSTOOD
THAT (I) IF THE CLOSING DATE NET WORTH CALCULATED BY EACH OF BUYER AND AON
EXCEEDS THE ESTIMATED CLOSING DATE NET WORTH BY MORE THAN $25,000, BUYER SHALL
PROMPTLY PAY OR CAUSE TO BE PAID TO AON AN AMOUNT EQUAL TO THE SMALLER OF SUCH
AMOUNTS LESS THE ESTIMATED CLOSING DATE NET WORTH AND (II) IF THE ESTIMATED
CLOSING DATE NET WORTH EXCEEDS THE CLOSING DATE NET WORTH CALCULATED BY EACH OF
BUYER AND AON BY MORE THAN $25,000, AON SHALL PROMPTLY PAY TO BUYER (OR ITS
DESIGNEE) AN AMOUNT EQUAL TO THE ESTIMATED CLOSING DATE NET WORTH LESS THE
GREATER OF SUCH AMOUNTS). IF A CHANGE PROPOSED BY BUYER IS DISPUTED BY AON, THEN
AON AND BUYER SHALL NEGOTIATE IN GOOD FAITH TO RESOLVE SUCH DISPUTE. IF, AFTER A
PERIOD OF 20 DAYS FOLLOWING THE DATE ON WHICH BUYER GIVES AON NOTICE OF ANY SUCH
PROPOSED CHANGE, ANY SUCH PROPOSED CHANGE STILL REMAINS DISPUTED, THEN BUYER AND
AON SHALL TOGETHER CHOOSE AN INDEPENDENT FIRM OF PUBLIC ACCOUNTANTS OF
NATIONALLY-RECOGNIZED STANDING (THE “ACCOUNTING FIRM”) TO RESOLVE ANY REMAINING
DISPUTES. THE ACCOUNTING FIRM SHALL ACT AS AN ARBITRATOR TO DETERMINE, BASED
SOLELY ON PRESENTATIONS BY BUYER AND AON, AND NOT BY INDEPENDENT REVIEW, ONLY

18

--------------------------------------------------------------------------------

 

those issues still in dispute with respect to the Net Worth Adjustment Amount.
The decision of the Accounting Firm shall be final and binding and shall be in
accordance with the provisions of this section. All of the fees and expenses of
the Accounting Firm shall be borne by Buyer and Aon in the same proportion that
the aggregate amount of the disputed items submitted to the Accounting Firm that
are unsuccessfully disputed by Buyer and Aon, respectively (as finally
determined by the Accounting Firm), bears to the total amount of items submitted
to the Accounting Firm.

(B)           WITHIN 5 BUSINESS DAYS FOLLOWING THE APPLICABLE NET WORTH
ADJUSTMENT REPORT FINALIZATION DATE AON AND BUYER SHALL PAY THE FOLLOWING
AMOUNTS AS APPLICABLE. ANY NET WORTH ADJUSTMENT AMOUNT SHALL BE PAID AS FOLLOWS:

(I)            IF THE ESTIMATED CLOSING DATE NET WORTH EXCEEDS THE CLOSING DATE
NET WORTH, AS CALCULATED IN THIS SECTION 4.5, AON SHALL PAY TO BUYER (OR ITS
DESIGNEE) THE DIFFERENCE THEREOF PLUS ANY AMOUNTS PAID BY BUYER TO AON PURSUANT
TO CLAUSE (I) OF THE SECOND SENTENCE OF  SECTION 4.5(A), LESS ANY AMOUNTS PAID
BY AON TO BUYER PURSUANT TO CLAUSE (II) OF THE SECOND SENTENCE OF
SECTION 4.5(A), BY WIRE TRANSFER OF IMMEDIATELY AVAILABLE FUNDS TO AN ACCOUNT
SPECIFIED IN WRITING TO AON BY BUYER.

(II)           IF THE CLOSING DATE NET WORTH, AS CALCULATED IN THIS SECTION 4.5,
EXCEEDS THE ESTIMATED CLOSING DATE NET WORTH BUYER SHALL PAY OR CAUSE TO BE PAID
TO AON THE DIFFERENCE THEREOF PLUS ANY AMOUNTS PAID BY AON TO BUYER PURSUANT TO
CLAUSE (II) OF THE SECOND SENTENCE OF  SECTION 4.5(A), LESS ANY AMOUNTS PAID BY
BUYER TO AON PURSUANT TO CLAUSE (I) OF THE SECOND SENTENCE OF SECTION 4.5(A) BY
WIRE TRANSFER OF IMMEDIATELY AVAILABLE FUNDS TO AN ACCOUNT OR ACCOUNTS SPECIFIED
IN WRITING TO BUYER BY AON.

(III)          NOTWITHSTANDING (I) AND (II) OF THIS PARAGRAPH, IF THE ESTIMATED
CLOSING DATE NET WORTH AND THE CLOSING DATE NET WORTH, AS CALCULATED IN THIS
SECTION 4.5, ARE WITHIN $25,000 NO PAYMENT SHALL BE DUE UNDER THIS
SECTION 4.5(B).

Any payment required to be made pursuant to this Section 4.5(b) shall be made
together with interest thereon from the Closing Date to the date of payment at
the rate of interest per annum equal to ninety (90) day LIBOR in effect on the
Closing Date as reported in The Wall Street Journal.

ARTICLE V

REPRESENTATIONS AND WARRANTIES OF AON

As an inducement to Buyer to enter into this Agreement and to consummate the
transactions contemplated hereby, Aon represents and warrants to Buyer as
follows (it being understood and agreed that no representation or warranty is
being made with respect to the Excluded Assets, Excluded Subsidiaries or
Excluded Liabilities).

Section 5.1            Organization of the Companies. Each of the Companies has
been duly formed and is validly existing and in good standing under the laws of
the jurisdiction of its incorporation or formation as set forth in Schedule 5.1.
Each of the Companies is duly qualified to transact business and is in good
standing in each jurisdiction where the character of

19

--------------------------------------------------------------------------------

 

its properties owned or held under lease or the nature of its activities makes
such qualification necessary, except where the failure to be so qualified or in
good standing would not reasonably be expected to have a Material Adverse Effect
or would prevent a Company from operating in a jurisdiction in which it is
currently operating. Each of the Underwriting Companies holds the licenses
required by the insurance laws and regulations in its domiciliary state to
conduct the insurance businesses in which each Underwriting Company is engaged
and is in material compliance with all state insurance laws and regulations
applicable to it. Each of the Companies has the requisite corporate power and
authority to own or lease and operate its assets and to carry on its business in
the manner that it is now conducted. Except as set forth in Schedule 5.1, Aon
has made available to Buyer complete and accurate copies of the Charter or
by-laws or other governing documents (“Organizational Documents”), the stock
record book, the minute book and other corporate records of each of the
Companies. The book of account and other records of each of the Companies made
available to Buyer have been maintained in accordance with sound business
practices and applicable Requirements of Law and accounting policies.

Section 5.2            Capital Structure. Annex A sets forth the number of
shares of each class of capital stock of each of the Parent Entities that are
issued and outstanding. All of the outstanding shares of capital stock of each
of the Companies are validly issued, fully paid and nonassessable and free of
preemptive rights. All of the outstanding equity interests of the Parent
Entities are owned by a Seller, as reflected in Annex A (except as otherwise set
forth therein), and all of the outstanding equity interests of each of the
Subsidiaries (a) are owned, directly or indirectly, by a Parent Entity as
reflected in Annex B (except as otherwise set forth therein), in each case free
and clear of all Encumbrances, (b) have been duly authorized and are validly
issued, fully-paid and nonassessable and (c) were not issued in violation of any
preemptive or similar right. All of the outstanding equity interests of each of
the Sellers are owned, directly or indirectly, by Aon. Except for this
Agreement, there are no agreements, arrangements, options, warrants, rights or
commitments of any character relating to the issuance, sale, purchase, exchange,
transfer or redemption of any shares of capital stock of, or other equity
interests in any of the Companies, and no such shares or other equity interests
are reserved for issuance. The execution, delivery and performance of this
Agreement and the Seller Ancillary Agreements by each of the Seller Group
Members that are named parties thereto have been duly authorized and approved by
the board of directors of the Seller Group Members that are named parties
thereto and do not require any further authorization or consent of such Person
or its stockholders. This Agreement has been duly authorized, executed and
delivered by Aon. Any dividend that has been or will, in connection with the
transactions contemplated by this Agreement, including the Facilitating
Transactions, be paid by any UK domiciled entity is or will be lawful under the
UK Companies Act 1985.

Section 5.3            Subsidiaries and Investments. Except for the
Subsidiaries, none of the Companies, directly or indirectly, owns or has the
right to acquire any outstanding voting securities or other equity interests in
any Person, other than Investment Assets.

SECTION 5.4            AUTHORITY; CONFLICTS.

(A)           AON HAS FULL CORPORATE POWER AND AUTHORITY TO EXECUTE, DELIVER AND
PERFORM THIS AGREEMENT. EACH SELLER GROUP MEMBER HAS FULL CORPORATE POWER AND
AUTHORITY TO EXECUTE, DELIVER AND PERFORM EACH OF THE SELLER ANCILLARY
AGREEMENTS TO WHICH IT IS A PARTY. THIS

20

--------------------------------------------------------------------------------

 

Agreement and each of the Seller Ancillary Agreements to which a Seller Group
Member is a party constitute the valid and binding obligations of each such
party, enforceable in accordance with their respective terms, in each case
subject to bankruptcy, insolvency, reorganization, moratorium, and similar laws
relating to or affecting the enforcement of creditors’ rights generally and to
general equity principles.

(B)           EXCEPT AS SET FORTH IN SCHEDULE 5.4, NONE OF THE EXECUTION AND
DELIVERY BY AON OF THIS AGREEMENT, THE EXECUTION AND DELIVERY BY ANY SELLER
GROUP MEMBER OF ANY SELLER ANCILLARY AGREEMENT OR THE CONSUMMATION BY ANY SELLER
GROUP MEMBER OF ANY OF THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, NOR
COMPLIANCE BY ANY SELLER GROUP MEMBER WITH, OR FULFILLMENT BY AON OF, THE TERMS,
CONDITIONS AND PROVISIONS HEREOF OR THEREOF WILL:

(I)            ASSUMING THE RECEIPT OF ALL NECESSARY CONSENTS AND APPROVALS AND
THE FILING OF ALL NECESSARY DOCUMENTS AS DESCRIBED IN SECTION 5.4(B)(III),
RESULT IN A VIOLATION OR BREACH OF THE TERMS, CONDITIONS OR PROVISIONS OF, OR
CONSTITUTE A DEFAULT, AN EVENT OF DEFAULT OR AN EVENT CREATING RIGHTS OF
ACCELERATION, TERMINATION OR CANCELLATION OR A LOSS OF RIGHTS UNDER, OR RESULT
IN THE CREATION OR IMPOSITION OF ANY ENCUMBRANCE UPON A SELLER OR ANY OF THE
SHARES OR ANY OF THE ASSETS OF A SELLER OR ANY OF THE COMPANIES, UNDER THE
ORGANIZATIONAL DOCUMENTS OF A SELLER OR ANY OF THE COMPANIES,

(II)           ASSUMING THE RECEIPT OF ALL NECESSARY CONSENTS AND APPROVALS AND
THE FILING OF ALL NECESSARY DOCUMENTS AS DESCRIBED IN SECTION 5.4(B)(III),
RESULT IN A VIOLATION OR BREACH OF THE TERMS, CONDITIONS OR PROVISIONS OF, OR
CONSTITUTE A DEFAULT, AN EVENT OF DEFAULT OR AN EVENT CREATING RIGHTS OF
ACCELERATION, TERMINATION OR CANCELLATION OR A LOSS OF RIGHTS UNDER, OR RESULT
IN THE CREATION OR IMPOSITION OF ANY ENCUMBRANCE UPON A SELLER OR ANY OF THE
SHARES OR ANY ASSET OF A SELLER OR ANY OF THE COMPANIES, UNDER (1) ANY OF THE
BUSINESS AGREEMENTS, (2) ANY COMPANY PLAN, (3) ANY NOTE, INSTRUMENT, MORTGAGE,
LEASE, FRANCHISE OR FINANCIAL OBLIGATION OR MATERIAL AGREEMENT TO WHICH A SELLER
IS A PARTY OR BY WHICH A SELLER IS BOUND, (4) ANY COURT ORDER TO WHICH A SELLER
OR ANY OF THE COMPANIES IS A PARTY OR BY WHICH A SELLER OR ANY OF THE COMPANIES
IS BOUND, (5) ANY REQUIREMENTS OF LAW AFFECTING A SELLER OR ANY OF THE COMPANIES
OR (6) ANY GOVERNMENTAL PERMIT, OTHER THAN, IN EACH CASE, ANY SUCH VIOLATIONS,
BREACHES, DEFAULTS, RIGHTS, LOSS OF RIGHTS OR ENCUMBRANCES THAT WOULD NOT,
INDIVIDUALLY OR IN THE AGGREGATE, REASONABLY BE EXPECTED TO HAVE A MATERIAL
ADVERSE EFFECT OR PREVENT THE CONSUMMATION OF ANY OF THE TRANSACTIONS
CONTEMPLATED HEREBY, OR

(III)          REQUIRE THE APPROVAL, CONSENT, AUTHORIZATION OR ACT OF, OR THE
MAKING BY A SELLER OR ANY OF THE COMPANIES OF ANY DECLARATION, FILING OR
REGISTRATION WITH, ANY ADMINISTRATIVE AUTHORITY, EXCEPT (1) IN CONNECTION, OR IN
COMPLIANCE, WITH THE PROVISIONS OF THE HSR ACT, EUROPEAN COMMUNITY COUNCIL
REGULATION (EC) NO. 139/2004, OR SIMILAR COMPETITION REQUIREMENTS OF LAW IN
FOREIGN JURISDICTIONS, (2) ACQUISITION OF CONTROL STATEMENT FILINGS AND
PREACQUISITION STATEMENTS REQUIRED UNDER APPLICABLE STATE INSURANCE HOLDING
COMPANY SYSTEM LAWS AND REGULATIONS AND ANY OTHER INSURANCE REGULATORY
APPROVALS, CONSENTS, FILINGS OR NOTICES REQUIRED BY ANY APPLICABLE INSURANCE
REQUIREMENTS OF LAW, (3) SUCH FILINGS AS MAY BE REQUIRED IN CONNECTION WITH THE
TAXES DESCRIBED IN SECTION 8.1, AND (4) SUCH APPROVALS, CONSENTS,
AUTHORIZATIONS, DECLARATIONS, FILINGS OR REGISTRATIONS THE FAILURE OF WHICH TO
BE OBTAINED OR MADE WOULD NOT, INDIVIDUALLY OR IN THE

21

--------------------------------------------------------------------------------

 

aggregate, reasonably be expected to have a Material Adverse Effect or prevent
the consummation of any of the transactions contemplated hereby, or materially
impair the operation of the Warranty Business after the Closing.

SECTION 5.5            FINANCIAL STATEMENTS.

(A)           SCHEDULE 5.5(A) CONTAINS THE AUDITED BALANCE SHEET OF THE WARRANTY
BUSINESS AS OF DECEMBER 31, 2005 (THE “BALANCE SHEET”) AND THE RELATED AUDITED
STATEMENT OF INCOME AND CASH FLOW OF THE WARRANTY BUSINESS FOR THE YEAR ENDED
DECEMBER 31, 2005 TOGETHER WITH THE REPORT THEREON OF ERNST & YOUNG LLP,
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS (THE “AUDITED FINANCIAL STATEMENTS”)
AND AN UNAUDITED BALANCE SHEET OF THE WARRANTY BUSINESS AS OF MARCH 31, 2006 AND
RELATED UNAUDITED STATEMENT OF INCOME OF THE WARRANTY BUSINESS FOR THE THREE
MONTHS ENDED MARCH 31, 2006 (THE “UNAUDITED FINANCIAL STATEMENTS” AND, TOGETHER
WITH THE AUDITED FINANCIAL STATEMENTS, THE “FINANCIAL STATEMENTS”). EXCEPT AS
SET FORTH THEREIN AND EXCEPT AS SET FORTH IN SCHEDULE 5.5(A), THE AUDITED
FINANCIAL STATEMENTS HAVE BEEN PREPARED IN CONFORMITY WITH GAAP (APPLIED ON A
CONSISTENT BASIS THROUGHOUT THE PERIODS INVOLVED), AND PRESENT FAIRLY IN
ACCORDANCE WITH GAAP, THE FINANCIAL POSITION AND RESULTS OF OPERATIONS AND CASH
FLOW OF THE WARRANTY BUSINESS, AS AT THE RESPECTIVE DATES OF AND FOR THE PERIODS
REFERRED TO THEREIN. EXCEPT AS SET FORTH IN SCHEDULE 5.5(A), THE UNAUDITED
FINANCIAL STATEMENTS HAVE BEEN PREPARED IN ACCORDANCE WITH AON’S HISTORICAL
PRACTICES FOR THE WARRANTY BUSINESS, SUBJECT TO NORMAL RECURRING YEAR-END
ADJUSTMENTS (THE EFFECT OF WHICH WILL NOT, INDIVIDUALLY OR IN THE AGGREGATE, BE
MATERIALLY ADVERSE) AND THE ABSENCE OF NOTES.

(B)           TO THE EXTENT REQUIRED TO BE FILED AT LEAST TWO BUSINESS DAYS
PRIOR TO THE DATE OF THIS AGREEMENT, EXCEPT AS SET FORTH IN SCHEDULE 5.5(B), AON
HAS MADE AVAILABLE TO BUYER THE FOLLOWING STATUTORY STATEMENTS, IN EACH CASE
TOGETHER WITH THE REQUIRED EXHIBITS, SCHEDULES AND NOTES THERETO AND ANY
REQUIRED AFFIRMATIONS AND CERTIFICATIONS FILED THEREWITH (COLLECTIVELY, THE
“STATUTORY STATEMENTS”):  (I) THE ANNUAL STATEMENTS OF EACH OF THE UNDERWRITING
COMPANIES AND FFG INSURANCE COMPANY, AS OF DECEMBER 31, 2005 AND DECEMBER 31,
2004, IN EACH CASE AS FILED WITH THE INSURANCE REGULATORY AUTHORITY OF ITS
JURISDICTION OF DOMICILE AND (II) THE QUARTERLY STATEMENTS OF EACH OF THE
UNDERWRITING COMPANIES AND FFG FOR THE QUARTERLY PERIOD ENDING MARCH 31, 2006,
AS FILED WITH THE INSURANCE REGULATORY AUTHORITY OF ITS JURISDICTION OF
DOMICILE. EXCEPT AS SET FORTH THEREIN, ALL SUCH STATUTORY STATEMENTS FAIRLY
PRESENT, IN ALL MATERIAL RESPECTS, IN ACCORDANCE WITH SAP APPLIED ON A
CONSISTENT BASIS THROUGHOUT THE PERIODS INVOLVED (EXCEPT AS REQUIRED BY SAP) THE
STATUTORY FINANCIAL POSITION OF THE UNDERWRITING COMPANIES AND FFG INSURANCE
COMPANY, AS OF THE DATES THEREIN SPECIFIED AND THE STATUTORY RESULTS OF
OPERATIONS AND CASH FLOW OF SUCH COMPANIES, FOR THE PERIODS THEREIN SPECIFIED.
ALL ASSETS THAT ARE REFLECTED AS ADMITTED ASSETS ON THE STATUTORY STATEMENTS, TO
THE EXTENT APPLICABLE, QUALIFY AS ADMITTED ASSETS UNDER THE REQUIREMENTS OF LAW
OF THE APPLICABLE COMPANY’S DOMICILIARY JURISDICTION.

(C)           TO THE KNOWLEDGE OF AON, THE COMPANIES MAINTAIN INTERNAL
ACCOUNTING CONTROLS WHICH PROVIDE REASONABLE ASSURANCE THAT (I) TRANSACTIONS ARE
EXECUTED WITH MANAGEMENT’S AUTHORIZATION; (II) TRANSACTIONS ARE RECORDED AS
NECESSARY TO PERMIT PREPARATION OF THE FINANCIAL AND STATUTORY STATEMENTS OF THE
COMPANIES AND TO MAINTAIN ACCOUNTABILITY FOR THE COMPANIES’ CONSOLIDATED ASSETS;
(III) ACCESS TO THE COMPANIES’ ASSETS IS PERMITTED ONLY IN ACCORDANCE WITH
MANAGEMENT’S AUTHORIZATION; AND (IV) THE REPORTING OF THE COMPANIES’ ASSETS IS
COMPARED WITH EXISTING ASSETS AT REGULAR INTERVALS.

 

22

--------------------------------------------------------------------------------

 

Section 5.6            Operations Since Financial Statements Date  Except as set
forth in Schedule 5.6, from December 31, 2005 through the date hereof, there has
been no Material Adverse Effect. Except as set forth in Schedule 5.6, from the
Financial Statements Date through the date hereof, the Companies have conducted
their business in all material respects in the ordinary course. Without limiting
the generality of the foregoing, from the Financial Statements Date through the
date hereof, except as set forth in Schedule 5.6, none of the Companies has
taken any action which, if taken after the date hereof, would be prohibited by
Sections 7.4(b).

Section 5.7            Taxes. Except as set forth in Schedule 5.7, (i) the
Companies have filed all material Tax Returns required to have been filed on or
before the date hereof; (ii) all material Taxes of the Companies have been
timely paid; (iii) none of the Companies has waived in writing any statute of
limitations in respect of Taxes of such Company which waiver is currently in
effect; (iv) no issues that have been raised by the relevant taxing authority in
connection with the examination of the Tax Returns referred to in clause (i) are
currently pending; (v) all deficiencies asserted or assessments made as a result
of any examination of the Tax Returns referred to in clause (i) by a taxing
authority have been paid in full; (vi) there are no liens for Taxes upon the
assets of the Companies except liens relating to current Taxes not yet due;
(vii) all Tax sharing arrangements and Tax indemnity arrangements relating to
the Companies (other than this Agreement) will terminate prior to the Closing
Date and none of the Companies will have any liability thereunder on or after
the Closing Date; (viii) all material Taxes which the Companies are required by
law to withhold or to collect for payment have been duly withheld and collected
and have been paid to the appropriate governmental authority or have been
accrued, reserved against and entered on the books of the Companies; and
(xi) Aon is not a foreign person for purposes of Section 1445 of the Code.

Section 5.8            Governmental Permits. Except as set forth in
Schedule 5.8, the Companies own, hold or possess all material licenses,
franchises, permits, privileges, immunities, approvals and other authorizations
from a Administrative Authority that are necessary to entitle them to own or
lease, operate and use their assets and to carry on and conduct their business
substantially as conducted immediately prior to the date of this Agreement
(herein collectively called “Governmental Permits”). The Companies have complied
in all material respects with all terms and conditions of the Governmental
Permits.

Section 5.9            Real Property. Except as set forth in Schedule 5.9, none
of the Companies owns any real property (the “Owned Real Property”).
Schedule 5.9 sets forth a brief description of each lease or similar agreement
under which any of the Companies is lessee of, or holds or operates, any real
property owned by any third Person (the “Leased Real Property”) (and, together
with the Owned Real Property, the “Real Property”). All of the properties
identified in Schedule 5.9 constitute all of the real property used by the
Companies in the conduct of the Warranty Business. The Companies have good and
marketable title to the Owned Real Property, not subject to any Encumbrances
other than Permitted Encumbrances. None of the Companies leases or subleases any
real property to any Person. Since January 1, 2004, neither Aon nor any of its
subsidiaries has received any written notice of any pending, threatened or
contemplated condemnation proceeding affecting the Real Property or any part
thereof or any sale or other disposition of the Real Property or any part
thereof in lieu of condemnation. To the Knowledge of Aon, there is no pending,
threatened or contemplated condemnation proceeding

23

--------------------------------------------------------------------------------

 

affecting a material portion of the Real Property or any sale or other
disposition of a material portion of the Real Property in lieu of condemnation.

Section 5.10         Personal Property. Schedule 5.10 contains, as of the date
of this Agreement, a list of each lease or other agreement or right under which
any of the Companies is lessee of, or holds or operates, any machinery,
equipment, vehicle or other tangible personal property owned by a third Person,
except those which are terminable by such Company without penalty on 90 days’ or
less notice or which provide for annual rental payments of less than $250,000.

SECTION 5.11         INTELLECTUAL PROPERTY.

(A)           SCHEDULE 5.11(A) CONTAINS A LIST OF ALL COPYRIGHTS, PATENT RIGHTS
AND TRADEMARKS WITHIN THE COMPANY INTELLECTUAL PROPERTY, WHICH LIST SEPARATELY
IDENTIFIES WHICH COPYRIGHTS, PATENT RIGHTS AND TRADEMARKS ARE OWNED AND WHICH
ARE LICENSED BY THE COMPANIES WHICH ARE, IN EACH CASE, MATERIAL TO THE CONDUCT
OF THEIR BUSINESS, AS CURRENTLY CONDUCTED.

(B)           SCHEDULE 5.11(B) CONTAINS A LIST OF ALL SOFTWARE WITHIN THE
COMPANY INTELLECTUAL PROPERTY WHICH IS MATERIAL TO THE CONDUCT OF THEIR
BUSINESS, AS CURRENTLY CONDUCTED, WHICH LIST SEPARATELY IDENTIFIES WHICH
SOFTWARE IS OWNED AND WHICH IS LICENSED BY THE COMPANIES.

(C)           EXCEPT AS DISCLOSED IN SCHEDULE 5.11(C), THE COMPANIES EITHER: 
(I) OWN THE ENTIRE RIGHT, TITLE AND INTEREST IN AND TO ALL MATERIAL COMPANY
INTELLECTUAL PROPERTY, FREE AND CLEAR OF ALL ENCUMBRANCES; OR (II) HAVE A VALID
CONTRACTUAL RIGHT OR LICENSE TO USE THE SAME IN THE CONDUCT OF THEIR BUSINESS AS
CURRENTLY CONDUCTED. FOR PURPOSES OF THIS SECTION 5.11(C) (BUT NOT SCHEDULE
5.11(C)), THE DEFINITION OF “SOFTWARE” IN SECTION 1.1 SHALL BE APPLIED AS IF IT
DID NOT CONTAIN THE PROVISO IN CLAUSE (I) OF SUCH DEFINITION.

(D)           EXCEPT AS DISCLOSED IN SCHEDULE 5.11(D):  (I) ALL REGISTRATIONS
FOR MATERIAL COPYRIGHTS, PATENT RIGHTS AND TRADEMARKS IDENTIFIED IN
SCHEDULE 5.11(A) AND OWNED BY THE COMPANIES ARE VALID AND IN FORCE, AND ALL
APPLICATIONS TO REGISTER ANY MATERIAL UNREGISTERED COPYRIGHTS, PATENT RIGHTS AND
TRADEMARKS SO IDENTIFIED ARE PENDING AND IN GOOD STANDING, TO THE KNOWLEDGE OF
AON, ALL WITHOUT CHALLENGE OF ANY KIND; (II) THE MATERIAL COPYRIGHTS, PATENT
RIGHTS AND TRADEMARKS (OTHER THAN WITH RESPECT TO PENDING APPLICATIONS) OWNED BY
THE COMPANIES ARE VALID AND IN FORCE; AND (III) THE COMPANIES HAVE THE RIGHT TO
BRING ACTIONS FOR INFRINGEMENT OR UNAUTHORIZED USE OF THE MATERIAL COPYRIGHTS,
PATENT RIGHTS, TRADEMARKS AND SOFTWARE OWNED BY THE COMPANIES.

(E)           EXCEPT AS DISCLOSED IN SCHEDULE 5.11(E), TO THE KNOWLEDGE OF AON,
(I) NO INFRINGEMENT BY ANY COMPANY OF ANY INTELLECTUAL PROPERTY RIGHTS OF ANY
OTHER PERSON HAS OCCURRED OR RESULTED IN ANY WAY FROM ITS CONDUCT OF THEIR
BUSINESS SINCE JANUARY 1, 2004, (II) NO WRITTEN NOTICE OF A CLAIM OF ANY
INFRINGEMENT OF ANY INTELLECTUAL PROPERTY RIGHTS OF ANY OTHER PERSON HAS BEEN
RECEIVED BY ANY COMPANY IN RESPECT OF THE CONDUCT OF THEIR BUSINESS SINCE
JANUARY 1, 2004, (III) NO OWNED COMPANY INTELLECTUAL PROPERTY INFRINGES OR
OTHERWISE CONFLICTS WITH ANY INTELLECTUAL PROPERTY RIGHT OF ANY PERSON AND
(IV) THERE IS CURRENTLY NO INFRINGEMENT BY ANY PERSON OF ANY OWNED COMPANY
INTELLECTUAL PROPERTY.

24

--------------------------------------------------------------------------------

 

(F)            EXCEPT AS DISCLOSED IN SCHEDULE 5.11(F), AS OF THE DATE HEREOF NO
PROCEEDINGS ARE PENDING OR, TO THE KNOWLEDGE OF AON, THREATENED AGAINST THE
COMPANIES WHICH CHALLENGE THE VALIDITY OR OWNERSHIP OF ANY COMPANY INTELLECTUAL
PROPERTY THAT IS OWNED BY THE COMPANIES.

(G)           THE COMPANIES HAVE TAKEN REASONABLE STEPS TO PROTECT, MAINTAIN AND
SAFEGUARD THE MATERIAL COMPANY INTELLECTUAL PROPERTY.

Section 5.12         Title to Property. Except for assets disposed of in the
ordinary course of business, the Companies have good and marketable title to
each item of equipment and other tangible personal property they purport to own,
including all of the tangible personal property reflected on the Balance Sheet
as owned by the Companies, free and clear of all Encumbrances, except for
Permitted Encumbrances.

Section 5.13         No Violation, Litigation or Regulatory Action. Except as
set forth in Schedule 5.13:

(A)           TO THE KNOWLEDGE OF AON, THE COMPANIES HAVE COMPLIED IN ALL
MATERIAL RESPECTS WITH ALL APPLICABLE REQUIREMENTS OF LAW AND COURT ORDERS;

(B)           AS OF THE DATE HEREOF, THERE IS NO LAWSUIT, SUIT, PROCEEDING OR
INVESTIGATION PENDING OR, TO THE KNOWLEDGE OF AON, THREATENED AGAINST THE
COMPANIES FOR WHICH (I) THE LIABILITY ALLEGED BY THE PLAINTIFF EXCEEDS $50,000
OR (II) CLASS ACTION STATUS IS SOUGHT BY THE PLAINTIFF AGAINST THE COMPANIES;

(C)           AS OF THE DATE HEREOF, THERE IS NO ACTION, SUIT OR PROCEEDING
PENDING OR, TO THE KNOWLEDGE OF AON, THREATENED THAT QUESTIONS THE LEGALITY OF
THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT OR ANY OF THE SELLER ANCILLARY
AGREEMENTS;

(D)           TO THE KNOWLEDGE OF AON, NO ADMINISTRATIVE AUTHORITY HAS IN THE
PAST FIVE (5) YEARS ISSUED A SUBPOENA OR ORDER TO SHOW CAUSE OR TAKEN A SIMILAR
REGULATORY ACTION OR INITIATED AN EXAMINATION OTHER THAN A PERIODIC MARKET
CONDUCT OR FINANCIAL EXAMINATION REGARDING THE WARRANTY BUSINESS; AND

(E)           THERE IS (I) NO CONSENT DECREE, SETTLEMENT AGREEMENT OR
STIPULATION WITH AN ADMINISTRATIVE AUTHORITY IN EFFECT RELATING TO THE WARRANTY
BUSINESS AND (II) NO MATERIAL COURT ORDER TO WHICH THE COMPANIES ARE SUBJECT.

Section 5.14         Contracts. Except as set forth in Schedule 5.14, as of the
date of this Agreement, none of the Companies is a party to or bound by:

(A)           ANY CONTRACT FOR THE PURCHASE BY SUCH COMPANY OF SUPPLIES OR
EQUIPMENT WHICH SUCH COMPANY REASONABLY ANTICIPATES WILL INVOLVE THE ANNUAL
PAYMENT OF MORE THAN $250,000 AFTER THE DATE HEREOF;

(B)           ANY CONTRACT FOR THE SALE BY SUCH COMPANY OF ANY SERVICES OR
PRODUCTS OF THE COMPANIES’ BUSINESS WHICH INVOLVED GROSS WRITTEN PREMIUM AND
FEES IN FISCAL 2005 OF MORE

25

--------------------------------------------------------------------------------

 

than $2,000,000 or which such Company reasonably expects to involve gross
written premium and fees in fiscal 2006 in excess of $2,000,000;

(C)           ANY LOAN AGREEMENTS, PROMISSORY NOTES, INDENTURES, BONDS, SECURITY
AGREEMENTS, GUARANTEES OR OBLIGATIONS FOR BORROWED MONEY OR OTHER INSTRUMENTS
INVOLVING INDEBTEDNESS OF, OR HELD BY, ANY COMPANY (EXCLUDING INVESTMENT
ASSETS);

(D)           ANY PARTNERSHIP, JOINT VENTURE OR OTHER SIMILAR AGREEMENT OR
ARRANGEMENT WITH ANY ENTITY OTHER THAN ONE OF THE COMPANIES, EXCLUDING
AGREEMENTS AND ARRANGEMENTS WITH CLIENTS IN THE ORDINARY COURSE OF BUSINESS AS
DESCRIBED IN SCHEDULE 5.14;

(E)           ANY AGREEMENT CONTAINING ANY COVENANT OR PROVISION PROHIBITING
SUCH COMPANY FROM ENGAGING IN ANY LINE OR TYPE OF BUSINESS (EXCEPT FOR SUCH
AGREEMENTS WHICH SHALL NOT APPLY TO SUCH COMPANY UPON CLOSING);

(F)            ANY AGREEMENT PROVIDING FOR INDEMNIFICATION OF ANY OFFICER,
DIRECTOR, EMPLOYEE OR AGENT OF ANY COMPANY (EXCLUDING ORGANIZATIONAL DOCUMENTS);

(G)           ANY AGREEMENT OR COMMITMENT IN WHICH A COMPANY HAS GRANTED
EXCLUSIVE RIGHTS RELATING TO ANY PRODUCT OR SERVICE OFFERED BY ANY COMPANY,
INCLUDING IN ANY TERRITORY;

(H)           ANY AGREEMENTS FOR THE ACQUISITION OR SALE, DIRECTLY OR INDIRECTLY
(BY MERGER OR OTHERWISE) OF ASSETS (WHETHER TANGIBLE OR INTANGIBLE) OTHER THAN
IN THE ORDINARY COURSE OF BUSINESS, OR THE SECURITIES OF ANOTHER PERSON OTHER
THAN INVESTMENT ASSETS;

(I)            ANY CONSULTING AGREEMENT MATERIAL TO THE BUSINESS OF THE
COMPANIES AS CURRENTLY CONDUCTED; AND

(J)            ANY AGREEMENT FOR CAPITAL EXPENDITURES IN EXCESS OF $250,000.

Section 5.15         Status of Contracts. Except as set forth in Schedule 5.15
or in any other Schedule hereto, each of the leases, contracts, licenses and
other agreements listed in Schedules 5.9, 5.10, 5.11(b), 5.13(e)(i), 5.14, 5.18,
5.25 and 5.27 (collectively, the “Business Agreements”) is in full force and
effect, except where the Business Agreement will expire in accordance with its
terms following the date hereof. The Companies are not, and, to the Knowledge of
Aon, are not alleged to be in, and to the Knowledge of Aon, no event has
occurred, and no circumstance or condition exists, that (with or without notice
or lapse of time) will or would reasonably be likely to result in a, material
breach or default under any of the Business Agreements. Aon has made available
to Buyer a true and correct copy of each written Business Agreement and
descriptions of any oral Business Agreements.

SECTION 5.16         ERISA.

(A)           WELFARE PLANS AND PENSION PLANS. EACH WELFARE PLAN AND PENSION
PLAN IN WHICH EMPLOYEES OF THE COMPANIES EMPLOYED AT LOCATIONS IN THE UNITED
STATES PARTICIPATE IS LISTED IN SCHEDULE 5.16(A) (“COMPANY PLAN”), AND AON HAS
MADE AVAILABLE TO BUYER A TRUE AND CORRECT COPY OF EACH SUCH PLAN AND, IF
APPLICABLE, A SUMMARY PLAN DESCRIPTION USED IN CONNECTION WITH SUCH PLAN. TO THE
KNOWLEDGE OF AON, WITH RESPECT TO EACH WELFARE PLAN AND PENSION PLAN

26

--------------------------------------------------------------------------------

 

in which employees of the Companies participate, (i) such plan has been
maintained and operated in compliance in all material respects with the
applicable requirements of the Code, ERISA, the regulations issued thereunder
and any other Requirements of Law and (ii) as of the date hereof, no litigation
or asserted claims against the Companies exist with respect to any such plan
(other than claims for benefits in the normal course of business). The Companies
do not have, and have never had, any obligation to contribute to any
Multiemployer Plan or union-sponsored welfare fund. None of the Companies and
any of their ERISA Affiliates has incurred or would reasonably be expected to
incur any liability under or pursuant to Title IV of ERISA with respect to its
employees employed at locations in the United States that would reasonably be
expected to have a Material Adverse Effect.

(B)           OTHER MATERIAL EMPLOYEE BENEFITS. ANY MATERIAL EMPLOYEE BENEFITS
FOR EMPLOYEES EMPLOYED AT LOCATIONS IN THE UNITED STATES (OTHER THAN THOSE
PROVIDED THROUGH THE WELFARE PLANS AND PENSION PLANS LISTED IN SCHEDULE 5.16(A))
WHICH ARE IN EFFECT ON THE CLOSING DATE AND AS TO WHICH ANY OF THE COMPANIES HAS
OR MAY HAVE IN THE FUTURE ANY LIABILITY (OTHER THAN REGULAR WAGES OR SALARY),
SUCH AS ANY BONUS, INCENTIVE OR ANNUAL PROFIT SHARING PROGRAMS, ANY FRINGE
BENEFITS DESCRIBED IN SECTION 132 OF THE CODE, ANY EDUCATIONAL ASSISTANCE PLANS
UNDER SECTION 127 OF THE CODE AND ANY DEPENDENT CARE ASSISTANCE PLANS UNDER
SECTION 129 OF THE CODE, ARE LISTED IN SCHEDULE 5.16(B), AND ANY WRITTEN
DESCRIPTION OF ANY SUCH EMPLOYEE BENEFIT HAS BEEN MADE AVAILABLE TO BUYER BY
AON. SCHEDULE 5.16(B) IDENTIFIES EACH SUCH MATERIAL EMPLOYEE BENEFIT THAT IS
SPONSORED OR MAINTAINED BY THE COMPANIES.

(C)           MATERIAL INTERNATIONAL EMPLOYEE BENEFIT PLANS. EACH WELFARE PLAN
PROVIDING POST-RETIREMENT MEDICAL BENEFITS IN WHICH EMPLOYEES OF THE COMPANIES
EMPLOYED AT LOCATIONS OUTSIDE OF THE UNITED STATES PARTICIPATE, EACH FUNDED
PENSION PLAN IN WHICH EMPLOYEES OF THE COMPANIES EMPLOYED AT LOCATIONS OUTSIDE
OF THE UNITED STATES PARTICIPATE AND EACH OTHER MATERIAL PENSION PLAN (EXCLUDING
PENSION PLANS MANDATED BY REQUIREMENTS OF LAW) IN WHICH EMPLOYEES OF THE
COMPANIES EMPLOYED AT LOCATIONS OUTSIDE OF THE UNITED STATES PARTICIPATE IS
LISTED IN SCHEDULE 5.16(C) (“MATERIAL INTERNATIONAL PLAN”), AND AON HAS MADE
AVAILABLE TO BUYER A TRUE AND CORRECT COPY OF EACH SUCH PLAN.

Section 5.17         Environmental Matters. Except as set forth in
Schedule 5.17,

(A)           NONE OF THE COMPANIES NOR ANY OWNED REAL PROPERTY IS SUBJECT TO
ANY ORDER FROM OR CONSENT OR SETTLEMENT AGREEMENT WITH ANY PERSON (INCLUDING ANY
ADMINISTRATIVE AUTHORITY) NOR, TO THE KNOWLEDGE OF AON, IS ANY INVESTIGATION
PENDING OR THREATENED, RESPECTING (I) ANY REMEDIAL ACTION AT ANY OWNED REAL
PROPERTY OR (II) ANY CLAIM OF LOSSES AND EXPENSES ARISING FROM THE RELEASE OR
THREATENED RELEASE OF A CONTAMINANT INTO THE ENVIRONMENT;

(B)           TO THE KNOWLEDGE OF AON, NO PROPERTY LEASED BY ANY OF THE
COMPANIES IS CURRENTLY THE SUBJECT OF ANY INVESTIGATION BY, ORDER FROM OR
CONSENT OR SETTLEMENT AGREEMENT WITH ANY PERSON (INCLUDING ANY ADMINISTRATIVE
AUTHORITY) RESPECTING ANY (I) REMEDIAL ACTION OR (II) ANY CLAIM OF LOSSES AND
EXPENSES ARISING FROM THE RELEASE OR THREATENED RELEASE OF A CONTAMINANT INTO
THE ENVIRONMENT;

27

--------------------------------------------------------------------------------

 

(C)           NONE OF THE COMPANIES IS SUBJECT TO ANY JUDICIAL OR ADMINISTRATIVE
PROCEEDING, ORDER, JUDGMENT, DECREE OR SETTLEMENT ALLEGING OR ADDRESSING A
MATERIAL VIOLATION OF OR MATERIAL LIABILITY UNDER ANY ENVIRONMENTAL LAW; AND

(D)           SINCE JANUARY 1, 2004, THE COMPANIES HAVE NOT RECEIVED ANY WRITTEN
NOTICE OR CLAIM TO THE EFFECT THAT IT IS OR MAY BE LIABLE TO ANY PERSON,
INCLUDING ANY ADMINISTRATIVE AUTHORITY, AS A RESULT OF THE RELEASE OF A
CONTAMINANT;

(E)           THE BUSINESS OF THE COMPANIES ARE, AND HAVE BEEN, CONDUCTED IN
MATERIAL COMPLIANCE WITH ALL APPLICABLE ENVIRONMENTAL LAWS; AND

(F)            TO THE KNOWLEDGE OF AON, NO COMPANY HAS (I) CREATED OR ASSUMED
ANY MATERIAL LIABILITIES, GUARANTIES, OBLIGATIONS OR INDEMNIFICATIONS UNDER ANY
ENVIRONMENTAL LAW, CONSENT DECREE OR CONTRACT WITH ANY THIRD PARTY, INCLUDING
ANY ADMINISTRATIVE AUTHORITY, RELATED TO ANY PROPERTY CURRENTLY OR FORMERLY
OWNED, OPERATED OR LEASED BY THE COMPANIES; OR (II) ANY MATERIAL LIABILITY UNDER
ENVIRONMENTAL LAW FOR ITS NON-COMPLIANCE WITH ANY ENVIRONMENTAL LAW AT THE REAL
PROPERTY OR WITH RESPECT TO ANY INVESTIGATION, MONITORING, CLEANUP OR
REMEDIATION RELATED TO ANY CONTAMINANT.

SECTION 5.18         EMPLOYEE RELATIONS AND AGREEMENTS.

(A)           SCHEDULE 5.18 CONTAINS A TRUE AND COMPLETE LISTING OF EACH OF THE
EMPLOYEES OF THE COMPANIES WHOSE COMPENSATION EXCEEDED $250,000 DURING THE
TWELVE MONTHS ENDED DECEMBER 31, 2005 OR WHOSE ANNUAL BASE COMPENSATION EXCEEDS
$150,000 AS OF THE DATE HEREOF, ALONG WITH THEIR TITLES AND CURRENT ANNUAL BASE
COMPENSATION. EXCEPT AS SET FORTH IN SCHEDULE 5.18, NO EMPLOYEE OF ANY OF THE
COMPANIES WHOSE COMPENSATION EXCEEDED $250,000 DURING THE TWELVE MONTHS ENDED
DECEMBER 31, 2005 OR WHOSE ANNUAL BASE COMPENSATION IS IN EXCESS OF $150,000 HAS
GIVEN NOTICE TO ANY COMPANY TO CANCEL OR OTHERWISE TERMINATE SUCH PERSON’S
RELATIONSHIP WITH THE COMPANIES AS OF THE DATE HEREOF.

(B)           EXCEPT AS SET FORTH IN SCHEDULE 5.18, THE COMPANIES ARE NOT A
PARTY TO ANY LABOR CONTRACT OR COLLECTIVE BARGAINING AGREEMENT NOR IS ANY SUCH
CONTRACT OR AGREEMENT PRESENTLY BEING NEGOTIATED, NOR IS THERE, NOR HAS THERE
BEEN IN THE LAST THREE (3) YEARS, A PROCEEDING BEFORE ANY ADMINISTRATIVE
AUTHORITY CONCERNING A UNION REPRESENTATION QUESTION RESPECTING ANY OF THE
EMPLOYEES OF THE COMPANIES.

(C)           EXCEPT AS SET FORTH IN SCHEDULE 5.18, NO UNION OR SIMILAR
ORGANIZATION REPRESENTS EMPLOYEES OF THE COMPANIES AND, TO THE KNOWLEDGE OF AON,
NO SUCH ORGANIZATION IS ATTEMPTING TO ORGANIZE SUCH EMPLOYEES.

(D)           THE COMPANIES ARE IN COMPLIANCE IN ALL MATERIAL RESPECTS WITH ALL
APPLICABLE REQUIREMENTS OF LAW RELATING TO THE EMPLOYMENT OF LABOR, INCLUDING
ALL SUCH APPLICABLE LAWS RELATING TO WAGES, HOURS, COLLECTIVE BARGAINING,
EMPLOYMENT DISCRIMINATION, CIVIL RIGHTS, SAFETY AND HEALTH, WORKERS’
COMPENSATION, PAY EQUITY AND THE COLLECTION AND PAYMENT OF WITHHOLDING AND/OR
SOCIAL SECURITY TAXES AND SIMILAR TAXES, AND, TO THE KNOWLEDGE OF AON, THERE IS
NO PENDING OR THREATENED INQUIRY OR AUDIT FROM ANY ADMINISTRATIVE AUTHORITY
CONCERNING ANY COMPANY’S COMPLIANCE WITH ANY APPLICABLE REQUIREMENTS OF LAW
RELATING TO THE EMPLOYMENT OF LABOR. NONE OF THE COMPANIES HAS ANY OBLIGATION TO
PAY OVERTIME IN RESPECT OF ANY EMPLOYEE

28

--------------------------------------------------------------------------------

 

determined by such Person to be exempt from the overtime requirements of the
Fair Labor Standards Act or any similar state law.

(E)           EXCEPT AS SET FORTH IN SCHEDULE 5.18, NO DIRECTOR, OFFICER OR
EMPLOYEE OF ANY OF THE COMPANIES IS A PARTY TO (I) ANY EMPLOYMENT OR OTHER
AGREEMENT WITH ANY OF THE COMPANIES THAT ENTITLES HIM OR HER TO COMPENSATION OR
OTHER CONSIDERATION UPON THE ACQUISITION BY ANY PERSON OF CONTROL OF ANY OF THE
COMPANIES OR (II) ANY OTHER EMPLOYMENT AGREEMENT THAT PROVIDES FOR ANNUAL BASE
COMPENSATION IN EXCESS OF $150,000. AS OF THE CLOSING, NONE OF THE COMPANIES
WILL HAVE ANY CONTINUING LIABILITY OR OBLIGATIONS UNDER ANY OF THE SUCCESS BONUS
AGREEMENTS.

Section 5.19         No Undisclosed Liabilities. Except as set forth in
Schedule 5.19, or as reflected or reserved against in the Financial Statements
or Statutory Statements (including in each case the notes thereto), as of the
Financial Statements Date, the Warranty Business was not subject to any
liability, whether absolute, contingent, accrued, known, unknown, or otherwise,
that would be required to be included on a balance sheet prepared in accordance
with GAAP or SAP or disclosed in the notes thereto. Since the Financial
Statements Date through the date hereof, except as set forth in Schedule 5.19,
the Warranty Business has not incurred any material liability other than in the
ordinary course of business (including policyholder benefits or other insurance
policy liabilities), whether absolute, contingent, accrued or otherwise, except
for liabilities that would not be required to be included on a balance sheet
prepared in accordance with GAAP or SAP or disclosed in the notes thereto.

Section 5.20         Sufficiency of Assets. Except as set forth in
Schedule 5.20, the assets and properties (including Company Intellectual
Property) of the Companies (together with the Transferred Business) constitute
all of the assets and properties reasonably necessary to operate the Warranty
Business as currently conducted other than (i) assets and properties (including
Company Intellectual Property) that, individually and in the aggregate, are not
material to such business and (ii) assets and properties (including software)
being provided pursuant to the Transition Services Agreement. The equipment of
the Companies are, in the aggregate, in good operating condition and repair, and
are adequate for the uses to which they are being put. Except for the preceding
sentence, nothing in this Section 5.20 constitutes a representation or warranty
with respect to title or the condition of any assets or properties (whether real
or personal, tangible or intangible, owned, leased or held under license), any
and all representations or warranties with respect to which are set forth in
other sections of this Article V.

Section 5.21         Insurance. Aon currently maintains policies covering the
Companies in respect of fire and extended coverage and casualty, liability and
other forms of insurance (excluding reinsurance) in such amounts and against
such risks and losses, and including such levels of self-insured retention, as
are in its judgment prudent and shall use reasonable efforts to keep such
insurance or comparable insurance in full force and effect through the Closing
Date (the “Insurance Policies”). Schedule 5.21 contains a complete and accurate
list of all of the Insurance Policies. The Insurance Policies are in full force
and effect.

Section 5.22         Reserves. Except as indicated in Schedule 5.22, the
reserves of each of the Underwriting Companies as reported in such companies’
December 31, 2005

29

--------------------------------------------------------------------------------

 

Statutory Statements were determined in accordance with generally recognized
actuarial methods and standards, consistently applied, and were fairly stated in
accordance with sound actuarial principles using prescribed accident period loss
development triangles and such reserve liabilities met the applicable
requirements of the insurance laws and regulations of each company’s respective
jurisdiction of domicile.

Section 5.23         Regulatory Filings. Except as set forth in Schedule 5.23,
Aon has heretofore made available for inspection by Buyer (i) each annual
statement filed with or submitted to any state insurance regulatory authorities
by any of the Underwriting Companies required to make such filings since
December 31, 2002 and (ii) any reports of examination of any of the Underwriting
Companies required to make such a report, issued by any state insurance
regulatory authority, in any case, since December 31, 2002.

Section 5.24         Ratings. As of the date hereof, (i) the financial strength
or claims-paying ability of VSC and RLIC are currently rated A- and B++,
respectively, by A.M. Best, and VSC is rated BBBpi by Standard & Poor’s
Corporation; and (ii) except as disclosed on Schedule 5.24, no rating
organization named above has communicated to Aon or any Company that it has
under surveillance or review its rating of the financial strength or
claims-paying ability of VSC or RLIC.

Section 5.25         Reinsurance. Schedule 5.25 identifies all reinsurance
agreements to which each of the Underwriting Companies is a party with respect
to the Warranty Business.

Section 5.26         No Brokers. Except for the services of Morgan Stanley & Co.
Incorporated, none of the Companies nor any Person acting on their behalf has
paid or become obligated to pay any fee or commission to any broker, finder or
intermediary for or on account of the transactions contemplated by this
Agreement. Aon is solely responsible for any payment, fee or commission that may
be due to Morgan Stanley & Co. Incorporated in connection with the transactions
contemplated hereby.

Section 5.27         Transaction with Affiliates. Except as set forth in
Schedule 5.27 and for any Buyer Ancillary Agreement or Seller Ancillary
Agreement, and except for compensation and the reimbursement of expenses
incurred in the ordinary course of business to the employees of the Companies,
(a) there are no contracts or leases between any Company, on the one hand, and
any Seller Group Member (other than the Companies), or any executive officer or
director of the Companies or, to the Knowledge of Aon, any member of their
respective immediate families, on the other hand, and (b) to the Knowledge of
Aon, no executive officer or director of the Companies or any member of their
respective immediate families has any interest in any property (whether real,
personal, or mixed and whether tangible or intangible) used in or pertaining to
the Warranty Business as currently conducted.

SECTION 5.28         CERTAIN BUSINESS PRACTICES.

(A)           WITHIN THE LAST FIVE (5) YEARS, NONE OF THE COMPANIES OR THEIR
RESPECTIVE DIRECTORS, OFFICERS, AGENTS OR EMPLOYEES ACTING FOR OR ON THE
COMPANIES’ BEHALF IN RESPECT OF THE WARRANTY BUSINESS, IN VIOLATION OF ANY
REQUIREMENT OF LAW, HAS (I) MADE ANY CONTRIBUTION, GIFT, BRIBE, REBATE, PAYOFF,
INFLUENCE PAYMENT, KICKBACK, OR OTHER PAYMENT TO ANY PERSON, PRIVATE OR

30

--------------------------------------------------------------------------------

 

public, regardless of form, whether in money, property, or services (w) to
obtain favorable treatment in securing business, (x) to pay for favorable
treatment for business secured, (y) to obtain special concessions or for special
concessions already obtained, for or in respect of any Company or any Affiliate
of a Company, (ii) received, directly or indirectly, any rebates, payments,
commissions, promotional allowances or any other economic benefits, regardless
of their nature or type, from any customer, governmental employee or other
person or entity with whom any Company will do business directly or indirectly
or (iii) established or maintained any fund or asset that has not been recorded
in the books and records of the Companies.

(B)           NO COMPANY HAS VIOLATED IN ANY MATERIAL RESPECT, AND THE COMPANIES
ARE IN COMPLIANCE IN ALL MATERIAL RESPECTS WITH, UNITED STATES AND INTERNATIONAL
ECONOMIC AND TRADE SANCTIONS, INCLUDING THOSE ADMINISTERED BY THE OFFICE OF
FOREIGN ASSETS CONTROL WITHIN THE UNITED STATES DEPARTMENT OF THE TREASURY.

Section 5.29         Warranty Business. The Companies (other than VSC, LGI, LGH
and CLAC) have not engaged in activities that do not relate to or arise out of
the Warranty Business.

Section 5.30         Actuarial Reports. Aon has made available to Buyer a true
and complete copy of any actuarial reports prepared by independent actuaries
relating to the Warranty Business since December 31, 2002, and all material
attachments, addenda, supplements and modifications thereto.

Section 5.31         Clients. Schedule 5.31 lists the top ten clients of the
Warranty Business (based upon gross written premium and fees in fiscal 2005). To
the Knowledge of Aon, neither Aon nor any of the Companies has received notice
from any Person listed in Schedule 5.31 that it intends to terminate or
materially reduce its writings with or through the Warranty Business.

ARTICLE VI

REPRESENTATIONS AND WARRANTIES OF BUYER

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

Section 6.1            Organization of Buyer. Buyer is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware. Buyer has the corporate power and authority to own or lease and
operate its assets and to carry on its businesses in the manner that they were
conducted immediately prior to the date of this Agreement.

SECTION 6.2            AUTHORITY OF BUYER; CONFLICTS.

(A)           BUYER HAS THE CORPORATE POWER AND AUTHORITY TO EXECUTE, DELIVER
AND PERFORM THIS AGREEMENT AND EACH OF THE BUYER ANCILLARY AGREEMENTS. THE
EXECUTION, DELIVERY AND PERFORMANCE OF THIS AGREEMENT AND THE BUYER ANCILLARY
AGREEMENTS BY BUYER HAVE BEEN DULY AUTHORIZED AND APPROVED BY BUYER’S BOARD OF
DIRECTORS AND DO NOT REQUIRE ANY FURTHER

31

--------------------------------------------------------------------------------

 

authorization or consent of Buyer or its stockholders. This Agreement has been
duly authorized, executed and delivered by Buyer and (assuming the valid
authorization, execution and delivery of this Agreement by Aon) is the legal,
valid and binding agreement of Buyer enforceable in accordance with its terms,
and each of the Buyer Ancillary Agreements has been duly authorized by Buyer and
upon execution and delivery by Buyer will be (assuming the valid authorization,
execution and delivery by the other party or parties thereto) a legal, valid and
binding obligation of Buyer enforceable in accordance with its terms, in each
case subject to bankruptcy, insolvency, reorganization, moratorium and similar
laws relating to or affecting the enforcement of creditors’ rights generally and
to general equity principles.

(B)           EXCEPT AS SET FORTH IN SCHEDULE 6.2, NEITHER THE EXECUTION AND
DELIVERY OF THIS AGREEMENT BY BUYER OR ANY OF THE BUYER ANCILLARY AGREEMENTS OR
THE CONSUMMATION BY BUYER OF ANY OF THE TRANSACTIONS CONTEMPLATED HEREBY OR
THEREBY NOR COMPLIANCE BY BUYER WITH OR FULFILLMENT OF THE TERMS, CONDITIONS AND
PROVISIONS HEREOF OR THEREOF WILL:

(I)            ASSUMING THE RECEIPT OF ALL NECESSARY CONSENTS AND APPROVALS AND
THE FILING OF ALL NECESSARY DOCUMENTS AS DESCRIBED IN SECTION 6.2(B)(II), RESULT
IN A VIOLATION OR BREACH OF THE TERMS, CONDITIONS OR PROVISIONS OF, OR
CONSTITUTE A DEFAULT, AN EVENT OF DEFAULT OR AN EVENT CREATING RIGHTS OF
ACCELERATION, TERMINATION OR CANCELLATION OR A LOSS OF RIGHTS UNDER (1) THE
ORGANIZATIONAL DOCUMENTS OF BUYER, (2) ANY NOTE, INSTRUMENT, MORTGAGE, LEASE,
FRANCHISE, FINANCIAL OBLIGATION OR MATERIAL AGREEMENT TO WHICH BUYER IS A PARTY
OR ANY OF ITS PROPERTIES IS SUBJECT OR BY WHICH BUYER IS BOUND, (3) ANY COURT
ORDER TO WHICH BUYER IS A PARTY OR BY WHICH IT IS BOUND OR (4) ANY REQUIREMENTS
OF LAW AFFECTING BUYER, OTHER THAN, IN THE CASE OF CLAUSES (2), (3) AND
(4) ABOVE, ANY SUCH VIOLATIONS, BREACHES, DEFAULTS, RIGHTS OR LOSS OF RIGHTS
THAT WOULD NOT MATERIALLY IMPAIR THE ABILITY OF BUYER TO PERFORM ITS OBLIGATIONS
HEREUNDER OR PREVENT THE CONSUMMATION OF ANY OF THE TRANSACTIONS CONTEMPLATED
HEREBY, OR

(II)           REQUIRE THE APPROVAL, CONSENT, AUTHORIZATION OR ACT OF, OR THE
MAKING BY BUYER OF ANY DECLARATION, FILING OR REGISTRATION WITH, ANY
ADMINISTRATIVE AUTHORITY, EXCEPT FOR (1) IN CONNECTION, OR IN COMPLIANCE, WITH
THE PROVISIONS OF THE HSR ACT, EUROPEAN COMMUNITY COUNCIL REGULATION (EC)
NO. 139/2004, OR SIMILAR COMPETITION REQUIREMENTS OF LAW IN FOREIGN
JURISDICTIONS, (2) ACQUISITION OF CONTROL STATEMENT FILINGS AND PREACQUISITION
STATEMENTS REQUIRED UNDER APPLICABLE STATE INSURANCE HOLDING COMPANY SYSTEM LAWS
AND REGULATIONS AND ANY OTHER INSURANCE REGULATORY APPROVALS, CONSENTS, FILINGS
OR NOTICES REQUIRED BY ANY APPLICABLE INSURANCE REQUIREMENTS OF LAW, (3) SUCH
FILINGS AS MAY BE REQUIRED IN CONNECTION WITH THE TAXES DESCRIBED IN
SECTION 8.1, AND (4) SUCH APPROVALS, CONSENTS, AUTHORIZATIONS, DECLARATIONS,
FILINGS OR REGISTRATIONS THE FAILURE OF WHICH TO BE OBTAINED OR MADE WOULD NOT
MATERIALLY IMPAIR THE ABILITY OF BUYER TO PERFORM ITS OBLIGATIONS HEREUNDER OR
PREVENT THE CONSUMMATION OF ANY OF THE TRANSACTIONS CONTEMPLATED HEREBY.

Section 6.3            No Violation, Litigation or Regulatory Action. Except as
set forth in Schedule 6.3:

(I)            AS OF THE DATE HEREOF, THERE ARE NO LAWSUITS, CLAIMS, SUITS,
PROCEEDINGS OR INVESTIGATIONS PENDING OR, TO THE KNOWLEDGE OF BUYER, THREATENED
AGAINST BUYER OR ITS

32

--------------------------------------------------------------------------------

 

subsidiaries which are reasonably expected to materially impair the ability of
Buyer to perform its obligations hereunder or prevent the consummation of any of
the transactions contemplated hereby; and

(II)           AS OF THE DATE HEREOF, THERE IS NO MATERIAL ACTION, SUIT OR
PROCEEDING PENDING OR, TO THE KNOWLEDGE OF BUYER, THREATENED AGAINST BUYER THAT
QUESTIONS THE LEGALITY OF THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT OR ANY
OF THE BUYER ANCILLARY AGREEMENTS.

SECTION 6.4            INVESTMENT INTENT.

(A)           BUYER IS ACQUIRING THE SHARES AS AN INVESTMENT FOR ITS OWN ACCOUNT
AND NOT WITH A VIEW TO THE DISTRIBUTION THEREOF.

(B)           BUYER ACKNOWLEDGES THAT IT HAS BEEN FURNISHED WITH SUCH DOCUMENTS,
MATERIALS AND INFORMATION AS BUYER DEEMS NECESSARY OR APPROPRIATE FOR EVALUATING
THE PURCHASE OF THE SHARES. BUYER CONFIRMS THAT IT HAS MADE SUCH FURTHER
INVESTIGATION OF THE COMPANIES AS WAS DEEMED APPROPRIATE TO EVALUATE THE MERITS
AND RISKS OF THIS PURCHASE. BUYER FURTHER ACKNOWLEDGES THAT IT HAS HAD THE
OPPORTUNITY TO ASK QUESTIONS OF, AND RECEIVE ANSWERS FROM, THE DIRECTORS AND
OFFICERS OF THE COMPANIES, SELLERS AND PERSONS ACTING ON THE COMPANIES’ AND
SELLERS’ BEHALF, CONCERNING THE TERMS AND CONDITIONS OF THE PURCHASE OF THE
SHARES. NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED HEREIN, BUYER’S
RIGHTS WITH RESPECT TO INDEMNIFICATION, PAYMENT OF LOSSES AND EXPENSES OR OTHER
REMEDY BASED ON REPRESENTATIONS, WARRANTIES, COVENANTS AND OBLIGATIONS IN THIS
AGREEMENT, OR ANY CERTIFICATE DELIVERED PURSUANT TO THIS AGREEMENT, WILL NOT,
SUBJECT TO SECTION 11.6(C), BE AFFECTED BY BUYER’S INVESTIGATION OF THE
COMPANIES OR BY ITS RECEIPT OF INFORMATION AS DESCRIBED IN THIS SECTION 6.4(B).

Section 6.5            Financial Ability. Buyer has available to it the
financial ability to consummate the transactions contemplated by this Agreement.

Section 6.6            No Brokers. Neither Buyer nor any Person acting on its
behalf has paid or become obligated to pay any fee or commission to any broker,
finder or intermediary for or on account of the transactions contemplated by
this Agreement.

ARTICLE VII

ACTION PRIOR TO THE CLOSING DATE

The respective parties hereto covenant and agree to take the following actions
between the date hereof and the Closing Date:

Section 7.1            Access to Information. Aon shall cause the Companies to
afford to the officers, employees and authorized representatives of Buyer
(including independent public accountants and attorneys) and Buyer’s financing
sources (and their authorized representatives) reasonable access during normal
business hours, upon reasonable advance notice, to the offices, properties,
employees, representatives (including accountants, attorneys and other
professionals), and business and financial records (including computer files,
retrieval programs and similar documentation and accountants’ work papers) of
the Companies and shall furnish to Buyer or its

33

--------------------------------------------------------------------------------

 

authorized representatives such additional information (including copies of such
information) concerning the Companies as shall be reasonably requested;
provided, however, that (i) the Companies shall not be required to violate any
Requirements of Law or Court Order, or legal or contractual obligation of
confidentiality to any third party to which the Companies are subject or to
waive any attorney-client privilege which they may possess in discharging their
obligations pursuant to this Section 7.1; and (ii) Buyer shall not, without the
prior written consent of Aon, which shall not be unreasonably withheld or
delayed, contact or communicate with any vendor, customer, or other business
partner of the Companies with respect to or in connection with the transactions
contemplated hereby. Buyer agrees that such investigation shall be conducted in
such a manner as not to interfere unreasonably with the operations of the
Companies. In the event that Aon shall have determined that it may not disclose
any information requested by Buyer under this Section 7.1 as a result of a legal
or contractual obligation of confidentiality to a third party to which any of
the Companies are subject, if Buyer so requests it shall, and shall cause each
of the applicable Companies to, use its commercially reasonable efforts to
obtain the consent or waiver of such third party to the disclosure requested by
Buyer hereunder as promptly as practicable following Buyer’s request.
Notwithstanding the foregoing, the obligations of Aon pursuant to this
Section 7.1 shall be subject to the right of Aon to determine, in its
discretion, the appropriate timing of the disclosure of information they
reasonably deem to be highly sensitive or privileged information. The parties
shall act at all times in accordance with the terms and provisions of the
Confidentiality Agreement.

Section 7.2            Notification. Each of Buyer and Aon shall promptly notify
the other of any action, suit or proceeding that shall be instituted or
threatened against such party to restrain, prohibit or otherwise challenge the
legality of any transaction contemplated by this Agreement. Each party hereto
shall promptly notify the other of any lawsuit, claim, proceeding or
investigation that may be threatened, brought, asserted or commenced against
Sellers, the Companies or Buyer, as the case may be, that would have been listed
in Schedule 5.13 or Schedule 6.3, as the case may be, if such lawsuit, claim,
proceeding or investigation had arisen prior to the date hereof. Each party
shall promptly notify the other party as promptly as practicable of (a) any
notice or other communication from any Person alleging that the consent of such
Person (or another Person) is or may be required in connection with the
transactions contemplated by this Agreement, (b) any notice or other
communication from any Administrative Authority in connection with the
transactions contemplated by this Agreement, (c) any notice or other
communication from any Person whose consent, approval or waiver is being sought
under Section 7.3(a), and (d) any event, condition, fact or circumstance that
would make the timely satisfaction of any of the conditions set forth in
Article IX and X impossible or unlikely.

SECTION 7.3            CONSENTS OF THIRD PARTIES; GOVERNMENTAL APPROVALS.

(A)           AON AND BUYER WILL ACT DILIGENTLY AND REASONABLY IN ATTEMPTING TO
SECURE, BEFORE THE CLOSING DATE, THE CONSENT, APPROVAL OR WAIVER, IN FORM AND
SUBSTANCE REASONABLY SATISFACTORY TO THE OTHER PARTY, REQUIRED TO BE OBTAINED
FROM ANY PERSON (OTHER THAN A ADMINISTRATIVE AUTHORITY) TO CONSUMMATE THE
TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT; PROVIDED, HOWEVER, THAT SUCH ACTION
SHALL NOT INCLUDE ANY REQUIREMENT OF THE COMPANIES, AON OR ANY OF THEIR
RESPECTIVE AFFILIATES TO EXPEND MONEY, COMMENCE OR PARTICIPATE IN ANY LITIGATION
OR OFFER OR GRANT ANY ACCOMMODATION (FINANCIAL OR OTHERWISE) TO ANY THIRD PARTY
UNLESS, IN THE CASE

34

--------------------------------------------------------------------------------

 

of any proposed requirement of the Companies to expend money, Buyer shall have
requested that such an expenditure be made, in which case Aon shall cause the
Companies to make such payment, and if such payment is made prior to Closing and
(i) the Closing occurs, the amount of such payment shall be considered cash of
the Companies for purposes of determining Closing Date Net Worth and (ii) if
this Agreement is terminated prior to Closing, Buyer shall reimburse the
Companies for the full amount of the expenditure promptly following the
termination of this Agreement.

(B)           FROM AND AFTER THE DATE HEREOF THROUGH THE CLOSING DATE, BUYER
SHALL ACT DILIGENTLY AND REASONABLY, AND AON SHALL ACT REASONABLY AND DILIGENTLY
TO COOPERATE WITH BUYER, IN ATTEMPTING TO SECURE ANY INSURANCE REGULATORY
CONSENTS AND APPROVALS OF ANY ADMINISTRATIVE AUTHORITY REQUIRED TO BE OBTAINED
IN ORDER TO PERMIT THE CONSUMMATION OF THE TRANSACTIONS CONTEMPLATED BY THIS
AGREEMENT (INCLUDING APPROVALS AND CONSENTS FROM STATE DEPARTMENTS OF INSURANCE
AND THE UK FINANCIAL SERVICES AUTHORITY (OR SIMILAR FOREIGN DEPARTMENTS)) HAVING
OR ASSERTING JURISDICTION OVER ANY OF THE UNDERWRITING COMPANIES AND AUTOMOTIVE
INSURANCE AGENCY, INC., THE TRANSFERS OF THE FFG WARRANTY BUSINESS AND THE CICA
WARRANTY BUSINESS AND THE OTHER FACILITATING TRANSACTIONS, AND THE TRANSFER OF
OWNERSHIP OF ANY OTHER ENTITY BEING CONVEYED PURSUANT TO THIS AGREEMENT (IT
BEING UNDERSTOOD THAT (I) WITH RESPECT TO THE SALE OF THE SHARES TO BUYER AT THE
CLOSING, BUYER WILL HAVE PRIMARY RESPONSIBILITY FOR PREPARING ALL SUCH NECESSARY
FILINGS AND THAT AON WILL COOPERATE FULLY IN PROVIDING ANY NECESSARY INFORMATION
AND SIGNATURES FOR SUCH FILINGS AND (II) WITH RESPECT TO THE FACILITATING
TRANSACTIONS, AON WILL HAVE THE PRIMARY RESPONSIBILITY FOR PREPARING ALL SUCH
NECESSARY FILINGS AND BUYER WILL COOPERATE FULLY IN PROVIDING ANY NECESSARY
INFORMATION AND SIGNATURES FOR SUCH FILINGS), OR TO OTHERWISE SATISFY THE
CONDITIONS SET FORTH IN SECTION 9.3 AND SECTION 10.3 WITH RESPECT TO INSURANCE
REGULATORY REQUIREMENTS. PRIOR TO FILING ANY MATERIALS OR DOCUMENTS WITH ANY
ADMINISTRATIVE AUTHORITY, EACH OF BUYER AND AON SHALL AFFORD THE OTHER A
REASONABLE OPPORTUNITY (NO LESS THAN TWO (2) BUSINESS DAYS) TO REVIEW AND
COMMENT ON SUCH MATERIALS OR DOCUMENTS.

(C)           AON AND BUYER SHALL USE THEIR COMMERCIALLY REASONABLE EFFORTS TO
TAKE, OR CAUSE TO BE TAKEN, ALL ACTIONS NECESSARY TO CAUSE THE CONDITIONS
CONTAINED IN ARTICLES IX AND X TO BE SATISFIED IN A TIMELY MANNER AND TO
CONSUMMATE THE TRANSACTIONS CONTEMPLATED HEREBY. EXCEPT TO THE EXTENT OTHERWISE
PROVIDED IN SECTION 7.3(B) WITH RESPECT TO INSURANCE REGULATORY REQUIREMENTS,
AON AND BUYER SHALL (I) MAKE ALL FILINGS AND GIVE ALL NOTICES REQUIRED TO BE
MADE AND GIVEN BY SUCH PARTY OR ITS SUBSIDIARIES WITH ANY ADMINISTRATIVE
AUTHORITY IN CONNECTION WITH THE TRANSACTIONS CONTEMPLATED HEREBY AND SUBMIT
PROMPTLY ANY ADDITIONAL INFORMATION REQUESTED IN CONNECTION WITH SUCH FILINGS
AND NOTICES AND (II) USE THEIR COMMERCIALLY REASONABLE EFFORTS TO OBTAIN EACH
CONSENT REQUIRED TO BE OBTAINED PURSUANT TO ANY APPLICABLE REQUIREMENTS OF LAW,
INCLUDING ANTITRUST LAWS, BY SUCH PARTY IN CONNECTION WITH THE TRANSACTIONS
CONTEMPLATED BY THIS AGREEMENT.

(D)           WITHOUT LIMITING THE FOREGOING PROVISIONS OF THIS SECTION 7.3,
BUYER AND AON SHALL USE THEIR COMMERCIALLY REASONABLE EFFORTS TO FILE NOT MORE
THAN 10 DAYS AFTER THE DATE HEREOF WITH THE FEDERAL TRADE COMMISSION AND THE
ANTITRUST DIVISION OF THE DEPARTMENT OF JUSTICE THE NOTIFICATIONS AND OTHER
INFORMATION REQUIRED TO BE FILED UNDER THE HSR ACT WITH RESPECT TO THE
TRANSACTIONS CONTEMPLATED HEREBY. EACH PARTY WARRANTS THAT ALL SUCH FILINGS BY
IT WILL BE, AS OF THE DATE FILED, TRUE AND ACCURATE IN ALL MATERIAL RESPECTS AND
IN MATERIAL COMPLIANCE WITH THE REQUIREMENTS OF THE HSR ACT. EACH OF BUYER AND
AON AGREES TO FILE ANY ADDITIONAL

35

--------------------------------------------------------------------------------

information requested by such agencies under the HSR Act, to make available to
the other such information as each of them may reasonably request relative to
its business, assets and property as may be required of each of them to file
such additional information and to use their commercially reasonable efforts to
take all other actions necessary to cause the expiration or termination of the
applicable waiting periods under the HSR Act as soon as practicable.

(E)           IN FURTHERANCE AND NOT IN LIMITATION OF THE FOREGOING, THE PARTIES
SHALL USE THEIR COMMERCIALLY REASONABLE EFFORTS TO RESOLVE SUCH OBJECTIONS, IF
ANY, AS MAY BE ASSERTED BY ANY ADMINISTRATIVE AUTHORITY WITH RESPECT TO THE
TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT UNDER ANY REQUIREMENTS OF LAW.
EXCEPT AS MAY BE PROHIBITED BY ANY ADMINISTRATIVE AUTHORITY OR BY APPLICABLE
REQUIREMENTS OF LAW, AON AND BUYER WILL CONSULT AND COOPERATE WITH ONE ANOTHER,
AND WILL CONSIDER IN GOOD FAITH THE VIEWS OF ONE ANOTHER, IN CONNECTION WITH ANY
ANALYSIS, APPEARANCE, PRESENTATION, MEMORANDUM, BRIEF, ARGUMENT, OPINION OR
PROPOSAL MADE OR SUBMITTED IN CONNECTION WITH ANY PROCEEDING UNDER OR RELATING
TO THE HSR ACT OR ANY OTHER ANTITRUST REQUIREMENT OF LAW. EXCEPT AS MAY BE
PROHIBITED BY ANY ADMINISTRATIVE AUTHORITY OR BY APPLICABLE REQUIREMENT OF LAW,
IN CONNECTION WITH ANY PROCEEDING UNDER OR RELATING TO THE HSR ACT OR ANY OTHER
FOREIGN, FEDERAL OR STATE ANTITRUST OR FAIR TRADE REQUIREMENT OF LAW OR ANY
OTHER SIMILAR LEGAL PROCEEDING, EACH OF AON AND BUYER WILL PERMIT AUTHORIZED
REPRESENTATIVES OF THE OTHER TO BE PRESENT AT EACH MEETING OR CONFERENCE
RELATING TO ANY SUCH LEGAL PROCEEDING AND TO HAVE ACCESS TO AND BE CONSULTED IN
CONNECTION WITH ANY DOCUMENT, OPINION OR PROPOSAL MADE OR SUBMITTED TO ANY
ADMINISTRATIVE AUTHORITY IN CONNECTION WITH ANY SUCH LEGAL PROCEEDING.

(F)            NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN THIS
AGREEMENT, BUYER SHALL NOT HAVE ANY OBLIGATION UNDER THIS AGREEMENT:  (I) TO
DISPOSE, TRANSFER OR HOLD SEPARATE, OR CAUSE ANY OF ITS SUBSIDIARIES OR
AFFILIATES TO DISPOSE, TRANSFER OR HOLD SEPARATE ANY MATERIAL ASSETS OR
OPERATIONS, OR TO COMMIT OR TO CAUSE ANY OF THE COMPANIES (IN RESPECT OF THE
WARRANTY BUSINESS) TO DISPOSE OF ANY MATERIAL ASSETS; (II) TO DISCONTINUE OR
CAUSE ANY OF ITS SUBSIDIARIES TO DISCONTINUE OFFERING ANY PRODUCT OR SERVICE, OR
TO COMMIT TO CAUSE ANY OF THE COMPANIES (IN RESPECT OF THE WARRANTY BUSINESS) TO
DISCONTINUE OFFERING ANY PRODUCT OR SERVICE; OR (III) TO MAKE OR CAUSE ANY OF
ITS SUBSIDIARIES TO MAKE ANY COMMITMENT (TO ANY ADMINISTRATIVE AUTHORITY OR
OTHERWISE) REGARDING ITS FUTURE OPERATIONS OR THE FUTURE OPERATIONS OF ANY OF
THE COMPANIES, EXCEPT, IN THE CASE OF CLAUSE (II) OR (III), FOR ANY COMMITMENT
THAT WOULD NOT, INDIVIDUALLY OR IN THE AGGREGATE, MATERIALLY ADVERSELY AFFECT
THE ABILITY OF BUYER TO CONDUCT THE WARRANTY BUSINESS.

SECTION 7.4            OPERATIONS PRIOR TO THE CLOSING DATE.

(A)           AON SHALL (AND SHALL CAUSE THE OTHER SELLERS TO) USE ALL
REASONABLE EFFORTS TO CAUSE THE COMPANIES (IN RESPECT OF THE WARRANTY BUSINESS)
TO OPERATE AND CARRY ON THEIR BUSINESS IN THE ORDINARY COURSE AND SUBSTANTIALLY
AS OPERATED IMMEDIATELY PRIOR TO THE DATE OF THIS AGREEMENT, EXCEPT AS
SPECIFICALLY CONTEMPLATED BY THIS AGREEMENT. CONSISTENT WITH THE FOREGOING, AON
SHALL (AND SHALL CAUSE THE OTHER SELLERS TO) CAUSE THE COMPANIES (IN RESPECT OF
THE WARRANTY BUSINESS) TO USE THEIR REASONABLE EFFORTS CONSISTENT WITH GOOD
BUSINESS PRACTICE TO PRESERVE THE GOODWILL OF THE SUPPLIERS, CONTRACTORS,
LICENSORS, EMPLOYEES, CUSTOMERS, DISTRIBUTORS AND OTHERS HAVING BUSINESS
RELATIONS WITH THE COMPANIES.

 

36

--------------------------------------------------------------------------------

 

(B)           WITHOUT LIMITING SECTION 7.4(A), EXCEPT AS SET FORTH IN
SCHEDULE 7.4, EXCEPT AS SPECIFICALLY CONTEMPLATED BY THIS AGREEMENT OR EXCEPT
WITH THE EXPRESS WRITTEN APPROVAL OF BUYER (WHICH BUYER AGREES SHALL NOT, OTHER
THAN WITH RESPECT TO CLAUSES (V)(A) AND (XVIII) BELOW, BE UNREASONABLY WITHHELD
OR DELAYED), AON SHALL (AND SHALL CAUSE THE OTHER SELLERS TO) CAUSE THE
COMPANIES (IN RESPECT OF THE WARRANTY BUSINESS) NOT TO:

(I)            MAKE ANY MATERIAL CHANGE IN THEIR BUSINESS OR THEIR OPERATIONS,
EXCEPT SUCH CHANGES AS MAY BE REQUIRED TO COMPLY WITH ANY APPLICABLE
REQUIREMENTS OF LAW;

(II)           MAKE ANY CAPITAL EXPENDITURE OR ENTER INTO ANY CONTRACT OR
COMMITMENT THEREFOR WHICH IS IN EXCESS OF $250,000 UNLESS SUCH EXPENDITURE IS
PROVIDED FOR IN THE CAPITAL EXPENDITURE BUDGET FOR 2006 MADE AVAILABLE TO BUYER
PRIOR TO THE DATE HEREOF, AND AON SHALL HAVE NOTIFIED BUYER IN WRITING OF THE
MAKING OF ANY SUCH CAPITAL EXPENDITURE (OR CONTRACT OR COMMITMENT) IN EXCESS OF
$250,000 SUBSTANTIALLY CONCURRENTLY THEREWITH;

(III)          PURCHASE OR SELL ANY REAL PROPERTY;

(IV)          SELL, LEASE (AS LESSOR), TRANSFER OR OTHERWISE DISPOSE OF
(INCLUDING ANY TRANSFERS TO ANY OF ITS AFFILIATES), OR MORTGAGE OR PLEDGE, OR
IMPOSE OR SUFFER TO BE IMPOSED ANY ENCUMBRANCE ON, ANY OF THEIR ASSETS, OTHER
THAN INVENTORY AND PERSONAL PROPERTY SOLD OR OTHERWISE DISPOSED OF IN THE
ORDINARY COURSE OF BUSINESS CONSISTENT WITH PAST PRACTICES AND OTHER THAN
PERMITTED ENCUMBRANCES;

(V)           ACQUIRE (A) BY MERGER OR CONSOLIDATION WITH, OR BY THE PURCHASE OF
ALL OR A SUBSTANTIAL PORTION OF THE ASSETS OR ANY STOCK OF, OR BY ANY OTHER
MANNER, ANY BUSINESS OR ANY CORPORATION, PARTNERSHIP, JOINT VENTURE, LIMITED
LIABILITY COMPANY, ASSOCIATION OR OTHER BUSINESS ORGANIZATION OR DIVISION
THEREOF (OTHER THAN INVESTMENT ASSETS IN THE ORDINARY COURSE) OR (B) ANY ASSETS
THAT ARE MATERIAL, IN THE AGGREGATE, TO THE COMPANIES, TAKEN AS A WHOLE, EXCEPT
IN THE CASE OF (B) FOR PURCHASES OF ASSETS IN THE ORDINARY COURSE OF BUSINESS
CONSISTENT WITH PAST PRACTICE (IN TRANSACTIONS NOT OTHERWISE SUBJECT TO
SUBPARAGRAPH (A) OF THIS SECTION 7.4(A)(V));

(VI)          CANCEL ANY INDEBTEDNESS OWED TO OR CLAIMS HELD BY THEM (INCLUDING
THE SETTLEMENT OF ANY CLAIMS OR LITIGATION) OTHER THAN IN THE ORDINARY COURSE OF
BUSINESS OR IN ACCORDANCE WITH SECTION 7.5;

(VII)         CREATE, INCUR OR ASSUME, OR AGREE TO CREATE, INCUR OR ASSUME, ANY
INDEBTEDNESS OTHER THAN ANY INDEBTEDNESS THAT IS SUBJECT TO SECTION 7.5 OR WHICH
CONSTITUTES THE DEFERRED PURCHASE PRICE OF CAPITAL EXPENDITURES PERMITTED BY
SECTION 7.4(B)(II) ABOVE;

(VIII)        DECLARE, SET ASIDE OR PAY ANY DIVIDENDS ON, OR MAKE ANY OTHER
DISTRIBUTIONS IN RESPECT OF, ANY OF THE THEIR OUTSTANDING EQUITY INTERESTS
(EXCEPT DIVIDENDS AND DISTRIBUTIONS BY ONE COMPANY SOLELY TO ONE OR MORE
COMPANIES AND DIVIDENDS OR DISTRIBUTIONS OF CASH AND/OR CASH EQUIVALENTS AND/OR
INVESTMENT ASSETS MADE PRIOR TO CLOSING);

37

--------------------------------------------------------------------------------

 

(IX)           SPLIT, COMBINE OR RECLASSIFY ANY OF THEIR EQUITY INTERESTS OR
ISSUE OR AUTHORIZE THE ISSUANCE OF ANY OTHER SECURITIES IN RESPECT OF, IN LIEU
OF OR IN SUBSTITUTION FOR THEIR EQUITY INTERESTS;

(X)            ISSUE, DELIVER, SELL, GRANT, PLEDGE OR OTHERWISE DISPOSE OF OR
ENCUMBER, OR REDEEM, PURCHASE OR OTHERWISE ACQUIRE OR GRANT NEGOTIATION RIGHTS
WITH RESPECT TO, ANY OF THEIR EQUITY INTERESTS, OR ANY SECURITIES CONVERTIBLE
INTO OR EXCHANGEABLE FOR, OR ANY RIGHTS, WARRANTS OR OPTIONS TO ACQUIRE, ANY
SUCH EQUITY INTERESTS;

(XI)           HIRE ANY NEW EMPLOYEE WITH EXPECTED TOTAL COMPENSATION DURING ANY
FISCAL YEAR IN EXCESS OF $250,000 OR WITH AN ANNUAL BASE SALARY IN EXCESS OF
$150,000, PROMOTE ANY EMPLOYEE TO BE AN OFFICER OR MEMBER OF SENIOR MANAGEMENT,
OR ENGAGE ANY CONSULTANT OR INDEPENDENT CONTRACTOR FOR A PERIOD EXCEEDING
30 DAYS UNLESS SUCH ENGAGEMENT MAY BE CANCELLED WITHOUT PENALTY UPON NOT MORE
THAN 30 DAYS’ NOTICE OR THE EXPECTED TOTAL ANNUAL COMPENSATION WILL NOT EXCEED
$250,000;

(XII)          INCREASE IN ANY MANNER THE COMPENSATION OF, OR PAY ANY BONUS TO,
ANY EMPLOYEE, OFFICER OR DIRECTOR, EXCEPT FOR INCREASES IN THE ORDINARY COURSE
OF BUSINESS CONSISTENT WITH PAST COMPENSATION PRACTICES (WHICH INCREASES MAY
NOT, IN THE CASE OF ANY EMPLOYEE WHOSE COMPENSATION EXCEEDED $250,000 DURING THE
TWELVE MONTHS ENDED DECEMBER 31, 2005 OR WHOSE ANNUAL BASE SALARY EXCEEDS
$150,000 AS OF THE DATE HEREOF, IN ANY CALENDAR YEAR EXCEED THE INCREASE IN THE
CPI ON A SPECIFIED DATE IN SUCH CALENDAR YEAR OVER THE CPI ON THE SAME DATE IN
THE PRIOR CALENDAR YEAR) AND INCREASES REQUIRED UNDER ANY EXISTING BUSINESS
AGREEMENT;

(XIII)         ADOPT OR ENTER INTO ANY COLLECTIVE BARGAINING AGREEMENT OR OTHER
LABOR UNION CONTRACT APPLICABLE TO THEIR EMPLOYEES;

(XIV)        ADOPT, MODIFY OR INCREASE THE BENEFITS TO ANY EMPLOYEES OF THE
COMPANIES UNDER, OR ACCELERATE OR SETTLE THE PAYMENT OF BENEFITS TO ANY
EMPLOYEES OF THE COMPANIES UNDER, ANY COMPANY PLAN, EXCEPT, (A) IN EACH CASE, AS
REQUIRED UNDER REQUIREMENTS OF LAW OR BY EXISTING CONTRACTUAL ARRANGEMENTS,
(B) AS A RESULT OF A MODIFICATION OR INCREASE IN BENEFITS UNDER AN EXISTING
COMPANY PLAN THAT IS GENERALLY APPLICABLE TO AON EMPLOYEES OR (C) AS A RESULT OF
THE ADOPTION OF A COMPANY PLAN THAT IS GENERALLY APPLICABLE TO AON EMPLOYEES
FROM WHICH THE EMPLOYEES OF THE COMPANIES MAY NOT EXCLUDED UNDER APPLICABLE
REQUIREMENTS OF LAW;

(XV)         MAKE ANY MATERIAL CHANGE OUTSIDE OF THE ORDINARY COURSE OF BUSINESS
TO (A) ANY PRICING, INVESTMENT, ACCOUNTING, FINANCIAL REPORTING, CREDIT,
RESERVING, HEDGING, UNDERWRITING, CLAIMS ADMINISTRATION OR ALLOWANCE PRACTICE OR
POLICY, (B) ANY METHOD OF CALCULATING ANY RESERVE FOR ACCOUNTING, FINANCIAL
REPORTING OR TAX PURPOSES, (C) THE FISCAL YEAR OR (D) ANY EXISTING CREDIT,
BILLING, COLLECTION AND PAYMENT POLICIES, EXCEPT IN EACH CASE AS REQUIRED BY
CHANGES IN GAAP, SAP OR APPLICABLE REQUIREMENTS OF LAW;

(XVI)        MAKE OR RESCIND ANY TAX ELECTION, SETTLE OR COMPROMISE ANY MATERIAL
TAX LIABILITY, AMEND ANY TAX RETURN, FILE ANY TAX-RELATED RULING REQUEST, CHANGE
ITS TAX ACCOUNTING, OR FILE ANY TAX RETURN NOT CONSISTENT WITH HISTORICAL
PRACTICE;

38

--------------------------------------------------------------------------------

 

(XVII)       MAKE ANY CHANGE IN THEIR ORGANIZATIONAL DOCUMENTS;

(XVIII)      CREATE ANY NEW SUBSIDIARY OR ENTER INTO ANY JOINT VENTURE OR
PARTNERSHIP OR OTHER SIMILAR AGREEMENT OR ARRANGEMENT (EXCLUDING AGREEMENTS OR
ARRANGEMENTS WITH CLIENTS IN THE ORDINARY COURSE OF BUSINESS AS DESCRIBED IN
SCHEDULE 5.14);

(XIX)         MODIFY, AMEND, CANCEL, TERMINATE OR WAIVE ANY MATERIAL RIGHTS
UNDER ANY BUSINESS AGREEMENT, EXCEPT IN THE ORDINARY COURSE OF BUSINESS;

(XX)          SETTLE OR COMPROMISE ANY CLAIM AGAINST THE COMPANIES (WHETHER OR
NOT COMMENCED PRIOR TO THE DATE OF THIS AGREEMENT) BY ANY ADMINISTRATIVE
AUTHORITY OR OTHER PERSON THAT COULD REASONABLY BE EXPECTED TO MATERIALLY IMPAIR
THE WARRANTY BUSINESS AFTER THE CLOSING; OR

(XXI)         AUTHORIZE ANY OF, OR COMMIT OR AGREE, IN WRITING OR OTHERWISE, TO
TAKE ANY OF, THE FOREGOING ACTIONS OR ANY ACTION WHICH WOULD MATERIALLY IMPAIR
OR PREVENT THE SATISFACTION OF ANY CONDITIONS IN ARTICLE VII HEREOF.

Section 7.5            Termination of Certain Intercompany Indebtedness. At or
prior to the Closing, Aon shall (and shall cause the other Sellers to)
contribute to the capital of the Parent Entities all intercompany indebtedness
and non-trade accounts (other than ordinary course trade payables and
receivables and federal income Tax payables) owed by the Companies to Sellers or
any of their Affiliates as of the Closing Date, and Aon shall (and shall cause
the other Sellers to) cause the Parent Entities to assume all intercompany
indebtedness and non-trade accounts (other than ordinary course trade payables
and receivables) owed by Sellers or any of their Affiliates to the Companies;
provided, however, that any intercompany indebtedness and non-trade accounts
involving the Underwriting Companies shall be settled in cash to the extent
required by applicable Requirements of Law.

Section 7.6            Facilitating Transactions. Aon shall cause each of the
Facilitating Transactions required to occur prior to the Closing to occur
pursuant to the Facilitating Transaction Agreements at the time specified in
Schedule 1.1(E), and Buyer shall act reasonably and diligently to cooperate with
Aon to cause such transactions to occur. From and after the Closing, Aon and
Buyer shall cause each of the Facilitating Transactions required to occur
subsequent to the Closing to occur pursuant to the Facilitating Transaction
Agreements at the time specified in Schedule 1.1(E). From time to time, Buyer
shall, upon Aon’s request and at the cost of Aon, (i) deliver the books and
records relating primarily to the Excluded Assets, the Excluded Liabilities and
the Excluded Subsidiaries in the possession of Buyer or its subsidiaries and
(ii) do, execute, acknowledge and deliver, or cause to be done, executed,
acknowledged and delivered, all deeds, assignments, transfers and conveyances as
may be reasonably required for the better assigning, transferring, granting,
conveying and confirming to the Sellers or their Affiliates, or for aiding and
assisting in collecting and reducing to possession of the Sellers or their
Affiliates, any of the Excluded Assets, the Excluded Liabilities and the
Excluded Subsidiaries. From and after the Closing, pursuant to Article XI (and
subject to the limitations thereof), Aon agrees to indemnify and hold harmless
each Buyer Group Member from and against, and reimburse each Buyer Group Member
for, Losses and Expenses incurred by such Buyer Group Member to the extent
caused by the transfer of rights, properties, assets and

39

--------------------------------------------------------------------------------

 

employees out of the Companies pursuant to the Facilitating Transaction
Agreements (other than Losses and Expenses in respect of Taxes, which are the
subject of Section 8.1); provided, however, that in no event shall a Buyer Group
Member be entitled to recover for any Losses or Expenses relating to (x) any
liabilities or obligations that Buyer or its Affiliates (including the Companies
after the Closing) are expressly required to pay or perform pursuant to the
terms of any Facilitating Transaction Agreement or (y) the impact of any
accounting principles, rules or regulations arising out of the Facilitating
Transactions.

Section 7.7            Transferred Business. Following the transfer of the
Transferred Business as part of the Facilitating Transactions, Buyer shall
(following the Closing) cause VSC, RLIC and LGI, respectively, to assume, pay,
perform, discharge and be responsible for all of the liabilities and obligations
related to the Transferred Business, except to the extent otherwise expressly
excused from payment or performance with respect to any portion of the
Transferred Business in the applicable Facilitating Transaction Agreements.
These liabilities and obligations of VSC, RLIC and LGI shall include all
liabilities and obligations arising from or relating to any breach by any
reinsurer with respect to policies or other risks constituting Warranty Business
or any failure by such a reinsurer to perform any of its covenants or
obligations in any agreement or undertaking with respect to such policies or
risks. From time to time, Aon shall upon Buyer’s request and at the cost of
Buyer (i) deliver the books and records relating primarily to the Transferred
Business in Sellers’ or their Affiliates’ possession to Buyer and (ii) do,
execute, acknowledge and deliver, or cause to be done, executed, acknowledged
and delivered, all deeds, assignments, transfers and conveyances as may be
reasonably required for the better assigning, transferring, granting, conveying
and confirming to Buyer or its Affiliates the Transferred Business.

Section 7.8            Exclusivity. Aon agrees that, during the period
commencing on the date hereof through the earlier to occur of the Closing or the
termination of this Agreement, that it will not, and it will use commercially
reasonable efforts to cause each of its respective Affiliates and its and their
directors, officers and representatives not to, directly or indirectly,
(a) knowingly initiate, solicit, encourage, discuss, negotiate or respond
affirmatively to any inquiries, proposals or offers (whether initiated by them
or otherwise) with respect to (i) any transaction, however structured, resulting
in or relating to the acquisition of any equity interests of the Companies or
any interest therein by a third party; or (ii) the acquisition of all or a
material portion of the assets and properties of the Companies or of the
Warranty Business (each, a “Potential Transaction”) from any Person or provide
information to any Person in connection with a Potential Transaction or
(b) enter into any contract, agreement or arrangement with any Person other than
Buyer or its designee or assignee concerning or relating to a Potential
Transaction. Aon shall terminate any existing discussions with respect to a
Potential Transaction and shall not amend or terminate, or waive any of its
rights under, any existing confidentiality agreement. Notwithstanding the
foregoing, nothing contained in this Section 7.8 shall in any manner apply to or
be construed to limit Aon regarding any actions involving Excluded Assets,
Excluded Subsidiaries or Excluded Liabilities.

Section 7.9            Success Bonus Payments. Aon shall be responsible for, and
shall pay, all Success Bonus Payments.

40

--------------------------------------------------------------------------------

 

SECTION 7.10         FINANCIAL AND STATUTORY STATEMENTS.

(A)           FROM AND AFTER THE DATE HEREOF UNTIL THE EARLIER TO OCCUR OF THE
CLOSING OR THE TERMINATION OF THIS AGREEMENT, AON SHALL DELIVER TO BUYER COPIES
OF ANY ANNUAL OR QUARTERLY STATEMENTS OF EACH OF THE UNDERWRITING COMPANIES AND
FFG INSURANCE COMPANY FILED WITH THE APPLICABLE INSURANCE REGULATORY AUTHORITY
OF ITS JURISDICTION OF DOMICILE, PROMPTLY, BUT IN NO EVENT LATER THAN THREE
(3) BUSINESS DAYS AFTER, SUCH STATEMENTS ARE FILED WITH THE APPLICABLE
REGULATORY AUTHORITY. ALL SUCH STATEMENTS, TO THE KNOWLEDGE OF AON, SHALL FAIRLY
PRESENT, IN ALL MATERIAL RESPECTS, IN ACCORDANCE WITH SAP APPLIED ON A
CONSISTENT BASIS THROUGHOUT THE PERIODS INVOLVED (EXCEPT AS REQUIRED BY SAP) THE
STATUTORY FINANCIAL POSITION OF THE UNDERWRITING COMPANIES AND FFG INSURANCE
COMPANY, AS OF THE DATES THEREIN SPECIFIED AND THE STATUTORY RESULTS OF
OPERATIONS AND CASH FLOW OF SUCH COMPANIES, FOR THE PERIODS THEREIN SPECIFIED
AND ALL ASSETS THAT ARE REFLECTED AS ADMITTED ASSETS ON SUCH STATEMENTS, TO THE
EXTENT APPLICABLE, QUALIFY AS ADMITTED ASSETS UNDER THE REQUIREMENTS OF LAW OF
THE APPLICABLE COMPANY’S DOMICILIARY JURISDICTION.

(B)           FROM AN AFTER THE DATE HEREOF UNTIL THE EARLIER TO OCCUR OF THE
CLOSING OR THE TERMINATION OF THIS AGREEMENT, AON SHALL, (I) WITHIN 45 DAYS
AFTER THE EXPIRATION OF EACH CALENDAR QUARTER, DELIVER TO BUYER UNAUDITED
STATEMENTS OF INCOME OF THE COMPANIES (AFTER GIVING EFFECT TO THE FACILITATING
TRANSACTIONS) FOR THE THREE MONTH PERIOD THEN ENDED PREPARED ON A BASIS
CONSISTENT WITH THE INCOME STATEMENT FOR THE THREE MONTH PERIOD ENDED MARCH 31,
2006 ATTACHED AS SCHEDULE 7.10(B)(I) HERETO;  AND (II) WITHIN 60 DAYS AFTER THE
EXPIRATION OF EACH CALENDAR QUARTER, DELIVER TO BUYER (A) AN UNAUDITED BALANCE
SHEET OF THE COMPANIES (AFTER GIVING EFFECT TO THE FACILITATING TRANSACTIONS) AS
OF THE LAST DAY OF SUCH CALENDAR QUARTER PREPARED ON A BASIS CONSISTENT WITH THE
BALANCE SHEET ATTACHED AS SCHEDULE 7.10(B)(II)(A) HERETO AND (B) A
RECONCILIATION OF THE BALANCE SHEET DELIVERED TO BUYER UNDER
SECTION 7.10(B)(II)(A) TO THE THEN CURRENT BALANCES AS OF THE LAST DAY OF THE
APPLICABLE CALENDAR QUARTER DETERMINED IN MANNER CONSISTENT WITH THE AUDITED
FINANCIAL STATEMENTS.

Section 7.11         P&C Business. From and after September 30, 2006 until the
earlier to occur of the Closing or the termination of this Agreement, Aon shall
cause the Companies and FFG not to enter into or issue any treaties, policies,
binders, slips or contracts of insurance with respect to any business other than
the Warranty Business (including, for the avoidance of doubt, the P&C Business)
(other than (i) workers compensation business in the ordinary course of business
consistent with past practice and (ii) non-warranty business in Portugal) other
than renewals that are required by applicable Requirements of Law or contractual
commitments existing as of the date hereof.

Section 7.12         Actuarial Review. Prior to the Closing, (i) Aon shall
engage Milliman U.S.A. or another nationally recognized actuary reasonably
acceptable to Buyer (the “Actuary”), to separately calculate the loss and loss
expense reserves and unearned premium reserves with respect to any outstanding 
risk underwritten by VSC (and not otherwise reinsured) under any treaties,
policies, binders, slips or contracts of insurance or reinsurance written by VSC
with respect to any business other than the Warranty Business (including, for
the avoidance of doubt, the P&C Business) as of June 30, 2006 (the “P&C
Underwriting”) and (ii) such actuary shall separately determine the loss and
loss expense reserves and unearned premium reserves for the P&C Underwriting as
of such date. The applicable Facilitating Transaction Agreement with respect to
the P&C Underwriting shall  separately reflect loss and loss expense reserves
and the unearned premium reserves with respect to the P&C Underwriting as each
being an amount

41

--------------------------------------------------------------------------------

 

equal to the midpoint of such reserves calculated by the Actuary, as updated by
Aon to the Closing Date.

Section 7.13         Additional Capital. Prior to the Closing, Aon may
contribute capital to one or more of the Companies and, to the extent permitted
by Requirements of Law, may transfer capital among the Companies. For purposes
of satisfying a condition set forth in Section 9.8(a), (b) or (c), at its
option, Aon may contribute capital from outside of the Companies to VSC, RLIC
and/or LGI. Any such capital contribution by Aon described in the preceding
sentence shall not be included in the calculation of Closing Date Net Worth. For
the avoidance of doubt, if the capital contribution is due to an increased or
new liability (other than an Excluded Liability), both the increased or new
liability and any capital contribution up to such liability shall be included in
the calculation of Closing Date Net Worth, it being understood that any capital
contribution due to an increased or new Excluded Liability shall be transferred
to FFG pursuant to a Facilitating Transaction Agreement.

ARTICLE VIII

ADDITIONAL AGREEMENTS

SECTION 8.1            TAX MATTERS.

(A)           LIABILITY FOR TAXES.

(I)            AON SHALL BE LIABLE FOR AND PAY, AND PURSUANT TO ARTICLE XI (AND
SUBJECT TO THE LIMITATIONS THEREOF) AGREES TO INDEMNIFY AND HOLD HARMLESS EACH
BUYER GROUP MEMBER AGAINST, ANY AND ALL TAXES (A) IMPOSED ON ANY OF THE
COMPANIES PURSUANT TO TREASURY REGULATION SECTION 1.1502-6 OR SIMILAR PROVISION
OF STATE OR LOCAL LAW AS A RESULT OF ANY COMPANY HAVING BEEN A MEMBER OF THE AON
CONSOLIDATED GROUP, OR (B) IMPOSED ON ANY COMPANY, OR FOR WHICH ANY COMPANY MAY
OTHERWISE BE LIABLE, FOR ANY TAXABLE YEAR OR PERIOD THAT ENDS ON OR BEFORE THE
CLOSING DATE AND, WITH RESPECT TO ANY STRADDLE PERIOD, THE PORTION OF SUCH
STRADDLE PERIOD ENDING ON AND INCLUDING THE CLOSING DATE; PROVIDED, HOWEVER,
THAT AON SHALL NOT BE LIABLE FOR OR PAY, AND SHALL NOT INDEMNIFY OR HOLD
HARMLESS ANY BUYER GROUP MEMBER FROM AND AGAINST (I) ANY TAXES SHOWN AS A
LIABILITY OR RESERVE ON THE NET WORTH ADJUSTMENT REPORT AND TAKEN INTO ACCOUNT
IN THE CALCULATION OF THE CLOSING DATE NET WORTH (“RESERVED TAXES”), (II) ANY
TAXES THAT RESULT FROM ANY ACTUAL OR DEEMED ELECTION UNDER SECTION 338 OF THE
CODE OR ANY SIMILAR PROVISIONS OF STATE, LOCAL OR FOREIGN LAW AS A RESULT OF THE
PURCHASE OF THE SHARES OR THE DEEMED PURCHASE OF SHARES OF ANY OF THE
SUBSIDIARIES OR THAT RESULT FROM BUYER, ANY AFFILIATE OF BUYER, OR ANY OF THE
COMPANIES ENGAGING IN ANY ACTIVITY OR TRANSACTION THAT WOULD CAUSE THE
TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT TO BE TREATED AS A PURCHASE OR SALE
OF ASSETS OF ANY OF THE COMPANIES FOR FEDERAL, STATE OR LOCAL TAX PURPOSES, AND
(III) ANY TAXES IMPOSED ON ANY OF THE COMPANIES OR FOR WHICH ANY OF THE
COMPANIES MAY OTHERWISE BE LIABLE AS A RESULT OF TRANSACTIONS OCCURRING ON THE
CLOSING DATE THAT ARE PROPERLY ALLOCABLE (BASED ON, AMONG OTHER RELEVANT
FACTORS, FACTORS SET FORTH IN TREASURY REGULATION
SECTION 1.1502-76(B)(1)(II)(B)) TO THE PORTION OF THE CLOSING DATE AFTER THE
CLOSING (THE TAXES DESCRIBED IN THIS PROVISO BEING REFERRED TO AS “EXCLUDED
TAXES”) AND,

42

--------------------------------------------------------------------------------

 

PROVIDED, FURTHER THAT, WITHOUT LIMITING THE FOREGOING, AON SHALL BE LIABLE FOR
ALL FACILITATING TRANSACTION TAXES. AON SHALL BE ENTITLED TO ANY REFUND OF (OR
CREDIT FOR) TAXES ALLOCABLE TO ANY TAXABLE YEAR OR PERIOD THAT ENDS ON OR BEFORE
THE CLOSING DATE AND, WITH RESPECT TO ANY STRADDLE PERIOD, THE PORTION OF SUCH
STRADDLE PERIOD ENDING ON AND INCLUDING THE CLOSING DATE, EXCEPT TO THE EXTENT
THAT SUCH REFUND WAS SHOWN AS AN ASSET ON THE NET WORTH ADJUSTMENT REPORT AND
TAKEN INTO ACCOUNT IN THE CALCULATION OF THE CLOSING DATE NET WORTH.

(II)           BUYER SHALL BE LIABLE FOR AND PAY, AND PURSUANT TO ARTICLE XI
(AND SUBJECT TO THE LIMITATIONS THEREOF) SHALL INDEMNIFY AND HOLD HARMLESS EACH
SELLER GROUP MEMBER FROM AND AGAINST, (A) ANY AND ALL TAXES IMPOSED ON THE
COMPANIES OR FOR WHICH THE COMPANIES MAY OTHERWISE BE LIABLE FOR ANY TAXABLE
YEAR OR PERIOD THAT BEGINS AFTER THE CLOSING DATE AND, WITH RESPECT TO ANY
STRADDLE PERIOD, THE PORTION OF SUCH STRADDLE PERIOD BEGINNING AFTER THE CLOSING
DATE AND (B) EXCLUDED TAXES (IN THE CASE OF (A) OR (B) OTHER THAN FACILITATING
TRANSACTION TAXES). EXCEPT AS OTHERWISE PROVIDED HEREIN, BUYER SHALL BE ENTITLED
TO ANY REFUND OF (OR CREDIT FOR) TAXES DESCRIBED IN CLAUSES (A) AND (B). BUYER
SHALL PAY SELLER (IN THE CASE OF ANY RESERVED TAXES THAT ARE PAID BY SELLER ON
BEHALF OF THE CONSOLIDATED GROUP OF CORPORATIONS, COMBINED GROUP OF
CORPORATIONS, AFFILIATED GROUP OF CORPORATIONS OR UNITARY GROUP OF CORPORATIONS
(OR OTHER SIMILAR GROUP) OF WHICH THE PARENT ENTITIES AND THEIR RELEVANT
SUBSIDIARIES ARE MEMBERS (“RESERVED CONSOLIDATED TAXES”)) OR THE RELEVANT TAXING
AUTHORITY (IN THE CASE OF ALL OTHER RESERVED TAXES) ALL RESERVED TAXES IN
ACCORDANCE WITH PAST PRACTICE (BUT, IN THE CASE OF RESERVED CONSOLIDATED TAXES,
IN NO EVENT LATER THAN 5 BUSINESS DAYS FOLLOWING THE NET WORTH ADJUSTMENT REPORT
FINALIZATION DATE). FOR THE AVOIDANCE OF DOUBT, BUYER SHALL PAY SELLER THE FULL
AMOUNT ACCRUED FOR RESERVED CONSOLIDATED TAXES (REGARDLESS OF ANY ACTUAL TAX
LIABILITY).

(III)          FOR PURPOSES OF SECTIONS 8.1(A)(I) AND (A)(II), WHENEVER IT IS
NECESSARY TO DETERMINE THE LIABILITY FOR TAXES OF THE COMPANIES FOR A STRADDLE
PERIOD, THE DETERMINATION OF SUCH TAXES FOR THE PORTION OF THE STRADDLE PERIOD
ENDING ON AND INCLUDING, AND THE PORTION OF THE STRADDLE PERIOD BEGINNING AFTER,
THE CLOSING DATE SHALL BE DETERMINED BY ASSUMING THAT THE STRADDLE PERIOD
CONSISTED OF TWO TAXABLE YEARS OR PERIODS, ONE WHICH ENDED AT THE CLOSE OF THE
CLOSING DATE AND THE OTHER WHICH BEGAN AT THE BEGINNING OF THE DAY FOLLOWING THE
CLOSING DATE, AND ITEMS OF INCOME, GAIN, DEDUCTION, LOSS OR CREDIT OF THE
COMPANIES FOR THE STRADDLE PERIOD SHALL BE ALLOCATED BETWEEN SUCH TWO TAXABLE
YEARS OR PERIODS ON A “CLOSING OF THE BOOKS BASIS” BY ASSUMING THAT THE BOOKS OF
THE COMPANIES WERE CLOSED AT THE CLOSE OF THE CLOSING DATE; PROVIDED, HOWEVER,
THAT (I) TRANSACTIONS OCCURRING ON THE CLOSING DATE THAT ARE PROPERLY ALLOCABLE
(BASED ON, AMONG OTHER RELEVANT FACTORS, FACTORS SET FORTH IN TREASURY
REGULATION SECTION 1.1502-76(B)(1)(II)(B)) TO THE PORTION OF THE CLOSING DATE
AFTER THE CLOSING SHALL BE ALLOCATED TO THE TAXABLE YEAR OR PERIOD THAT IS
DEEMED TO BEGIN AT THE BEGINNING OF THE DAY FOLLOWING THE CLOSING DATE,
(II) EXEMPTIONS, ALLOWANCES OR DEDUCTIONS THAT ARE CALCULATED ON AN ANNUAL
BASIS, SUCH AS THE DEDUCTION FOR DEPRECIATION, SHALL BE APPORTIONED BETWEEN SUCH
TWO TAXABLE YEARS OR PERIODS ON A DAILY BASIS AND (III) ALL FACILITATING
TRANSACTIONS SHALL BE ALLOCATED TO THE PERIOD BEFORE THE CLOSING DATE.

(IV)          IF, AS A RESULT OF ANY ACTION, SUIT, INVESTIGATION, AUDIT, CLAIM,
ASSESSMENT OR AMENDED TAX RETURN, THERE IS ANY CHANGE AFTER THE CLOSING DATE IN
AN ITEM OF INCOME,

43

--------------------------------------------------------------------------------

 

GAIN, LOSS, DEDUCTION, CREDIT OR AMOUNT OF TAX THAT RESULTS IN AN INCREASE IN A
TAX LIABILITY FOR WHICH AON WOULD OTHERWISE BE LIABLE PURSUANT TO
SECTION 8.1(A)(I), AND SUCH CHANGE RESULTS IN OR WILL RESULT IN A DECREASE IN
THE TAX LIABILITY OF THE COMPANIES, BUYER OR ANY AFFILIATE OR SUCCESSOR THEREOF
FOR ANY TAXABLE YEAR OR PERIOD BEGINNING AFTER THE CLOSING DATE OR FOR THE
PORTION OF ANY STRADDLE PERIOD BEGINNING AFTER THE CLOSING DATE, AON SHALL NOT
BE LIABLE PURSUANT TO SUCH SECTION 8.1(A)(I) WITH RESPECT TO SUCH INCREASE TO
THE EXTENT OF THE PRESENT VALUE (USING A DISCOUNT RATE EQUAL TO THE THEN
“FEDERAL MID-TERM RATE,” AS THAT TERM IS DEFINED IN SECTION 1274(D) OF THE CODE)
OF SUCH DECREASE (AND, TO THE EXTENT SUCH INCREASE IN TAX LIABILITY IS PAID TO A
TAXING AUTHORITY BY AON OR ANY AFFILIATE THEREOF, BUYER SHALL PAY AON AN AMOUNT
EQUAL TO THE PRESENT VALUE OF SUCH DECREASE).

(V)           NOTWITHSTANDING ANYTHING HEREIN TO THE CONTRARY, BUYER AND AON
SHALL EACH BE RESPONSIBLE FOR AND INDEMNIFY THE OTHER FOR 50% OF ANY REAL
PROPERTY TRANSFER OR GAINS TAX, SALES TAX, USE TAX, STAMP TAX, STOCK TRANSFER
TAX, OR OTHER SIMILAR TAX IMPOSED ON THE TRANSACTIONS CONTEMPLATED BY THIS
AGREEMENT.

(B)           TAX RETURNS.

(I)            AON SHALL TIMELY FILE OR CAUSE TO BE TIMELY FILED WHEN DUE
(TAKING INTO ACCOUNT ALL EXTENSIONS PROPERLY OBTAINED) ALL TAX RETURNS REQUIRED
TO BE FILED WITH RESPECT TO THE COMPANIES FOR TAXABLE YEARS OR PERIODS ENDING ON
OR PRIOR TO THE CLOSING DATE, AND AON SHALL REMIT, OR CAUSE TO BE REMITTED, ANY
TAXES DUE IN RESPECT OF SUCH TAX RETURNS, AND BUYER SHALL TIMELY FILE OR CAUSE
TO BE TIMELY FILED WHEN DUE (TAKING INTO ACCOUNT ALL EXTENSIONS PROPERLY
OBTAINED) ALL OTHER TAX RETURNS THAT ARE REQUIRED TO BE FILED BY OR WITH RESPECT
TO THE COMPANIES, AND BUYER SHALL REMIT, OR CAUSE TO BE REMITTED, ANY TAXES DUE
IN RESPECT OF SUCH TAX RETURNS. WITH RESPECT TO TAX RETURNS TO BE FILED BY BUYER
PURSUANT TO THE PRECEDING SENTENCE THAT RELATE TO TAXABLE YEARS OR PERIODS
ENDING ON OR BEFORE THE CLOSING DATE OR THAT RELATE TO ANY STRADDLE PERIOD
(I) SUCH TAX RETURNS SHALL BE FILED IN A MANNER CONSISTENT WITH PAST PRACTICE
AND NO POSITION SHALL BE TAKEN, ELECTION MADE OR METHOD ADOPTED THAT IS
INCONSISTENT WITH POSITIONS TAKEN, ELECTIONS MADE OR METHODS USED IN PRIOR
PERIODS IN FILING SUCH TAX RETURNS (INCLUDING ANY SUCH POSITION, ELECTION OR
METHOD WHICH WOULD HAVE THE EFFECT OF ACCELERATING INCOME TO PERIODS FOR WHICH
AON IS LIABLE OR DEFERRING DEDUCTIONS TO PERIODS FOR WHICH BUYER IS LIABLE) AND
(II) SUCH TAX RETURNS SHALL BE SUBMITTED TO AON NOT LATER THAN 30 DAYS PRIOR TO
THE DUE DATE FOR FILING SUCH TAX RETURNS (OR, IF SUCH DUE DATE IS WITHIN 45 DAYS
FOLLOWING THE CLOSING DATE, AS PROMPTLY AS PRACTICABLE FOLLOWING THE CLOSING
DATE) FOR REVIEW AND APPROVAL BY AON, WHICH APPROVAL MAY NOT BE UNREASONABLY
WITHHELD, BUT MAY IN ALL CASES BE WITHHELD IF SUCH TAX RETURNS WERE NOT PREPARED
IN ACCORDANCE WITH CLAUSE (I) OF THIS SENTENCE. AON OR BUYER SHALL PAY THE OTHER
PARTY FOR THE TAXES FOR WHICH AON OR BUYER, RESPECTIVELY, IS LIABLE PURSUANT TO
SECTION 8.1(A) BUT WHICH ARE PAYABLE WITH ANY TAX RETURN TO BE FILED BY THE
OTHER PARTY PURSUANT TO THIS SECTION 8.1(B) UPON THE WRITTEN REQUEST OF THE
PARTY ENTITLED TO PAYMENT, SETTING FORTH IN DETAIL THE COMPUTATION OF THE AMOUNT
OWED BY AON OR BUYER, AS THE CASE MAY BE, BUT IN NO EVENT EARLIER THAN 10
BUSINESS DAYS PRIOR TO THE DUE DATE FOR PAYING SUCH TAXES, WITHOUT REGARD TO THE
AGGREGATE INDEMNIFICATION LIMITATIONS SET FORTH IN SECTION 11.1(A) AND
SECTION 11.2(A).

44

--------------------------------------------------------------------------------

 

(II)           NONE OF BUYER OR ANY AFFILIATE OF BUYER SHALL (OR SHALL CAUSE OR
PERMIT THE COMPANIES TO) AMEND, REFILE OR OTHERWISE MODIFY (OR GRANT AN
EXTENSION OF ANY STATUTE OF LIMITATION WITH RESPECT TO) ANY TAX RETURN RELATING
IN WHOLE OR IN PART TO THE COMPANIES WITH RESPECT TO ANY TAXABLE YEAR OR PERIOD
ENDING ON OR BEFORE THE CLOSING DATE (OR WITH RESPECT TO ANY STRADDLE PERIOD)
WITHOUT THE PRIOR WRITTEN CONSENT OF AON, WHICH CONSENT MAY BE WITHHELD IN THE
SOLE DISCRETION OF AON.

(III)          BUYER SHALL PROMPTLY CAUSE EACH COMPANY TO PREPARE AND PROVIDE TO
AON A PACKAGE OF TAX INFORMATION MATERIALS, INCLUDING SCHEDULES AND WORK PAPERS
(THE “TAX PACKAGE”), REQUIRED BY AON TO ENABLE AON TO PREPARE AND FILE ALL TAX
RETURNS REQUIRED TO BE PREPARED AND FILED BY IT PURSUANT TO SECTION 8.1(B)(I).
THE TAX PACKAGE SHALL BE COMPLETED IN ACCORDANCE WITH PAST PRACTICE, INCLUDING
PAST PRACTICE AS TO PROVIDING SUCH INFORMATION AND AS TO THE METHOD OF
COMPUTATION OF SEPARATE TAXABLE INCOME OR OTHER RELEVANT MEASURE OF INCOME OF
THE COMPANIES. BUYER SHALL CAUSE THE TAX PACKAGE TO BE DELIVERED TO AON WITHIN
75 DAYS AFTER THE CLOSING DATE.

(C)           CONTEST PROVISIONS.

(I)            BUYER SHALL PROMPTLY NOTIFY AON IN WRITING UPON RECEIPT BY BUYER,
ANY OF ITS AFFILIATES OR THE COMPANIES OF NOTICE OF ANY PENDING OR THREATENED
FEDERAL, STATE, LOCAL OR FOREIGN TAX AUDITS, EXAMINATIONS OR ASSESSMENTS
RELATING TO TAXABLE PERIODS ENDING ON OR BEFORE THE CLOSING DATE OR WHICH MIGHT
OTHERWISE AFFECT THE TAX LIABILITIES FOR WHICH AON MAY BE LIABLE PURSUANT TO
THIS SECTION 8.1.

(II)           AON SHALL HAVE THE SOLE RIGHT TO REPRESENT THE COMPANIES’
INTERESTS IN ANY TAX AUDIT OR ADMINISTRATIVE OR COURT PROCEEDING TO THE EXTENT
THAT SUCH AUDIT OR PROCEEDING RELATES TO TAXABLE PERIODS ENDING ON OR BEFORE THE
CLOSING DATE OR OTHERWISE RELATING TO TAXES FOR WHICH AON MAY BE LIABLE PURSUANT
TO THIS SECTION 8.1, AND TO EMPLOY COUNSEL OF THEIR CHOICE AT THEIR EXPENSE,
PROVIDED, HOWEVER, THAT AON SHALL NOT SETTLE OR OTHERWISE AGREE TO RESOLVE ANY
SUCH AUDIT OR PROCEEDING IF SUCH SETTLEMENT OR OTHER RESOLUTION WOULD HAVE A
MATERIAL ADVERSE IMPACT ON BUYER OR ANY OF THE COMPANIES WITHOUT CONSENT OF
BUYER, WHICH CONSENT SHALL NOT UNREASONABLY BE WITHHELD OR DELAYED. IN THE CASE
OF A STRADDLE PERIOD, AON SHALL BE ENTITLED TO PARTICIPATE AT THEIR EXPENSE IN
ANY TAX AUDIT OR ADMINISTRATIVE OR COURT PROCEEDING RELATING (IN WHOLE OR IN
PART) TO TAXES ATTRIBUTABLE TO THE PORTION OF SUCH STRADDLE PERIOD ENDING ON AND
INCLUDING THE CLOSING DATE AND, WITH THE WRITTEN CONSENT OF BUYER, AND AT AON’S
SOLE EXPENSE, MAY ASSUME THE ENTIRE CONTROL OF SUCH AUDIT OR PROCEEDING. NONE OF
BUYER, ANY OF ITS AFFILIATES OR THE COMPANIES MAY SETTLE ANY TAX CLAIM FOR ANY
TAXES FOR WHICH AON MAY BE LIABLE PURSUANT TO SECTION 8.1(A), WITHOUT THE PRIOR
WRITTEN CONSENT OF AON, WHICH CONSENT MAY NOT BE UNREASONABLY WITHHELD OR
DELAYED.

(D)           ASSISTANCE AND COOPERATION. AFTER THE CLOSING DATE, AON AND BUYER
SHALL (AND SHALL CAUSE THEIR RESPECTIVE AFFILIATES TO):

(I)            ASSIST THE OTHER PARTIES IN PREPARING ANY TAX RETURNS WHICH SUCH
OTHER PARTY IS RESPONSIBLE FOR PREPARING AND FILING IN ACCORDANCE WITH
SECTION 8.1(B);

45

--------------------------------------------------------------------------------

 

(II)           COOPERATE FULLY IN PREPARING FOR ANY AUDITS OF, OR DISPUTES WITH
TAXING AUTHORITIES REGARDING, ANY TAX RETURNS OF THE COMPANIES;

(III)          MAKE AVAILABLE TO THE OTHERS AND TO ANY TAXING AUTHORITY AS
REASONABLY REQUESTED ALL INFORMATION, RECORDS, AND DOCUMENTS RELATING TO TAXES
OF THE COMPANIES;

(IV)          PROVIDE TIMELY NOTICE TO THE OTHERS IN WRITING OF ANY PENDING OR
THREATENED TAX AUDITS OR ASSESSMENTS OF THE COMPANIES FOR TAXABLE PERIODS FOR
WHICH THE OTHER MAY HAVE A LIABILITY UNDER THIS SECTION 8.1;

(V)           FURNISH THE OTHERS WITH COPIES OF ALL CORRESPONDENCE RECEIVED FROM
ANY TAXING AUTHORITY IN CONNECTION WITH ANY TAX AUDIT OR INFORMATION REQUEST
WITH RESPECT TO ANY SUCH TAXABLE PERIOD;

(VI)          TIMELY SIGN AND DELIVER SUCH CERTIFICATES OR FORMS AS MAY BE
NECESSARY OR APPROPRIATE TO ESTABLISH AN EXEMPTION FROM (OR OTHERWISE REDUCE),
OR FILE TAX RETURNS OR OTHER REPORTS WITH RESPECT TO, TAXES DESCRIBED IN
SECTION 8.1(A)(V) (RELATING TO SALES, TRANSFER AND SIMILAR TAXES); AND

(VII)         TIMELY PROVIDE TO THE OTHERS POWERS OF ATTORNEY OR SIMILAR
AUTHORIZATIONS NECESSARY TO CARRY OUT THE PURPOSES OF THIS SECTION 8.1.

SECTION 8.2            EMPLOYEE MATTERS.

(A)           CONTINUED EMPLOYMENT. AS OF THE CLOSING DATE, BUYER AGREES TO, OR
TO CAUSE AN AFFILIATE OF BUYER TO, CONTINUE TO EMPLOY AS A SUCCESSOR EMPLOYER
ALL OF THE EMPLOYEES OF THE COMPANIES (INCLUDING ALL SUCH EMPLOYEES WHO ARE ON
ANY AUTHORIZED VACATION, LEAVE OR OTHER AUTHORIZED ABSENCE), AFTER GIVING EFFECT
TO TRANSFERRING THE TRANSFERRED BUSINESS, THE P&C BUSINESS AND THE LGI EXCLUDED
BUSINESS (COLLECTIVELY, THE “TRANSFERRED EMPLOYEES”). FOR A PERIOD OF AT LEAST
ONE YEAR FOLLOWING THE CLOSING DATE, EACH TRANSFERRED EMPLOYEE SHALL BE ENTITLED
TO RECEIVE WHILE IN THE EMPLOYMENT OF BUYER OR ITS AFFILIATES AT LEAST THE SAME
SALARY, WAGES AND CASH BONUS OPPORTUNITIES AS WERE PROVIDED TO SUCH EMPLOYEE BY
THE COMPANIES, IMMEDIATELY PRIOR TO THE CLOSING DATE. NOTWITHSTANDING ANY
PROVISION HEREIN TO THE CONTRARY, NEITHER BUYER NOR ANY OF ITS AFFILIATES
(INCLUDING THE COMPANIES) SHALL BE OBLIGATED TO CONTINUE TO EMPLOY ANY
TRANSFERRED EMPLOYEE FOR ANY SPECIFIC PERIOD OF TIME FOLLOWING THE CLOSING DATE,
SUBJECT TO APPLICABLE LAW.

(B)           BUYER BENEFIT PLANS. FOR A PERIOD OF ONE YEAR COMMENCING ON THE
CLOSING DATE, BUYER SHALL PROVIDE THE TRANSFERRED EMPLOYEES WITH EMPLOYEE
BENEFITS, WHICH, WHEN TAKEN AS A WHOLE, WILL PROVIDE SUCH EMPLOYEES WITH A LEVEL
OF BENEFITS THAT IS SUBSTANTIALLY COMPARABLE TO THOSE BENEFITS PROVIDED UNDER
THE COMPANY PLANS IN EFFECT IMMEDIATELY PRIOR TO THE CLOSING DATE (WITHOUT
GIVING EFFECT TO ANY INCREASE MADE PURSUANT TO SECTION 7.4(B)(XIV)(B)) OR TO ANY
DEFINED BENEFIT PLAN OR ANY PLAN, PROGRAM OR ARRANGEMENT RELATING TO THE EQUITY
OF ANY BUYER GROUP MEMBER (OR ANY OTHER PERSON).

(C)           COMPANY PLANS. EXCEPT AS SET FORTH ON SCHEDULE 8.2(C) OR AS
OTHERWISE SPECIFICALLY PROVIDED IN THIS AGREEMENT (COLLECTIVELY, THE “ASSUMED
PLAN LIABILITIES”), NEITHER BUYER NOR ANY OF ITS AFFILIATES SHALL ASSUME ANY
OBLIGATIONS UNDER OR LIABILITIES WITH RESPECT TO,

46

--------------------------------------------------------------------------------

 

AND IT SHALL NOT RECEIVE ANY RIGHT OR INTEREST IN THE ASSETS OF, ANY COMPANY
PLANS. BUYER SHALL ASSUME (OR CAUSE THE COMPANIES TO ASSUME) THE ASSUMED PLAN
LIABILITIES. EFFECTIVE AS OF THE CLOSING DATE, EXCEPT AS OTHERWISE SPECIFICALLY
PROVIDED IN THIS AGREEMENT, ALL TRANSFERRED EMPLOYEES WILL CEASE ANY
PARTICIPATION IN, AND ANY BENEFIT ACCRUAL UNDER, ALL COMPANY PLANS. IF THE
CLOSING OCCURS, AON SHALL INDEMNIFY AND HOLD HARMLESS EACH BUYER GROUP MEMBER
FOR ANY LOSSES OR EXPENSES ARISING FROM OR IN CONNECTION WITH ANY PARENT ENTITY
OR AFFILIATE THEREOF BEING AN ERISA AFFILIATE OF AON ON OR PRIOR TO THE CLOSING
DATE.

(D)           LAYOFF BENEFITS. NOTWITHSTANDING ANY OF THE FOREGOING TO THE
CONTRARY, FOLLOWING THE CLOSING DATE, BUYER AGREES TO, OR TO CAUSE ITS
AFFILIATES TO, PROVIDE SEVERANCE BENEFITS TO ANY TRANSFERRED EMPLOYEE WHO IS
LAID OFF DURING THE ONE-YEAR PERIOD BEGINNING ON THE CLOSING DATE IN AN AMOUNT
THAT IS AT LEAST EQUAL TO THE LAYOFF BENEFITS THAT WOULD HAVE BEEN PAID TO SUCH
EMPLOYEE PURSUANT TO THE TERMS OF THE COMPANY PLANS AS IN EFFECT IMMEDIATELY
PRIOR TO THE CLOSING DATE, TO BE CALCULATED, HOWEVER, ON THE BASIS OF THE
EMPLOYEE’S COMPENSATION AND SERVICE AT THE TIME OF THE LAYOFF.

(E)           INDIVIDUAL EMPLOYMENT CONTRACTS. EXCEPT AS SET FORTH ON
SCHEDULE 8.2(E), EFFECTIVE AS OF THE CLOSING DATE, BUYER SHALL ASSUME, OR CAUSE
AN AFFILIATE TO CONTINUE TO BE OBLIGATED UNDER OR ASSUME THE COMPANIES’
OBLIGATIONS (AFTER GIVING EFFECT TO THE TRANSFER OF THE TRANSFERRED BUSINESS)
UNDER ALL INDIVIDUAL EMPLOYMENT, TERMINATION, RETENTION, SEVERANCE OR OTHER
SIMILAR CONTRACTS OR AGREEMENTS SET FORTH IN SCHEDULE 5.18 (OTHER THAN ITEM 4
THEREOF).

(F)            WELFARE BENEFITS. EXCEPT AS OTHERWISE EXPRESSLY PROVIDED HEREIN,
AON OR ONE OF ITS AFFILIATES SHALL RETAIN RESPONSIBILITY UNDER THE COMPANY
BENEFIT PLANS THAT ARE WELFARE PLANS IN WHICH THE TRANSFERRED EMPLOYEES
PARTICIPATE WITH RESPECT TO ALL AMOUNTS THAT ARE PAYABLE BY REASON OF, OR IN
CONNECTION WITH, ANY AND ALL WELFARE BENEFIT CLAIMS MADE BY THE TRANSFERRED
EMPLOYEES AND THEIR ELIGIBLE DEPENDENTS BUT ONLY TO THE EXTENT THE CLAIMS WERE
INCURRED PRIOR TO THE CLOSING DATE. HOWEVER, BUYER SHALL REIMBURSE AON OR ONE OF
ITS AFFILIATES PROMPTLY FOR ANY PAYMENTS OF WELFARE BENEFITS MADE BY AON OR ONE
OF ITS AFFILIATES TO ELIGIBLE TRANSFERRED EMPLOYEES AND THEIR ELIGIBLE
DEPENDENTS ON OR AFTER THE CLOSING DATE WITH RESPECT TO CLAIMS INCURRED PRIOR TO
THE CLOSING DATE UPON RECEIPT OF PERIODIC BILLINGS FOR SUCH AMOUNTS, BUT ONLY TO
THE EXTENT THAT SUCH CLAIMS WERE REFLECTED IN THE CALCULATION OF CLOSING DATE
NET WORTH. BUYER AND ITS AFFILIATES SHALL BE RESPONSIBLE FOR ALL OTHER WELFARE
BENEFIT CLAIMS MADE BY THE TRANSFERRED EMPLOYEES AND THEIR ELIGIBLE DEPENDENTS
TO THE EXTENT SUCH CLAIMS WERE INCURRED ON OR AFTER THE CLOSING DATE.

(G)           CREDIT FOR SERVICE. TO THE EXTENT THAT SERVICE IS RELEVANT FOR
PURPOSES OF ELIGIBILITY AND VESTING (AND, IN ORDER TO CALCULATE THE AMOUNT OF
ANY VACATION, SICK DAYS, SEVERANCE AND SIMILAR BENEFITS, BUT NOT FOR PURPOSES OF
DEFINED BENEFIT PENSION BENEFIT ACCRUALS) UNDER ANY RETIREMENT PLAN, EMPLOYEE
BENEFIT PLAN, PROGRAM OR ARRANGEMENT ESTABLISHED OR MAINTAINED BY BUYER OR ANY
OF ITS AFFILIATES FOR THE BENEFIT OF THE TRANSFERRED EMPLOYEES, FOLLOWING THE
CLOSING DATE SUCH PLAN, PROGRAM OR ARRANGEMENT SHALL CREDIT SUCH TRANSFERRED
EMPLOYEES FOR SERVICE EARNED ON AND PRIOR TO THE CLOSING DATE WITH THE
COMPANIES, ANY OF THEIR AFFILIATES OR ANY OF THEIR RESPECTIVE PREDECESSORS IN
ADDITION TO SERVICE EARNED WITH BUYER OR ANY OF BUYER’S AFFILIATES AFTER THE
CLOSING DATE.

 

47

--------------------------------------------------------------------------------

 

(H)           PREEXISTING CONDITIONS; COORDINATION. FOLLOWING THE CLOSING DATE,
BUYER SHALL, OR SHALL CAUSE ITS AFFILIATES TO, WAIVE LIMITATIONS ON ELIGIBILITY,
ENROLLMENT AND BENEFITS RELATING TO ANY PREEXISTING MEDICAL CONDITIONS OF THE
TRANSFERRED EMPLOYEES AND THEIR ELIGIBLE DEPENDENTS. FOLLOWING THE CLOSING DATE,
BUYER SHALL RECOGNIZE, OR SHALL CAUSE ITS AFFILIATES TO ALSO RECOGNIZE, FOR
PURPOSES OF ANNUAL DEDUCTIBLE AND OUT OF POCKET LIMITS UNDER ITS HEALTH AND
DENTAL PLANS (THE “BUYER PLANS”), DEDUCTIBLE AND OUT OF POCKET EXPENSES PAID BY
TRANSFERRED EMPLOYEES AND THEIR RESPECTIVE DEPENDENTS UNDER HEALTH AND DENTAL
COMPANY BENEFIT PLANS IN THE CALENDAR YEAR IN WHICH THE CLOSING DATE OCCURS TO
THE EXTENT THE TRANSFERRED EMPLOYEES PARTICIPATE IN ANY SUCH BUYER PLANS IN SUCH
SAME CALENDAR YEAR.

(I)            VACATIONS. BUYER SHALL, OR SHALL CAUSE ITS AFFILIATES TO,
CONTINUE A VACATION PROGRAM FOR THE BENEFIT OF THE TRANSFERRED EMPLOYEES THROUGH
AT LEAST THE END OF THE CALENDAR YEAR IN WHICH THE CLOSING OCCURS THAT IS AT
LEAST AS FAVORABLE AS THE VACATION PROGRAM OF THE COMPANIES IN EFFECT
IMMEDIATELY PRIOR TO THE CLOSING DATE. BUYER SHALL, OR SHALL CAUSE ITS
AFFILIATES TO, RECOGNIZE AND PROVIDE ALL ACCRUED BUT UNUSED VACATION OF EACH
TRANSFERRED EMPLOYEE AS OF THE CLOSING DATE. NEITHER AON NOR ITS AFFILIATES
SHALL HAVE ANY OBLIGATION OR LIABILITY TO PAY OR PROVIDE ANY VACATION PAYMENTS
CLAIMED ON OR AFTER THE CLOSING DATE, IT BEING UNDERSTOOD THAT ALL ACCRUED AND
UNUSED VACATION OF EACH TRANSFERRED EMPLOYEE SHALL BE FULLY ACCRUED WITH RESPECT
TO ALL PERIODS THROUGH THE CLOSING DATE IN THE CALCULATION OF CLOSING DATE NET
WORTH IN ACCORDANCE WITH GAAP.

(J)            BONUSES. BUYER SHALL, OR SHALL CAUSE ITS AFFILIATES TO, ASSUME
THE BONUS PROGRAMS FOR TRANSFERRED EMPLOYEES IN EXISTENCE AS OF THE CLOSING DATE
AND SHALL PAY TO THE TRANSFERRED EMPLOYEES THE BONUSES THEY EARN UNDER SUCH
PROGRAMS WITH RESPECT TO THE FULL BONUS DETERMINATION PERIOD THAT INCLUDES THE
CLOSING DATE, IT BEING UNDERSTOOD THAT BONUS AMOUNTS SHALL BE FULLY ACCRUED WITH
RESPECT TO ALL PERIODS THROUGH THE CLOSING DATE (AND INCLUDING THE CLOSING) IN
THE CALCULATION OF CLOSING DATE NET WORTH IN ACCORDANCE WITH GAAP.

(K)           HEALTHCARE SPENDING ACCOUNT PROGRAM. BUYER SHALL, OR SHALL CAUSE
ITS AFFILIATES TO, ESTABLISH OR MAINTAIN A HEALTHCARE SPENDING ACCOUNT PROGRAM
FOR EACH TRANSFERRED EMPLOYEE WHO, IN THE PORTION OF THE CALENDAR YEAR ON OR
PRIOR TO THE CLOSING DATE, CONTRIBUTED TO THE HEALTHCARE SPENDING ACCOUNT
PROGRAM OF AON. THE BEGINNING BALANCE AS OF THE CLOSING DATE IN THE BUYER’S
HEALTHCARE SPENDING ACCOUNT PROGRAM SHALL BE THE UNUSED PORTION OF THE BALANCE
IN AON’S HEALTHCARE SPENDING ACCOUNT PROGRAM (THE “HEALTHCARE SPENDING ACCOUNT
OPENING BALANCE”). TO THE EXTENT THAT BUYER (OR AN AFFILIATE OF BUYER) HAS
PREVIOUSLY ESTABLISHED AND MAINTAINS A HEALTH REIMBURSEMENT ACCOUNT, ANY UNUSED
AMOUNT IN AON’S HEALTH REIMBURSEMENT ACCOUNT (ON BEHALF OF THE TRANSFERRED
EMPLOYEES) SHALL BE CREDITED TO THE BUYER’S HEALTH REIMBURSEMENT ACCOUNT TO THE
EXTENT THAT IT IS GREATER THAN THE AMOUNT A SIMILARLY SITUATED EMPLOYEE OF BUYER
MAY BE ENTITLED. AON SHALL, PROMPTLY FOLLOWING BUYER’S WRITTEN REQUEST,
REIMBURSE BUYER FOR ANY PORTION OF THE HEALTHCARE SPENDING ACCOUNT FUNDED BY
BUYER PURSUANT TO THIS SECTION 8.2(K) WHICH IS USED BY TRANSFERRED EMPLOYEES AND
NOT RELEASED TO BUYER FOLLOWING THE END OF THE CALENDAR YEAR IN WHICH THE
CLOSING OCCURS.

(L)            COBRA. FOLLOWING THE CLOSING DATE, BUYER SHALL, OR SHALL CAUSE AN
AFFILIATE TO, PROVIDE CONTINUATION HEALTH CARE COVERAGE TO ALL TRANSFERRED
EMPLOYEES AND THEIR QUALIFIED BENEFICIARIES, REGARDLESS OF WHEN A “QUALIFYING
EVENT” OCCURS, IN ACCORDANCE WITH THE CONTINUATION HEALTH CARE COVERAGE
REQUIREMENTS OF SECTION 4980B OF THE CODE AND TITLE I,

48

--------------------------------------------------------------------------------

 

Subtitle B, Part 6 of ERISA (“COBRA”) with respect to claims incurred at any
time on or after the Closing Date. Aon or one of its Affiliates shall provide
COBRA coverage for former employees of the Companies who do not become
Transferred Employees.

(M)          WARN. BUYER SHALL BE RESPONSIBLE FOR ALL LIABILITIES OR OBLIGATIONS
UNDER THE WORKER ADJUSTMENT AND RETRAINING NOTIFICATION ACT AND SIMILAR STATE
AND LOCAL RULES, STATUTES AND ORDINANCES RESULTING FROM THE CLOSING OR FROM
BUYER’S OR THE COMPANIES’ ACTIONS FOLLOWING THE CLOSING.

Section 8.3            Securities Law Legends. Buyer understands that the Shares
have not been, and upon transfer to the Buyer at Closing will not be, registered
under the Securities Act or the securities laws of any state or other
Administrative Authority and that the Shares may be sold or disposed of only in
one or more transactions registered under the Securities Act, applicable state
securities laws or the laws of any other applicable Administrative Authority or
as to which an exemption from the registration requirements of the Securities
Act, applicable state securities laws or the laws of any other applicable
Administrative Authority is available. Buyer acknowledges and agrees that it
does not have any rights hereunder to require Aon to cause the registration of
any of the Shares. Buyer understands that the certificates representing the
Shares delivered to it by Aon at Closing will contain a legend similar to the
following and other legends necessary or appropriate under applicable state
securities laws or the laws of any other Administrative Authority:

THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 (THE “ACT”) OR ANY STATE SECURITIES LAWS AND MAY NOT BE
SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS A REGISTRATION STATEMENT UNDER
THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS WITH RESPECT TO SUCH SHARES IS
EFFECTIVE OR UNLESS THE COMPANY IS IN RECEIPT OF AN OPINION OF COUNSEL
SATISFACTORY TO IT TO THE EFFECT THAT SUCH SHARES MAY BE SOLD WITHOUT
REGISTRATION UNDER THE ACT AND SUCH LAWS.

Section 8.4            Insurance; Risk of Loss. Aon shall cause the Companies to
keep insurance policies currently maintained by the Companies covering their
business, assets and current or former employees, as the case may be, or
suitable replacements therefor, in full force and effect through the Closing
Date. From and after the Closing Date, Buyer shall be solely responsible for all
insurance coverage and related risk of loss based on claims pending as of the
Closing Date and claims made after the Closing Date, without regard to the when
the event giving rise to any such claim occurred, with respect to the Companies
and their business, assets and current or former employees. To the extent that
after the Closing any party hereto requires any information regarding claim
data, payroll or other information in order to make filing with insurance
carriers or self insurance regulators from another party hereto, such party will
promptly supply such information.

Section 8.5            Release of Guaranties  Buyer shall use its commercially
reasonable efforts to cause Aon and its Affiliates to be fully released, as of
the Closing Date or as promptly as practicable after the Closing Date, in
respect of all obligations under any guaranties,

49

--------------------------------------------------------------------------------

 

letters of credit, letters of comfort, bid bonds or performance or surety bonds
or cash or other collateral obtained or given by Aon or its Affiliates relating
to any parcel of Leased Real Property or any other contractual commitment of the
Companies (which shall include for the purpose of this Section 8.5, FFG and
Combined with respect to the Transferred Business) (collectively, the
“Guaranties”). If, at or prior to the Closing, after using its commercially
reasonable efforts to do so, Buyer is unable to effect such a substitution and
release with respect to any Guaranty, from and after the Closing Buyer and the
Companies shall indemnify each Seller Group Member against any and all Loss or
Expense arising from such Guaranty. Without limiting the foregoing, after the
Closing Date, Buyer will not, and will not permit any of its Affiliates to,
renew, or extend any contract, lease or other obligation that is known by Buyer
or any of the Companies to be covered by a Guaranty without obtaining the
release thereof. Any cash or other collateral posted by Aon or its Affiliates in
respect of any Guaranty shall be delivered to Aon promptly following the release
of Aon therefrom.

SECTION 8.6            NONCOMPETITION AND NONSOLICITATION

(A)           FOR A PERIOD OF TEN (10) YEARS AFTER THE CLOSING (THE “RESTRICTED
PERIOD”), AON SHALL NOT, AND SHALL CAUSE ITS AFFILIATES NOT TO, ENGAGE, ANYWHERE
IN THE WORLD, DIRECTLY OR INDIRECTLY, IN ANY RESTRICTED BUSINESS OR, DIRECTLY OR
INDIRECTLY, OWN AN INTEREST IN, MANAGE, OPERATE OR CONTROL ANY PERSON THAT
ENGAGES, ANYWHERE IN THE WORLD, IN A RESTRICTED BUSINESS; PROVIDED, HOWEVER,
THAT, FOR THE PURPOSES OF THIS SECTION 8.6, (X) OWNERSHIP OF SECURITIES HAVING
NO MORE THAN FIVE PERCENT OF THE OUTSTANDING VOTING POWER OF ANY PERSON WHICH
ARE LISTED ON ANY NATIONAL SECURITIES EXCHANGE OR NATIONAL QUOTATION SYSTEM AND
(Y) OWNERSHIP OF NOT MORE THAN 25% OF ANY PRIVATE EQUITY FUND OR ALTERNATIVE
INVESTMENT VEHICLE IN WHICH AON OR ITS AFFILIATES IS A PASSIVE INVESTOR SHALL
NOT BE DEEMED TO BE A VIOLATION OF THIS SECTION 8.6; PROVIDED, HOWEVER, THAT IN
THE CASE OF (X) OR (Y) AON AND ITS AFFILIATES DO NOT PARTICIPATE IN ANY WAY IN
THE OPERATION OR MANAGEMENT OF THE RESTRICTED BUSINESS.

(B)           NOTWITHSTANDING THE PROVISIONS OF THIS SECTION 8.6, NOTHING IN
THIS SECTION 8.6 SHALL BE DEEMED TO PRECLUDE, PROHIBIT OR RESTRICT AON OR ANY OF
ITS AFFILIATES FROM (I) ENGAGING IN ANY EXEMPT BUSINESS ACTIVITIES;
(II) ACQUIRING ANY PERSON, AND FOLLOWING SUCH ACQUISITION, ACTIVELY ENGAGING IN
ANY RESTRICTED BUSINESS THROUGH A SUBSIDIARY, DIVISION, GROUP, FRANCHISE OR
SEGMENT OF SUCH PERSON THAT IS ENGAGED IN SUCH RESTRICTED BUSINESS AT THE TIME
OF THE ACQUISITION OF SUCH PERSON (AN “ACQUIRED BUSINESS”), SO LONG AS (X) FOR
THE MOST RECENT FISCAL YEAR ENDING PRIOR TO THE DATE OF SUCH PURCHASE, THE
CONSOLIDATED GROSS REVENUES OF SUCH PERSON DERIVED FROM RESTRICTED BUSINESSES
WERE LESS THAN 50% OF THE TOTAL CONSOLIDATED GROSS REVENUES OF SUCH PERSON AND
(Y) FOLLOWING SUCH ACQUISITION, THE ACQUIRED BUSINESS ENGAGES IN THE RESTRICTED
BUSINESS ONLY WITH PERSONS THAT WERE CLIENTS OF THE ACQUIRED BUSINESS
IMMEDIATELY PRIOR TO THE ACQUISITION AND PROVIDES EACH SUCH EXISTING CLIENT ONLY
THE PROGRAMS PROVIDED TO SUCH EXISTING CLIENT IMMEDIATELY PRIOR TO THE
ACQUISITION IN THE GEOGRAPHIC AREA IN WHICH SUCH PROGRAM WAS PROVIDED TO SUCH
EXISTING CLIENT IMMEDIATELY PRIOR TO THE ACQUISITION; (III) ENGAGING IN A CHANGE
OF CONTROL OR, IF THE ACQUIRING PERSON HAS A SUBSIDIARY, DIVISION, GROUP,
FRANCHISE OR SEGMENT THAT IS ENGAGED IN A RESTRICTED BUSINESS AT THE TIME OF THE
CHANGE OF CONTROL, THEREAFTER ENGAGING IN THE RESTRICTED BUSINESS; OR
(IV) PROVIDING ANY WARRANTY TPA SERVICES TO ANY PERSON IN A MARKET WHERE AON HAS
AN ESTABLISHED WARRANTY TPA CAPABILITY AS OF THE DATE OF THIS AGREEMENT
FOLLOWING COMPLIANCE WITH SECTION 8.6(E); PROVIDED, HOWEVER, THAT IN THE CASE OF
CLAUSE (II), (A) THE ACQUIRED BUSINESS SHALL BE CONDUCTED WITHOUT THE USE OF THE
“AON” TRADENAME AND (B) IF

50

--------------------------------------------------------------------------------

 

such Acquired Business’s consolidated fee income from such Restricted Businesses
in the calendar year prior to the acquisition or in any calendar year thereafter
is in excess of $10 million (the “Divestiture Condition”), Aon or its Affiliates
will dispose of (or enter into and consummate a definitive agreement which
requires, as soon as practicable but not later than six (6) months after the
date of such agreement, the disposal of) such Restricted Business within two
years of the satisfaction of the Divestiture Condition and, with respect to any
such disposition of any Restricted Business, Buyer shall have a 30-day right of
first offer to purchase such Restricted Business. If any such Acquired
Business’s consolidated fee income from such Restricted Business in the calendar
year prior to the acquisition or in any calendar year thereafter is in excess of
$5 million but less than $10 million, Buyer shall have a one-time (except as
provided in the immediately preceding sentence) 30-day right to make an offer to
purchase such Restricted Business from Aon and/or its Affiliates, as applicable.
For the avoidance of doubt, for purposes of this Section 8.6, the consolidated
gross revenues of any Restricted Business shall include forwarded premiums.

(C)           AS A SEPARATE AND INDEPENDENT COVENANT, FOR A PERIOD OF TWO YEARS
FOLLOWING THE CLOSING, AON SHALL NOT, AND SHALL CAUSE ITS AFFILIATES NOT TO, IN
ANY WAY, DIRECTLY OR INDIRECTLY, HIRE ANY DESIGNATED AWG EMPLOYEE OR SOLICIT ANY
TRANSFERRED EMPLOYEES TO LEAVE THE EMPLOY OF ANY OF THE COMPANIES OR VIOLATE THE
TERMS OF THEIR CONTRACTS, OR ANY EMPLOYMENT ARRANGEMENTS, WITH ANY OF THE
COMPANIES; PROVIDED, HOWEVER, THAT AON OR ANY OF ITS AFFILIATES MAY SOLICIT ANY
TRANSFERRED EMPLOYEES WHO ARE DISCHARGED BY THE COMPANIES, AND, PROVIDED
FURTHER, THAT NOTHING IN THIS SECTION 8.6(C) SHALL PROHIBIT AON OR ANY OF ITS
AFFILIATES FROM EMPLOYING ANY TRANSFERRED EMPLOYEES WHO ARE NOT DESIGNATED AWG
EMPLOYEES AS A RESULT OF A GENERAL SOLICITATION TO THE PUBLIC OR GENERAL
ADVERTISING, OR THE SOLICITATION OF ANY INDIVIDUAL WHOSE EMPLOYMENT WITH THE
COMPANIES HAS BEEN TERMINATED FOR AT LEAST TWELVE MONTHS.

(D)           AS A SEPARATE AND INDEPENDENT COVENANT, BUYER AGREES THAT, FOR A
PERIOD OF TWO YEARS FOLLOWING THE CLOSING, BUYER SHALL NOT, AND SHALL CAUSE ITS
AFFILIATES (INCLUDING THE COMPANIES) NOT TO, IN ANY WAY, DIRECTLY OR INDIRECTLY,
SOLICIT ANY EMPLOYEES OF AON OR ITS AFFILIATES TO LEAVE THE EMPLOY OF AON OR ITS
AFFILIATES, AS APPLICABLE, OR VIOLATE THE TERMS OF THEIR CONTRACTS, OR ANY
EMPLOYMENT ARRANGEMENTS, WITH AON OR ITS AFFILIATES, AS APPLICABLE; PROVIDED,
HOWEVER, THAT BUYER OR ANY OF ITS AFFILIATES MAY SOLICIT ANY SUCH EMPLOYEES WHO
ARE DISCHARGED BY AON OR ITS AFFILIATES, AS APPLICABLE, AND, PROVIDED FURTHER,
THAT NOTHING IN THIS SECTION 8.6(D) SHALL PROHIBIT BUYER OR ANY OF ITS
AFFILIATES FROM EMPLOYING ANY SUCH EMPLOYEE AS A RESULT OF A GENERAL
SOLICITATION TO THE PUBLIC OR GENERAL ADVERTISING, OR THE SOLICITATION OF ANY
INDIVIDUAL WHOSE EMPLOYMENT WITH AON AND ITS AFFILIATES HAS BEEN TERMINATED FOR
AT LEAST TWELVE MONTHS.

(E)           IF, DURING THE PERIOD BETWEEN THE DATE HEREOF AND THE CLOSING OR
DURING THE RESTRICTED PERIOD, AON OR ANY ITS AFFILIATES RECEIVES A BONA FIDE
OFFER FROM A THIRD PARTY RELATING TO THE POTENTIAL PROVISION OF WARRANTY TPA
SERVICES BY AON OR ITS AFFILIATES TO SUCH THIRD PARTY THAT AON OR ITS AFFILIATES
DESIRES TO ACCEPT, AON SHALL, PRIOR TO ACCEPTING SUCH OFFER, FIRST DELIVER A
WRITTEN NOTICE TO BUYER SETTING FORTH THE MATERIAL TERMS OF THE THIRD PARTY
OFFER; PROVIDED, THAT AON MAY ELECT NOT TO INCLUDE THE NAME OF THE OFFERING
THIRD PARTY IN SUCH NOTICE TO THE EXTENT IT REASONABLY DETERMINES THAT DOING SO
WOULD VIOLATE ANY DUTY OF CONFIDENTIALITY OWING TO SUCH THIRD PARTY. BUYER WILL
HAVE FIFTEEN (15) DAYS FROM ITS RECEIPT OF SUCH OFFER (A “BUYER CONSIDERATION
PERIOD”) TO NOTIFY AON OF ITS INTEREST IN PROVIDING THE WARRANTY TPA SERVICES TO
SUCH THIRD PARTY ON THE SAME TERMS AND CONDITIONS AS ARE SET FORTH IN THE THIRD
PARTY OFFER, AND IF BUYER PROVIDES

51

--------------------------------------------------------------------------------

 

such notice, Aon will, if applicable, promptly inform Buyer of the third party
offeror’s identity, and will cooperate with Buyer in good faith in coordinating
Buyer’s negotiations with respect to such offer with the applicable third party.
If Buyer fails to notify Aon in writing of its interest in providing such 
Warranty TPA Services prior to the expiration of the Buyer Consideration Period
or fails to enter into a definitive agreement during the sixty (60) day period
immediately following the expiration of the Buyer Consideration Period, then Aon
or its Affiliates will be permitted, during the sixty (60) day period
thereafter, to accept the applicable third party offer on the terms and
conditions set forth therein. For the avoidance of doubt, if Buyer shall have
elected to exercise its right with respect to any Services under this
Section 8.6(e), is willing to execute the definitive agreement relating to the
third party offer on the terms and conditions set forth therein that Aon is
prepared to accept and the applicable third party shall have refused to permit
Buyer to accept its offer in lieu of Aon or its Affiliates, Aon and its
Affiliates shall not be permitted to provide such services to such third party.

SECTION 8.7            USE OF NAMES.

(A)           AON IS NOT CONVEYING OWNERSHIP RIGHTS OR GRANTING BUYER OR ITS
AFFILIATES (INCLUDING THE COMPANIES AFTER THE CLOSING) A LICENSE TO USE ANY OF
THE TRADENAMES, SERVICE MARKS OR TRADEMARKS OF AON OR ANY AFFILIATE OF AON
(OTHER THAN THE TRADEMARKS AND SERVICE MARKS INCLUDED IN THE INTELLECTUAL
PROPERTY IDENTIFIED IN SCHEDULE 5.11(A)) (COLLECTIVELY, THE “RETAINED NAMES AND
MARKS”) AND, AFTER THE CLOSING, BUYER AND ITS AFFILIATES (INCLUDING THE
COMPANIES AFTER THE CLOSING) SHALL NOT USE IN ANY MANNER THE NAMES OR MARKS OF
AON OR ANY AFFILIATE OF AON OR ANY WORD THAT IS CONFUSINGLY SIMILAR TO SUCH
NAMES OR MARKS, EXCEPT AS PROVIDED IN THIS SECTION 8.7. IN THE EVENT BUYER OR
ANY AFFILIATE OF BUYER (INCLUDING THE COMPANIES AFTER THE CLOSING) VIOLATES ANY
OF ITS OBLIGATIONS UNDER THIS SECTION 8.7, AON AND ITS AFFILIATES MAY PROCEED
AGAINST IT IN LAW OR IN EQUITY FOR SUCH DAMAGES OR OTHER RELIEF AS A COURT MAY
DEEM APPROPRIATE. BUYER ACKNOWLEDGES THAT A VIOLATION OF THIS SECTION 8.7 MAY
CAUSE AON AND ITS AFFILIATES IRREPARABLE HARM WHICH MAY NOT BE ADEQUATELY
COMPENSATED FOR BY MONEY DAMAGES.

(B)           AT THE CLOSING, BUYER SHALL EXECUTE SUCH AMENDED ORGANIZATIONAL
DOCUMENTS WITH RESPECT TO ANY OF THE COMPANIES CONTAINING THE WORD “AON,”
“COMBINED” OR “PAT RYAN” IN ITS NAME SUCH THAT EACH SUCH COMPANY CHANGES ITS
NAME TO A NAME NOT CONTAINING THE WORD “AON,” “COMBINED” OR “PAT RYAN.” 
PROMPTLY, BUT IN NO EVENT LATER THAN FIVE (5) BUSINESS DAYS AFTER THE CLOSING,
BUYER SHALL CAUSE THE APPLICABLE COMPANIES TO FILE THE AMENDED ORGANIZATIONAL
DOCUMENTS WITH THE APPLICABLE ADMINISTRATIVE AUTHORITY AND USE ALL REASONABLE
EFFORTS TO TAKE SUCH ACTIONS AS MAY BE NECESSARY TO FULFILL ITS OBLIGATIONS SET
FORTH IN THIS SECTION 8.7(B).

(C)           FOLLOWING THE CLOSING, BUYER SHALL (AND SHALL CAUSE THE COMPANIES
TO) CEASE PROMPTLY, BUT IN NO EVENT LATER THAN 60 DAYS AFTER THE CLOSING DATE,
USING ANY (I) ADVERTISING OR PROMOTIONAL MATERIALS AND (II) ANY STATIONERY,
BUSINESS CARDS, BUSINESS FORMS AND OTHER SIMILAR ITEMS, IN EACH CASE THAT
CONTAIN ANYWHERE THEREON ANY OF THE RETAINED NAMES AND MARKS; PROVIDED, HOWEVER,
THAT BUYER SHALL (AND SHALL CAUSE THE COMPANIES TO), WHEN USING ITEMS REFERRED
TO IN CLAUSE (II) IN THE CONTEXT OF ENTERING INTO OR CONDUCTING CONTRACTUAL
RELATIONSHIPS, MAKE REASONABLY CLEAR TO ALL OTHER APPLICABLE PARTIES THAT BUYER
AND THE COMPANIES, RATHER THAN AON OR ANY AFFILIATE OF AON IS THE PARTY ENTERING
INTO OR CONDUCTING THE CONTRACTUAL RELATIONSHIP; AND PROVIDED, FURTHER, THAT
BUYER SHALL (AND SHALL CAUSE THE COMPANIES

52

--------------------------------------------------------------------------------

 

to) ensure that personnel of the Companies using such items shall not, and shall
have no authority to, hold themselves out as officers, employees or agents of
Aon or any Affiliate of Aon. Notwithstanding the foregoing, the Companies shall
be permitted to use the Retained Names and Marks in any jurisdiction where they
are unable under applicable Requirements of Law to change the name under which
they conduct the Warranty Business without receipt of an approval or consent
from an Administrative Authority in such jurisdiction, provided that Buyer and
the Companies are using all reasonable efforts to obtain such approval or
consent. With respect to all materials used after the Closing which state or
suggest or imply any affiliation with Aon or any of the Affiliates of Aon, Buyer
shall indemnify and hold harmless the Seller Group Members from and against all
Losses which arise out of, relate to or result from the inclusion of such
statements, suggestions or implications in such materials.

(D)           AON, ON BEHALF OF ITSELF AND ITS AFFILIATES, GRANTS BUYER AND THE
COMPANIES A LIMITED NON-EXCLUSIVE, ROYALTY-FREE, TRANSITION TRADEMARK LICENSE
SOLELY FOR THE PURPOSE OF THE COMPANIES’ TRANSITIONING USE OF THE RETAINED NAMES
AND MARKS AFTER THE CLOSING SUBJECT TO AND IN ACCORDANCE WITH SECTION 8.7(C).
NEITHER BUYER NOR ANY COMPANY SHALL ACQUIRE ANY RIGHTS WHATSOEVER IN THE
RETAINED NAMES AND MARKS BY VIRTUE OF ITS USE DURING THIS TRANSITION PERIOD AND
ALL USE OF THE RETAINED NAMES AND MARKS BY BUYER OR THE COMPANIES DURING THIS
PERIOD AND ALL GOODWILL ARISING OUT OF SUCH USE SHALL INURE TO THE BENEFIT OF
AON.

(E)           DURING THE RESTRICTED PERIOD, AON SHALL NOT, AND SHALL CAUSE ITS
AFFILIATES NOT TO, USE AS A TRADE NAME THE WORDS “AON” AND “WARRANTY” AS PART OF
THE SAME TRADE NAME.

Section 8.8            Financial Information. For three years following the
Closing, Aon shall provide Buyer with the following assistance in connection
with the preparation of financial statements and financial data relating to the
Companies for periods prior to the Closing Date for use in connection with the
registration of securities by Buyer or its Affiliates:  (i) providing Buyer and
its advisors and auditors with reasonable access to books and records of Aon and
its Affiliates to the extent relating to the Companies, (ii) permitting the
independent public accountants retained by Buyer as auditors for such periods to
conduct an examination of the financial statements of the Companies for such
periods in accordance with the standards of the Public Company Accounting
Oversight Board, (iii) providing the independent public accountants referred to
in clause (ii) with such information and access to records as they may
reasonably request in connection with the matter referred to in such clause, and
(iv) to the extent not resulting in an unreasonable burden on Aon and its
Affiliates, providing Buyer and its independent public accountants with such
other assistance as Buyer may reasonably request as required to obtain audited
financial statements and selected financial data of the Companies meeting the
requirements of Rules promulgated by the Securities and Exchange Commission for
use in a registration statement filed on Form S-1 or any equivalent successor
form. To the extent required by Buyer’s independent auditors, Aon shall retain
the independent auditors to provide the opinion (and related consent) and
customary comfort letters, in each case for periods prior to the Closing, and
shall authorize and request the independent public accountants under these
circumstances to provide Buyer and its advisors and auditors with access to
their workpapers to the extent relating to the Companies. Within 5 Business Days
following any request therefor, Buyer shall reimburse Aon for all out-of-pocket
costs and expenses incurred by Aon in connection with the matters referred to in
this Section 8.8. Buyer and the Companies shall indemnify Aon against any and
all Loss and Expense arising from this Section 8.8.

53

--------------------------------------------------------------------------------

 

Section 8.9            Reissuance of FFG Policies. From and after the Closing,
Buyer shall cause VSC to use all commercially reasonable efforts to cancel all
policies issued by FFG comprising the Warranty Business and reissue such
policies by VSC; provided, however, any such action taken by VSC under this
Section 8.9 shall be in compliance with all applicable Requirements of Law and
any reinsurance contracts applicable to such policies.

Section 8.10         Certain Deposits. The parties agree to act in accordance
with Schedule 8.10.

Section 8.11         Existing Client Schedule. The Existing Client Schedule
shall initially be as set forth on Schedule 8.11. During the ninety (90) day
period immediately following the date hereof, Aon shall in good faith conduct a
full review of the Existing Client Schedule for purposes of verifying the
information set forth therein. Aon shall, by no later than the end of such
ninety (90) period, provide Buyer with a revised Existing Client Schedule and
Client Agreements supporting the inclusion of each client (and with respect to
each such client, each geographic area and each program provided within each
geographic area) appearing thereon. For avoidance of doubt, no entry may be
included on the Existing Client Schedule that is not so supported by a Client
Agreement that is in effect on the date hereof and is delivered to Buyer within
such ninety (90) day period. Notwithstanding anything to the contrary contained
herein, Aon shall be permitted to redact any portion of any Client Agreement
delivered to Buyer under this Section 8.11 in its sole discretion to the extent
that such information is not necessary to establish the existence of the Client
Agreement, the identity of the client or the program or geography covered
thereby.

ARTICLE IX

CONDITIONS PRECEDENT TO OBLIGATIONS OF BUYER

The obligations of Buyer under this Agreement shall, at the option of Buyer (to
the extent permissible under applicable law), be subject to the satisfaction, on
or prior to the Closing Date, of the following conditions:

SECTION 9.1            NO MISREPRESENTATION OR BREACH OF COVENANTS AND
WARRANTIES.

(A)           (A) THERE SHALL NOT HAVE BEEN ANY MATERIAL BREACH BY AON IN THE
PERFORMANCE OF ANY OF ITS COVENANTS AND AGREEMENTS HEREIN WHICH SHALL NOT HAVE
BEEN REMEDIED OR CURED; (B) EACH OF THE REPRESENTATIONS AND WARRANTIES OF AON
CONTAINED IN THIS AGREEMENT (DISREGARDING ANY QUALIFICATION AS TO MATERIALITY OR
MATERIAL ADVERSE EFFECT) SHALL BE TRUE AND CORRECT ON THE CLOSING DATE AS THOUGH
MADE ON THE CLOSING DATE (EXCEPT TO THE EXTENT THAT THEY EXPRESSLY RELATE TO AN
EARLIER DATE, IN WHICH CASE THEY SHALL BE TRUE AND CORRECT AS OF SUCH DATE),
EXCEPT FOR (I) CHANGES THEREIN SPECIFICALLY PERMITTED BY THIS AGREEMENT OR
RESULTING FROM ANY TRANSACTION EXPRESSLY CONSENTED TO IN WRITING BY BUYER OR ANY
TRANSACTION EXPRESSLY CONTEMPLATED BY THIS AGREEMENT AND (II) BREACHES OF
REPRESENTATIONS AND WARRANTIES WHICH WOULD NOT, INDIVIDUALLY OR IN THE
AGGREGATE, REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT; AND

54

--------------------------------------------------------------------------------

 

there shall have been delivered to Buyer a certificate to such effect, dated the
Closing Date, signed on behalf of Aon by a duly authorized officer of Aon.

Section 9.2            HSR Act and EU Merger Control. The waiting period under
the HSR Act with respect to the transactions contemplated by this Agreement
shall have expired or been terminated. To the extent applicable, the European
Commission shall have issued a decision under Article 6(1)(b) or (8)(1) or
(8)(2) of Council Regulation (EC) No. 139/2004 of the Council of the European
Union (or shall be deemed to have done so under Article 10(6) thereof) declaring
the transactions contemplated by this Agreement compatible with the EC Common
Market.

Section 9.3            Necessary Governmental Approvals. There shall have been
obtained or taken all approvals and actions of or by all Administrative
Authorities (including any approvals or consents from state departments of
insurance having or asserting jurisdiction over any of the Underwriting
Companies) set forth in Schedule 9.3 or as to which the failure to have been
obtained or taken place would reasonably be expected to have a Material Adverse
Effect.

Section 9.4            No Restraint. No injunction or restraining order shall
have been issued by any court of competent jurisdiction or Administrative
Authority and be in effect which restrains or prohibits any material transaction
contemplated hereby.

Section 9.5            No Governmental Proceedings. No legal proceeding by an
Administrative Authority shall be pending against Buyer, Aon, FFG, Combined or
any of the Companies (i) to restrain or prohibit any material transaction
contemplated hereby or (ii) which would, if adversely determined, reasonably be
expected to have a Material Adverse Effect.

Section 9.6            [Intentionally Omitted.]

Section 9.7            FIRPTA Certificate. Aon shall have delivered to Buyer a
certificate of non-foreign status, in the form attached hereto as Exhibit B.

Section 9.8            Ratings. (a)  A.M. Best Company shall have confirmed in
writing the Financial Strength Rating of A- and the Issuer Credit Rating of a-
for VSC, after giving effect to the Closing and the Facilitating Transactions;
provided that this condition shall be deemed satisfied if A.M. Best shall have
confirmed in writing that it would have issued such rating had the Indebtedness
incurred by Buyer and the Companies in connection with the transactions
contemplated hereby been $150 million or less (it being understood by the
parties that VSC will not incur any of such Indebtedness).

(b)  No downgrade of the ratings by A.M. Best Company of RLIC and LGI as of the
date of this Agreement shall have occurred and not been reinstated in writing;
provided that this condition shall be deemed satisfied if A.M. Best shall have
confirmed in writing that it would not have issued such downgrade had the
Indebtedness incurred by Buyer and the Companies in connection with the
transactions contemplated hereby been $150 million or less (it being understood
by the parties that RLIC and LGI will not incur any of such Indebtedness).

(C)  NO ANNOUNCEMENT BY A.M. BEST COMPANY OF A REVIEW OF THE RATINGS OF RLIC OR
LGI AS OF THE DATE OF THIS AGREEMENT WITH NEGATIVE INDICATIONS SHALL HAVE
OCCURRED AND NOT

55

--------------------------------------------------------------------------------

 

been withdrawn in writing; provided that this condition shall be deemed
satisfied A.M. Best Company shall have confirmed in writing that it would not
have initiated such review had the Indebtedness incurred by Buyer and the
Companies in connection with the transactions contemplated hereby been $150
million or less (it being understood by the parties that RLIC and LGI will not
incur any of such Indebtedness).

Section 9.9            No MAE. Since the date of this Agreement, there shall not
have occurred any Material Adverse Effect, or any event or circumstance that
would reasonably be expected to have a Material Adverse Effect.

Notwithstanding the failure of any one or more of the foregoing conditions in
this Article IX, Buyer may, at its option, proceed with the Closing without
satisfaction, in whole or in part, of any one or more of such conditions and
without written waiver. To the extent that at or prior to the Closing Aon
delivers to Buyer a written notice confirming that the condition specified in
Section 9.1 has not been satisfied and specifying in reasonable detail the
inaccuracies of representations and warranties that cause such condition not to
be satisfied and nevertheless Buyer proceeds with the Closing, Buyer shall be
deemed to have waived for all purposes any rights or remedies it may have
against Aon by reason of the inaccuracies in representations and warranties
described in such notice.

ARTICLE X

CONDITIONS PRECEDENT TO OBLIGATIONS OF AON

The obligations of Aon under this Agreement shall, at the option of Aon (to the
extent permissible under applicable law), be subject to the satisfaction, on or
prior to the Closing Date, of the following conditions:

SECTION 10.1         NO MISREPRESENTATION OR BREACH OF COVENANTS AND WARRANTIES.
(A)  THERE SHALL NOT HAVE BEEN ANY MATERIAL BREACH BY BUYER IN THE PERFORMANCE
OF ANY OF ITS COVENANTS AND AGREEMENTS HEREIN WHICH SHALL NOT HAVE BEEN REMEDIED
OR CURED; (B) EACH OF THE REPRESENTATIONS AND WARRANTIES OF BUYER CONTAINED IN
THIS AGREEMENT (DISREGARDING ANY QUALIFICATION AS TO MATERIALITY) SHALL BE TRUE
AND CORRECT ON THE CLOSING DATE AS THOUGH MADE ON THE CLOSING DATE (EXCEPT TO
THE EXTENT THAT THEY EXPRESSLY RELATE TO AN EARLIER DATE, IN WHICH CASE THEY
SHALL BE TRUE AND CORRECT AS OF SUCH DATE), EXCEPT FOR (I) CHANGES THEREIN
SPECIFICALLY PERMITTED BY THIS AGREEMENT OR RESULTING FROM ANY TRANSACTION
EXPRESSLY CONSENTED TO IN WRITING BY AON OR ANY TRANSACTION EXPRESSLY
CONTEMPLATED BY THIS AGREEMENT AND (II) BREACHES OF REPRESENTATIONS AND
WARRANTIES (INTERPRETED WITHOUT GIVING EFFECT TO REFERENCES TO MATERIALITY)
WHICH WOULD NOT, INDIVIDUALLY OR IN THE AGGREGATE, REASONABLY BE EXPECTED TO
HAVE A MATERIAL ADVERSE EFFECT ON BUYER’S ABILITY TO CONSUMMATE THE TRANSACTIONS
CONTEMPLATED HEREBY; AND THERE SHALL HAVE BEEN DELIVERED TO AON A CERTIFICATE TO
SUCH EFFECT, DATED THE CLOSING DATE, SIGNED ON BEHALF OF BUYER BY A DULY
AUTHORIZED OFFICER OF BUYER.

Section 10.2         HSR Act and EU Merger Control. The waiting period under the
HSR Act with respect to the transactions contemplated by this Agreement shall
have expired or been terminated. To the extent applicable, the European
Commission shall have issued a decision under Article 6(1)(b) or (8)(1) or
(8)(2) of Council Regulation (EC) No. 139/2004 of the

56

--------------------------------------------------------------------------------

 

Council of the European Union (or shall be deemed to have done so under
Article 10(6) thereof) declaring the transactions contemplated by this Agreement
compatible with the EC Common Market.

Section 10.3         Necessary Governmental Approvals.There shall have been
obtained or taken all approvals and actions of or by all Administrative
Authorities (including, but not limited to, any approvals or consents from state
departments of insurance having or asserting jurisdiction over any of the
Underwriting Companies) set forth in Schedule 10.3 or as to which the failure to
have been obtained or taken place would reasonably be expected to have a
Material Adverse Effect.

Section 10.4         No Restraint. No injunction or restraining order shall have
been issued by any court of competent jurisdiction or Administrative Authority
and be in effect which restrains or prohibits any material transaction
contemplated hereby.

Section 10.5         No Governmental Proceedings. No legal proceeding by an
Administrative Authority shall be pending (i) to restrain or prohibit any
material transaction contemplated hereby or (ii) which would reasonably be
expected to have a Material Adverse Effect.

Notwithstanding the failure of any one or more of the foregoing conditions in
Article X, Aon may, at its option, proceed with the Closing without
satisfaction, in whole or in part, of any one or more of such conditions and
without written waiver. To the extent that at or prior to the Closing Buyer
delivers to Aon a written notice confirming that the condition specified in
Section 10.1 has not been satisfied and specifying in reasonable detail the
inaccuracies of representations and warranties that cause such condition not to
be satisfied and nevertheless Aon proceeds with the Closing, Aon shall be deemed
to have waived for all purposes any rights or remedies it may have against Buyer
by reason of the inaccuracies in representations and warranties described in
such notice.

ARTICLE XI

INDEMNIFICATION

SECTION 11.1         INDEMNIFICATION BY AON.

(A)           FROM AND AFTER THE CLOSING, AON AGREES TO INDEMNIFY AND HOLD
HARMLESS EACH BUYER GROUP MEMBER FROM AND AGAINST, AND TO REIMBURSE EACH BUYER
GROUP MEMBER FOR, ANY AND ALL LOSSES AND EXPENSES INCURRED BY SUCH BUYER GROUP
MEMBER IN CONNECTION WITH OR ARISING FROM (AND WHETHER OR NOT INVOLVING A THIRD
PARTY CLAIM):

(I)            ANY BREACH OR INACCURACY OF ANY REPRESENTATION OR WARRANTY OF AON
CONTAINED IN THIS AGREEMENT OR IN ANY CERTIFICATE OF AON DELIVERED PURSUANT TO
THIS AGREEMENT;

(II)           ANY BREACH BY AON OF, OR FAILURE BY AON TO PERFORM, ANY OF ITS
COVENANTS OR OBLIGATIONS CONTAINED IN THIS AGREEMENT REQUIRING PERFORMANCE PRIOR
TO THE CLOSING;

57

--------------------------------------------------------------------------------

 

(III)          ANY BREACH BY AON OF, OR FAILURE BY AON TO PERFORM, ANY OF ITS
COVENANTS OR OBLIGATIONS CONTAINED IN THIS AGREEMENT REQUIRING PERFORMANCE
SUBSEQUENT TO THE CLOSING; AND

(IV)          (A) ANY EXCLUDED LIABILITY AND (B) ANY BREACH BY ANY SELLER GROUP
MEMBER (OTHER THAN ANY OF THE COMPANIES FOLLOWING THE CLOSING) OF, OR ANY
FAILURE BY ANY SELLER GROUP MEMBER (OTHER THAN ANY OF THE COMPANIES FOLLOWING
THE CLOSING) TO PERFORM, ANY OF ITS COVENANTS OR OBLIGATIONS IN ANY FACILITATING
TRANSACTION AGREEMENT IN ACCORDANCE WITH THE TERMS THEREOF;

provided, however, that Aon shall be required to indemnify and hold harmless
under clause (i) or clause (ii) of this Section 11.1(a) with respect to Losses
and Expenses incurred by Buyer Group Members only to the extent that:

(x)            the amount of Loss and Expense suffered by Buyer Group Members
related to each individual claim (or group or series of similar or related
claims) exceeds $50,000 (it being understood that such $50,000 shall be a
threshold that, once exceeded, shall be disregarded in determining Aon’s
indemnification obligation);

(y)           the aggregate amount of such Losses and Expenses (other than
Losses and Expenses excluded by clause (x) above) exceeds 1% of the Purchase
Price (it being understood that such amount shall be a deductible for which Aon
shall bear no indemnification responsibility); and

(z)            the aggregate amount required to be paid by Aon pursuant to
clause (i) or (ii) of this Section 11.1(a) does not exceed 15% of the Purchase
Price.

Notwithstanding anything to the contrary herein, the limitations contained in
clauses (x), (y) and (z) shall not apply to any Loss or Expense incurred by any
Buyer Group Member:  (i) in connection with or arising from any breach of any
representation or warranty in Sections 5.2, 5.4(a) or 5.26 (or, to the extent
relating thereto, the certificate delivered pursuant to Section 9.1); or
(ii) which is required to be indemnified by Aon pursuant to Section 8.1 or 8.2;
provided, however, that in no event shall the aggregate amount required to be
paid by Aon pursuant to this Section 11.1(a) (other than with respect to the
matters referred to in Section 11(a)(iii), Section 11(a)(iv) or Section 8.1 or
8.2, for which Aon’s liability shall be unlimited) exceed 50% of the Purchase
Price.

With respect to any Excluded Liability that an Affiliate of Aon is required to
satisfy pursuant to the terms of a Facilitating Transaction Agreement, Buyer
shall not initiate a claim (and shall not be required to give any notice) under
this Article XI unless such Affiliate fails to satisfy such liability in
accordance with the requirements of such Facilitating Transaction Agreement.

(B)           THE INDEMNIFICATION PROVIDED FOR IN CLAUSES (I), (II) AND (III) OF
SECTION 11.1(A) SHALL TERMINATE 12 MONTHS AFTER THE CLOSING DATE (AND NO CLAIMS
SHALL BE MADE BY ANY BUYER GROUP MEMBER UNDER SECTION 11.1(A) THEREAFTER),
EXCEPT THAT THE INDEMNIFICATION BY AON SHALL CONTINUE AS TO:

 

58

--------------------------------------------------------------------------------

 

(I)            THE COVENANTS OF AON SET FORTH IN SECTIONS 8.1, 8.2, 8.7 AND
8.10, AND REFERRED TO IN SECTION 11.1(A)(IV)(B) AND THE REPRESENTATIONS AND
WARRANTIES IN SECTIONS 5.2, 5.4(A) AND 5.26 (OR TO THE EXTENT RELATING THERETO,
THE CERTIFICATE DELIVERED PURSUANT TO SECTION 9.1), WHICH SHALL SURVIVE UNTIL
30 DAYS AFTER THE EXPIRATION OF THE RELEVANT STATUTORY PERIOD OF LIMITATIONS
APPLICABLE TO THE UNDERLYING CLAIM, GIVING EFFECT TO ANY WAIVER, MITIGATION OR
EXTENSION THEREOF (OR, IF NO STATUTORY PERIOD OF LIMITATIONS IS APPLICABLE TO
THE UNDERLYING CLAIM, SHALL SURVIVE FOREVER);

(II)           THE COVENANTS OF AON WHICH BY THEIR TERMS EXTEND BEYOND
12 MONTHS, WHICH SHALL SURVIVE UNTIL 30 DAYS AFTER EXPIRING IN ACCORDANCE WITH
THEIR RESPECTIVE TERMS;

(III)          THE REPRESENTATIONS AND WARRANTIES IN SECTION 5.1 AND SECTION 5.3
(OR, TO THE EXTENT RELATING THERETO, THE CERTIFICATE DELIVERED PURSUANT TO
SECTION 9.1) WHICH SHALL SURVIVE UNTIL THE SECOND ANNIVERSARY OF THE CLOSING
DATE;

(IV)          THE REPRESENTATIONS AND WARRANTIES IN SECTION 5.7 (OR TO THE
EXTENT RELATING THERETO, THE CERTIFICATE DELIVERED PURSUANT TO SECTION 9.1),
WHICH SHALL SURVIVE UNTIL THE LATER OF 12 MONTHS AFTER THE CLOSING DATE AND 30
DAYS AFTER THE FILING OF THE LAST TAX RETURN REQUIRED TO BE FILED FOR THE
RELEVANT TYPE OF TAX RELATING IN WHOLE OR IN PART TO ANY TAXABLE YEAR OR PERIOD
ENDING ON OR BEFORE THE CLOSING DATE (OR WITH RESPECT TO ANY STRADDLE PERIOD);
AND

(V)           ANY LOSSES OR EXPENSES OF WHICH ANY BUYER GROUP MEMBER HAS VALIDLY
GIVEN A CLAIM NOTICE TO AON IN ACCORDANCE WITH THE REQUIREMENTS OF SECTION 11.3
ON OR PRIOR TO THE DATE SUCH INDEMNIFICATION WOULD OTHERWISE TERMINATE IN
ACCORDANCE WITH THIS SECTION 11.1, AS TO WHICH THE OBLIGATION OF AON SHALL
CONTINUE SOLELY WITH RESPECT TO THE SPECIFIC MATTERS IN SUCH CLAIM NOTICE UNTIL
THE LIABILITY OF AON SHALL HAVE BEEN DETERMINED PURSUANT TO THIS ARTICLE XI, AND
AON SHALL HAVE REIMBURSED ALL BUYER GROUP MEMBERS FOR THE FULL AMOUNT OF SUCH
LOSSES AND EXPENSES THAT ARE PAYABLE WITH RESPECT TO SUCH CLAIM NOTICE IN
ACCORDANCE WITH THIS ARTICLE XI.

Claims pursuant to Section 11.1(a)(iv)(A) may be made at any time, whether
before or after the expiration of any statutory period of limitations.

SECTION 11.2         INDEMNIFICATION BY BUYER.

(A)           FROM AND AFTER THE CLOSING, BUYER AGREES TO INDEMNIFY AND HOLD
HARMLESS EACH SELLER GROUP MEMBER FROM AND AGAINST, AND TO REIMBURSE EACH SELLER
GROUP MEMBER FOR, ANY AND ALL LOSSES AND EXPENSES INCURRED BY SUCH SELLER GROUP
MEMBER IN CONNECTION WITH OR ARISING FROM (AND WHETHER OR NOT INVOLVING A THIRD
PARTY CLAIM):

(I)            ANY BREACH OR INACCURACY OF ANY REPRESENTATION OR WARRANTY OF
BUYER CONTAINED IN THIS AGREEMENT OR IN ANY CERTIFICATE OF BUYER DELIVERED
PURSUANT TO THIS AGREEMENT;

(II)           ANY BREACH BY BUYER OF, OR FAILURE BY BUYER TO PERFORM, ANY OF
ITS COVENANTS AND OBLIGATIONS CONTAINED IN THIS AGREEMENT REQUIRING PERFORMANCE
PRIOR TO THE CLOSING;

59

--------------------------------------------------------------------------------

 

(III)          ANY BREACH BY BUYER OF, OR FAILURE BY BUYER TO PERFORM, ANY OF
ITS COVENANTS AND OBLIGATIONS CONTAINED IN THIS AGREEMENT REQUIRING PERFORMANCE
SUBSEQUENT TO THE CLOSING (INCLUDING SECTION 7.7); AND

(IV)          (A) THE OPERATION OF THE COMPANIES AFTER THE CLOSING (OTHER THAN
ANY MATTER FOR WHICH AON IS REQUIRED TO PROVIDE INDEMNIFICATION PURSUANT TO
SECTION 11.1 OR TO THE EXTENT RESULTING FROM A BREACH OR INACCURACY OR ANY
REPRESENTATION OR WARRANTY OF AON CONTAINED IN THIS AGREEMENT OR IN ANY
CERTIFICATE OF AON DELIVERED PURSUANT TO THIS AGREEMENT) OR (B) ANY BREACH BY
ANY OF THE COMPANIES AFTER THE CLOSING OF, OR ANY FAILURE BY ANY OF THE
COMPANIES TO PERFORM AFTER THE CLOSING, ANY OF ITS COVENANTS OR OBLIGATIONS IN
ANY OF THE FACILITATING TRANSACTION AGREEMENTS IN ACCORDANCE WITH THE TERMS
THEREOF.

WITH RESPECT TO ANY MATTER COVERED BY SECTION 11.2(A)(IV) THAT AN AFFILIATE OF
BUYER IS REQUIRED TO SATISFY PURSUANT TO THE TERMS OF A FACILITATING TRANSACTION
AGREEMENT, AON SHALL NOT INITIATE A CLAIM (AND SHALL NOT BE REQUIRED TO GIVE ANY
NOTICE) UNDER THIS ARTICLE XI UNLESS SUCH AFFILIATE FAILS TO SATISFY SUCH
LIABILITY IN ACCORDANCE WITH THE REQUIREMENTS OF SUCH FACILITATING TRANSACTION
AGREEMENT.

(B)           THE INDEMNIFICATION PROVIDED FOR IN CLAUSES (I) AND (II) OF
SECTION 11.2(A) SHALL TERMINATE 12 MONTHS AFTER THE CLOSING DATE (AND NO CLAIMS
SHALL BE MADE BY ANY SELLER GROUP MEMBER UNDER SECTION 11.2(A) THEREAFTER),
EXCEPT THAT THE INDEMNIFICATION BY BUYER SHALL CONTINUE AS TO:

(I)            THE COVENANTS OF BUYER SET FORTH IN SECTIONS 8.1, 8.2, 8.5, 8.7,
8.8, 8.9 AND 8.10 AND REFERRED TO IN SECTION 11.2(A)(IV)(B), AND THE
REPRESENTATIONS AND WARRANTIES IN SECTIONS 6.2(A), 6.4 AND 6.6 (OR TO THE EXTENT
RELATED THERETO, THE CERTIFICATE DELIVERED PURSUANT TO SECTION 10.1), WHICH
SHALL SURVIVE UNTIL 30 DAYS AFTER THE EXPIRATION OF THE RELEVANT STATUTORY
PERIOD OF LIMITATIONS APPLICABLE TO THE UNDERLYING CLAIM, GIVING EFFECT TO ANY
WAIVER, MITIGATION OR EXTENSION THEREOF (OR, IF NO STATUTORY PERIOD OF
LIMITATIONS IS APPLICABLE TO THE UNDERLYING CLAIM, SHALL SURVIVE FOREVER);

(II)           THE COVENANTS OF BUYER WHICH BY THEIR TERMS EXTEND BEYOND
12 MONTHS, WHICH SHALL SURVIVE UNTIL 30 DAYS AFTER EXPIRING IN ACCORDANCE WITH
THEIR RESPECTIVE TERMS; AND

(III)          ANY LOSSES OR EXPENSES OF WHICH ANY SELLER GROUP MEMBER HAS
VALIDLY GIVEN A CLAIM NOTICE TO BUYER IN ACCORDANCE WITH THE REQUIREMENTS OF
SECTION 11.3 ON OR PRIOR TO THE DATE SUCH INDEMNIFICATION WOULD OTHERWISE
TERMINATE IN ACCORDANCE WITH THIS SECTION 11.2, AS TO WHICH THE OBLIGATION OF
BUYER SHALL CONTINUE SOLELY WITH RESPECT TO THE SPECIFIC MATTERS IN SUCH CLAIM
NOTICE UNTIL THE LIABILITY OF BUYER SHALL HAVE BEEN DETERMINED PURSUANT TO THIS
ARTICLE XI, AND BUYER SHALL HAVE REIMBURSED ALL SELLER GROUP MEMBERS FOR THE
FULL AMOUNT OF SUCH LOSSES AND EXPENSES THAT ARE PAYABLE WITH RESPECT TO SUCH
CLAIM NOTICE IN ACCORDANCE WITH THIS ARTICLE XI.

Claims pursuant to Section 11.2(a)(iv)(A) may be made at any time, whether
before or after the expiration of any statutory period of limitations.

60

--------------------------------------------------------------------------------

 

Section 11.3         Notice of Claims. Any Buyer Group Member or Seller Group
Member seeking indemnification hereunder (the “Indemnified Party”) shall give
promptly to the party obligated to provide indemnification to such Indemnified
Party (the “Indemnitor”) a notice (a “Claim Notice”) describing in reasonable
detail the facts giving rise to the claim for indemnification hereunder (to the
extent known) and shall include in such Claim Notice (if then known) the amount
or the method of computation of the amount of such claim, and a reference to the
provision of this Agreement or any other agreement, document or instrument
executed hereunder or in connection herewith upon which such claim is based;
provided, however, that a Claim Notice in respect of any action at law or suit
in equity by or against a third Person as to which indemnification will be
sought shall be given promptly after the action or suit is commenced. The
failure to give notice as provided in this Section 11.3 shall not relieve the
Indemnitor of its obligations hereunder, except to the extent it shall have been
prejudiced by such failure.

SECTION 11.4         DETERMINATION OF AMOUNT.

(A)           IN CALCULATING ANY LOSS OR EXPENSE, SUCH AMOUNTS SHALL BE
CALCULATED ON AN AFTER-TAX BASIS AND SHALL BE NET OF ANY THIRD-PARTY INSURANCE
PROCEEDS (DETERMINED NET OF RECOVERY COSTS) WHICH HAVE BEEN RECOVERED BY THE
INDEMNIFIED PARTY IN CONNECTION WITH THE FACTS GIVING RISE TO THE RIGHT OF
INDEMNIFICATION (SUCH PROCEEDS TO BE REDUCED BY THE AMOUNT OF ANY RETROSPECTIVE
OR OTHER PREMIUM ADJUSTMENT PAYABLE BY THE INDEMNIFIED PARTY IN RESPECT OF SUCH
CLAIM). THE INDEMNIFIED PARTY SHALL USE COMMERCIALLY REASONABLE EFFORTS TO
RECOVER INSURANCE PROCEEDS THAT MAY BE RECOVERABLE.

(B)           AFTER THE GIVING OF ANY CLAIM NOTICE PURSUANT TO SECTION 11.3, THE
AMOUNT OF INDEMNIFICATION TO WHICH AN INDEMNIFIED PARTY SHALL BE ENTITLED UNDER
THIS ARTICLE XI SHALL BE DETERMINED:  (I) BY THE WRITTEN AGREEMENT BETWEEN THE
INDEMNIFIED PARTY AND THE INDEMNITOR; (II) BY A FINAL JUDGMENT OR DECREE OF ANY
COURT OF COMPETENT JURISDICTION; OR (III) BY ANY OTHER MEANS TO WHICH THE
INDEMNIFIED PARTY AND THE INDEMNITOR SHALL AGREE. THE JUDGMENT OR DECREE OF A
COURT SHALL BE DEEMED FINAL WHEN THE TIME FOR APPEAL, IF ANY, SHALL HAVE EXPIRED
AND NO APPEAL SHALL HAVE BEEN TAKEN OR WHEN ALL APPEALS TAKEN SHALL HAVE BEEN
FINALLY DETERMINED. THE INDEMNIFIED PARTY SHALL HAVE THE BURDEN OF PROOF IN
ESTABLISHING THE AMOUNT OF LOSSES AND EXPENSES SUFFERED BY IT.

SECTION 11.5         THIRD PERSON CLAIMS.

(A)           ANY PARTY SEEKING INDEMNIFICATION PROVIDED FOR UNDER THIS
AGREEMENT IN RESPECT OF, ARISING OUT OF OR INVOLVING A CLAIM OR DEMAND MADE BY
ANY THIRD PERSON AGAINST THE INDEMNIFIED PARTY SHALL NOTIFY THE INDEMNITOR IN
WRITING, AND IN REASONABLE DETAIL, OF THE THIRD PERSON CLAIM WITHIN 10 BUSINESS
DAYS AFTER RECEIPT BY SUCH INDEMNIFIED PARTY OF WRITTEN NOTICE OF THE THIRD
PERSON CLAIM. THEREAFTER, THE INDEMNIFIED PARTY SHALL DELIVER TO THE INDEMNITOR,
WITHIN 5 BUSINESS DAYS AFTER THE INDEMNIFIED PARTY’S RECEIPT THEREOF, COPIES OF
ALL NOTICES AND DOCUMENTS

61

--------------------------------------------------------------------------------

 

(including court papers) received by the Indemnitor relating to the third Person
claim. Notwithstanding the foregoing, should a party be physically served with a
complaint with regard to a third Person claim, the Indemnified Party shall
notify the Indemnitor with a copy of the complaint within 10 Business Days after
receipt thereof and shall deliver to the Indemnitor within 5 Business Days after
the receipt of such complaint copies of notices and documents (including court
papers) received by the Indemnified Party relating to the third Person claim.
The failure to give notice or make deliveries as provided in this
Section 11.5(a) shall not relieve the Indemnitor of its obligations hereunder
except to the extent it shall have been prejudiced by such failure.

(B)           IF ANY LEGAL PROCEEDING SHALL BE THREATENED OR INSTITUTED OR ANY
CLAIM OR DEMAND SHALL BE ASSERTED BY ANY PERSON IN RESPECT OF WHICH PAYMENT MAY
BE SOUGHT BY ONE PARTY HERETO FROM THE OTHER PARTY UNDER THE PROVISIONS OF THIS
ARTICLE XI, THE INDEMNIFIED PARTY SHALL PROMPTLY CAUSE WRITTEN NOTICE OF THE
ASSERTION OF ANY SUCH CLAIM OF WHICH IT HAS KNOWLEDGE WHICH IS COVERED BY THIS
INDEMNITY TO BE FORWARDED TO THE INDEMNITOR, BUT THE FAILURE TO GIVE SUCH NOTICE
SHALL NOT RELIEVE THE INDEMNITOR OF ITS OBLIGATIONS HEREUNDER EXCEPT TO THE
EXTENT IT SHALL HAVE BEEN PREJUDICED BY SUCH FAILURE. ANY NOTICE OF A CLAIM BY
REASON OF ANY OF THE REPRESENTATIONS, WARRANTIES OR COVENANTS CONTAINED IN THIS
AGREEMENT SHALL REFER TO THE PROVISION OF THIS AGREEMENT OR ANY OTHER AGREEMENT,
DOCUMENT OR INSTRUMENT EXECUTED HEREUNDER OR IN CONNECTION HEREWITH UPON WHICH
SUCH CLAIM IS BASED AND DESCRIBE IN REASONABLE DETAIL (TO THE EXTENT KNOWN) THE
FACTS GIVING RISE TO AN ALLEGED BASIS FOR THE CLAIM AND THE AMOUNT OF THE
LIABILITY ASSERTED AGAINST THE INDEMNITOR BY REASON OF THE CLAIM. IN THE EVENT
OF THE INITIATION OF ANY LEGAL PROCEEDING AGAINST THE INDEMNIFIED PARTY BY A
THIRD PERSON, THE INDEMNITOR SHALL HAVE THE SOLE AND ABSOLUTE RIGHT AFTER THE
RECEIPT OF NOTICE, AT ITS OPTION AND AT ITS OWN EXPENSE, TO BE REPRESENTED BY
COUNSEL OF ITS CHOICE AND TO CONTROL, DEFEND AGAINST, NEGOTIATE, SETTLE OR
OTHERWISE DEAL WITH ANY PROCEEDING, CLAIM, OR DEMAND WHICH RELATES TO ANY LOSS,
LIABILITY OR DAMAGE INDEMNIFIED AGAINST HEREUNDER EXCEPT TO THE EXTENT THE
INDEMNITOR IS ALSO A PARTY TO SUCH LEGAL PROCEEDING AND JOINT DEFENSE WOULD
INVOLVE A CONFLICT OF INTEREST UNDER APPLICABLE PROFESSIONAL STANDARDS;
PROVIDED, HOWEVER, THAT THE INDEMNIFIED PARTY MAY PARTICIPATE IN ANY SUCH
PROCEEDING WITH COUNSEL OF ITS CHOICE AND AT ITS EXPENSE. EACH OF THE PARTIES
HERETO AGREES TO COOPERATE FULLY WITH THE OTHER PARTIES IN CONNECTION WITH THE
DEFENSE, NEGOTIATION OR SETTLEMENT OF ANY SUCH LEGAL PROCEEDING, CLAIM OR DEMAND
AND TO MAKE AVAILABLE TO THE OTHER PARTIES ALL WITNESSES, PERTINENT RECORDS,
MATERIALS AND INFORMATION IN SUCH PARTY’S POSSESSION OR UNDER SUCH PARTY’S
CONTROL RELATING THERETO AS IS REASONABLY REQUIRED BY THE OTHER PARTIES. TO THE
EXTENT THE INDEMNITOR FAILS TO DEFEND SUCH PROCEEDING, CLAIM OR DEMAND, AND THE
INDEMNIFIED PARTY DEFENDS AGAINST OR OTHERWISE DEALS WITH ANY SUCH PROCEEDING,
CLAIM OR DEMAND, THE INDEMNIFIED PARTY MAY RETAIN COUNSEL, AT THE EXPENSE OF THE
INDEMNITOR, AND CONTROL THE DEFENSE OF SUCH PROCEEDING; PROVIDED, HOWEVER, THAT
THE INDEMNITOR SHALL BE OBLIGATED PURSUANT TO THIS SECTION 11.5 TO PAY FOR ONLY
ONE FIRM OF COUNSEL (AND LOCAL COUNSEL, AS APPROPRIATE) FOR ALL INDEMNIFIED
PARTIES. NEITHER THE INDEMNITOR NOR THE INDEMNIFIED PARTY MAY SETTLE OR
OTHERWISE CONSENT TO THE RESOLUTION OF ANY SUCH PROCEEDING WHICH SETTLEMENT OR
RESOLUTION OBLIGATES THE OTHER PARTY TO PAY MONEY, TO PERFORM OBLIGATIONS OR TO
ADMIT OR ACCEPT A FINDING OF LIABILITY, WRONGDOING OR VIOLATION OF LAW OR THE
RIGHTS OF ANY PERSON WITHOUT THE CONSENT OF THE OTHER PARTY, SUCH CONSENT NOT TO
BE UNREASONABLY WITHHELD (TAKING INTO ACCOUNT THE IMPACT OF THE SETTLEMENT ON
ONGOING BUSINESS). IN THE EVENT THE INDEMNIFIED PARTY SHALL REFUSE TO CONSENT TO
THE SETTLEMENT OF ANY THIRD PERSON CLAIM, SO LONG AS ONLY MONEY DAMAGES THAT ARE
PAYABLE IN FULL BY THE INDEMNITOR ARE INVOLVED AND THERE IS NO ADMISSION OF
LIABILITY, WRONGDOING OR VIOLATION OF LAW OR THE RIGHTS OF ANY PERSON WITH
RESPECT TO THE INDEMNIFIED PARTY, THE LIABILITY OF THE INDEMNITOR IN RESPECT OF
SUCH THIRD PERSON CLAIM SHALL NOT EXCEED THE AMOUNT FOR WHICH THE THIRD PERSON
CLAIM COULD HAVE BEEN SETTLED PLUS THE AMOUNT OF EXPENSES INCURRED BY THE
INDEMNIFIED PARTY PRIOR TO THE TIME OF THE PROPOSED SETTLEMENT TO WHICH IT IS
ENTITLED TO INDEMNIFICATION. AFTER ANY FINAL JUDGMENT OR AWARD SHALL HAVE BEEN
RENDERED BY A COURT, ARBITRATION BOARD OR ADMINISTRATIVE AGENCY OF COMPETENT

62

--------------------------------------------------------------------------------

 

jurisdiction and the time in which to appeal therefrom has expired, or a
settlement shall have been consummated, or the Indemnified Party and the
Indemnitor shall arrive at a mutually binding agreement with respect to each
separate matter alleged to be indemnified by the Indemnitor hereunder, the
Indemnified Party shall forward to the Indemnitor notice of any sums due and
owing by it with respect to such matter and the Indemnitor shall pay all of the
sums so owing to the Indemnified Party by wire transfer, certified or bank
cashier’s check within 30 days after the date of such notice.

(C)           TO THE EXTENT OF ANY INCONSISTENCY BETWEEN THIS SECTION 11.5 AND
SECTION 8.1(C) (RELATING TO TAX CONTESTS), THE PROVISIONS OF
SECTION 8.1(C) SHALL CONTROL WITH RESPECT TO TAX CONTESTS.

SECTION 11.6         LIMITATIONS.

(A)           IN ANY CASE WHERE AN INDEMNIFIED PARTY RECOVERS FROM THIRD PERSONS
ANY AMOUNT IN RESPECT OF A MATTER WITH RESPECT TO WHICH AN INDEMNITOR HAS
INDEMNIFIED IT PURSUANT TO THIS ARTICLE XI, SUCH INDEMNIFIED PARTY SHALL
PROMPTLY PAY OVER TO THE INDEMNITOR THE AMOUNT SO RECOVERED (AFTER DEDUCTING
THEREFROM THE FULL AMOUNT OF THE EXPENSES INCURRED BY IT IN PROCURING SUCH
RECOVERY), BUT NOT IN EXCESS OF THE AMOUNT BY WHICH ANY AMOUNT PREVIOUSLY SO
PAID BY THE INDEMNITOR TO OR ON BEHALF OF THE INDEMNIFIED PARTY IN RESPECT OF
SUCH MATTER WOULD HAVE BEEN REDUCED IF SUCH RECOVERY HAD BEEN TAKEN INTO
ACCOUNT.

(B)           IF AON IS CONDUCTING ANY DEFENSE AGAINST A THIRD PERSON CLAIM FOR
WHICH A BUYER GROUP MEMBER HAS SOUGHT INDEMNIFICATION PURSUANT TO
SECTION 11.1(A), EXPENSES INCURRED BY AON IN CONNECTION THEREWITH, INCLUDING
LEGAL COSTS AND EXPENSES, SHALL CONSTITUTE EXPENSES FOR PURPOSES OF DETERMINING
THE MAXIMUM AGGREGATE AMOUNT TO BE PAID BY AON PURSUANT TO SECTION 11.1(A).

(C)           AON SHALL NOT HAVE ANY LIABILITY FOR ANY INACCURACY IN OR BREACH
OF ANY REPRESENTATION OR WARRANTY BY AON IF ROBERT M. LE BLANC HAD ACTUAL
KNOWLEDGE ON OR BEFORE DATE OF THIS AGREEMENT OF THE FACTS AS A RESULT OF WHICH
SUCH REPRESENTATION OR WARRANTY WAS INACCURATE OR BREACHED.

(D)           EXCEPT FOR REMEDIES THAT CANNOT BE WAIVED AS A MATTER OF LAW AND
EQUITABLE REMEDIES (INCLUDING SPECIFIC PERFORMANCE), IF THE CLOSING OCCURS, THIS
ARTICLE XI SHALL BE THE EXCLUSIVE REMEDY FOR BREACHES OF THIS AGREEMENT
(INCLUDING ANY COVENANT, OBLIGATION, REPRESENTATION OR WARRANTY CONTAINED IN
THIS AGREEMENT OR IN ANY CERTIFICATE DELIVERED PURSUANT TO THIS AGREEMENT) OR
OTHERWISE IN RESPECT OF THE SALE OF THE SHARES CONTEMPLATED HEREBY.

(E)           EXCEPT FOR MATTERS UNDER SECTIONS 11.1(A)(III) AND (IV) AND
SECTIONS 11.2(A)(III) AND (IV), IN NO EVENT SHALL ANY PARTY BE LIABLE FOR ANY
SPECIAL, INCIDENTAL, CONSEQUENTIAL (INCLUDING LOSS OF REVENUES OR PROFITS),
EXEMPLARY OR PUNITIVE DAMAGES ARISING UNDER ANY LEGAL OR EQUITABLE THEORY OR
ARISING UNDER OR IN CONNECTION WITH THIS AGREEMENT, ALL OF WHICH ARE HEREBY
EXCLUDED BY AGREEMENT OF THE PARTIES REGARDLESS OF WHETHER OR NOT ANY PARTY TO
THIS AGREEMENT HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. FOR THE
AVOIDANCE OF DOUBT, WITH RESPECT TO MATTERS UNDER SECTIONS 11.1(A)(III) AND
(IV) AND SECTIONS 11.2(A)(III) AND (IV), LOSSES AND EXPENSES SHALL INCLUDE
SPECIAL, INCIDENTAL, CONSEQUENTIAL, EXEMPLARY OR PUNITIVE

63

--------------------------------------------------------------------------------

 

damages. Except for Section 8.8, under no circumstances shall a party be
entitled to recover any Losses or Expenses arising from or relating to (i) any
registration or issuance of securities by Buyer or its Affiliates after the
Closing (or any inability to do so), (ii) any sale or other disposition of all
or any portion of the Warranty Business (by merger, consolidation, share
exchange, tender or exchange offer, spin-off, recapitalization, sale of assets,
sale of securities or otherwise) by Buyer or its Affiliates after the Closing
(or any inability to do so) or (iii) any change in Requirements of Law or
accounting standards, principles or rules after the date of this Agreement.

(F)            AON SHALL NOT BE REQUIRED TO INDEMNIFY AND HOLD HARMLESS ANY
BUYER GROUP MEMBER PURSUANT TO SECTION 11.1(A) TO THE EXTENT THE MATTER IN
QUESTION WAS TAKEN INTO ACCOUNT IN THE COMPUTATION OF THE NET WORTH ADJUSTMENT
AMOUNT PURSUANT TO SECTION 4.5.

Section 11.7         No Effect of Knowledge. Except as provided for in
Section 11.6(c), the right to indemnification, payment of Losses and Expenses or
other remedy based on representations, warranties, covenants and obligations in
this Agreement, or any certificate delivered pursuant to this Agreement, will
not be affected by any investigation conducted with respect to, or any knowledge
acquired (or capable of being acquired) at any time, whether before or after the
execution and delivery of this Agreement or the Closing Date, with respect to
the accuracy or inaccuracy of or compliance with, any such representation,
warranty, covenant, or obligation. Except as specifically provided in the last
sentences of Article IX and Article X, the waiver of any condition based on the
accuracy of any representation or warranty, or on the performance of or
compliance with any covenant or obligation, will not affect the right to
indemnification, payment of Losses and Expenses, or other remedy based on such
representations, warranties, covenants and obligations.

Section 11.8         Mitigation. Each of the parties agrees to act in good faith
to mitigate their respective Losses and Expenses upon and after becoming aware
of any event or condition which could reasonably be expected to give rise to any
Losses and Expenses that are indemnifiable hereunder.

Section 11.9         Facilitating Transactions. For all purposes of this
Article XI, the indemnification and reimbursement obligations of Aon set forth
in the last sentence of Section 7.6 shall be treated as if provided in
Section 11.1(a)(iv)(A).

ARTICLE XII

TERMINATION

Section 12.1         Termination. Anything contained in this Agreement to the
contrary notwithstanding, this Agreement may be terminated at any time prior to
the Closing Date:

(A)           BY THE MUTUAL CONSENT OF BUYER AND AON;

(B)           BY BUYER IN THE EVENT OF ANY BREACH BY AON OF ANY OF ITS
AGREEMENTS, REPRESENTATIONS OR WARRANTIES CONTAINED HEREIN WHICH HAS RESULTED IN
A MATERIAL ADVERSE EFFECT

64

--------------------------------------------------------------------------------

 

and the failure of Aon to cure such breach within 30 days after receipt of
notice from Buyer requesting such breach to be cured;

(C)           BY AON IN THE EVENT OF ANY BREACH BY BUYER OF ANY OF BUYER’S
AGREEMENTS, REPRESENTATIONS OR WARRANTIES CONTAINED HEREIN WHICH HAS RESULTED IN
A MATERIAL ADVERSE EFFECT ON BUYER’S ABILITY TO CONSUMMATE THE TRANSACTIONS
CONTEMPLATED HEREBY AND THE FAILURE OF BUYER TO CURE SUCH BREACH WITHIN 30 DAYS
AFTER RECEIPT OF NOTICE FROM AON REQUESTING SUCH BREACH TO BE CURED;

(D)           BY BUYER OR AON IF ANY COURT OF COMPETENT JURISDICTION IN THE
UNITED STATES OR OTHER UNITED STATES ADMINISTRATIVE AUTHORITY SHALL HAVE ISSUED
A FINAL AND NON-APPEALABLE ORDER, DECREE OR RULING PERMANENTLY RESTRAINING,
ENJOINING OR OTHERWISE PROHIBITING THE CONSUMMATION OF ANY MATERIAL TRANSACTION
CONTEMPLATED HEREBY; OR

(E)           BY BUYER OR AON IF THE CLOSING SHALL NOT HAVE OCCURRED ON OR
BEFORE MARCH 31, 2007; PROVIDED, HOWEVER, THAT EITHER PARTY MAY BY WRITTEN
NOTICE TO THE OTHER PARTY DELIVERED ON OR BEFORE MARCH 31, 2007 EXTEND SUCH DATE
UNTIL ANY DATE PRIOR TO MAY 31, 2007 IF THE FAILURE OF THE CLOSING TO HAVE
OCCURRED ON OR BEFORE MARCH 31, 2007 SHALL HAVE RESULTED FROM THE FAILURE OF THE
CONDITION SET FORTH IN SECTION 9.3 AND 10.3; PROVIDED, FURTHER, THAT THE RIGHT
TO TERMINATE THIS AGREEMENT PURSUANT TO THIS SECTION 12.1(E) SHALL NOT BE
AVAILABLE TO ANY PARTY WHOSE FAILURE TO FULFILL ANY OF ITS OBLIGATIONS CONTAINED
IN THIS AGREEMENT HAS BEEN THE CAUSE OF, OR RESULTED IN, THE FAILURE OF THE
CLOSING TO HAVE OCCURRED ON OR PRIOR TO THE AFORESAID DATE.

Section 12.2         Notice of Termination. Any party desiring to terminate this
Agreement pursuant to Section 12.1 shall give written notice of such termination
to the other parties to this Agreement.

Section 12.3         Effect of Termination. If this Agreement shall be
terminated pursuant to this Article XII, all further obligations of the parties
under this Agreement (other than Section 13.9) shall be terminated without
further liability of any party to the other; provided, however, that nothing
herein shall relieve any party from liability for its willful breach of this
Agreement.

Section 12.4         Specific Performance. The parties agree that irreparable
damage would occur in the event that any of the terms or provisions of this
Agreement were not performed in accordance with their specific wording or were
otherwise breached. It is accordingly agreed that, notwithstanding anything to
the contrary contained in this Agreement, each of the parties hereto shall be
entitled, without the necessity of posting a bond, to a temporary restraining
order and to a preliminary and final injunction or injunctions to prevent
breaches of this Agreement and to enforce specifically the terms and provisions
hereof in any court of the United States of America or any state having
jurisdiction, such remedy being in addition to any other remedy to which any
party may be entitled at law or in equity.

65

--------------------------------------------------------------------------------

 

ARTICLE XIII

GENERAL PROVISIONS

Section 13.1         Survival of Representations and Warranties. All
representations and warranties contained in this Agreement shall survive the
consummation of the transactions contemplated by this Agreement through the
period during which claims for indemnification may be made for such
representations and warranties pursuant to Article XI (at which time such
representations and warranties shall terminate).

Section 13.2         No Public Announcement. None of Buyer and Aon shall,
without the approval of the other, make any press release or other public
announcement concerning the transactions contemplated by this Agreement, except
as and to the extent that any such party shall be so obligated by law, in which
case the other party shall be advised and the parties shall use their reasonable
efforts to cause a mutually agreeable release or announcement to be issued;
provided, however, that the foregoing shall not preclude communications or
disclosures (i) necessary to implement the provisions of this Agreement or to
comply with the accounting and the Securities and Exchange Commission disclosure
obligations, Canadian provincial securities laws or the rules of any stock
exchange or (ii) with public stockholders and/or analysts in the ordinary course
of business for a transaction of the type contemplated by this Agreement.

Section 13.3         Notices. All notices or other communications required or
permitted hereunder shall be in writing and shall be deemed given or delivered
when delivered personally or when sent by registered or certified mail or by
private courier addressed as follows:

If to Buyer, to:

c/o Onex Partners, L.P.
712 Fifth Avenue
New York, New York  10019
Attention:  Robert M. LeBlanc
Telecopier:  (212) 528-0909

with copies to:

Kaye Scholer LLP
425 Park Avenue
New York, New York  10022
Attention:  Joel I. Greenberg
Telecopier:  (212) 836-8211

Onex Corporation
161 Bay Street
Toronto, Ontario, Canada M5J 2S1
Attention:  Andrea E. Daly
Telecopier:  (416) 362-5765

If to Aon, to:

Aon Corporation
Aon Center
200 East Randolph Street

66

--------------------------------------------------------------------------------

Chicago, Illinois  60601
Attention:  Richard E. Barry
Facsimile:  (312) 381-6165

67

--------------------------------------------------------------------------------

with a copy to:

Sidley Austin LLP
One South Dearborn Street
Chicago, Illinois  60603
Attention:  Frederick C. Lowinger
                      Gary D. Gerstman
Telecopier:  (312) 853-7036

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

Section 13.4         Successors and Assigns. This Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and permitted assigns; provided, however, that no party to this
Agreement may assign its rights prior to the Closing or delegate its obligations
under this Agreement without the express prior written consent of the other
party to this Agreement. Notwithstanding the foregoing, Buyer may assign any of
its rights or obligations under this Agreement to any of its Affiliates provided
that (a) such assignment shall not relieve Buyer of any of its obligations
hereunder, (b) the assignee shall have agreed to be jointly and severally liable
for Buyer’s obligations hereunder and (c) such assignment shall not delay the
Closing for more than an insignificant period. Following the Closing, any party
may assign any of its rights hereunder, but no such assignment shall relieve it
of its obligations hereunder.

Section 13.5         Access to Records after Closing.

(A)           FOR A PERIOD OF SIX YEARS AFTER THE CLOSING DATE, AON AND ITS
REPRESENTATIVES SHALL HAVE REASONABLE ACCESS TO ALL OF THE BOOKS AND RECORDS OF
THE COMPANIES TO THE EXTENT THAT SUCH ACCESS MAY REASONABLY BE REQUIRED BY AON
IN CONNECTION WITH MATTERS RELATING TO OR AFFECTED BY THE OPERATIONS OF THE
COMPANIES PRIOR TO THE CLOSING DATE. SUCH ACCESS SHALL BE AFFORDED BY BUYER UPON
RECEIPT OF REASONABLE ADVANCE NOTICE AND DURING NORMAL BUSINESS HOURS. AON SHALL
BE SOLELY RESPONSIBLE FOR ANY COSTS OR EXPENSES INCURRED BY IT PURSUANT TO THIS
SECTION 13.5(A). IF BUYER OR THE COMPANIES SHALL DESIRE TO DISPOSE OF ANY OF
SUCH BOOKS AND RECORDS PRIOR TO THE EXPIRATION OF SUCH SIX-YEAR PERIOD, BUYER
SHALL, PRIOR TO SUCH DISPOSITION, GIVE AON A REASONABLE OPPORTUNITY, AT AON’S
EXPENSE, TO SEGREGATE AND REMOVE SUCH BOOKS AND RECORDS AS AON MAY SELECT.

(B)           FOR A PERIOD OF SIX YEARS AFTER THE CLOSING DATE, BUYER AND ITS
REPRESENTATIVES SHALL HAVE REASONABLE ACCESS TO ALL OF THE BOOKS AND RECORDS
RELATING TO THE COMPANIES WHICH AON MAY RETAIN AFTER THE CLOSING DATE. SUCH
ACCESS SHALL BE AFFORDED BY AON UPON RECEIPT OF REASONABLE ADVANCE NOTICE AND
DURING NORMAL BUSINESS HOURS. BUYER SHALL BE SOLELY RESPONSIBLE FOR ANY COSTS
AND EXPENSES INCURRED BY IT PURSUANT TO THIS SECTION 13.5(B). IF AON SHALL
DESIRE TO DISPOSE OF ANY OF SUCH BOOKS AND RECORDS PRIOR TO THE EXPIRATION OF
SUCH SIX-YEAR PERIOD, AON SHALL, PRIOR TO SUCH DISPOSITION, GIVE BUYER A
REASONABLE OPPORTUNITY, AT BUYER’S EXPENSE, TO SEGREGATE AND REMOVE SUCH BOOKS
AND RECORDS AS BUYER MAY SELECT.

 

68

--------------------------------------------------------------------------------

 

Section 13.6         Entire Agreement; Amendments. This Agreement, the Exhibits
and Schedules referred to herein, the documents delivered pursuant hereto and
the Confidentiality Agreement contain the entire understanding of the parties
hereto with regard to the subject matter contained herein or therein, and
supersede all other prior representations, warranties, agreements,
understandings or letters of intent between or among any of the parties hereto.
This Agreement shall not be amended, modified or supplemented except by a
written instrument signed by an authorized representative of each of the parties
hereto.

Section 13.7         Interpretation. Disclosure of any fact or item in any
Schedule hereto referenced by a particular section in this Agreement shall be
deemed to have been disclosed with respect to every other section in this
Agreement to the extent such disclosure is reasonably clear on its face that it
would apply to such other section. Neither the specification of any dollar
amount in any representation or warranty contained in this Agreement nor the
inclusion of any specific item in any Schedule hereto is intended to imply that
such amount, or higher or lower amounts, or the item so included or other items,
are or are not material, and no party shall use the fact of the setting forth of
any such amount or the inclusion of any such item in any dispute or controversy
between the parties as to whether any obligation, item or matter not described
herein or included in any Schedule is or is not material for purposes of this
Agreement. Unless this Agreement specifically provides otherwise, neither the
specification of any item or matter in any representation or warranty contained
in this Agreement nor the inclusion of any specific item in any Schedule hereto
is intended to imply that such item or matter, or other items or matters, are or
are not in the ordinary course of business, and no party shall use the fact of
the setting forth or the inclusion of any such item or matter in any dispute or
controversy between the parties as to whether any obligation, item or matter not
described herein or included in any Schedule is or is not in the ordinary course
of business for purposes of this Agreement. Any Exhibit that is required to be
in substantially the form attached to this Agreement or Facilitating Transaction
Agreement that is required to be in substantially the form provided by Schedule
1.1(E) shall include any modifications required by an Administrative Authority
in order to obtain the approval of such Administrative Authority of any of the
transactions contemplated hereby which do not materially alter the economic
terms of such agreements or the rights or obligations of any party thereunder.
Article and Section headings are not part of this Agreement and shall be
disregarded in the interpretation of this Agreement.

Section 13.8         Waivers. Any term or provision of this Agreement may be
waived, or the time for its performance may be extended, by the party or parties
entitled to the benefit thereof. Any such waiver shall be validly and
sufficiently authorized for the purposes of this Agreement if, as to any party,
it is authorized in writing by an authorized representative of such party. The
failure of any party hereto to enforce at any time any provision of this
Agreement shall not be construed to be a waiver of such provision, nor in any
way to affect the validity of this Agreement or any part hereof or the right of
any party thereafter to enforce each and every such provision. No waiver of any
breach of this Agreement shall be held to constitute a waiver of any other or
subsequent breach.

Section 13.9         Expenses  Except as expressly set forth herein, each party
hereto will pay all costs and expenses incident to its negotiation and
preparation of this Agreement and to its performance and compliance with all
agreements and conditions contained herein on its

69

--------------------------------------------------------------------------------

 

part to be performed or complied with, including the fees, expenses and
disbursements of its counsel, independent public accountants and other advisors.

Section 13.10       Partial Invalidity. Wherever possible, each provision hereof
shall be interpreted in such manner as to be effective and valid under
applicable law, but in case any one or more of the provisions contained herein
shall, for any reason, be held to be invalid, illegal or unenforceable in any
respect, such provision shall be ineffective to the extent, but only to the
extent, of such invalidity, illegality or unenforceability without invalidating
the remainder of such invalid, illegal or unenforceable provision or provisions
or any other provisions hereof, unless such a construction would be
unreasonable.

Section 13.11       Execution in Counterparts. This Agreement may be executed in
counterparts, each of which shall be considered an original instrument, but all
of which shall be considered one and the same agreement, and shall become
binding when one or more counterparts have been signed by each of the parties
hereto and delivered to the other parties.

Section 13.12       Further Assurances. Upon the terms and subject to the
conditions herein, each of the parties hereto agrees to use its reasonable best
efforts to take or cause to be taken all action, to do or cause to be done, and
to assist and cooperate with the other party in doing, all things necessary,
proper or advisable under applicable laws and regulations to consummate and make
effective, in the most expeditious manner practicable, the transactions
contemplated by this Agreement, including (i) the satisfaction of the conditions
precedent to the obligations of any of the parties hereto; (ii) the defending of
any lawsuits or other legal proceedings, whether judicial or administrative,
challenging this Agreement or the performance of the obligations hereunder; and
(iii) the execution and delivery of such instruments, and the taking of such
other actions as the other party hereto may reasonably require in order to carry
out the intent of this Agreement.

Section 13.13       Disclaimer of Warranties. Aon makes no representations or
warranties with respect to any projections, forecasts or forward-looking
information provided to Buyer. There is no assurance that any projected or
forecasted results will be achieved. EXCEPT AS TO THOSE MATTERS EXPRESSLY
COVERED BY THE REPRESENTATIONS AND WARRANTIES IN THIS AGREEMENT, AON IS SELLING
THE SHARES (AND THE BUSINESS AND ASSETS OF THE COMPANIES REPRESENTED THEREBY) ON
AN “AS IS, WHERE IS” BASIS AND AON DISCLAIMS ALL OTHER WARRANTIES,
REPRESENTATIONS AND GUARANTEES WHETHER EXPRESS OR IMPLIED. AON MAKES NO
REPRESENTATION OR WARRANTY AS TO MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR
PURPOSE AND NO IMPLIED WARRANTIES WHATSOEVER. Buyer acknowledges that neither
Aon nor any of its representatives or Affiliates or any other Person has made
any representation or warranty, express or implied, as to the accuracy or
completeness of any memoranda, charts or summaries heretofore made available by
the Companies or Aon or their respective representatives or Affiliates to Buyer
or any other information which is not included in this Agreement or the
Schedules hereto, and none of Aon, its representatives or Affiliates or any
other Person will have or be subject to any liability to Buyer, any Affiliate of
Buyer or any other Person resulting from the distribution of any such
information to, or use of any such information by, Buyer, any Affiliate of Buyer
or any of their agents, consultants, accountants, counsel or other
representatives.

70

--------------------------------------------------------------------------------

 

Section 13.14       Governing Law; Submission to Jurisdiction  This Agreement
shall be governed by and construed in accordance with the internal laws of the
State of Illinois. By the execution and delivery of this Agreement, Buyer and
Aon submit to the personal jurisdiction of any state or federal court in the
State of Illinois in any suit or proceeding arising out of or relating to this
Agreement.

Section 13.15       Waiver of Jury Trial. Each of the parties hereby expressly
waives any right to trial by jury in any dispute, whether sounding in contract,
tort or otherwise, between or among any of the parties arising out of or related
to the transactions contemplated by this Agreement or any of the Seller
Ancillary Agreements or Buyer Ancillary Agreements, or any other instrument or
document executed or delivered in connection herewith or therewith. Any party
may file an original counterpart or a copy of this Agreement with any court as
written evidence of the consent of the parties to the waiver of their right to
trial by jury.

 

71

--------------------------------------------------------------------------------

 

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

 

AON CORPORATION

 

 

 

 

 

 

 

By:

/s/ Diane Aigotti

 

 

Name: Diane Aigotti

 

 

Title: Senior Vice President and Treasurer

 

 

 

 

 

 

 

 

WARRIOR ACQUISITION CORP.

 

 

 

 

 

 

 

By:

/s/ Robert M. LeBlanc

 

 

Name: Robert M. LeBlanc

 

 

Title:

 

--------------------------------------------------------------------------------

Annex A

Parent Entities

Name of Parent
Entity

 

Owner of Parent
Entity Capital Stock

 

Number of
Shares
Outstanding of
Parent Entity

Aon Warranty Group, Inc. [IL]

 

Aon Corporation [DE]

 

1,100,000

Resource Life Insurance Company [IL]

 

Aon Corporation [DE]

 

250,000

Virginia Surety Company, Inc. [IL]

 

Aon Corporation [DE]

 

5,000,000

Rockford Holding, Inc. [DE]

 

Sterling Life Insurance Company [IL]

 

100,000

Combined Life Assurance Company Limited [UK]

 

Aon Warranty Group Europe Limited [UK]

 

5,250,000

Aon Warranty Group Services Limited [UK]

 

Aon Warranty Group Europe Limited [UK]

 

541,542

Aon Warranty Services Limited [ISLE OF MAN]

 

Aon Warranty Group Europe Limited [UK]

 

20,000

Aon Warranty Group Limited [UK]

 

Aon Warranty Group Europe Limited [UK]

 

1

London General Holdings Limited [UK]

 

Aon Warranty Group Europe Limited [UK]

 

5,000,000

London General Insurance Company Limited [UK]

 

Aon Warranty Group Europe Limited [UK]

 

15,000,000

 

--------------------------------------------------------------------------------

 

Annex B

Subsidiaries

Name of Subsidiary

 

Owner of Subsidiary Capital Stock

 

 

 

Aon Innovative Solutions, Inc. [MO]

 

Aon Warranty Group, Inc. [IL]

Innovative Services International, LLC [DE]

 

Aon Innovative Solutions, Inc. [MO]

Aon Warranty Peru S.A. [PERU]

 

99% Aon Warranty Group, Inc. [IL] /
1% Aon Warranty Services, Inc. [IL]

Aon Warranty Services Australasia Pty. Ltd. [AUSTRALIA]

 

Aon Warranty Group, Inc. [IL]

Aon Warranty Korea, Inc. [KOREA]

 

Aon Warranty Group, Inc. [IL]

Aon Warranty Services de Mexico S.A. de C.V. [MEXICO]

 

99.99% Aon Warranty Group, Inc. [IL] /
 0.01% Aon Warranty Services, Inc. [IL]

Aon Warranty Services, Inc. [IL]

 

Aon Warranty Group, Inc. [IL]

Aon Warranty Services do Brasil Ltda. [BRAZIL]

 

Aon Warranty Services, Inc. [IL]

Aon Warranty Services Colombia S.A. [COLOMBIA] [under review]

 

Aon Warranty Services, Inc. [IL]

Automotive Warranty Services, Inc. [DE]

 

Aon Warranty Group, Inc. [IL]

AWS Warranty Services Canada, Inc. [CANADA]

 

Automotive Warranty Services, Inc. [DE]

AWS Warranty Services Quebec, Inc. [ONTARIO]

 

AWS Warranty Services Canada, Inc. [CANADA]

Automotive Warranty Services of Florida, Inc. [FL]

 

Aon Warranty Group, Inc. [IL]

Service Saver, Incorporated [FL]

 

Automotive Warranty Services of Florida, Inc. [FL]

ServicePlan of Florida, Inc. [FL]

 

Automotive Warranty Services of Florida, Inc. [FL]

Consumer Program Administrators, Inc. [IL]

 

Aon Warranty Group, Inc. [IL]

ServicePlan, Inc. [IL]

 

Aon Warranty Group, Inc. [IL]

National Product Care Company [IL]

 

ServicePlan, Inc. [IL]

Product Care, Inc. [IL]

 

ServicePlan, Inc. [IL]

Service Protection, Inc. [IL]

 

ServicePlan, Inc. [IL]

--------------------------------------------------------------------------------

 

Name of Subsidiary

 

Owner of Subsidiary Capital Stock

 

 

 

Combined Insurance Company de Argentina S.A. Compania de Seguros [ARGENTINA]

 

Aon Warranty Group, Inc. [IL]

Combined Seguros Brasil SA [BRAZIL]

 

Aon Warranty Group, Inc. [IL]

Resource Automotive, Inc. [IL]

 

Aon Warranty Group, Inc. [IL]

First Extended, Inc. [DE]

 

Resource Automotive, Inc. [IL]

FFG Corporation [DE]

 

First Extended, Inc. [DE]

Dealer Performance, Inc. [TX]

 

FFG Corporation [DE]

First Extended Service Corporation of Florida [FL]

 

FFG Insurance Company [TX]

First Extended Service Corporation [TX]

 

First Extended, Inc. [DE]

Automotive Insurance Agency, Inc. [TX]

 

First Extended Service Corporation [TX]*

Automotive Insurance Purchasing Group, Inc. [TX]**

 

 

Resource Acquisition Corporation [DE]

 

Resource Automotive, Inc. [IL]

Resource Training, Inc. [IL]

 

Resource Automotive, Inc. [IL]

Resource Dealer Group, Inc. [IL]

 

Resource Automotive, Inc. [IL]

Associates Dealer Group of Bellevue, Washington, Inc. [WA]

 

Resource Dealer Group, Inc. [IL]

RDG Resource Dealer Group (Canada) Inc. [CANADA]

 

Resource Dealer Group, Inc. [IL]

Resource Dealer Group, Inc. [MS]

 

Resource Dealer Group, Inc. [IL]

Resource Dealer Group of Arizona Insurance Services, Inc. [AZ]

 

Resource Dealer Group, Inc. [IL]

Resource Dealer Group of Nevada, Inc. [NV]

 

Resource Dealer Group, Inc. [IL]

Resource Dealer Insurance Services of California, Inc. [CA]

 

Resource Dealer Group, Inc. [IL]

Aon Home Warranty Services, Inc. [DE]

 

Virginia Surety Company, Inc. [IL]

Virginia Surety Compania de Seguros [ARGENTINA]

 

99.97% Virginia Surety Company, Inc. [IL] /
0.03% Combined Insurance Company of America [IL]

--------------------------------------------------------------------------------

 

Name of Subsidiary

 

Owner of Subsidiary Capital Stock

 

 

 

Rockford Life Insurance Company [AZ]

 

Rockford Holding, Inc. [DE]

IMC Group Limited [UK]

 

Aon Warranty Group Services Limited [UK]

Aon Warranty Group Polska Sp Z.o.o. [POLAND]

 

Aon Warranty Group Limited [UK]

Motorplan Limited [UK]

 

London General Holdings Limited [UK]

London General Holdings Spain SA [SPAIN]

 

London General Holdings Limited [UK]

Aon Warranty Group France Sarl [FRANCE]

 

London General Holdings Limited [UK]

Aon Repair Services (Shanghai) Co., Ltd. [CHINA]

 

Aon Warranty Services, Inc. [IL]

AWST (Thailand) Company Limited [THAILAND]

 

Aon Warranty Services, Inc. [IL] /
Resource Dealer Group, Inc. [IL]

 

--------------------------------------------------------------------------------

* Beneficial ownership only

** This is a not-for-profit corporation and has no shareholders

 

--------------------------------------------------------------------------------