Exhibit 10.1

CONTRIBUTION AND EXCHANGE AGREEMENT

dated as of August 3, 2014

among

ISI HOLDING, INC.

ISI HOLDING II, INC.

ISI MANAGEMENT HOLDINGS LLC

ISI HOLDING, LLC

EDWARD S. HYMAN

THE HOLDERS LISTED ON ANNEX A

EVERCORE LP

EVERCORE PARTNERS INC.

and

EDWARD S. HYMAN

(SOLELY IN HIS CAPACITY AS THE HOLDERS’ REPRESENTATIVE)

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TABLE OF CONTENTS

 

            Page  

ARTICLE I DEFINITIONS

     2   

Section 1.1

    

Certain Defined Terms

     2   

ARTICLE II THE CONTRIBUTION AND EXCHANGE OF THE ISI INTERESTS

     20   

Section 2.1

    

Contribution of the ISI Interests

     20   

Section 2.2

    

Issuance of the Securities in Exchange for the ISI Interests; Distribution of
the Securities

     20   

Section 2.3

    

Closing Date and Place

     20   

Section 2.4

    

Closing Deliveries by the Acquiror

     21   

Section 2.5

    

Closing Deliveries by the Transferor Parties

     21   

Section 2.6

    

Closing Deliveries by the Holders and the Founder

     22   

Section 2.7

    

Holders’ Representative

     22   

Section 2.8

    

Working Capital and Excess Working Capital

     25   

ARTICLE III REPRESENTATIONS AND WARRANTIES REGARDING THE TRANSFERRED COMPANIES

     27   

Section 3.1

    

Corporate Organization

     27   

Section 3.2

    

Due Authorization

     28   

Section 3.3

    

No Conflict

     28   

Section 3.4

    

Consents and Approvals

     29   

Section 3.5

    

Capitalization

     29   

Section 3.6

    

Title to Property

     30   

Section 3.7

    

Financial Statements

     30   

Section 3.8

    

Litigation

     32   

Section 3.9

    

No Undisclosed Liabilities

     32   

Section 3.10

    

Absence of Certain Developments

     32   

Section 3.11

    

Minute Books

     32   

Section 3.12

    

Taxes

     33   

Section 3.13

    

Contracts

     34   

Section 3.14

    

Intellectual Property

     37   

Section 3.15

    

Compliance with Law

     38   

Section 3.16

    

Licenses and Permits

     39   

Section 3.17

    

ERISA

     39   

Section 3.18

    

Employee Benefit Plans

     39   

Section 3.19

    

Labor Matters

     42   

Section 3.20

    

Insurance

     44   

Section 3.21

    

Environmental Matters

     44   

Section 3.22

    

Broker-Dealer Matters

     44   

Section 3.23

    

Investment Adviser; Asset Management and Other Regulatory Matters

     46   

Section 3.24

    

Corruption Laws; Pay to Play

     46   

Section 3.25

    

Affiliate Transactions

     46   

Section 3.26

    

Brokers

     47   

 

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Section 3.27

    

Assets

     47   

Section 3.28

    

BIPRU Remuneration Code Staff

     47   

Section 3.29

    

Disclaimer of Representations and Warranties

     47   

ARTICLE IV REPRESENTATIONS AND WARRANTIES REGARDING THE TRANSFEROR PARTIES, THE
HOLDERS AND THE FOUNDER

     48   

Section 4.1

    

Corporate Organization of Such Transferor Party

     48   

Section 4.2

    

Due Authorization by Such Transferor Party

     48   

Section 4.3

    

No Conflict for Such Transferor Party

     48   

Section 4.4

    

Consents and Approvals of Such Transferor Party

     49   

Section 4.5

    

Brokers for the Transferor Parties

     49   

Section 4.6

    

Purchase for Investment

     49   

Section 4.7

    

Due Authorization by Such Holder

     50   

Section 4.8

    

No Conflict for Such Holder

     50   

Section 4.9

    

Consents and Approvals of Such Holder

     50   

Section 4.10

    

Capitalization of Management Holdings

     50   

Section 4.11

    

Purchase for Investment

     51   

Section 4.12

    

Due Authorization by the Founder

     51   

Section 4.13

    

No Conflict for the Founder

     51   

Section 4.14

    

Consents and Approvals of the Founder

     52   

Section 4.15

    

Capitalization of Holding

     52   

Section 4.16

    

No Actions Related to Holding

     52   

Section 4.17

    

Disclaimer of Representations and Warranties

     52   

ARTICLE V REPRESENTATIONS AND WARRANTIES REGARDING THE ACQUIROR

     52   

Section 5.1

    

Corporate Organization of the Acquiror

     53   

Section 5.2

    

Due Authorization by the Acquiror

     53   

Section 5.3

    

No Conflict for the Acquiror

     53   

Section 5.4

    

Consents and Approvals of the Acquiror

     54   

Section 5.5

    

Investment Purpose

     54   

Section 5.6

    

Acquiror’s Reliance

     54   

Section 5.7

    

Brokers

     54   

Section 5.8

    

Access to Information

     54   

Section 5.9

    

Issuance of Securities

     55   

Section 5.10

    

Disclaimer of Representations and Warranties

     55   

Section 5.11

    

Acquiror Tax Representations

     55   

ARTICLE VI REPRESENTATIONS AND WARRANTIES REGARDING PARENT

     56   

Section 6.1

    

Corporate Organization of Parent; Subsidiaries

     57   

Section 6.2

    

Due Authorization of Parent

     57   

Section 6.3

    

No Conflict for Parent

     57   

Section 6.4

    

Consents and Approvals of Parent

     58   

Section 6.5

    

Issuance of Shares

     58   

Section 6.6

    

Parent’s Reliance

     58   

Section 6.7

    

Parent SEC Reports; Financial Statements

     58   

 

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Section 6.8

    

Regulatory Compliance

     60   

Section 6.9

    

No Actions

     60   

Section 6.10

    

Compliance with Law

     60   

Section 6.11

    

Parent Tax Representations

     60   

Section 6.12

    

Absence of Changes

     61   

Section 6.13

    

Disclaimer of Representations and Warranties

     61   

ARTICLE VII COVENANTS

     61   

Section 7.1

    

Conduct of Business

     61   

Section 7.2

    

Commercially Reasonable Efforts

     65   

Section 7.3

    

Pre-Closing Access and Information

     66   

Section 7.4

    

Post-Closing Access; Books and Records

     67   

Section 7.5

    

Employee Benefits Matters

     69   

Section 7.6

    

Certain Intercompany Matters

     70   

Section 7.7

    

Other Transaction Documents

     70   

Section 7.8

    

Notice of Developments

     71   

Section 7.9

    

Further Assurances

     71   

Section 7.10

    

Confidentiality

     71   

Section 7.11

    

Publicity; Notices

     72   

Section 7.12

    

Cooperation

     72   

Section 7.13

    

Transition Plan

     73   

Section 7.14

    

Tax Matters

     73   

Section 7.15

    

Registration Rights

     76   

Section 7.16

    

Cancellation of Management Holdings Management Units

     76   

Section 7.17

    

Dissolution and Liquidation of Management Holdings

     76   

Section 7.18

    

Dissolution of the Transferor

     76   

Section 7.19

    

Bank Regulatory Matters

     76   

Section 7.20

    

Signing Balance Sheet

     76   

Section 7.21

    

Valuation and Reporting

     76   

Section 7.22

    

Directors & Officers Indemnification and Insurance

     77   

Section 7.23

    

Passporting Undertaking

     78   

Section 7.24

    

Transition Services

     78   

Section 7.25

    

Distribution Agreement

     78   

ARTICLE VIII CONDITIONS TO CLOSING

     79   

Section 8.1

    

Conditions Precedent to the Obligations of Each Party

     79   

Section 8.2

    

Conditions Precedent to the Obligations of the Transferor Parties, the Holders
and the Founder

     79   

Section 8.3

    

Conditions Precedent to the Obligations of the Acquiror and Parent

     80   

ARTICLE IX TERMINATION

     81   

Section 9.1

    

Termination

     81   

Section 9.2

    

Notice of Termination

     82   

Section 9.3

    

Effect of Termination

     82   

 

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ARTICLE X INDEMNIFICATION

     82   

Section 10.1

    

Survival

     82   

Section 10.2

    

Indemnification by Holding and the Holders

     83   

Section 10.3

    

Indemnification by the Acquiror and Parent

     84   

Section 10.4

    

Third-Party Claim Indemnification Procedures

     85   

Section 10.5

    

Direct Claims

     87   

Section 10.6

    

Payments

     88   

Section 10.7

    

Payment by Holding and the Holders

     88   

Section 10.8

    

Exclusive Remedies

     94   

Section 10.9

    

Additional Indemnification Provisions

     94   

Section 10.10

    

Mitigation

     96   

Section 10.11

    

Holders’ Representative

     96   

ARTICLE XI GENERAL PROVISIONS

     96   

Section 11.1

    

Expenses

     96   

Section 11.2

    

Notices

     97   

Section 11.3

    

Severability

     98   

Section 11.4

    

Entire Agreement

     99   

Section 11.5

    

Assignment

     99   

Section 11.6

    

No Third-Party Beneficiaries

     99   

Section 11.7

    

Amendment; Waiver

     99   

Section 11.8

    

Disclosure Schedules

     99   

Section 11.9

    

Governing Law; Submission to Jurisdiction; Waiver of Jury Trial

     100   

Section 11.10

    

Scope of Agreements

     101   

Section 11.11

    

Rules of Construction

     101   

Section 11.12

    

Specific Performance

     102   

Section 11.13

    

Counterparts

     102   

 

-iv-

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ANNEXES

 

Annex A    List of Holders; Allocation of Securities Annex B    Excluded
Liabilities Annex C    List of Key Employees Annex D    Forms of Subordinated
Loan Amendments and Guaranty Annex E    Registration Rights Annex F    Specified
Liabilities Annex G    Specified Indemnification Annex H    Operating Principles

SCHEDULES

Transferor Parties Disclosure Schedule

Acquiror Disclosure Schedule

 

-v-

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CONTRIBUTION AND EXCHANGE AGREEMENT

This CONTRIBUTION AND EXCHANGE AGREEMENT (this “Agreement”), dated as of
August 3, 2014, is entered into by and among ISI Holding, LLC, a Delaware
limited liability company (the “Transferor”), ISI Holding, Inc., a Delaware
corporation (“Holding”), ISI Management Holdings LLC, a Delaware limited
liability company (“Management Holdings”), ISI Holding II, Inc., a Delaware
corporation (“Holding II” and together with Holding, the Transferor and
Management Holdings, the “Transferor Parties” and each individually a
“Transferor Party”), the holders of the Management Holdings Management Units set
forth on Annex A hereto (each, a “Holder” and collectively, the “Holders”),
Edward S. Hyman (the “Founder”), Evercore LP, a Delaware limited partnership
(the “Acquiror”), Evercore Partners Inc., a Delaware corporation (“Parent”), and
the Founder, solely in his capacity as the Holders’ Representative (as defined
in Section 2.7).

W I T N E S S E T H:

WHEREAS, the Transferor owns (i) 100% of the membership interest units of ISI
Group (the “ISI Group Units”) and (ii) all of the issued and outstanding shares
of the capital of ISI UK (the “ISI UK Shares” and together with the ISI Group
Units, the “ISI Interests”);

WHEREAS, simultaneously with the execution of this Agreement, Evercore Partners
Services East L.L.C. is entering into new employment agreements (each, a “New
Employment Agreement”) with those individuals listed on Annex C (each, a “Key
Employee”), that will, in each case, become effective at the Closing;

WHEREAS, simultaneously with the execution of this Agreement, each of the
Holders and the Founder is executing an Employee Covenants Agreement or a Key
Employee Covenants Agreement, as applicable, each effective upon the Closing,
and a Holder Waiver and Consent;

WHEREAS, simultaneously with the execution of this Agreement, the Holders,
Holding, Holding II, Parent and the Acquiror are entering into the Acquiror LP
Agreement, effective upon the Closing;

WHEREAS, each of the Transferor Parties, the Holders and the Founder desires
that the Transferor contribute to the Acquiror, the ISI Interests in exchange
for the issuance by the Acquiror of the Securities to the Transferor, upon the
terms and subject to the conditions set forth herein;

WHEREAS, the parties desire that immediately following receipt of the
Securities, the Transferor will distribute to Holding II and Holding the Founder
Securities and to Management Holdings the Management Securities in liquidation,
and immediately thereafter Management Holdings will distribute to its members in
liquidation the Management Securities it receives from the Transferor;

WHEREAS, the parties intend that the contribution of the ISI Interests to the
Acquiror in exchange for the Securities and the distribution by the Transferor
of Securities in liquidation of the Transferor pursuant to Section 2.2 be
treated for U.S. federal income tax purposes as an “assets over” merger, as such
term is given meaning in Treasury Regulations Section 1.708-1(c)(3)(i);

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NOW, THEREFORE, in consideration of the premises and the mutual representations,
warranties, covenants and undertakings contained herein, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto, intending to be legally bound, agree as
follows:

ARTICLE I

DEFINITIONS

Section 1.1 Certain Defined Terms. As used in this Agreement, the following
terms have the meanings set forth below.

“Accounting Expert” has the meaning set forth in Section 2.8(e).

“Accounting Principles” means the accounting methods, policies, practices and
procedures used by each of the Transferred Companies in the preparation of the
ISI Group Audited Financial Statements and the ISI UK Audited Financial
Statements.

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

“Acquiror Disclosure Schedule” has the meaning set forth in the first paragraph
of Article V.

“Acquiror Fundamental Representations” means the representations and warranties
set forth in Section 5.1 (Corporate Organization of the Acquiror), Section 5.2
(Due Authorization by the Acquiror), Section 5.9 (Issuance of Securities),
Section 6.1 (Corporate Organization of Parent), Section 6.2 (Due Authorization
of Parent), and Section 6.5 (Issuance of Shares).

“Acquiror Indemnified Parties” has the meaning set forth in Section 10.2(a).

“Acquiror LP Agreement” means the Fourth Amended and Restated Limited
Partnership Agreement of the Acquiror, dated as of the date hereof, but
effective upon the Closing.

“Acquiror Material Adverse Effect” means (a) a material adverse effect on the
business, assets, financial condition or results of operations of Parent and its
Subsidiaries, taken as a whole; provided, however, that none of the following
shall, individually or in the aggregate, constitute an Acquiror Material Adverse
Effect, or shall otherwise be taken into account in determining whether an
Acquiror Material Adverse Effect has occurred or would be reasonably likely to
occur: any adverse effect, circumstance, event, change, occurrence or state of
facts to the extent arising out of, resulting from, or attributable to
(i) (A) the United States or global economy generally or capital or financial
markets generally, including changes in interest or exchange rates,
(B) political conditions generally worldwide or in the United States or any
political subdivision thereof, or (C) changes that are the result of factors
generally

 

2

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affecting the industries or markets in which Parent and its Subsidiaries
operate, (ii) any changes in applicable Law, GAAP or the enforcement or
interpretation thereof, (iii) actions or omissions required to be taken or
required not to be taken pursuant to the Transaction Documents or taken or not
taken at the request of the Transferor Parties, the Founder or the Holders,
(iv) any hostilities, act of war, sabotage, terrorism or military actions, or
any escalation or worsening of any such hostilities, act of war, sabotage,
terrorism, military actions or other national or international calamity, crisis
or emergency (including any flood, fire, earthquake, hurricane or any other
natural disaster), or any escalation or worsening of the foregoing matters
described in this clause (iv), (v) a decline in the market price of the Parent
Common Stock (provided, that the facts underlying such decline may be taken into
account), (vi) any loss of, or adverse change in, the relationships between the
Acquiror or Parent and its respective customers, employees or suppliers that was
proximately caused by the pendency or the announcement of the Transactions, or
(vii) any breach of the Transaction Documents by the Transferor Parties, the
Founder or the Holders, except in the case of the foregoing clauses (a)(i),
(a)(ii) and (a)(iv) to the extent such effect, circumstances, event, change,
occurrence or state of facts is disproportionately adverse with respect to
Parent and its Subsidiaries, taken as a whole, as compared to other similarly
situated Persons engaged in the industries in which Parent and its Subsidiaries,
taken as a whole, conduct business or (b) a material impairment of or material
delay in the ability of the Acquiror or Parent to perform its obligations under
this Agreement or to consummate the Transactions.

“Acquiror Required Governmental Approvals” has the meaning set forth in
Section 5.4.

“Action” means any civil, criminal or administrative action, suit, claim, case,
litigation, arbitration, inquiry, hearing, dispute, demand, investigation or
other proceeding.

“Affiliate” means, with respect to any specified Person, any other Person, at
the time of such determination, directly or indirectly Controlling or Controlled
by or under direct or indirect common Control with such specified Person.

“Aggregate Exchange Restricted Removal Units” has the meaning set forth in
Section 10.7(b).

“Agreed Working Capital” means $5,300,000.

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

“Associated Person” has the meaning set forth in Section 3(a)(18) of the
Exchange Act.

“Assumed Tax Rate” means (x) with respect to the Acquiror and Holding II, the
highest effective marginal combined U.S. federal, state and local income tax
rate for a corporation doing business in New York, New York; (y) with respect to
Holding, the highest effective marginal combined U.S. federal, state and local
income tax rate for an individual residing in New York, New York, and earning
income through a Subchapter S corporation that is fully taxable in New York,
New York (and thus such rate shall include the New York City corporate-level tax
rate on the income of such Subchapter S corporation), as applicable; and
(z) with respect to Management Holdings or any Holder, as applicable, the
highest effective marginal combined U.S. federal, state and local income tax
rate for an individual residing in New York, New York.

 

3

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“Audit Restricted Units” has the meaning set forth in Section 10.7(f).

“Available Class E Units” has the meaning set forth in Section 2.7(e).

“BIPRU Remuneration Code” means the BIPRU remuneration code set out in SYSC 19C
of the FCA Handbook.

“Business” means the equity sales, trading and research business of Parent, the
Acquiror and their respective Subsidiaries, excluding (i) such business as
conducted by Parent, the Acquiror or their respective Subsidiaries in Mexico and
(ii) sales of equity, equity-linked and debt securities in connection with
public or private offerings by issuers and/or selling security holders,
including the business being contributed pursuant to this Agreement.

“Business Day” means any day other than a Saturday, Sunday or a day on which
banks in New York, New York are authorized or required by Law to close.

“Claim Notice” has the meaning set forth in Section 10.4(a).

“Claim Notice Period” has the meaning set forth in Section 10.4(d).

“Class E Pro Rata Percentage” means, as of the relevant date,

(i) for Holding, the percentage obtained by dividing (A) the number of Founder
Class E Units (including any Reallocated Class E Units) owned by Holding, that
are due to become exchangeable for Parent Common Stock at such time (other than
Class E Units that were converted from Class G Interests or Class H Interests)
by (B) the number of (i) non-Founder Class E Units (including any Reallocated
Class E Units held by the Holders) that are due to be vested at such time, plus
(ii) the Founder Class E Units (including any Reallocated Class E Units held by
Holding) that are due to become exchangeable for Parent Common Stock at such
time, plus (iii) any Class E Units that have been forfeited pursuant to the
Acquiror LP Agreement or any employment agreement entered into by any Holder in
connection with the Transactions that would have been due to become vested at
such time but for the forfeiture and that are not Reallocated Class E Units
(other than, in each of (i), (ii) and (iii), Class E Units that were converted
from Class G Interests or Class H Interests), and

(ii) for each Holder, the percentage obtained by dividing (A) the number of
non-Founder Class E Units (including any Reallocated Class E Units) owned by
such Holder, that are due to be vested at such time (other than Class E Units
that were converted from Class G Interests or Class H Interests) by (B) the
number of (i) non-Founder Class E Units (including any Reallocated Class E Units
held by the Holders) that are due to be vested at such time, plus (ii) the
Founder Class E Units (including any Reallocated Class E Units held by Holding)
that are due to become exchangeable for Parent Common Stock at such time, plus
(iii) any Class E Units that have been forfeited pursuant to the Acquiror LP
Agreement or any employment agreement entered into by any Holder in connection
with the Transactions that would have been due to become vested at such time but
for the forfeiture and that are not Reallocated Class E Units (other than, in
each of (i), (ii) and (iii), Class E Units that were converted from Class G
Interests or Class H Interests).

 

4

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“Class E Units” means the Class E Units issued or issuable pursuant to the
Acquiror LP Agreement.

“Class E Units Cap” means (i) with respect to the Closing, the first anniversary
and the second anniversary of the Closing, 33 1/3% of the Class E Units that
vest at such time for non-Founder Class E Units and 33 1/3% of the Class E Units
that become exchangeable for Parent Common Stock for Founder Class E Units
(other than, in each case, Class E Units that were converted from Class G
Interests or Class H Interests), and (ii) with respect to the third anniversary
of the Closing, 100% of the Class E Units that vest at such time for non-Founder
Class E Units and 100% of the Class E Units that become exchangeable for Parent
Common Stock for Founder Class E Units (other than, in each case, Class E Units
that were converted from Class G Interests or Class H Interests).

“Class G Interests” means the Class G Interests issued or issuable pursuant to
the Acquiror LP Agreement.

“Class H Interests” means the Class H Interests issued or issuable pursuant to
the Acquiror LP Agreement.

“Closing” has the meaning set forth in Section 2.3.

“Closing Balance Sheet” means the unaudited combined and combining statement of
financial condition for the Transferred Companies as of the Closing Date,
prepared in good faith in accordance with GAAP, applying the Accounting
Principles (which, for the avoidance of doubt, are modified to reflect GAAP to
the extent required). Each of the unaudited statement of financial condition for
ISI Group and the unaudited statement of financial condition for ISI UK used in
the preparation of such unaudited combined and combining statement of financial
condition for the Transferred Companies shall be reviewed separately on a
standalone basis (and not combined and combining basis) by the post-Closing
Transferred Companies’ auditors in accordance with the review procedures
specified by (i) with respect to ISI Group, the American Institute of Certified
Public Accountants for a review of interim financial information as described in
SAS No. 116 and SAS No. 122, and (ii) with respect to ISI UK, the International
Standard on Review Engagements (U.K. and Ireland) 2410, Review of Interim
Financial Information Performed by the Independent Auditor of the Entity, in the
case of each of clauses (i) and (ii), accompanied by such auditor’s review
report.

“Closing Date” has the meaning set forth in Section 2.3.

“Closing Date Income Statement” means an unaudited statement of income of the
Transferred Companies for the period beginning on the date hereof and ending on
the Closing Date, which statement shall be prepared in accordance with GAAP,
applying the Accounting Principles (which, for the avoidance of doubt, are
modified to reflect GAAP to the extent required). Each of the unaudited
statement of income of ISI Group and the unaudited statement of income of ISI UK
used in the preparation of such unaudited combined and combining statement of
income of the Transferred Companies shall be reviewed separately on a standalone

 

5

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basis (and not combined and combining basis) by the post-Closing Transferred
Companies’ auditors in accordance with the review procedures specified by
(i) with respect to ISI Group, the American Institute of Certified Public
Accountants for a review of interim financial information as described in SAS
No. 116 and SAS No. 122, and (ii) with respect to ISI UK, the International
Standard on Review Engagements (U.K. and Ireland) 2410, Review of Interim
Financial Information Performed by the Independent Auditor of the Entity, in the
case of each of clauses (i) and (ii), accompanied by such auditor’s review
report.

“Closing Date Net Working Capital” has the meaning set forth in Section 2.8(d).

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

“Code Staff” has the meaning set forth in Section 3.28.

“Compensation Ratio” has the meaning set forth in Section 7.1.

“Confidentiality Agreement” means the letter agreement, dated March 12, 2014,
between ISI Group and Parent.

“Continuing Employees” has the meaning set forth in Section 7.5(b).

“Contract” means any contract, agreement, undertaking, indenture, commitment,
loan, consent, note or other legally binding obligation, whether written or
oral.

“Control”, and the correlative terms “Controlling” and “Controlled”, means, with
respect to any specified Person, the power to direct the management and policies
of such Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise.

“Copyrights” means any and all published and unpublished works of authorship
(including Software), U.S. and non-U.S. copyrights therein and thereto and
rights to mask works and all registrations thereof and applications therefor.

“Current Assets” means the current assets of the Transferred Companies on a
combined and combining basis determined in accordance with GAAP, applying to the
extent consistent therewith the Accounting Principles (which, for the avoidance
of doubt, are modified to reflect GAAP to the extent required).

“Current Liabilities” means the current liabilities of the Transferred Companies
on a combined and combining basis determined in accordance with GAAP, applying
to the extent consistent therewith the Accounting Principles (which, for the
avoidance of doubt, are modified to reflect GAAP to the extent required).

“D&O Insurance” has the meaning set forth in Section 7.22(c).

“Deficit Amount” has the meaning set forth in Section 2.8(b).

“Deficit Reserve” has the meaning set forth in Section 10.7(b).

 

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“Direct Claim” has the meaning set forth in Section 10.5.

“Distribution Agreement” has the meaning set forth in Section 7.25.

“DOJ” means the United States Department of Justice.

“Domain Names” is included within the definition of “Intellectual Property”
below.

“Eligible Class E Units” means the Class E Units, other than Class E Units that
were converted from Class G Interests or Class H Interests, and includes,
subject to the Class E Units Cap, those Class E Units that are or become
Exchange Restricted Units.

“Eligible Third-Party Proceeds” has the meaning set forth in Section 10.9(a).

“Employee Covenants Agreement” means each of the Confidentiality,
Non-Solicitation and Proprietary Information Agreements entered into between
Evercore Partners Services East L.L.C. and each of the Holders set forth on
Annex A, in each case on the date hereof.

“Encumbrance” means any lien, deed of trust, deed to secure debt, security
interest, charge, mortgage, option, pledge, restriction on transfer, voting or
use or similar restriction, third party interest or encumbrance of any kind, and
in the case of real property, includes any easement, restriction, covenant,
condition, title default, encroachment or other survey defect, option or other
encumbrance.

“End Date” has the meaning set forth in Section 9.1(b).

“Environmental Law” means any Law, including common law, relating to the
protection of health, safety or the environment or the use, storage, recycling,
treatment, handling, transport, release or disposal of, or exposure to, any
chemical substance or waste.

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

“Estimated Income Statement” has the meaning set forth in Section 2.8(c)(i).

“Estimated Net Income” means the Transferor’s good faith estimate as of three
(3) Business Days prior to the Closing Date of the net income of the Transferred
Companies for the period beginning on the date hereof and ending on the Closing
Date, derived from the Estimated Income Statement, minus (i) any taxes payable
in respect thereof at the Assumed Tax Rate, plus (ii) any Transferor Expenses
included in the calculation of net income of the Transferred Companies for the
period beginning on the date hereof and ending on the Closing Date, as set forth
on the Estimated Income Statement, net of any Net Tax Benefit reasonably
estimated to be realized by the Transferred Companies resulting from the
inclusion of any such Transferor Expenses in such net income (“Estimated
Transferor Expenses”).

“Estimated Transferor Expenses” has the meaning set forth in the definition of
“Estimated Net Income” above.

 

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“Excess Working Capital” means the amount of Net Working Capital reflected on
the Signing Balance Sheet in excess of Agreed Working Capital.

“Excess Working Capital Distribution” has the meaning set forth in
Section 2.8(a).

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

“Exchange Restricted Units” has the meaning set forth in Section 10.7(a).

“Excluded Liabilities” means the Liabilities set forth on Annex B.

“FCA” means the Financial Conduct Authority of the UK or any successor authority
or authorities.

“FCA Handbook” means the handbook published and maintained by the FCA containing
provisions made by the FCA.

“Final Deficit Amount” has the meaning set forth in Section 2.8(f).

“Final Net Income” means the net income of the Transferred Companies for the
period beginning on the date hereof and ending on the Closing Date, as set forth
on the Closing Date Income Statement delivered by the Acquiror pursuant to
Section 2.8(d)(iii), and determined pursuant to Section 2.8, minus (i) any taxes
payable in respect thereof at the Assumed Tax Rate, plus (ii) any Transferor
Expenses included in the calculation of net income of the Transferred Companies
for the period beginning on the date hereof and ending on the Closing Date, as
set forth on the Closing Date Income Statement, net of any Net Tax Benefit
reasonably estimated to be realized by the Transferred Companies resulting from
the inclusion of any such Transferors Expenses in such net income (“Final
Transferor Expenses”).

“Final Transferor Expenses” is included within the definition of “Final Net
Income” above.

“finally determined” has the meaning set forth in Section 10.6(b).

“Financial Statements” has the meaning set forth in Section 3.7(b).

“FINRA” means the Financial Industry Regulatory Authority (including any
predecessor entity, including the National Association of Securities Dealers,
Inc.).

“Forfeiting Holder” has the meaning set forth in Section 10.7(f)(iii).

“Forfeiture Notice” has the meaning set forth in Section 10.7(d).

“Form BD” has the meaning set forth in Section 3.22(b).

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

 

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“Founder Class E Units” means the Founder Class E Units issued or issuable
pursuant to the Acquiror LP Agreement.

“Founder Class G Interests” means the Founder Class G Interests issued or
issuable pursuant to the Acquiror LP Agreement.

“Founder Class H Interests” means the Founder Class H Interests issued or
issuable pursuant to the Acquiror LP Agreement.

“Founder Fundamental Representations” means the representations and warranties
set forth in Section 4.12 (Due Authorization by the Founder) and Section 4.15
(Capitalization of Holding).

“Founder Securities” means the Founder Class E Units, Founder Class G Interests
and Founder Class H Interests distributed to Holding and Holding II pursuant to
Section 2.2, as set forth in Annex A.

“FSMA” has the meaning set forth in Section 3.22(a).

“FTC” means the United States Federal Trade Commission.

“GAAP” means U.S. generally accepted accounting principles and practices in
effect from time to time applied consistently throughout the periods involved.

“Governmental Authority” means any federal, state, local, domestic or foreign
agency, court, tribunal, administrative body, arbitration panel, department or
other legislative, judicial, governmental, quasi-governmental entity or
Self-Regulatory Organization with competent jurisdiction.

“Guaranty” means the Guaranty, to be dated as of the Closing Date, between the
Founder and the Acquiror, substantially in the form attached hereto as Annex
D-3.

“Hazardous Material” means any petroleum or petroleum products, radioactive
materials or wastes, asbestos, lead paint, mold, polychlorinated biphenyls or
hazardous substance, extremely hazardous substance, pollutant or hazardous waste
as listed or defined pursuant to any Environmental Law.

“Holder” or “Holders” has the meaning set forth in the Preamble.

“Holder Fundamental Representations” means the representations and warranties
set forth in Section 4.7 (Due Authorization by Such Holder) and Section 4.10
(Capitalization of Management Holdings).

“Holder Waiver and Consent” means each of the Consent, Waiver and Release
Agreements entered into between Management Holdings and each of the Holders set
forth on Annex A, in each case on the date hereof.

“Holders’ Representative” has the meaning set forth in Section 2.7(a).

 

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“Holders’ Representative Expenses” has the meaning set forth in
Section 2.7(a)(vi).

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

“Holding II” has the meaning set forth in the Preamble.

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

“Immediate Family Member” means, with respect to any natural Person, (a) such
Person’s spouse, domestic partner, parents, parents-in-law, grandparents,
grandparents-in-law, children, grandchildren, siblings and siblings-in-law (in
each case whether adoptive or biological), (b) spouses of such Person’s
children, grandchildren and siblings (in each case whether adoptive or
biological) and (c) estates, trusts, partnerships and other entities which
directly or indirectly through one or more intermediaries are controlled by the
foregoing.

“Indebtedness” means, without duplication, (i) all liabilities for borrowed
money, whether current or funded, secured or unsecured, and all obligations
evidenced by bonds, debentures, notes or similar instruments, (ii) all
liabilities for the deferred purchase price of property, (iii) all liabilities
in respect of any lease of (or other arrangement conveying the right to use)
real or personal property, or a combination thereof, which liabilities are
required to be classified and accounted for under GAAP as capital leases,
(iv) all liabilities for the reimbursement of any obligor on any letter of
credit, banker’s acceptance or similar credit transaction securing obligations
of a type described in clauses (i), (ii) or (iii) above to the extent of the
obligation secured, and all liabilities as obligor, guarantor, or otherwise, to
the extent of the obligation secured and (v) the guaranty or other assumption of
liability for, or grant of an Encumbrance or provision of collateral to secure,
the obligations of any other Person of a type described in clauses (i) through
(iv) above; provided, however, that “Indebtedness” shall not be deemed to
include any of the following: (A) any intercompany Indebtedness owing by any
Transferor Party to any of the Transferred Companies, by a Transferred Company
to any Transferor Party or by one Transferred Company to another Transferred
Company, or (B) any leases (other than capital leases).

“Indemnification Cap” has the meaning set forth in Section 10.2(f).

“Indemnified Party” has the meaning set forth in Section 10.4(a).

“Indemnifying Party” has the meaning set forth in Section 10.4(a).

“Individual Exchange Restricted Units” has the meaning set forth in
Section 10.7(a).

“Individual Reserve Amount” has the meaning set forth in Section 10.7(a).

“Insurance Policies” has the meaning set forth in Section 3.20.

 

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“Intellectual Property” means any and all intellectual property, industrial
property and proprietary rights (anywhere in the world, whether statutory,
common law or otherwise), including: (i) Patents; (ii) Copyrights;
(iii) trademarks, service marks, logos and design marks, trade dress, trade
names, and brand names, together with all goodwill associated with any of the
foregoing and all registrations thereof and applications therefor
(“Trademarks”); (iv) domain names and uniform resource locators associated with
the Internet, including registrations thereof (“Domain Names”); and
(v) proprietary information and materials not generally known to the public,
including trade secrets and other confidential or proprietary information, and
any other information or materials meeting the definition of a trade secret
under the Uniform Trade Secrets Act (“Trade Secrets”), including rights to limit
the use or disclosure thereof by any Person.

“Intellectual Property Contract” has the meaning set forth in
Section 3.13(a)(x).

“Interest Contribution Instruments” has the meaning set forth in Section 2.5(a).

“Interim Financial Statements” has the meaning set forth in Section 3.7(b).

“IRS” means the Internal Revenue Service.

“ISI Group” means International Strategy & Investment Group, LLC, a Delaware
limited liability company.

“ISI Group Audited Balance Sheet” has the meaning set forth in Section 3.7(a).

“ISI Group Audited Financial Statements” has the meaning set forth in
Section 3.7(a).

“ISI Group Financial Statements” has the meaning set forth in Section 3.7(a).

“ISI Group Interim Financial Statements” has the meaning set forth in
Section 3.7(a).

“ISI Group Latest Balance Sheet” has the meaning set forth in Section 3.7(a).

“ISI Group Units” has the meaning set forth in the Recitals.

“ISI Inc.” means International Strategy & Investment Inc., a Delaware
corporation.

“ISI Interests” has the meaning set forth in the Recitals.

“ISI UK” means International Strategy & Investment (UK) Limited, a private
limited company organized and existing under the laws of England and Wales and
registered with company number 7610874.

“ISI UK Audited Balance Sheet” has the meaning set forth in Section 3.7(b).

“ISI UK Audited Financial Statements” has the meaning set forth in
Section 3.7(b).

 

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“ISI UK Financial Statements” has the meaning set forth in Section 3.7(b).

“ISI UK Interim Financial Statements” has the meaning set forth in
Section 3.7(b).

“ISI UK Latest Balance Sheet” has the meaning set forth in Section 3.7(b).

“ISI UK Shares” has the meaning set forth in the Recitals.

“IT Assets” means computers, hard drives, Software, firmware, middleware,
servers, workstations, routers, hubs, switches, network equipment, data
communications lines, and all other information technology equipment and systems
and all associated documentation, used by the Transferred Companies in
connection with their business.

“Key Employee” has the meaning set forth in the Recitals.

“Key Employee Covenants Agreements” means (i) the Confidentiality,
Non-Solicitation and Proprietary Information Agreement, by and between Evercore
Partners Services East L.L.C. and the Founder and (ii) the Confidentiality,
Non-Solicitation and Proprietary Information Agreement, by and between Evercore
Partners Services East L.L.C. and Vinayak Singh, each as entered into by the
respective parties thereto on the date hereof.

“Knowledge” means (i) with respect to the Transferor, the actual knowledge after
reasonable due inquiry, as of the date of this Agreement, of any of the officers
of such Transferor Party or any of the Transferred Companies whose names are
listed on Schedule 1.1(a) of the Transferor Parties Disclosure Schedule,
(ii) with respect to the Founder, the actual knowledge after reasonable due
inquiry, as of the date of this Agreement, of the Founder and (iii) with respect
to the Acquiror, the actual knowledge after reasonable due inquiry, as of the
date of this Agreement, of any of the officers of the Acquiror listed on
Schedule 1.1(a) of the Acquiror Disclosure Schedule.

“Law” means any federal, state, local or foreign law, statute, regulation, rule,
executive order, ordinance, judgment, ruling, injunction, Order, license,
approval or permit enacted, issued, promulgated, adjudged, entered or enforced
by a Governmental Authority.

“Leased Real Property” has the meaning set forth in Section 3.6(c).

“Liability” means any liability, debt, obligation, loss, damage, claim, cost or
expense, in each case, whether direct or indirect, known or unknown, or accrued
or contingent.

“License and Permit” means any permit, license, registration, consent, approval
or other authorization provided or granted by or from a Governmental Authority
in any jurisdiction that is required for (i) the operation of the business of
the Transferred Companies, collectively or (ii) the ownership, possession,
occupation or use of any assets of the Transferred Companies.

“Licensed Intellectual Property” has the meaning set forth in Section 3.14(a).

 

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“Losses” means any and all losses, damages, costs, expenses, Liabilities,
settlement payments, awards, judgments, and fines, including, to the extent
direct damages, lost profits and diminution in value.

“Management Holdings” has the meaning set forth in the Preamble.

“Management Holdings LLC Agreement” means the Limited Liability Company
Agreement of Management Holdings, dated as of November 16, 2011.

“Management Holdings Management Units” means the units issued by Management
Holdings to each member of Management Holdings pursuant to the Limited Liability
Company Agreement of Management Holdings.

“Management Projections” has the meaning set forth in Section 7.1.

“Management Securities” means the Class E Units, Class G Interests and Class H
Interests distributed to the Holders pursuant to Section 2.2, as set forth in
Annex A.

“Market Price” means, on a given date, (i) if there is a public market for
Parent Common Stock on such date, the volume-weighted average price per share of
Parent Common Stock for the twenty (20) trading days ending on and including the
third Business Day prior to such date, as reported by the principal national
securities exchange on which such shares are listed or admitted to trading, or,
if Parent Common Stock is not listed or admitted on any national securities
exchange, the volume-weighted average price per share of Parent Common Stock for
the twenty (20) Business Days ending on and including the third Business Day
prior to such date as quoted on the primary market in which such prices are
regularly quoted, or, if no sale of shares of Parent Common Stock shall have
been reported by any national securities exchange or quoted on such other
primary market on such date, then the twenty (20) trading days immediately
preceding and including the immediately preceding date on which sales of the
shares of Parent Common Stock have been so reported or quoted, and (ii) if there
is not a public market for Parent Common Stock on such date, the market price
shall be the value of a share of Parent Common Stock established by the
Management Committee of Parent reasonably and in good faith, based on the price
at which all of the business and assets, subject to all of the liabilities, of
Parent would likely be sold in an arm’s-length transaction between a willing and
able buyer under no compulsion to buy and a willing and able seller under no
compulsion to sell, and such buyer and seller being apprised of and considering
all relevant facts, circumstances and factors.

“Material Contract” has the meaning set forth in Section 3.13(a).

“Net Tax Benefit” has the meaning set forth in Section 10.9(a).

“Net Working Capital” means (a) Current Assets minus (b) Current Liabilities.

“New Employment Agreement” has the meeting set forth in the Recitals.

“NFA” has the meaning set forth in Section 3.23(c).

 

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“Notice” has the meaning set forth in Section 7.2(d).

“Notice of Objection” has the meaning set forth in Section 2.8(d).

“Notice Period” has the meaning set forth in Section 10.4(a).

“Order” means any order, decision, directive, judgment, writ, injunction,
decree, award or other determination of any Governmental Authority.

“Organizational Documents” means, with respect to any Person, such Person’s
articles or certificate of incorporation, association or formation, deed of
incorporation, bylaws, limited liability company agreement, partnership
agreement or other constitutive documents.

“Owned Company Intellectual Property” means any and all Intellectual Property
owned (whether solely or jointly) by any of the Transferred Companies.

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

“Parent Common Stock” means the Class A Common Stock of Parent, par value $.01
per share.

“Parent SEC Reports” has the meaning set forth in Section 6.7(a).

“Passporting Notification” means a passporting notification of intention to
provide cross-border services in another European Economic Area state from ISI
UK in the form set out in Annex 2 to SUP 13 of the FCA Handbook.

“Patents” means any and all U.S. and non-U.S. patent rights, including all
(i) patents and inventions, and (ii) pending patent applications, including all
provisional applications, substitutions, continuations, continuations-in-part,
divisions, renewals, extensions, reissues, reexaminations and all patents
granted thereon.

“Permitted Encumbrance” means any (i) Encumbrance specifically reflected or
specifically reserved against or otherwise disclosed in the Interim Financial
Statements; (ii) Encumbrance for Taxes, assessments or other government charges
not yet due and payable or which are being contested in good faith by
appropriate proceedings, in each case, in an amount that would not be material;
(iii) non-exclusive licenses of Intellectual Property entered into in the
ordinary course of business consistent with past practice that are not material
to the Business and that do not impair the use of such Intellectual Property by
the Transferred Companies for the purposes for which it is currently used;
(iv) mechanics’ liens, materialmen’s liens or other like Encumbrances that have
arisen in the ordinary course of business and (v) with respect to real property,
(A) zoning, building, subdivision, environmental regulations, entitlement or
other land use regulations or other similar government restrictions; (B) any
condition that is shown by a survey or title document provided to the Acquiror
prior to the date hereof; (C) any lease, sublease, license, or occupancy
agreement disclosed to the Acquiror prior to the date hereof or any terms or
conditions thereof; (D) any right, title or interest of a landlord, sublandlord
or licensor under any lease, sublease or license to which a Transferred Company
is a party disclosed to the Acquiror prior to the date hereof and (E) any other
non-monetary Encumbrance that does not materially adversely affect the
Transferred Companies or the use or occupancy of the property for the purposes
for which it is currently used or the value of the property to any third party
buyer.

 

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

“Personal Information” means information from or about an individual person, the
collection, use, aggregation, holding or management of which is subject to
applicable Laws. For the avoidance of doubt, if an applicable Law requires a
Person to comply with its statements regarding collection, use, aggregation,
holding, disclosure or management of personal information, then any type of
personal information that is a subject of such statements is “Personal
Information” for the purposes of this Agreement.

“Pre-Signing Tax Period” means any taxable year or other taxable period ending
before the Signing Date.

“Privacy Policy” has the meaning set forth in Section 3.14(c).

“Reallocated Class E Unit” means, with respect to Holding or any Holder, any
Class E Unit that has been allocated to such Person pursuant to Section 8.02(b)
of the Acquiror LP Agreement.

“Registered” means issued by, registered with, renewed by or the subject of a
pending application before any Governmental Authority or Internet domain name
registrar.

“Registered Owned Company Intellectual Property” means all Owned Company
Intellectual Property that is Registered.

“Registration Rights” means the Registration Rights to be provided by Parent to
the Holders, Holding, Holding II and the Founder following the Closing, as set
forth on Annex E.

“Representative” means, with respect to any Person, any officer, director,
employee, advisor, agent or representative of such Person, or anyone acting on
behalf of them or such Person.

“Required Governmental Approvals” means the Acquiror Required Governmental
Approvals and the Transferor Required Governmental Approvals.

“Reserve Amount” has the meaning set forth in Section 10.7(a).

“SEC” means the United States Securities and Exchange Commission.

“Securities” means the Founder Securities and the Management Securities.

“Securities Act” means the Securities Act of 1933, as amended.

 

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“Self-Regulatory Organization” means any self-regulatory organization in the
securities and commodities field, including the NFA, the Securities and Futures
Authority.

“Signing Balance Sheet” means the unaudited combined and combining statement of
financial condition for the Transferred Companies as of the Signing Date,
prepared in good faith by the Transferor in accordance with GAAP, applying the
Accounting Principles (which, for the avoidance of doubt, are modified to
reflect GAAP to the extent required). Each of the unaudited statement of
financial condition for ISI Group and the unaudited statement of financial
condition for ISI UK used in the preparation of such unaudited combined and
combining statement of financial condition for the Transferred Companies shall
be reviewed separately on a standalone basis (and not combined and combining
basis) by the Transferred Companies’ auditors in accordance with the review
procedures specified by (i) with respect to ISI Group, the American Institute of
Certified Public Accountants for a review of interim financial information as
described in SAS No. 116 and SAS No. 122, and (ii) with respect to ISI UK, the
International Standard on Review Engagements (U.K. and Ireland) 2410, Review of
Interim Financial Information Performed by the Independent Auditor of the
Entity, in the case of each of clauses (i) and (ii), accompanied by such
auditor’s review report.

“Signing Date” means the date on which this Agreement is executed.

“Software” means all (i) computer programs and other software, including
software implementations of algorithms, models, and methodologies, whether in
source code, object code or other form, including libraries, subroutines and
other components thereof; (ii) computerized databases and other computerized
compilations and collections of data or information, including all data and
information included in such databases, compilations or collections; (iii) user
interfaces, templates, menus, buttons and icons; (iv) software flow-charts and
architectures, software development tools, and other materials used to design,
plan, organize and develop any of the foregoing; and (v) all documentation,
including development, diagnostic, support, user and training documentation
related to any of the foregoing.

“Specified Amounts” has the meaning set forth on Annex G.

“Specified Liabilities” means the Liabilities set forth on Annex F.

“Specified Restricted Units” has the meaning set forth in Section 10.7(f)(ii).

“Straddle Period” means any taxable period that begins before and ends on or
after the Signing Date.

“Subordinated Loan Amendments” means (i) the Amendment to Previously Approved
Subordinated Loan Agreement Maturity Extension, to be dated as of the Closing
Date, between the Founder and ISI Group, substantially in the form attached
hereto as Annex D-1 and (ii) the Amendment to Previously Approved Subordinated
Loan Agreement Maturity Extension, to be dated as of the Closing Date, between
the Founder and ISI Group, substantially in the form attached hereto as
Annex D-2.

“Subsidiary” means, with respect to any Person, any corporation, partnership,
trust, limited liability company or other entity that is Controlled by such
Person, whether directly or indirectly through one or more intermediaries, or in
which such Person (or another

 

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Subsidiary of such Person) holds stock or other ownership interests representing
(i) more than 50% of the voting power of all outstanding stock or ownership
interests of such entity, (ii) the right to receive more than 50% of the net
assets of such entity available for distribution to the holders of outstanding
stock or ownership interests upon a liquidation or dissolution of such entity or
(iii) a general or managing partnership interest or similar position in such
entity.

“Tax” means any and all United States federal, state and local, non-United
States and other taxes, levies, fees, imposts, duties, tariffs and other charges
in the nature of tax, together with any interest, penalties or additions imposed
in connection therewith or with respect thereto, imposed by any Tax Authority,
including taxes imposed on, or measured by, income, franchise, profits or gross
receipts, and also alternative minimum, add-on minimum, ad valorem, value added,
sales, use, service, real or personal property, capital stock, license,
registration, documentary, environmental, disability, payroll, withholding,
employment, social security, workers’ compensation, unemployment compensation,
utility, severance, production, excise, stamp, occupation, premium, windfall
profits, transfer and gains taxes and customs duties.

“Tax Authority” means, with respect to any Tax, the Governmental Authority or
political subdivision thereof that imposes such Tax, and the agency (if any)
charged with the collection of such Tax for such entity or subdivision.

“Tax Claim” has the meaning set forth in Section 7.14(c).

“Tax Indemnifying Party” has the meaning set forth in Section 7.14(c).

“Tax Audit” has the meaning set forth in Section 10.7(f).

“Tax Returns” means all returns, reports, information statements, elections,
agreements, declarations and other documents of any nature or kind (including
any attached schedules, supplements and additional or supporting material)
filed, or required to be filed, with respect to Taxes, including any claim for
refund, amended return or declaration of estimated Taxes (and including any
amendments with respect thereto) and returns or reports with respect to backup
withholding and other payments to third parties.

“Termination Date” has the meaning set forth in Section 9.1(b).

“Third-Party Claim” has the meaning set forth in Section 10.4(a).

“Third-Party Consents” has the meaning set forth in Section 3.4.

“Trade Secrets” is included within the definition of “Intellectual Property”
above.

“Trademarks” is included within the definition of “Intellectual Property” above.

“Transaction Documents” means, collectively, this Agreement, the Acquiror LP
Agreement, each of the Key Employee Covenants Agreements, the Employee Covenants
Agreements, the Holder Waiver and Consents, the Subordinated Loan Amendments,
the Guaranty, to the extent entered into pursuant to Section 7.24, the
Transition Services Agreement and when entered into pursuant to Section 7.25,
the Distribution Agreement.

 

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“Transactions” means the transactions contemplated by this Agreement.

“Transfer Taxes” means all transfer, documentary, sales, use, stamp, value added
taxes, turnover taxes, good and services taxes, registration and other such
taxes and fees, incurred in connection with this Agreement and the transactions
contemplated hereby.

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

“Transferor Entity 401(k) Plan” has the meaning set forth in Section 7.5(d).

“Transferor Expenses” means (i) any severance obligations in connection with the
termination of employment with a Transferred Company of any holders of
Management Holdings Management Units prior to the Closing to the extent not paid
prior to the Signing Date, (ii) the fees and expenses incurred by or on behalf
of any Transferor Party or a Transferred Company in connection with the
Transactions, including any fees of legal counsel, accountants or financial
advisors, to the extent not paid prior to the Signing Date, and (iii) any costs
or expenses incurred in connection with the purchase of D&O Insurance pursuant
to Section 7.22(c).

“Transferor Indemnified Parties” has the meaning set forth in Section 10.3(a).

“Transferor Party” or “Transferor Parties” has the meaning set forth in the
Preamble.

“Transferor Parties Fundamental Representations” means the representations and
warranties set forth in Section 3.1 (Corporate Organization), Section 3.2 (Due
Authorization), Section 3.3(a) (No Conflict), Section 3.5 (Capitalization),
Section 3.27(a) (Assets), Section 4.1 (Corporate Organization of Such
Transferor), and Section 4.2 (Due Authorization by Such Transferor).

“Transferor Parties Disclosure Schedule” has the meaning set forth in the first
paragraph of Article III.

“Transferor Plans” has the meaning set forth in Section 3.18(a).

“Transferor Required Governmental Approvals” has the meaning set forth in
Section 3.4.

“Transferor Taxes” means any and all Taxes (in each case, without duplication)
(a) imposed on or with respect to any of the Transferred Companies, or for which
any of the Transferred Companies may otherwise be liable, for any Pre-Signing
Tax Period and for the portion of any Straddle Period ending on the Signing Date
(determined in accordance with Section 7.14(b)), (b) of any other Person for
which any of the Transferred Companies is or has been liable as a transferee or
successor, (c) any Taxes resulting from or arising out of any breach of or
inaccuracy in any of the representations and warranties contained in
Section 3.12

 

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(disregarding, solely for purposes of determining the amount of Taxes, any
limitation as to materiality or Transferred Companies Material Adverse Effect
contained in such representation or warranty), (d) any obligation or other
liability of any of the Transferred Companies to indemnify any other Person in
respect of or relating to Taxes or for any amounts calculated by reference to
Taxes or to pay an amount pursuant to any Tax sharing or Tax allocation
agreement entered into prior to the Signing Date (other than any such agreements
solely among Transferred Companies), (e) any Taxes attributable to or resulting
from any breach of or any failure by Transferor Parties to perform any covenant
or obligation contained in Section 7.1(p) of this Agreement and (f) any Taxes of
Transferor Parties, the Founder, the Holders, or any other direct or indirect
beneficial owner of ISI Interests, for any taxable period. For purposes of
determining Transferor Taxes, the payment of Transferor Expenses by the
Transferor or the Transferred Companies in the period after the Signing Date and
on or before the Closing shall be treated as deducted in a taxable period ending
on the Signing Date to the extent such payment actually results in a reduction
in the Tax liability of the Transferor or its Subsidiaries for any taxable
period beginning after the Signing Date or the portion of any Straddle Period
beginning after the Signing Date (determined in accordance with
Section 7.14(b)).

“Transferred Companies” means ISI Group and ISI UK.

“Transferred Companies Material Adverse Effect” means (a) a material adverse
effect on the business, assets, financial condition or results of operations of
the Transferred Companies, taken as a whole; provided, however, that none of the
following shall, individually or in the aggregate, constitute a Transferred
Companies Material Adverse Effect, or shall otherwise be taken into account in
determining whether a Transferred Companies Material Adverse Effect has occurred
or would be reasonably likely to occur: any adverse effect, circumstance, event,
change, occurrence or state of facts to the extent arising out of, resulting
from, or attributable to (i) (A) the United States or global economy generally
or capital or financial markets generally, including changes in interest or
exchange rates, (B) political conditions generally worldwide or in the United
States or any political subdivision thereof or (C) changes that are the result
of factors generally affecting the industries or markets in which the
Transferred Companies operate, (ii) the identity of, or any facts or
circumstances specifically relating to, the Acquiror, Parent or their respective
Affiliates, (iii) any changes in applicable Law, GAAP, U.K. GAAP or the
enforcement or interpretation thereof, (iv) actions or omissions required to be
taken or required not to be taken pursuant to the Transaction Documents or taken
or required not to be taken at the request of the Acquiror or Parent, (v) any
hostilities, act of war, sabotage, terrorism, military actions or other national
or international calamity, crisis or emergency (including any flood, fire,
earthquake, hurricane or any other natural disaster), or any escalation or
worsening of the foregoing matters described in this clause (v), (vi) any loss
of, or adverse change in, the relationships between any Transferor Party or any
Transferred Company and its respective customers, employees or suppliers
proximately caused by the pendency or the announcement of the Transactions, or
(vii) any breach of the Transaction Documents by Parent or any of its
Subsidiaries; except in the case of the foregoing clauses (a)(i), (a)(iii) and
(a)(v) to the extent such effect, circumstance, event, change, occurrence or
state of facts is disproportionately adverse with respect to the Transferred
Companies, taken as a whole, as compared to other similarly situated Persons
engaged in the industries in which the Transferred Companies conduct business or
(b) a material impairment of or material delay in the ability of the Transferred
Companies, the Transferor Parties, the Holders’ Representative or the Founder to
perform their obligations under this Agreement or to consummate the
Transactions.

 

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“Transition Services Agreement” has the meaning set forth in Section 7.24.

“U.K. GAAP” means U.K. generally accepted accounting principles and practices in
effect from time to time applied consistently throughout the periods involved.

“U.S.” means the United States of America.

ARTICLE II

THE CONTRIBUTION AND EXCHANGE OF THE ISI INTERESTS

Section 2.1 Contribution of the ISI Interests. On the terms and subject to the
conditions set forth in this Agreement, at the Closing, the Transferor shall
contribute to the Acquiror all of the Transferor’s right, title and interest in
and to all of the issued and outstanding ISI Group Units and ISI UK Shares, in
each case free and clear of all Encumbrances.

Section 2.2 Issuance of the Securities in Exchange for the ISI Interests;
Distribution of the Securities. On the terms and subject to the conditions set
forth in this Agreement, at the Closing, in consideration for the ISI Interests
to be contributed to the Acquiror pursuant to Section 2.1, subject to
Section 2.8, the Acquiror shall issue to the Transferor (a) the aggregate number
of Founder Securities to be distributed to Holding and Holding II, as set forth
on Annex A and (b) the aggregate number of Management Securities to be
distributed to Management Holdings, as set forth on Annex A. In conjunction with
and as part of the Closing, (i) the aggregate number of Founder Securities shall
be distributed by the Transferor to Holding and Holding II and the aggregate
number of Management Securities shall be distributed by the Transferor to
Management Holdings in accordance with Annex A, which lists the number of
Founder Securities to be distributed to Holding and Holding II and the number of
Management Securities to be distributed to Management Holdings in liquidation of
the Transferor, and (ii) following the distributions described in clause (i) of
this Section 2.2, the aggregate number of Management Securities shall be
distributed by Management Holdings in liquidation of Management Holdings to the
respective Holders in accordance with Annex A, which lists the name of each such
Holder and the number of Management Securities to be distributed to each such
Holder. In the event the liquidations described in the previous sentence do not
occur, the Closing shall not be deemed to have occurred, and the Securities
issued in connection therewith shall be null and void and the contribution of
the ISI Interests shall be deemed not to have occurred. Any Holder, all the
Management Holdings Management Units of whom are forfeited prior to the Closing
as a result of the termination of such Holder’s employment with a Transferred
Company prior to the Closing, shall automatically cease to be a party hereto
with no continuing liability or rights hereunder.

Section 2.3 Closing Date and Place. The contribution and exchange of the ISI
Interests shall take place at a closing (the “Closing”) to be held at the
offices of Sullivan & Cromwell LLP, 125 Broad Street, New York, New York 10004,
at 10:00 a.m. (prevailing United States Eastern Time), five (5) Business Days
following the satisfaction or, to the extent permitted

 

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by applicable Law, waiver, of all conditions to the obligations of the parties
set forth in Article VIII (other than such conditions as may, by their terms,
only be satisfied at the Closing or on the Closing Date), or at such other place
or at such other time and date as the Founder and the Acquiror mutually may
agree in writing (the “Closing Date”). Upon the occurrence of the Closing, the
time and date that the contribution and exchange of the ISI Interests described
in Section 2.1 becomes effective shall be 12:01 a.m., New York City time, on the
Closing Date.

Section 2.4 Closing Deliveries by the Acquiror. At the Closing, the Acquiror
shall deliver, or cause to be delivered, to the Transferor Parties or the
Holders’ Representative:

(a) the Acquiror LP Agreement (together with an updated schedule of partners
thereto), which, among other things, evidences the Founder Securities, the
Management Securities and each holder thereof;

(b) the certificate required to be delivered by the Acquiror pursuant to
Section 8.2(d);

(c) evidence of the Acquiror Required Governmental Approvals;

(d) countersigned Interest Contribution Instruments in respect of the ISI
Interests; and

(e) such other documents and instruments as may be reasonably necessary to
consummate the Transactions.

Section 2.5 Closing Deliveries by the Transferor Parties. At the Closing, the
Transferor Parties shall deliver, or cause to be delivered, to the Acquiror:

(a) instruments of transfer and conveyance duly executed by the Transferor, in
each case, in customary form as necessary to contribute all of the rights, title
and interests in and to the ISI Interests to the Acquiror (the “Interest
Contribution Instruments”);

(b) the certificate required to be delivered by the Transferor Parties pursuant
to Section 8.3(d)(i);

(c) the certificate required to be delivered by the Holders’ Representative
pursuant to Section 8.3(d)(ii);

(d) evidence of the Transferor Required Governmental Approvals;

(e) a certificate of non-foreign status as described in Treasury Regulations
Section 1.1445-2(b)(2) from the Transferor;

(f) documentation evidencing the liquidation of Management Holdings and the
distribution of Securities in connection therewith pursuant to Section 2.2 to
the extent reasonably requested by the Acquiror prior to the Closing;

 

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(g) an amended Schedule A to the Management Holdings LLC Agreement reflecting
the cancellation of all of the Management Holdings Management Units;

(h) written resignation of such directors of ISI UK as identified by the
Acquiror, which identification shall be provided by notice from Acquiror to the
Transferor prior to the Closing Date, with each such resignation becoming
effective as of the Closing Date;

(i) completed and signed Form(s) TM01 in respect of those directors to whom the
written resignations set out in subsection (h) above relate, to be filed with
Companies House England and Wales on the Closing Date and effective as of the
Closing Date;

(j) signed minutes of a meeting of the directors of ISI UK or a signed
shareholder resolution of ISI UK appointing such person(s) as the Acquiror gives
notice, prior to the Closing Date, to the Transferor of each as a director of
ISI UK, each such appointment effective as of the Closing Date; and

(k) the Company Records (as defined in section 1134 of the UK Companies Act
2006) of ISI UK.

Section 2.6 Closing Deliveries by the Holders and the Founder. At the Closing,
the Founder or the Holders’ Representative, as applicable, shall deliver, or
cause to be delivered, to the Acquiror:

(a) the certificate required to be delivered by the Holders’ Representative
pursuant to Section 8.3(d)(ii); and

(b) duly executed counterparts of the Subordinated Loan Amendments and the
Guaranty.

Section 2.7 Holders’ Representative.

(a) Each Holder hereby designates the Founder (solely in his capacity as the
representative of the Holders, the “Holders’ Representative”) as his or her
representative, attorney-in-fact and agent with full power and authority:

(i) to execute and deliver the Transaction Documents and any documents or
certificates required to be delivered pursuant to this Agreement or any of the
Transaction Documents, and to agree to such amendments or modifications to this
Agreement, any of the Transaction Documents and such other agreements,
documents, instruments or certificates as the Holders’ Representative, in his
sole discretion, determines to be desirable, in each case prior to the Closing
Date or in connection with the consummation of the Transactions, the enforcement
of rights under this Agreement or the defense of claims under this Agreement;

(ii) to execute and deliver such amendments, waivers and consents in connection
with this Agreement, the other Transaction Documents and the consummation of the
Transactions as the Holders’ Representative, in his sole discretion, may deem
necessary or desirable, including any amendments or modifications to this
Agreement, in each case prior to the Closing Date or in connection with the
consummation of the Transactions, the enforcement of rights under this Agreement
or the defense of claims under this Agreement;

 

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(iii) to collect and receive all moneys and other proceeds and property payable
to the Holders pursuant to this Agreement, and, subject to any applicable
withholding retention Laws, to disburse and pay the same to each Holder in
accordance with the terms of this Agreement;

(iv) to enforce and protect the rights and interests of the Holders arising out
of or under or in any manner relating to this Agreement, any of the other
Transaction Documents and each other agreement, document, instrument or
certificate referred to herein or therein or the Transactions, and to take any
and all actions which the Holders’ Representative believes are necessary or
appropriate under this Agreement and the other Transaction Documents for and on
behalf of the Holders, including (but subject to Section 10.4 herein) asserting
or pursuing any claim against the Acquiror or Parent, defending any Third-Party
Claims or claims by any Acquiror Indemnified Party, consenting to, compromising
or settling any such claims, and conducting negotiations with any Acquiror
Indemnified Party or the Acquiror, Parent and their respective Representatives
regarding such claims, and, in connection therewith, to (A) assert any claim or
institute any action, proceeding or investigation, (B) investigate, defend,
contest or litigate any claim, action, proceeding or investigation initiated by
the Acquiror or Parent or any other Person, or by any Governmental Authority
against the Holders’ Representative or any or all of the Holders, and receive
process on behalf of any or all of the Holders in any such claim, action,
proceeding or investigation and compromise or settle on such terms as the
Holders’ Representative shall determine to be appropriate, and give receipts,
releases and discharges with respect to any such claim, action, proceeding or
investigation, (C) file any proofs of debt, claims and petitions as the Holders’
Representative may deem advisable or necessary and (D) file and prosecute
appeals from any decision, judgment or award rendered in any such action,
proceeding or investigation (it being understood that the Holders’
Representative shall not have any obligation to take any such actions, and shall
not have any liability for any failure to take any such actions);

(v) to refrain from enforcing any right of the Holders or any of them and/or the
Holders’ Representative arising out of or under or in any manner relating to
this Agreement or the other Transaction Documents, or any other agreement,
instrument or document in connection with the foregoing; provided, however, that
no such failure to act on the part of the Holders’ Representative, except as
otherwise provided in this Agreement or in any other Transaction Document, shall
be deemed a waiver of any such right or interest by the Holders’ Representative
or by such Holders unless such waiver is in writing signed by the waiving party
or by the Holders’ Representative;

(vi) to engage attorneys, accountants, financial advisors or such other third
party service providers, and to otherwise incur such expenses, as the Holders’
Representative determines necessary or advisable in his sole discretion for the
exercise of the Holders’ Representative’s rights and obligations hereunder
(including in connection with indemnification claims pursuant to Article X or in
connection with Section 2.8) and the other Transaction Documents (the fees and
expenses of such activities are referred to herein as the “Holders’
Representative Expenses”);

 

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(vii) to give and receive any notice to be given by or to the Holders pursuant
to this Agreement or in any other Transaction Document; and

(viii) to make any payments or pay any expenses under or in connection with this
Agreement or on behalf of the Holders.

The foregoing grant of authority set forth in this Section 2.7(a) is a special
power of attorney coupled with an interest, is irrevocable and shall survive the
death or incompetence of any Holder. All decisions and actions by the Holders’
Representative in its capacity as the representative of the Holders pursuant to
this Agreement or any other Transaction Documents shall be binding upon all
Holders, and no Holder shall have the right to object, dissent, protest or
otherwise contest the same. Notwithstanding the foregoing, nothing in this
Section 2.7(a) shall authorize the Holders’ Representative (A) prior to the
Closing, to approve on behalf of the Holders any amendment or waiver to the
Acquiror LP Agreement which, following the Closing, would require approval of
holders of Class E Units, Class G Interests or Class H Interests pursuant to the
terms of the Acquiror LP Agreement, (B) following the Closing, to approve on
behalf of Holders any amendment or waiver to the Acquiror LP Agreement or (C) to
vote or dispose of, or to direct the voting or disposition of, any securities
held by any Holder.

(b) The Acquiror shall be entitled to rely on any and all actions taken by the
Holders’ Representative without any liability to, or obligation to inquire of,
or seek the consent of any Holder.

(c) In connection with this Agreement and any instrument, agreement or document
relating hereto, and in exercising or failing to exercise all or any of the
powers conferred upon the Holders’ Representative by this power of attorney,
coupled with an interest, (i) the Holders’ Representative shall incur no
responsibility whatsoever to the Holders by reason of any error in judgment or
other act or omission performed or omitted hereunder, excepting only
responsibility for, any act or failure to act which represents gross negligence
or willful misconduct and (ii) the Holders’ Representative shall be entitled to
rely on the advice of counsel, public accountants or other independent experts
experienced in the matter at issue, and any error in judgment or other act or
omission of the Holders’ Representative pursuant to such advice shall in no
event subject the Holders’ Representative to liability to the Holders. The
Holders shall severally and not jointly indemnify the Holders’ Representative
and any other Holder serving on an advisory committee formed by the Holders’
Representative in connection with the performance of its responsibilities and
hold the Holders’ Representative and any such Holder harmless against any Losses
incurred without willful misconduct on the part of the Holders’ Representative
arising out of or in connection with the acceptance or administration of its or
his duties under this Agreement.

(d) The Holders’ Representative may resign as the Holders’ Representative
hereunder at any time and for any reason, effective upon a new representative
(who may be an individual or entity) being appointed in writing by the current
Holders’ Representative; provided, that if the Person serving as the Holders’
Representative dies or becomes incapable of performing the responsibilities of
the Holders’ Representative hereunder or resigns, in each case, without so
appointing a replacement Holders’ Representative, a substitute Holders’
Representative shall be appointed no later than ten (10) Business Days after

 

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such resignation by the Holders representing a majority of the Management
Holdings Management Units (if the need for the Holders to appoint a substitute
representative arises prior to the Closing) or by the Holders representing a
majority of the outstanding Class E Units issued to all Holders at the Closing
(if the need for the Holders to appoint a substitute representative arises on or
after the Closing). The resigning Holders’ Representative or the Holders
appointing such new representative shall provide notice to the Acquiror of the
occurrence of the appointment of a new Holders’ Representative pursuant to this
Section 2.7(d).

(e) Each Holder agrees with the Holders’ Representative to bear, and promptly
upon request reimburse the Holders’ Representative, for its pro rata portion of
Holders’ Representative Expenses (which, for the avoidance of doubt, shall
include a proportionate allocation of expenses incurred on behalf of Holding,
Holding II and the Holders in connection with Section 2.8 or with any claim for
indemnification pursuant to Section 10.2(a)) or Section 7.14), and of other
expenses allocated to the Holders hereunder; provided, that the liability of
each Holder pursuant to this sentence shall be limited to the value of vested
and exchangeable Class E Units (other than any Exchange Restricted Units or
Individual Exchange Restricted Units) held by such Holder (“Available Class E
Units”), or to the proceeds of any disposition of Available Class E Units (or of
Parent Common Stock issued in respect thereof).

Section 2.8 Working Capital and Excess Working Capital.

(a) Immediately prior to the Closing, the Transferred Companies may, at the
direction of the Transferor, effect a distribution of cash (an “Excess Working
Capital Distribution”) equal to the lesser of (i) Excess Working Capital and
(ii) such amount as would result in Net Working Capital at Closing being equal
to Agreed Working Capital plus, if not less than zero, Estimated Net Income.

(b) If Net Working Capital, as reflected on the Signing Balance Sheet, plus
Estimated Net Income minus Estimated Transferor Expenses minus any Excess
Working Capital Distribution is less than Agreed Working Capital plus, if not
less than zero, Estimated Net Income, then the absolute value of such difference
is the “Deficit Amount”. If there is a Deficit Amount, then the number of Class
E Units issued to the Transferor and distributed to Holding, Holding II and the
Holders as consideration pursuant to Section 2.2 at the Closing shall be reduced
by the number of Class E Units equal to the Deficit Amount divided by the Market
Price as of the Closing Date, pro rata in accordance with the number of Class E
Units Holding, Holding II, or such Holder would have received in the liquidating
distributions of the Transferor and Management Holdings at the Closing pursuant
to Section 2.2, and Annex A shall be amended accordingly.

(c) The Transferor shall prepare in good faith and deliver to the Acquiror three
(3) Business Days prior to the expected Closing Date (i) an estimated unaudited
statement of income of the Transferred Companies for the period beginning on the
date hereof and ending on the Closing Date, which statement shall be prepared in
accordance with GAAP, applying the Accounting Principles (the “Estimated Income
Statement”), and (ii) a statement that sets forth the Transferor’s calculation
of the Deficit Amount (if any) and the components thereof, each determined in
accordance with this Agreement.

 

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(d) As promptly as practicable after the Closing Date, but no later than ninety
(90) days thereafter, the Acquiror shall prepare in good faith and deliver to
Holding and the Holders’ Representative (i) the Closing Balance Sheet and a
statement of Net Working Capital derived therefrom (as determined pursuant to
this Section 2.8, the “Closing Date Net Working Capital”), (ii) the Closing Date
Income Statement and the Final Net Income derived therefrom and (iii) a
statement that sets forth the Acquiror’s calculation of the Final Deficit Amount
(if any) and the components thereof, each determined in accordance with this
Agreement. Holding and the Holders’ Representative shall have sixty (60) days
following delivery of the Closing Balance Sheet and the Closing Date Income
Statement during which to notify the Acquiror in writing (the “Notice of
Objection”) of any objections to the calculation of the Final Deficit Amount (or
any component thereof), setting forth in reasonable detail the basis of their
objections. In reviewing the Closing Balance Sheet and Closing Date Income
Statement, each of Holding and the Holders’ Representative shall be entitled to
reasonable access to all relevant books, records and personnel of the
Transferred Companies. If Holding and the Holders’ Representative fail to
deliver a Notice of Objection in accordance with this Section 2.8(d), the
Acquiror’s calculation of the Final Deficit Amount delivered in accordance with
this Section 2.8 shall be conclusive and binding. If Holding and the Holders’
Representative submit a Notice of Objection, then (i) for ten (10) Business Days
after the date upon which the Acquiror receives the Notice of Objection, the
Acquiror, on the one hand, and Holding and the Holders’ Representative, on the
other hand, will each use their commercially reasonable efforts to agree on the
calculation of the Final Deficit Amount and (ii) failing such agreement within
ten (10) Business Days of such notice, the matter shall be resolved in
accordance with Section 2.8(e).

(e) If the Acquiror, on the one hand, and Holding and the Holders’
Representative, on the other hand, have not agreed on the Final Deficit Amount
within ten (10) Business Days after delivery of a Notice of Objection, then the
Acquiror, Holding and the Holders’ Representative, acting jointly, shall refer
the matter for resolution to an international accounting firm reasonably
acceptable to the Acquiror, Holding and the Holders’ Representative and which
accounting firm is not aware of any conflict of interest, whether arising out of
any prior representation of or services provided to the Acquiror, Holding or the
Holders’ Represntative (the “Accounting Expert”) and shall deliver notice of
such referral to the other parties hereto. The Accounting Expert shall act as an
expert and not an arbitrator. Within ten (10) Business Days of the selection of
the Accounting Expert, the Acquiror, on the one hand, and Holding and the
Holders’ Representative, on the other hand, shall each deliver to the other
party and to the Accounting Expert a notice setting forth in reasonable detail
their objections and their calculations of the Final Deficit Amount (and the
components thereof). The parties shall instruct the Accounting Expert to
consider only those items as to which Holding and the Holders’ Representative
have disagreed pursuant to a Notice of Objection and for which the Acquiror, on
the one hand, and Holding and the Holders’ Representative, on the other hand,
have not resolved their disagreement. Within fifteen (15) Business Days after
receipt thereof, the Accounting Expert shall issue to the parties its final
determination of the Final Deficit Amount (and the components thereof), and
provide a written description of the basis for such determination; provided,
that if the Accounting Expert requests a hearing before making a determination,
such hearing shall be held within twenty (20) Business Days of the parties’
delivery of their respective calculation notices and the determination of the
Final Deficit Amount (and the components thereof), shall be made within ten
(10) Business Days after such hearing. The Accounting Expert’s determination
shall be final and binding on the parties hereto.

 

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The fees and expenses of the Accounting Expert shall be paid in accordance with
the percentage of the disputed amounts awarded to the Acquiror, on the one hand,
and Holding and the Holders, on the other hand, as a result of the Accounting
Expert’s decision. Each party shall bear the costs of its own counsel, witnesses
(if any) and employees incurred in connection with the foregoing procedures.

(f) True-Up. If Net Working Capital, as reflected on the Closing Balance Sheet,
plus Final Net Income minus Final Transferor Expenses minus any Excess Working
Capital Distribution is less than Agreed Working Capital plus, if not less than
zero, Final Net Income, then the absolute value of such difference is the “Final
Deficit Amount” (in each case, as finally determined in accordance with this
Section 2.8). For the purpose of the calculations below in (i) and (ii), if
there were no Deficit Amount pursuant to Section 2.8(b), the Deficit Amount
shall be zero, and if there were no Final Deficit Amount pursuant to the
preceding sentence, the Final Deficit Amount shall be zero.

(i) If the Deficit Amount minus the Final Deficit Amount is a positive number,
then the Acquiror shall issue to Holding, Holding II, and the Holders the number
of Class E Units equal to the amount of such excess divided by the Market Price
as of the date of the Closing Balance Sheet, pro rata in accordance with the
number of Class E Units Holding, Holding II or such Holder received at the
Closing, as reflected in Annex A (as amended as of the Closing); and

(ii) If the Deficit Amount minus the Final Deficit Amount is a negative number,
then the amount of such deficit shall be considered a finally determined claim
in favor of the Acquiror for the purposes of Article X and the procedures of
Section 10.7 shall apply to satisfy such claim (with the Market Price for such
purpose as of the date of the Closing Balance Sheet).

ARTICLE III

REPRESENTATIONS AND WARRANTIES REGARDING THE TRANSFERRED COMPANIES

Except as set forth in the corresponding sections or subsections of the
disclosure schedule delivered to the Acquiror by the Transferor Parties on or
prior to the date hereof (the “Transferor Parties Disclosure Schedule”) (it
being understood and agreed by the parties hereto that disclosure of any item in
any section or subsection of the Transferor Parties Disclosure Schedule shall be
deemed disclosure with respect to any other section or subsection of the
Transferor Parties Disclosure Schedule to which the relevance of such item is
readily apparent), each of the Transferor Parties represents and warrants as of
the date hereof and as of the Closing (except to the extent any such
representations and warranties speak as of an earlier date) to the Acquiror and
Parent as set forth below.

Section 3.1 Corporate Organization. Each of the Transferred Companies has been
duly organized and is validly existing as a corporation or company in good
standing under the Laws of its jurisdiction of organization. Each of the
Transferred Companies has all requisite corporate power and authority to carry
on its business as and where it is now being conducted and to own, lease and

 

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operate its properties and assets. Each of the Transferred Companies is in good
standing (to the extent applicable) as a foreign corporation or other entity, as
applicable, in each jurisdiction where the ownership or operation of its assets
or the conduct of its business requires such qualification. Each Transferred
Company has supplied the Acquiror with a true and complete copy of its
Organizational Documents, each as in effect on the date hereof.

Section 3.2 Due Authorization. Each Transferred Company has all requisite power
and authority to execute, deliver and perform each Transaction Document to which
it is or will be a party and to consummate the Transactions. The execution,
delivery and performance by each Transferred Company of each Transaction
Document to which it is or will be a party and the consummation of the
Transactions have been duly and validly authorized and approved by all necessary
corporate or similar action of each Transferred Company and the Transferor, and
no other corporate or similar proceeding, consent or authorization in respect of
any Transferred Company is necessary to authorize the execution, delivery and
performance by such Transferred Company of any Transaction Document to which
such Transferred Company is or will be a party or the consummation of the
Transactions. Each Transaction Document to which each Transferred Company is or
will be a party has been or will be duly and validly executed and delivered by
such Transferred Company and such Transaction Document (other than any Key
Employee Covenants Agreement, Employee Covenants Agreement or Holder Waiver and
Consent) constitutes, or will constitute, when executed and delivered by the
other parties thereto, a legal, valid and binding obligation of such Transferred
Company, enforceable against such Transferred Company in accordance with its
respective terms, except as may be limited by bankruptcy, insolvency,
reorganization, moratorium or other Laws relating to or affecting creditors’
rights generally and by general equitable principles.

Section 3.3 No Conflict. Assuming the receipt of all Required Governmental
Approvals and all Third-Party Consents, the execution, delivery and performance
by each of the Transferred Companies and the Transferor Parties of each
Transaction Document to which it is or will be a party, and the consummation of
the Transactions, does not and will not:

(a) violate or conflict with any provision of the Organizational Documents of
any Transferred Companies;

(b) breach, violate, conflict with in any material respect, or result in a
material default under, any provision of, or constitute an event that, after
notice or lapse of time or both, would result in a material breach or violation
of, or material default under, or accelerate the performance required under, or
result in the termination, cancellation, modification or acceleration (whether
after the filing of notice or the lapse of time or both) of any right or
obligation of any Transferred Company under, or give any Person the right to
terminate, or result in a loss of any material benefit to which any Transferred
Company is entitled under, any Material Contract to which any of the Transferred
Companies is a party or by which any of the Transferred Companies is bound, or
result in the creation of any Encumbrance (other than any Permitted Encumbrance)
upon any asset of any of the Transferred Companies;

(c) breach, violate, conflict with or result in a default under, any provision
of, or constitute an event that, after notice or lapse of time or both, would
result in a breach or violation of, or conflict with, or default under, in each
case in any material respect, any applicable Law or Order binding upon or
applicable to any Transferred Company; or

(d) result in the creation of any Encumbrance on any of the ISI Interests or the
equity interests in the Transferred Companies.

 

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Section 3.4 Consents and Approvals. There are no material consents, approvals,
notices, Orders, registrations, declarations or filings required to be obtained,
made or given by or with respect to the Transferred Companies in connection with
the execution, delivery and performance of the Transaction Documents and the
consummation of the Transactions, except (a) for the consents and approvals from
a third party (other than a Governmental Authority) set forth on Schedule 3.4(a)
of the Transferor Parties Disclosure Schedule (collectively, the “Third-Party
Consents”) or (b) for the approvals, notices and filings with Governmental
Authorities set forth on Schedule 3.4(b) of the Transferor Parties Disclosure
Schedule (collectively, the “Transferor Required Governmental Approvals”).

Section 3.5 Capitalization.

(a) Schedule 3.5(a) of the Transferor Parties Disclosure Schedule sets forth
(i) a true and complete list of the outstanding capital stock or membership or
other equity interests of the Transferor, Management Holdings, Holding and
Holding II, together with the record and beneficial owners thereof and the
respective jurisdictions of organization of each and (ii) with respect to each
Transferred Company, their respective jurisdictions of organization, and the
outstanding capital stock or membership or other equity interests of each of the
Transferred Companies and the record and beneficial owners thereof. The
Transferor directly owns all of the issued and outstanding shares of capital
stock or membership or other equity interests of each Transferred Company, free
and clear of all Encumbrances.

(b) Other than as listed on Schedule 3.5(a) of the Transferor Parties Disclosure
Schedule, there are no outstanding equity interests or other securities of any
of the Transferred Companies, including any securities convertible into or
exchangeable or exercisable for, or any options, warrants, preemptive rights,
phantom shares, profit interests, profit participation rights or other rights to
purchase or subscribe for, shares of capital stock or membership or other equity
interests of any of the Transferred Companies. No Transferred Company is party
to any Contract, commitment, understanding or arrangement of any kind relating
to the issuance of any securities or interests of any Transferred Company,
including any securities convertible into or exchangeable or exercisable for
capital stock or membership or other equity interests of any Transferred
Company, or any options, warrants, preemptive rights, profit participation
rights or other rights to purchase or subscribe for, shares of such Transferred
Company’s capital stock or membership or other equity interests. Immediately
after the Closing, the capitalization of each of the Transferred Companies will
be as set forth on Schedule 3.5(a) of the Transferor Parties Disclosure
Schedule.

(c) Except as set forth on Schedule 3.5(b) of the Transferor Parties Disclosure
Schedule, none of the Transferred Companies has any authorized or outstanding
bonds, debentures, notes or other Indebtedness. None of the Transferred
Companies’ Indebtedness provides the holders thereof with the right to vote.
There are no Contracts to which any Transferred Company,

 

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Transferor Party, Holder or the Founder is a party or by which any Transferred
Company is bound to (i) repurchase, redeem or otherwise acquire any interests in
or other securities of, any Transferred Company, or (ii) vote or dispose of any
interests in or other securities of any Transferred Company. No Person has any
right of first offer, right of first refusal or preemptive right in connection
with any future offer, sale or issuance of equity interests or other securities
of any Transferred Company.

(d) None of the Transferred Companies owns the capital stock, membership
interests or any other equity interests of any Person. None of the Transferred
Companies is obligated to make any investment in or capital contribution to any
Person.

Section 3.6 Title to Property.

(a) The Transferred Companies have good, valid and marketable title to, or in
the case of material leased assets, a valid, binding and enforceable leasehold
interest in, all of the tangible material personal property owned by them in
connection with the conduct of the business of the Transferred Companies, as
currently conducted. None of the assets owned by the Transferred Companies is
subject to any Encumbrances, except for Permitted Encumbrances.

(b) None of the Transferred Companies owns any real property.

(c) Schedule 3.6(c) of the Transferor Parties Disclosure Schedule sets forth a
true and complete list of the real property leased by the Transferred Companies
as a tenant (the “Leased Real Property”). Each of the Transferred Companies has
good and valid title to its leasehold estates in the Leased Real Property, free
and clear of all Encumbrances except Permitted Encumbrances.

Section 3.7 Financial Statements.

(a) Schedule 3.7(a) of the Transferor Parties Disclosure Schedule sets forth
true, correct and complete copies of each of (i) the unaudited statement of
financial condition of ISI Group (the “ISI Group Latest Balance Sheet”) as of
June 30, 2014 and the related unaudited statement of income (loss) for the
three-month period then ended (together with the ISI Group Latest Balance Sheet,
the “ISI Group Interim Financial Statements”) and (ii) the audited statement of
financial condition of ISI Group for the fiscal years ended March 31, 2012,
March 31, 2013 and March 31, 2014 (the “ISI Group Audited Balance Sheet”) and
audited statements of operations and changes in member’s equity and cash flows
for the years then ended (together with the ISI Group Audited Balance Sheet, the
“ISI Group Audited Financial Statements”). The ISI Group Audited Financial
Statements and the ISI Group Interim Financial Statements, collectively, are
hereinafter referred to as the “ISI Group Financial Statements”.

(b) Schedule 3.7(b) of the Transferor Parties Disclosure Schedule sets forth
true, correct and complete copies of each of (i) the unaudited balance sheet of
ISI UK (the “ISI UK Latest Balance Sheet”) and the unaudited statements of
profit and loss and cash flows of ISI UK for each of the six months between
December 31, 2013 and June 30, 2014 (together with the ISI UK Latest Balance
Sheet, the “ISI UK Interim Financial Statements”), and (ii) the audited balance
sheet of ISI UK for the fiscal years ended December 31, 2012 and December 31,
2013 (the “ISI UK Audited Balance Sheet”) and the audited statements of profit
and loss and

 

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cash flows of ISI UK for the years then ended (together with the ISI UK Audited
Balance Sheet, the “ISI UK Audited Financial Statements”). The ISI UK Audited
Financial Statements and the ISI UK Interim Financial Statements, collectively,
are hereinafter referred to as the “ISI UK Financial Statements”. The ISI Group
Interim Financial Statements and the ISI UK Interim Financial Statements,
collectively, are hereinafter referred to as the “Interim Financial Statements”.
The ISI Group Financial Statements and the ISI UK Financial Statements,
collectively, are hereinafter referred to as the “Financial Statements.”

(c) The ISI Group Audited Financial Statements have been prepared in accordance
with GAAP consistently applied, and the ISI UK Audited Financial Statements have
been prepared in accordance with U.K. GAAP consistently applied. The Financial
Statements have been prepared in a manner consistent in all material respects
with the books of account and other records of the Transferred Companies, and
present fairly in all material respects the financial condition and results of
operations of ISI Group and ISI UK, respectively, as of the times and for the
periods referred to therein, subject in the case of the Interim Financial
Statements to (i) the absence of footnote disclosures, and (ii) changes
resulting from normal year-end adjustments. Except as disclosed in the Financial
Statements, none of the Transferred Companies maintains any “off-balance-sheet
arrangement” within the meaning of Item 303 of Regulation S-K of the SEC.

(d) The Transferred Companies maintain systems of internal accounting controls
with respect to themselves sufficient to provide reasonable assurances that
(i) all transactions are executed in accordance in all material respects with
management’s general or specific authorization and (ii) all transactions are
recorded as necessary to permit the preparation of the Financial Statements in
conformity with GAAP or U.K. GAAP, as applicable, subject in the case of the
Interim Financial Statements to (A) the absence of footnote disclosures, and
(B) changes resulting from normal year-end adjustments. Since January 1, 2013,
none of the Transferred Companies has received any material written complaint,
allegation, assertion or claim regarding the Transferred Companies’ accounting
or auditing practices, procedures, methodologies or methods, including any
material written complaint, allegation, assertion or claim that any of the
Transferred Companies has engaged in improper or illegal accounting or auditing
practices.

(e) The Transferor has made available to the Acquiror any management letters, or
other written communications, including with respect to proposed adjustments,
from the auditors to any of the Transferred Companies, any officer of any of the
Transferred Companies or the board of managers (or equivalent body) of any of
the Transferred Companies during the three (3) years preceding the Signing Date,
in any case regarding (i) any significant deficiencies and material weaknesses
in the design or operation of disclosure controls and procedures (as defined in
Rule 13a-15(e) of the Exchange Act) or of internal control over financial
reporting (as defined in Rule 13a-15(f) of the Exchange Act) which are
reasonably likely to adversely affect the ability of any of the Transferred
Companies to record, process, summarize and report financial information or
(ii) any fraud, whether or not material, that involves management or other
employees who have a significant role in the internal control over financial
reporting of any of the Transferred Companies.

 

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Section 3.8 Litigation.

(a) There is no (i) material Action pending or, to the Transferor’s Knowledge,
threatened against or with respect to any of the Transferred Companies or, to
the extent related to the Transferred Companies, or the businesses, properties
or assets of the Transferred Companies, any of their Affiliates, or (ii) Action
pending or, to the Transferor’s Knowledge, threatened, seeking to prevent,
hinder, modify, delay or challenge the Transactions. As of the date of this
Agreement, there is no Action commenced by or on behalf of any of the
Transferred Companies or any of their Affiliates pending against any other
Person, involving a claim that is material to the Transferred Companies, taken
as a whole. No current or former employee of any of the Transferred Companies
has brought or, to the Transferor’s Knowledge, threatened to bring, any material
Action involving a claim alleging discrimination under any Law, including claims
of discrimination or retaliation based on race, color, creed, age, sex, sexual
orientation, national origin, religion or disability.

(b) Since January 1, 2013, each Transferred Company and, to the extent related
to the Transferred Companies, each of their Affiliates, has fully complied in
all material respects with, and is not otherwise in material violation of, any
outstanding Order with respect to a Transferred Company or such Affiliate to the
extent related to the Transferred Companies.

Section 3.9 No Undisclosed Liabilities. There are no material Liabilities of or
with respect to any Transferred Company other than (a) Liabilities reflected or
reserved against in the Financial Statements as Liabilities of a Transferred
Company, (b) Liabilities for performance under any Material Contracts or
Transferor Plans (excluding any Liability for breach), (c) Liabilities disclosed
in the Transferor Parties Disclosure Schedule, and (d) Liabilities incurred in
the ordinary course of business consistent with past practice, since the date of
the Interim Financial Statements, that are not materially different in amount or
nature than for prior periods.

Section 3.10 Absence of Certain Developments. Since the date of the Interim
Financial Statements through the date hereof, (a) each of the Transferred
Companies has, in all material respects, conducted its business and operated its
properties in the ordinary course of business consistent with past practice,
other than in connection with effecting the Transactions, and (b) except as set
forth on Schedule 3.10 of the Transferor Parties Disclosure Schedule, there has
not been any Transferred Companies Material Adverse Effect and no circumstances
have arisen, which, individually or in the aggregate, would reasonably be
expected to have a Transferred Companies Material Adverse Effect.

Section 3.11 Minute Books. The Transferor Parties have made available, or upon
the request of the Acquiror will make available, to the Acquiror true and
correct copies of the minute books for each Transferred Company. Such minute
books accurately reflect, in all material respects, all actions approved by the
members, shareholders, board of directors or any board committee of any
Transferred Company, in each case, acting in such capacity.

 

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Section 3.12 Taxes.

(a) The Transferred Companies have timely filed all material Tax Returns
required to be filed by or with respect to them, all such Tax Returns are true,
accurate and complete in all material respects and all Taxes shown to be due on
such Tax Returns have been timely paid, collected or withheld, as the case may
be, and no other material Taxes are due or payable by or with respect to the
Transferred Companies (whether or not shown or reportable on a Tax Return).

(b) The Transferred Companies have withheld and paid over all material Taxes
required to have been withheld and paid over and complied with all information
reporting and backup withholding requirements in all material respects,
including maintenance of required records with respect thereto, in connection
with amounts paid or owing to any employee, creditor, independent contractor,
Affiliate or other third party.

(c) There are no audits, examinations, investigations or other proceedings,
claims or assessments pending or threatened against the Transferred Companies in
respect of any material Tax, and the Transferred Companies have not been
notified of any proposed, considered or threatened material Tax claims or
assessments against the Transferred Companies.

(d) No extensions or waivers of statutes of limitation have been given or
requested with respect to any material Taxes of the Transferred Companies. There
is no power of attorney granted with respect to material Taxes relating to any
of the Transferred Companies.

(e) The Transferor has made available to the Acquiror true, correct and complete
copies of all material Tax Returns filed by, or with respect to the Transferred
Companies for all taxable periods for the past three years, and all material
examination reports, and statements of deficiencies assessed against or agreed
to by the Transferor or the Transferred Companies with respect to such taxable
periods.

(f) The Transferred Companies have never been a party to any tax allocation or
sharing agreement (other than (x) a tax allocation or tax sharing agreement that
is among only the Transferred Companies, or (y) a commercial Contract the
principal purpose of which is unrelated to Taxes) or a member of any Affiliated,
combined or consolidated Tax Return filing group.

(g) None of the Transferred Companies has participated in a transaction that is
the same as, or substantially similar to, a transaction which is a “listed
transaction” within the meaning of Treasury Regulations Section 1.6011-4 or any
similar provision of state, local or foreign law.

(h) No claim has been made by any Tax Authority in a jurisdiction where a
Transferred Company does not file Tax Returns that such Transferred Company, as
applicable, is or may be subject to any material Taxes assessed by such
jurisdiction.

 

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(i) None of the Transferred Companies is liable for Taxes of any Person (other
than the Transferred Companies) as a result of being a transferee or successor
of such Person.

(j) None of the Transferred Companies, or the Acquiror or its Affiliates, will
be required to include any material item of income in, or exclude any material
credit or item of deduction from, taxable income for any taxable period (or
portion thereof) ending after the Signing Date as a result of (i) any amount
received by the Transferred Companies prior to the Signing Date, (ii) agreement
(including settlement of an audit or other controversy) with, or Tax ruling
from, any Tax Authority executed or requested on or prior to the Signing Date,
(iii) installment sale or open transaction disposition made on or prior to the
Signing Date, (iv) change in accounting method (whether overall or in respect of
any item), and (v) any similar event, transaction, fact, circumstance, action or
omission to act occurring on or prior to the Signing Date. None of the
Transferred Companies has made an election under Section 108(i) of the Code.

(k) There are no material Encumbrances for Taxes (other than Permitted
Encumbrances) on any of the assets of the Transferred Companies.

(l) No closing agreement, private letter ruling, technical advice memoranda,
advance pricing agreement, consent to an extension of time to make an election
or consent to a change a method of accounting, has been requested from, entered
into with or issued by any Tax Authority with respect to the Transferred
Companies.

(m) Except as set forth on Schedule 3.12(m) of the Transferor Parties Disclosure
Schedule, each of the Transferred Companies is and has always been, properly
treated as a partnership or a “disregarded entity” for U.S. federal income tax
purposes and for all state and local purposes.

This Section 3.12 constitutes the exclusive representations and warranties of
the Transferor Parties, the Transferred Companies, the Founder and the Holders
with respect to Taxes, except for the representations and warranties set forth
in Section 3.7, Section 3.13(b), Section 3.17 and Section 3.18 that relate to
Taxes. No representation or warranty contained in this Agreement that relates to
Taxes (other than Section 3.12(j) and (l)) shall be deemed to apply directly or
indirectly with respect to any taxable period (or portion thereof) after the
date that is fifteen (15) months after the Closing Date.

Section 3.13 Contracts.

(a) Schedule 3.13(a) of the Transferor Parties Disclosure Schedule contains a
true and complete list, as of the date hereof, of the following Contracts to
which any Transferred Company is a party (each, a “Material Contract”):

(i) any Contract for the provision of services providing for payment or
consideration in excess of $100,000;

(ii) any Contract relating to Indebtedness of any Transferred Company;

 

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(iii) any Contract for the granting or effectuation of the title to, or
ownership, lease, use, sale, exchange or transfer of, any real or material
personal property owned or leased by any Transferred Company as of the date
hereof;

(iv) any Contract (other than a Transferor Plan) under which any Transferred
Company would incur any change-in-control payment or similar obligations to any
Person, by reason of any Transaction Document or the consummation of any of the
Transactions;

(v) any non-competition or non-solicitation Contract with any current or former
member, officer, employee or consultant of the Transferred Companies;

(vi) any Contract under which any Transferred Company has advanced or loaned any
amount to any Person involving aggregate payment or consideration in excess of
$25,000 in any year, or $100,000 in the aggregate for all years, other than
trade credit or expense reimbursement in the ordinary course of business of the
Transferred Companies consistent with past practice;

(vii) any joint venture, partnership or limited liability company Contract;

(viii) any Contract which purports to limit or restrict, in any material
respect, the ability of any Transferred Company to enter into or engage in any
market or line of business or establishes an exclusive sale or purchase
obligation with respect to any product or any geographic location;

(ix) any Contract for the sale, transfer or acquisition of any of the material
assets, equity securities or businesses of any Transferred Company (other than
sales, transfers or acquisitions that are part of the ordinary course of
business of the Transferred Companies consistent with past practice) or for the
grant to any Person of any preferential rights to purchase any of the assets,
equity securities or businesses of any Transferred Company, in each case under
which there are material outstanding obligations;

(x) any Contract under which (A) any of the Transferred Companies grants to any
third party the right to use any material Owned Company Intellectual Property,
other than non-exclusive licenses of Owned Company Intellectual Property entered
into in the ordinary course of business consistent with past practice that do
not materially impair the use of such Owned Company Intellectual Property by the
Transferred Companies for the purposes for which it is currently used or (B) any
third party (including an Affiliate of any of the Transferred Companies) grants
to any Transferred Company any right to any material Intellectual Property,
other than those Contracts (x) relating primarily to commercially available
off-the-shelf, non-customized software or (y) entered into in the ordinary
course of business consistent with past practice and involving payments of less
than $50,000 (each of the Contracts under (A) or (B), an “Intellectual Property
Contract”);

(xi) any Contract for capital expenditures involving payments of more than
$100,000 individually or in the aggregate, in each case under which there are
material outstanding obligations;

 

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(xii) any Contract entered into in the past two years involving any resolution
or settlement of any actual or threatened Action involving amounts in excess of
$100,000 and which imposes material continuing obligations on any Transferred
Company;

(xiii) any Contract under which any Transferred Company has continuing material
indemnification obligations to any Person, involving aggregate payments or
consideration in excess of $25,000 other than those that are part of the
ordinary course of business of the Transferred Companies consistent with past
practice, other than customary indemnification provisions under contracts with
third party service providers;

(xiv) any Contract with any labor union or association relating to any current
or former employee of any Transferred Company;

(xv) any custody, transfer agent, shareholder service, administrative,
accounting and other similar Contracts to which any Transferred Company is a
party providing for aggregate payments or consideration in excess of $100,000 in
any year;

(xvi) any Contract that provides for earn-outs or other similar contingent
obligations of any Transferred Company;

(xvii) any Contract with any client of the Transferred Companies that contains
“key person” provisions pertaining to employees of any Transferred Company;

(xviii) any Contract with any Governmental Authority (other than client
agreements in the ordinary course of business of the Transferred Companies
consistent with past practice); or

(xix) any Contract (or group of related agreements) that does not fall within
items (i) through (xiii) of this Section 3.13(a) and the performance of which
requires aggregate payments to or from any of the Transferred Companies in
excess of $100,000 per year that is not terminable with less than sixty
(60) days’ notice or is otherwise material to the Transferred Companies.

(b) Prior to the date hereof, the Acquiror has been supplied with a true and
complete copy of each written Material Contract. Each Material Contract is a
valid and binding obligation of the Transferred Companies, as applicable, is in
full force and effect and is enforceable against the Transferred Companies, as
applicable, and, to the Knowledge of the Transferor, against the other parties
thereto, except as may be limited by bankruptcy, insolvency, reorganization,
moratorium or other Laws relating to or affecting creditors’ rights generally
and by general equitable principles. None of the Transferred Companies is in
material breach, violation of or default under any Material Contract. No event
has occurred that, with notice or lapse of time or both, would constitute such a
material breach, violation or default by any Transferred Company under any
Material Contract or, to the Transferor’s Knowledge, the other parties thereto.

 

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Section 3.14 Intellectual Property.

(a) Except as set forth on Schedule 3.14(a) of the Transferor Parties Disclosure
Schedule, all Owned Company Intellectual Property is owned by one or more of the
Transferred Companies free and clear of all Encumbrances (other than Permitted
Encumbrances). Each of the Transferred Companies is licensed to use or otherwise
has the right to use all material Intellectual Property, other than the Owned
Company Intellectual Property, that is used by it in the operation of its
business (the “Licensed Intellectual Property”). The Transferred Companies have
taken commercially reasonable actions to maintain and protect each item of Owned
Company Intellectual Property.

(b) Schedule 3.14(b) of the Transferor Parties Disclosure Schedule sets forth a
true and complete list of all Registered Owned Company Intellectual Property,
indicating for each item, if applicable, the owner, the registration or
application number, the applicable filing jurisdiction and the date of filing or
issuance. All of the Registered Owned Company Intellectual Property is valid and
enforceable, in full force and effect, in each case, in all material respects,
and has not expired or been cancelled, abandoned or otherwise terminated, and
payment of all material renewal and maintenance fees, costs and expenses in
respect thereof, and all material filings related thereto, have been duly made.
To the Knowledge of the Transferor, the conduct of the business of the
Transferred Companies does not infringe, misappropriate or otherwise violate any
Intellectual Property of any other Person. There is no Action pending or, to the
Transferor’s Knowledge, threatened, alleging any such infringement,
misappropriation or violation or challenging the rights of any Transferred
Company in or to any Owned Company Intellectual Property and, to the Knowledge
of the Transferor, there is no existing fact or circumstance that would be
reasonably expected to give rise to any such Action. None of the Transferred
Companies has received any written notice challenging the legality, validity,
enforceability or ownership of any Owned Company Intellectual Property. None of
the Transferred Companies has made any claim in writing that a Person has
infringed, diluted, misappropriated or violated any Owned Company Intellectual
Property, and, to the Transferor’s Knowledge, no Person has infringed, diluted,
misappropriated or violated any Owned Company Intellectual Property. There are
no actual, or, to the Transferor’s Knowledge, threatened, opposition
proceedings, reexamination proceedings, cancellation proceedings, interference
proceedings or other similar actions challenging the validity, existence or
ownership of any Owned Company Intellectual Property. The Owned Company
Intellectual Property together with the Licensed Intellectual Property is
sufficient for the Transferred Companies to carry on the business of the
Transferred Companies from and after the Closing Date in all material respects
as presently conducted by the Transferor and its Affiliates, consistent with the
past practice of the Transferor and its Affiliates with respect to the business
of the Transferred Companies.

(c) The Transferred Companies have a privacy policy (the “Privacy Policy”)
regarding the collection and use of Personal Information, a true and complete
copy of which has been provided to the Acquiror prior to the date hereof. Each
Transferred Company is in material compliance with all applicable Laws regarding
the collection, use, aggregation, holding, disclosure and management of Personal
Information, including Personal Information of the Transferred Companies’
customers and employees, and with the Privacy Policy, and to the Transferor’s
Knowledge, no Person has gained unauthorized access to or made any unauthorized

 

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use of any Personal Information collected, used or maintained by any of the
Transferred Companies. The Transferred Companies have commercially reasonable
security measures in place to protect such Personal Information from unlawful
use or access by any third party or any other use or access by a third party
that would violate the Privacy Policy. The execution, delivery and performance
of the Transaction Documents and the consummation of the Transactions do not
violate the Privacy Policy applicable to such Personal Information. No Actions
are pending or, to the Transferor’s Knowledge, threatened against any
Transferred Company relating to the collection, use, aggregation, holding,
disclosure or management of Personal Information.

(d) The IT Assets operate and perform in all material respects in accordance
with their documentation and functional specifications and otherwise as required
by the business of the Transferred Companies as presently conducted and as
currently proposed to be conducted. The Transferred Companies have implemented
commercially reasonable backup and disaster recovery systems and procedures in
connection with such business consistent with industry best practices.

Section 3.15 Compliance with Law.

(a) Each of the Transferred Companies and, to the extent related to the
Transferred Companies, each of their Affiliates, has since January 1, 2012
conducted and is currently conducting its business, in all material respects, in
compliance with all applicable Laws, and none of the Transferred Companies or,
to the extent related to the Transferred Companies, any of their Affiliates has
since January 1, 2012 engaged in any act or has permitted to exist any state of
affairs which (i) has led to a formal written request by any Governmental
Authority in any jurisdiction in which it operates to modify in any material
respect the manner in which its business is or has been operated or (ii) has
resulted in any disciplinary or enforcement action being commenced or, to the
Transferor’s Knowledge, threatened against any Transferred Company in respect of
the conduct of its business. None of the Transferred Companies or, to the extent
related to the Transferred Companies, any of their Affiliates, is a party or
subject to any Order which imposes any material restrictions on the business of
the Transferred Companies as currently conducted. None of the Transferred
Companies has received any formal written inquiry, notice, complaint or other
communication alleging or relating to a violation under any applicable Law from
any Governmental Authority and, to the Transferor’s Knowledge, none of the
Transferred Companies or, to the extent related to the Transferred Companies,
any of their Affiliates, is under investigation by any Governmental Authority
with regard to compliance with the rules, regulations, or standards of conduct
of any Governmental Authority. Except as otherwise set forth on Schedule 3.15(a)
of the Transferor Parties Disclosure Schedule, since January 1, 2012, the
Transferred Companies have timely filed in accordance with applicable Law all
registrations, reports, statements, notices, and other filings required to be so
filed with any Governmental Authority, including all amendments or supplements
to any of the above. Since January 1, 2012, the Transferred Companies have
complied in all material respects with all unclaimed property, escheat and
similar Laws in the conduct of their respective businesses.

(b) In connection with the conduct of its business, each Transferred Company has
adopted and maintains an anti-money laundering policy and a customer
identification program, each of which complies in all material respects with the
requirements of

 

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applicable Law. In connection with the conduct of its business, each Transferred
Company maintains “know your customer” policies and procedures and obtains
information concerning customers sufficient to know the essential facts
concerning its customers as required under the USA Patriot Act, under any
applicable regulations thereto, or under applicable rules of any Governmental
Authority.

Section 3.16 Licenses and Permits. Except as set forth on Schedule 3.16 of the
Transferor Parties Disclosure Schedule, the Transferred Companies are in
possession of all material Licenses and Permits necessary for the Transferred
Companies to own, lease and otherwise hold and operate their properties and
other assets and to conduct the business of the Transferred Companies as
presently conducted, and all such Licenses and Permits are in full force and
effect. No Transferred Company has received any written notice, during the three
(3) years immediately preceding the Signing Date, of any suspension or
cancellation, or Action relating to the suspension or cancellation, of any such
Licenses and Permits and no such Action is currently pending. No Transferred
Company is, or during the three (3) years immediately preceding the Signing Date
has been, in material default under, or in material violation of, any such
Licenses and Permits.

Section 3.17 ERISA. Other than with respect to any Transferor Plan, none of the
Transferred Companies acts as a fiduciary (within the meaning of Section 3(21)
of ERISA) with respect to “plan assets” (within the meaning of under Department
of Labor Regulation Section 2510.3-101, as modified by Section 3(42) of ERISA);
provided, that the representation in this Section 3.17 may be based upon a
Transferred Company’s reasonable reliance on written representations made by its
customers, clients and account owners regarding their status as “benefit plan
investors” under ERISA.

Section 3.18 Employee Benefit Plans.

(a) Schedule 3.18(a) of the Transferor Parties Disclosure Schedule contains a
list of all bonus, incentive, deferred compensation, guaranteed compensation,
pension, retirement, thrift, savings, employee ownership, profits interest,
profit participation or other equity-based plan, arrangement, agreement, program
or award, severance, welfare and fringe benefit plans, termination, separation,
employment or severance Contracts and all similar practices, policies and
arrangements maintained, sponsored or contributed to by any Transferor Party or
any Transferred Companies in which any current or former employee, consultant,
partner, limited partner or director of the Transferor or any Transferred
Company participates or to which any is a party, or under which the Transferor
or any Transferred Company could reasonably be expected to have any liability or
obligation, other than practices or policies providing for incidental fringe
benefits that are de minimis to the service provider and not, in the aggregate,
material to the Transferred Companies (collectively, the “Transferor Plans”),
but not including Social Security, workers compensation or other similar
government-mandated programs. Schedule 3.18(a) of the Transferor Parties
Disclosure Schedule separately identifies each Transferor Plan that is
maintained primarily for the benefit of employees outside of the United States.

(b) The Transferor and all Transferred Companies have provided to the Acquiror
prior to the date hereof accurate and complete copies, as applicable, of (i) the
most recent determination letter or opinion received from the IRS with respect
to each

 

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Transferor Plan intended to be qualified under Section 401(a) of the Code (or if
no such letter has been issued for such Transferor Plan, the pending
application, if any, to the IRS requesting such letter), or other similar
required approval of a Governmental Authority; (ii) the most recent Form 5500,
or other similar filings required under applicable Law, and financial statements
for the Transferor Plans, if applicable; (iii) a copy of each Transferor Plan
(including all amendments thereto); (iv) a copy of the most recent summary plan
description (or other similar document), together with each summary of material
modifications, required under ERISA or otherwise under applicable Law with
respect to such Transferor Plan; (v) if the Transferor Plan is intended to be
funded through a trust or any third party funding vehicle, such as an insurance
contract, a copy of the trust or other funding agreement (including all
amendments thereto) and the latest financial statements thereof; (vi) all
Contracts relating to Transferor Plans with respect to which the Transferor or
any Transferred Company may have any obligation or liability, including, without
limitation, administration agreements, insurance agreements, investment
management agreements, subscription and participation agreements and record
keeping agreements; and (vii) a copy of all material documents and
correspondence relating to the Transferor Plans received from or provided to the
Department of Labor or the IRS during the past three (3) years and any
applicable tax determination letters.

(c) Each Transferred Company has performed and complied in all material respects
with all of its obligations under or with respect to the Transferor Plans. Such
Transferor Plans comply in all material respects with applicable Law (including,
for the avoidance of any doubt, with respect to Transferor Plans subject to the
jurisdiction of the United States, ERISA and the Code). Each Transferor Plan
that is intended to be qualified under Section 401(a) of the Code has received a
favorable determination letter or opinion letter from the IRS or has applied to
the IRS for such favorable determination letter, and there are no circumstances
that could reasonably be expected to result in revocation of any such favorable
determination letter. Any arrangement that would have been disclosed on
Schedule 3.18(a) of the Transferor Parties Disclosure Schedule but for the fact
that it was terminated prior to the date of this Agreement was terminated in
compliance with its terms and all applicable Law, and the Transferred Companies
have no liability under such terminated Transferor Plan.

(d) There is no material pending or, to the Transferor’s Knowledge, threatened,
litigation relating to the Transferor Plans (other than routine claims for
benefits in accordance with such Transferor Plan’s claims procedures and that
have not resulted in any pending or threatened litigation). There are no audits,
inquiries or examinations actively in process or, to the Transferor’s Knowledge,
pending or threatened by the IRS, the Department of Labor or any other
Governmental Authority with respect to any Transferor Plan. Neither the
Transferor nor any Transferred Company has incurred any material tax or
liability under either Section 4975 or 4980F of the Code or Section 502(i) of
ERISA, in each case that has not been satisfied as of the date hereof or has
incurred any such liability (whether or not satisfied) in the three (3) year
period prior to the Closing, or could reasonably expect to incur any such
material liability (assuming for purposes of Section 4975 of the Code that the
taxable period of any such transaction expired as of the Closing Date), as a
result of any actions or omission of the Transferor or any Transferred Company
with respect to any Transferor Plan.

 

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(e) No Transferor Plan is, and none of the Transferor or Transferred Companies
nor any entity aggregated with the Transferor or a Transferred Company under
Section 414 of the Code or Section 4001 of ERISA maintains, contributes to, has
any liability or obligation under or has at any time in the six (6) year period
prior to the Closing maintained, contributed to, or had any liability or
obligation under, any benefit plan, program or arrangement that is, (i) a
“multiemployer plan” (within the meaning of Section 3(37) of ERISA), (ii) a
“multiple employer plan” (within the meaning of Section 413(c) of the Code),
(iii) any single employer plan or other pension plan that is subject to Title IV
or Section 302 of ERISA or Section 412 of the Code or (iv) a “multiple employer
welfare arrangement” (as defined in Section 3(40)(A) of ERISA). Except as set
forth on Schedule 3.18(e) of the Transferor Parties Disclosure Schedule, neither
the Transferor nor the Transferred Companies is or has at any time since the
date six years prior to the date of this Agreement been, “connected” with or an
“associate” of any employer which is or has been participating in a defined
benefit pension scheme. For the purposes of this Section 3.18(e), “connected”
and “associate” have the meanings given to them in sections 435 and 249 of the
Insolvency Act 1986 of England and Wales.

(f) With respect to any Transferor Plan for which a separate fund of assets is
or is required to be maintained, full and timely payment has been made of all
amounts required of the Transferor or a Transferred Company, under the terms of
each such Transferor Plan or applicable Law, as applied through the date hereof
and the Closing Date, and all contributions and premium payments for any period
ending on or before the date hereof and the Closing Date that are an obligation
of the Transferor or any Transferred Company and not yet due have either been
made by the Transferor or a Transferred Company, or have been accrued on the
Financial Statements. There are no loans by the Transferor or any Transferred
Company to any of their current or former employees, other than loans under any
Transferor Plan intended to qualify under Section 401(k) of the Code and routine
business expense advances made in the ordinary course of business.

(g) With respect to each Transferor Plan that is an employee welfare benefit
plan (within the meaning of Section 3(1) of ERISA), or a Transferor Plan
providing for similar benefits under applicable Law, all claims incurred by the
Transferor or any Transferred Company are (i) insured pursuant to a contract of
insurance whereby the insurance company bears any risk of loss with respect to
such claims or (ii) reflected as a liability or accrued for on the Financial
Statements.

(h) Except as set forth on Schedule 3.18(h)(i) of the Transferor Parties
Disclosure Schedule, neither the execution and delivery of this Agreement nor
the consummation of the Transactions (either alone or in combination with
another event that may occur in contemplation of or in connection with the
Transactions) is reasonably expected to (A) entitle any employee, consultant or
director to any payment (including severance pay or similar compensation), any
cancellation of indebtedness or any increase in compensation, (B) result in the
acceleration of payment or vesting under any Transferor Plan or (C) result in
any increase in benefits payable under any Transferor Plan. Schedule 3.18(h)(ii)
of the Transferor Parties Disclosure Schedule sets forth a list of each
Transferor Plan than contains a change in control provision.

 

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(i) The Transactions (including, without limitation, as a result of any
termination of employment prior to or following the Closing) will not directly
or indirectly result in the payment of any amount that could, individually or in
combination with any other such payment, constitute an “excess parachute
payment” as defined in Section 280G(b)(1) of the Code.

(j) Neither the Transferor nor the Transferred Companies has announced or
entered into any plan or binding commitment to create or implement any new
Transferor Plan or amend or modify any Transferor Plan. Neither the Transferor
nor any Transferred Company has made any commitments (written, oral or
otherwise) to any officer, employee, former employee, consultant or independent
contractor of the Transferor or any Transferred Company with respect to
compensation, promotion, retention, termination, severance or similar matters in
connection with the Transaction or otherwise, other than as set forth in any
Transferor Plan made available to the Acquiror. There are no payments of
compensation due but unpaid to any employee of any of the Transferred Companies
other than accrued in the ordinary course of business or other than pursuant to
Transferor Plans, and no Transferred Company is liable for any payments of
compensation (including severance) to any former employee of the Transferor or a
Transferred Company other than amounts earned but not yet due under the terms of
any Transferor Plan.

(k) Each Transferor Plan that is a nonqualified deferred compensation plan
within the meaning of Section 409A of the Code has been operated and maintained
in all material respects according to the requirements of Section 409A of the
Code.

(l) Each Transferor Plan that is subject to the Laws of a foreign government or
jurisdiction has been (A) maintained in all material respects in accordance with
government taxation and funding requirements, (B) to the extent required to be
registered or approved by a foreign Governmental Authority has been registered
with, or approved by, and maintained in all material respects in good standing
with such Governmental Authority, and (C) to the extent intended to be funded
and/or book-reserved, been so funded and/or book reserved, as appropriate, based
upon reasonable actuarial assumptions.

(m) The Transferor and the Transferred Companies have each complied in all
material respects with the notice and coverage continuation requirements of the
Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (and any
similar state law), Section 4980B of the Code, and Part 6 of Subtitle B of
Title I of ERISA and the regulations thereunder.

Section 3.19 Labor Matters.

(a) None of the Transferred Companies or, to the extent related to the
Transferred Companies, any of their Affiliates, is a party to or is directly or
indirectly bound by any collective bargaining agreement, contract or other labor
agreement or understanding with a labor union, works council, employee
representative body or other labor organization concerning a labor arrangement,
nor is any of the Transferred Companies or, to the extent related to the
Transferred Companies, any of their Affiliates the subject of a proceeding
asserting that it has committed an unfair labor practice (within the meaning of
the National Labor Relations Act) or

 

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seeking to compel any of the Transferred Companies or, to the extent related to
the Transferred Companies, any of their Affiliates to bargain with any labor
organization as to wages or conditions of employment, nor is there any strike,
work slowdown or other labor, industrial or trade dispute involving any of the
Transferred Companies or, to the extent related to the Transferred Companies,
any of their Affiliates pending or, to the Transferor’s Knowledge, threatened,
nor does the Transferor have Knowledge of any activity involving employees of
any of the Transferred Companies or, to the extent related to the Transferred
Companies, any of their Affiliates to certify a collective bargaining unit or
engaging in other organizational activity. There is no lawsuit, grievance,
arbitration, administrative hearing, workers compensation claim, claim or
investigation of wrongful discharge, employment discrimination or retaliation,
sexual harassment, unfair labor practice charge or complaint or other employment
dispute of any nature pending or, to the Knowledge of the Transferor, threatened
against or otherwise affecting any of the Transferred Companies or, to the
extent related to the Transferred Companies, any of their Affiliates.

(b) Each of the Transferred Companies and, to the extent related to the
Transferred Companies, each of their Affiliates, is in compliance in all
material respects with all applicable Laws, Contracts and policies relating to
employment, employment practices, wages, hours, and terms and conditions of
employment, including, without limitation, wages and hours, labor relations,
employee classification, employment discrimination, disability rights or
benefits, equal opportunity, plant closure or mass layoff issues, affirmative
action, leaves of absence, occupational health and safety, workers’ compensation
and unemployment insurance, and the collection and payment of withholding and/or
social security taxes or any similar tax.

(c) Schedule 3.19(c) of the Transferor Parties Disclosure Schedule sets forth a
complete and accurate list, in all material respects, as of a date no earlier
than five (5) days before the date of this Agreement, of all employees of the
Transferred Companies, showing for each such employee: (i) the employee
identification number and Fair Labor Standards Act classification of such
employee, (ii) such employee’s annualized base wages and any unmet compensation
guarantees as of the date of this Agreement, (iii) the date of service
recognized for any and all service-driven benefit entitlements, (iv) leave
status (including type of leave, expected date of return for non-disability
related leaves and expiration dates for disability leaves) and (v) any
governmental authorization, permit or license that is held by such employee and
that is used in connection with the Transferred Companies’ and their Affiliates’
(to the extent related to the Transferred Companies) business.

(d) Schedule 3.19(d) of the Transferor Parties Disclosure Schedule sets forth a
complete and accurate list, as of a date no earlier than five (5) days before
the date of this Agreement, of all independent contractors and consultants of
the Transferred Companies, showing for each such independent contractor or
consultant the aggregate dollar amounts of the compensation received by such
individual from any Transferred Company with respect to services performed in
2014 up to the date hereof and an estimate of such amounts to be received for
the remainder of 2014. All current and former consultants are and have been
properly classified as independent contractors of the Transferred Companies, and
no consultants could be, or have been, classified as employees of the
Transferred Companies during their service to the Transferred Companies as
consultants. No independent contractor of the Transferred Companies is eligible
to participate in any Transferor Plan, other than Transferor Plans maintained
for the benefit of

 

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independent contractors. There is no lawsuit, charge, or complaint actively in
process before, nor to the Transferor’s Knowledge, has any such lawsuit, charge,
or complaint been filed before, communicated to, initiated or threatened, by any
Governmental Authority, alleging that any Transferred Company or any of their
Affiliates, to the extent related to the Transferred Companies, has improperly
classified any Person as an independent contractor.

(e) There has been no “mass layoff” or “plant closing” as defined by the Worker
Adjustment and Retraining Notification Act of 1988 at any of the Transferred
Companies or any of their Affiliates within twelve (12) months prior to the
Closing.

(f) None of the Transferred Companies or, to the extent related to the
Transferred Companies, their Affiliates, is presently negotiating any employment
agreement or consulting agreement with any Person.

Section 3.20 Insurance. Schedule 3.20 of the Transferor Parties Disclosure
Schedule sets forth a correct and complete list of all material insurance
policies and binders maintained by the Transferred Companies for the benefit of
the Transferred Companies as of the date hereof (the “Insurance Policies”). To
the Transferor’s Knowledge, the Insurance Policies are valid, binding and in
full force and effect. None of the Transferred Companies or, to the extent
related to the Transferred Companies, any of their Affiliates, has received any
written notice of cancellation or non-renewal or threatened cancellation or
non-renewal of any such Insurance Policies (in each case, other than in
connection with the ordinary course renewals of any such Insurance Policy).
There is no Action pending under any of the Insurance Policies as to which
coverage has been formally denied or disputed by the underwriters of such
Insurance Policies.

Section 3.21 Environmental Matters. None of the Transferred Companies or, to the
extent related to the Transferred Companies, any of their Affiliates, has
received any written claims or notices alleging material liability relating to
any Environmental Law. Except as would not reasonably be expected to have,
individually or in the aggregate, a Transferred Companies Material Adverse
Effect, each of the Transferred Companies and, to the extent related to the
Transferred Companies, each of their Affiliates: (a) has complied at all times
with all applicable Environmental Laws, (b) has not disposed of or released any
Hazardous Materials on, under, at or about any property of any Transferred
Company or otherwise leased or owned any property contaminated with any
Hazardous Material that could be expected to result in liability under any
Environmental Law, and (c) has not disposed of or arranged for disposal of
Hazardous Material at any third-party property under circumstances that could
cause any Transferred Company to incur liability under any Environmental Law.
The Transferor has made available all material environmental assessments, audits
or reports on any of its property conducted by or at the request of or otherwise
in the possession of any Transferred Company.

Section 3.22 Broker-Dealer Matters.

(a) ISI Group is duly registered under the Exchange Act as a broker-dealer with
the SEC and is in compliance in all material respects with the applicable
provisions of the Exchange Act and the rules promulgated thereunder applicable
to broker-dealers. ISI Group is a member organization in good standing of FINRA
and in compliance in all material respects with all applicable rules and
regulations of FINRA as well as with the terms of its membership agreement with
FINRA. ISI Group is a member

 

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organization in good standing with NASDAQ OMB BX and NASDAQ Stock Market and in
compliance in all material respects with all applicable rules and regulations of
those entities as well as with the terms of its membership agreements with those
entities. ISI Group is duly registered as a broker-dealer under, and in
compliance with, the Laws of all jurisdictions in which it is required to be so
registered, including each of the fifty U.S. states, the District of Columbia
and Puerto Rico. ISI UK is duly authorized by the FCA for purposes of Part 4A of
the Financial Services and Markets Act 2000 (“FSMA”) and is in compliance in all
material respects with the applicable provisions of the FSMA and the FCA
Handbook.

(b) Each of ISI Group’s and ISI UK’s officers, employees and independent
contractors who are required to be registered, licensed or qualified with any
Governmental Authority as a registered principal or registered representative
are duly and properly registered, licensed or qualified as such and such
licenses are in full force and effect, or are in the process of being registered
as such within the time periods required by applicable law. As of the date of
this Agreement, neither ISI Group nor ISI UK is, nor are any of ISI Group’s or
ISI UK’s Associated Persons, subject to a “statutory disqualification” (as such
term is defined in the Exchange Act). There is no formal or informal
investigation, other than routine examinations including sweep and cycle
examinations, by any Governmental Authority pending or, to the Transferor’s
Knowledge, threatened against ISI Group, ISI UK, or any of their respective
Associated Persons. ISI Group is in compliance with all applicable regulatory
net capital requirements and no distribution of cash is required to be made by
ISI Group as of the date of this Agreement that will result in ISI Group not
being in compliance with applicable regulatory net capital requirements. ISI
Group is in compliance in all respects with all applicable regulatory
requirements for the protection of customer funds and securities. ISI Group has
not made any withdrawals from any reserve bank account it is required to
maintain pursuant to SEC Rule 15c3-3(e) except as permitted by SEC Rule
15c3-3(g). The Transferor has made available to the Acquiror a copy of each of
ISI Group’s Uniform Applications for Broker-Dealer Registration on Form BD filed
since January 1, 2011, and through the date of this Agreement, reflecting all
amendments thereto filed with the Central Registration Depository of FINRA prior
to the date of this Agreement (a “Form BD”). Each Form BD and each of ISI
Group’s other registrations, forms, and other reports filed with any
Governmental Authority since January 1, 2011 complied at the time of filing with
the applicable requirements of the Exchange Act and applicable Law. The
Transferor has provided or made available to the Acquiror true and correct
copies (redacted to the extent applicable) of all examination reports with
respect to any examination of ISI Group conducted by any Governmental Authority
since January 1, 2011, together with true and correct copies of all
correspondence between ISI Group and the examining Governmental Authorities
relating to such examinations. ISI Group has duly adopted written policies and
procedures required under the Exchange Act and FINRA rules, and all such
policies and procedures comply in all material respects with applicable legal
requirements.

 

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Section 3.23 Investment Adviser; Asset Management and Other Regulatory Matters.

(a) None of the Transferred Companies is, or has ever been, an investment
adviser registered with the SEC, nor is any Transferred Company required to, nor
has any Transferred Company conducted any business or acted in any way that
would require it to, be registered as an investment adviser with the SEC.

(b) Each of the Transferred Companies has, at all times, kept its assets and
liabilities, including the assets and liabilities of its clients, separate from
the assets and liabilities of ISI Inc., and at no point has there been any
comingling of any resources of any of the Transferred Companies with that of ISI
Inc. None of the Transferred Companies has engaged in the business of ISI Inc.

(c) ISI Group is not required to register with the National Futures Association
(“NFA”).

Section 3.24 Corruption Laws; Pay to Play. None of the Transferred Companies or,
to the extent related to the Transferred Companies, their Affiliates, nor, to
the Transferor’s Knowledge, any Representative or other Person authorized to act
on behalf of any of the Transferred Companies or, to the extent related to the
Transferred Companies, their Affiliates, (a) has materially violated, or is in
material violation of, any provision of the Foreign Corrupt Practices Act, the
U.K. Bribery Act, any Law, rule or regulation promulgated to implement the
Organization for Economic Co-operation and Development Convention on Combating
Bribery of Foreign Public Officials in International Business Transactions,
signed December 17, 1997, or any other Law, rule or regulation of similar
purpose or (b) has taken or is currently taking corrupt actions in furtherance
of an offer, payment, promise to pay or authorization of payment of anything of
value, including cash, checks, wire transfers, finder’s fees, cash solicitation
fees, fees for consulting, lobbying or otherwise, tangible and intangible gifts,
favors, services and entertainment and travel expenses, to (i) any executive,
official, employee or agent of a governmental department, agency or
instrumentality, state, municipality, or other political entity or subdivision
(including any related pension fund), (ii) a director, member, officer, employee
or agent of a wholly or partially government-owned or -controlled company or
business, (iii) a political party or official thereof, or candidate for
political office, (iv) an executive, official, employee or agent of a public
international organization (e.g., the International Monetary Fund or the World
Bank) or (v) a third party, in each case in this clause (b) in order to obtain,
retain or direct, or in connection with, the potential or existing business of
anyone or any entity described in clauses (b)(i)-(iv) and while knowing or
having a reasonable belief that all or any portion of any such offer or payment
will be used for the purpose of (x) influencing, in an improper manner, any act,
decision or failure to act by anyone described in clauses (b)(i)-(iv) in his or
her official capacity, (y) inducing, in an improper manner, anyone described in
clauses (b)(i)-(iv) to use his or her influence with a government or
instrumentality to affect any act or decision of such government or entity or
(z) securing an improper advantage.

Section 3.25 Affiliate Transactions. Except for any employment arrangements or
as set forth on Schedule 3.25 of the Transferor Parties Disclosure Schedule,
there are no Contracts or transactions between (i) any of the Transferred
Companies, on the one hand, and (ii) (A) any Transferor Party, (B) any Affiliate
of a Transferor Party (excluding any Transferred Company but including ISI Inc.)

 

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or (C) any director, officer, employee, or any Immediate Family Member of any
director, officer or employee of any Transferred Company, Transferor Party or
Affiliate of a Transferor Party (excluding any Transferred Company but including
ISI Inc.), on the other hand.

Section 3.26 Brokers. There are no brokerage fees, costs and expenses,
commissions, finders’ fees, costs and expenses, financial advisory fees, costs
and expenses or similar compensation owed by the Transferor Parties, the Founder
or any Holder in connection with the Transactions.

Section 3.27 Assets.

(a) The assets of the Transferred Companies constitute, all the assets,
properties and rights that any of the Transferor and its Affiliates has that are
necessary to conduct the business of the Transferred Companies in all material
respects in the manner and to the extent currently conducted by the Transferred
Companies and its Affiliates and, immediately after the Closing, assuming the
receipt of all Required Governmental Approvals, will permit the Acquiror to
continue to operate and conduct the business of the Transferred Companies as
currently conducted by the Transferred Companies and its Affiliates in all
material respects.

(b) The Transferor has no assets other than the ISI Interests and is not party
to any Contracts (other than its Organizational Documents).

Section 3.28 BIPRU Remuneration Code Staff. Schedule 3.28 of the Transferor
Parties Disclosure Schedule sets forth a full and complete list of those persons
who comprise BIPRU Remuneration Code staff in relation to ISI UK (“Code Staff”)
and the terms of employment and remuneration arrangements for each of the Code
Staff and the remuneration policies of ISI UK are in compliance with the BIPRU
Remuneration Code as applicable to ISI UK.

Section 3.29 Disclaimer of Representations and Warranties. The representations
and warranties made by the Transferor Parties in this Article III and Article IV
(including as set forth in the Transferor Parties Disclosure Schedule) are in
lieu of and are exclusive of all other representations and warranties, including
any statutory or implied representations or warranties. Other than the
representations and warranties made by the Transferor Parties in this
Article III and Article IV (including as set forth in the Transferor Parties
Disclosure Schedule), the Transferor Parties hereby disclaim any express or
implied representations or warranties, whether at law or in equity, including as
to the accuracy or completeness of, or reasonableness of any assumptions
underlying any estimates, projections and forecasts set forth in, any
information, documents or materials regarding the Transferor Parties, the
Transferred Companies or their Affiliates (including any pro forma financial
information, supplemental data or financial projections or other forward-looking
statements) furnished or made available to the Acquiror or Parent in any “data
rooms,” “virtual data rooms,” management presentations or in any other form in
expectation of, or in connection with, the Transactions.

 

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ARTICLE IV

REPRESENTATIONS AND WARRANTIES REGARDING THE TRANSFEROR

PARTIES, THE HOLDERS AND THE FOUNDER

Except as set forth in the corresponding sections or subsections of the
Transferor Parties Disclosure Schedule (it being understood and agreed by the
parties hereto that disclosure of any item in any section or subsection of the
Transferor Parties Disclosure Schedule shall be deemed disclosure with respect
to any other section or subsection of the Transferor Parties Disclosure
Schedule to which the relevance of such item is readily apparent), each
Transferor Party (but solely with respect to Section 4.1 to Section 4.6
inclusive), each Holder with respect of himself or herself (but solely with
respect to Section 4.7 to Section 4.11 inclusive) and the Founder (but solely
with respect to Section 4.12 to Section 4.16 inclusive) represents and warrants
as of the date hereof and as of the Closing (except to the extent any such
representations and warranties speak as of an earlier date) to the Acquiror and
Parent as follows:

Section 4.1 Corporate Organization of Such Transferor Party. Such Transferor
Party has been duly organized and is validly existing as a corporation or
company in good standing under the Laws of its jurisdiction of organization.
Such Transferor Party has all requisite corporate power and authority to carry
on its business as and where it is now being conducted and to own, lease and
operate its properties and assets. Such Transferor Party is in good standing (to
the extent applicable) as a foreign corporation or other entity, as applicable,
in each jurisdiction where the ownership or operation of its assets or the
conduct of its business requires such qualification. Such Transferor Party has
supplied the Acquiror with a true and complete copy of its Organizational
Documents, each as in effect on the date hereof.

Section 4.2 Due Authorization by Such Transferor Party. Such Transferor Party
has all requisite power and authority to execute, deliver and perform each
Transaction Document to which such Transferor Party is or will be a party and to
consummate the Transactions. The execution, delivery and performance by such
Transferor Party of each Transaction Document to which it is or will be a party
and the consummation of the Transactions has been duly and validly authorized
and approved by all necessary corporate or similar action of such Transferor
Party, and no other corporate or similar proceeding, consent or authorization in
respect of such Transferor Party is necessary to authorize the execution,
delivery and performance by such Transferor Party of any Transaction Document to
which such Transferor Party is or will be a party or the consummation of the
Transactions. Each Transaction Document to which such Transferor Party is or
will be a party has been or will be duly and validly executed and delivered by
such Transferor Party and constitutes, or will constitute, when executed and
delivered by the other parties thereto, a legal, valid and binding obligation of
such Transferor Party, enforceable against such Transferor Party in accordance
with its respective terms, except as may be limited by bankruptcy, insolvency,
reorganization, moratorium or other Laws relating to or affecting creditors’
rights generally and by general equitable principles.

Section 4.3 No Conflict for Such Transferor Party. Assuming the receipt of all
Required Governmental Approvals and all Third-Party Consents, the execution,
delivery and performance by such Transferor Party of each Transaction Document
to which it is or will be a party and the consummation of the Transactions does
not and will not:

(a) violate or conflict with any provision of the Organizational Documents of
such Transferor Party;

 

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(b) breach, violate, conflict with, or result in a default under, any provision
of, or constitute an event that, after notice or lapse of time or both, would
result in a breach or violation of, or default under, or accelerate the
performance required under, or result in the termination, cancellation,
modification or acceleration (whether after the filing of notice or the lapse of
time or both) of any right or obligation of such Transferor Party under, or give
any Person the right to terminate, any Contract to which such Transferor Party
is a party or by which such Transferor Party is bound, or result in the creation
of any Encumbrance (other than any Permitted Encumbrance) upon any asset of such
Transferor Party; or

(c) breach, violate, conflict with or result in a default under, any provision
of, or constitute an event that, after notice or lapse of time or both, would
result in a breach or violation of, or conflict with, or default under, in each
case in any material respect, any applicable Law or Order binding upon or
applicable to such Transferor Party.

Section 4.4 Consents and Approvals of Such Transferor Party. There are no
consents, approvals, notices, Orders, registrations, declarations or filings
required to be obtained, made or given by or with respect to such Transferor
Party in connection with the execution, delivery and performance of any of the
Transaction Documents and the consummation of the Transactions, except (a) the
Third-Party Consents, (b) the Transferor Required Governmental Approvals, or
(c) where the failure to obtain any of the foregoing, individually or in the
aggregate, does not, and would not reasonably be expected to, prevent, impair,
delay or otherwise interfere with such Transferor Party’s ability to perform its
obligations under the Transaction Documents to which it is or will be a party or
the consummation of the Transactions.

Section 4.5 Brokers for the Transferor Parties. Except as set forth on
Schedule 3.26 of the Transferor Parties Disclosure Schedule, there are no
brokerage fees, costs and expenses, commissions, finders’ fees, costs and
expenses, financial advisory fees, costs and expenses or similar compensation in
connection with the Transactions based on any Contract made by or on behalf of
such Transferor Party.

Section 4.6 Purchase for Investment. Each of the Transferor, Holding and
Holding II acknowledges that the Founder Securities have not been registered
under the Securities Act or under any state securities Laws. Each of Holding and
Holding II (i) is acquiring the Founder Securities pursuant to an exemption from
registration under the Securities Act solely for investment with no present
intention to distribute any of the Founder Securities to any Person in any
transaction that would require registration under the Securities Act, (ii) will
not sell or otherwise dispose of any of the Founder Securities, except in
compliance with the registration requirements or exemption provisions of the
Securities Act and any other applicable securities Laws, (iii) has received
sufficient information to evaluate the merits and risks of its acquisition of
the Founder Securities, understands the terms and conditions of the Founder
Securities, including limitations on transfer, exchange and conversion, and has
such knowledge and experience in financial and business matters and in
investments of this type that it is capable of evaluating the merits and risks
of its acquisition of the Founder Securities and of making an informed
investment decision and (iv) is an “accredited investor” (as that term is
defined by Rule 501 of the Securities Act).

 

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Section 4.7 Due Authorization by Such Holder. Such Holder has all requisite
power and authority to execute, deliver and perform each Transaction Document to
which such Holder is or will be a party and to consummate the Transactions. Each
Transaction Document to which such Holder is or will be a party has been or will
be duly and validly executed and delivered by such Holder and constitutes, or
will constitute, when executed and delivered by the other parties thereto, (or,
in the case of any Transaction Document that requires only such Holder to sign
to be legally enforceable against such Holder, when executed by such Holder
alone) a legal, valid and binding obligation of such Holder, enforceable against
such Holder in accordance with its respective terms, except as may be limited by
bankruptcy, insolvency, reorganization, moratorium or other Laws relating to or
affecting creditors’ rights generally and by general equitable principles.

Section 4.8 No Conflict for Such Holder. Assuming the receipt of all Required
Governmental Approvals, the execution, delivery and performance by such Holder
of each of the Transaction Documents to which it is or will be a party, and the
consummation of the Transactions, does not and will not:

(a) breach, violate, conflict with, or result in a default under, any provision
of, or constitute an event that, after notice or lapse of time or both, would
result in a breach or violation of, or default under, or accelerate the
performance required under, or result in the termination, cancellation,
modification or acceleration (whether after the filing of notice or the lapse of
time or both) of any right or obligation of such Holder under, or give any
Person the right to terminate, any Contract to which such Holder is a party or
by which such Holder is bound, or result in the creation of any Encumbrance
(other than any Permitted Encumbrance) upon any asset of such Holder; or

(b) breach, violate, conflict with or result in a default under, any provision
of, or constitute an event that, after notice or lapse of time or both, would
result in a breach or violation of, or conflict with, or default under, in each
case in any material respect, any applicable Law or Order binding upon or
applicable to such Holder.

Section 4.9 Consents and Approvals of Such Holder. There are no consents,
approvals, notices, Orders, registrations, declarations or filings required to
be obtained, made or given by or with respect to such Holder in connection with
the execution, delivery and performance of any of the Transaction Documents and
the consummation of the Transactions.

Section 4.10 Capitalization of Management Holdings. Such Holder directly owns
all of the membership interests of Management Holdings set forth opposite its
name on Schedule 3.5(a) of the Transferor Parties Disclosure Schedule, free and
clear of all Encumbrances. Such Holder does not own any capital stock or
membership or other equity interests in any of the Transferor Parties or the
Transferred Companies or in any of their Affiliates, other than its membership
interest in Management Holdings.

 

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Section 4.11 Purchase for Investment. Such Holder acknowledges that the
Management Securities have not been registered under the Securities Act or under
any state securities Laws. Such Holder (i) is acquiring the Management
Securities pursuant to an exemption from registration under the Securities Act
solely for investment with no present intention to distribute any of the
Management Securities to any Person in any transaction that would require
registration under the Securities Act, (ii) will not sell or otherwise dispose
of any of the Management Securities, except in compliance with the registration
requirements or exemption provisions of the Securities Act and any other
applicable securities Laws, (iii) has received sufficient information to
evaluate the merits and risks of its acquisition of the Management Securities,
understands the terms and conditions of the Management Securities, including
limitations on transfer, exchange and conversion, and has such knowledge and
experience in financial and business matters and in investments of this type
that it is capable of evaluating the merits and risks of its acquisition of the
Management Securities and of making an informed investment decision and (iv) is
an “accredited investor” (as that term is defined by Rule 501 of the Securities
Act).

Section 4.12 Due Authorization by the Founder. The Founder has all requisite
power and authority to execute, deliver and perform each Transaction Document to
which he is or will be a party and to consummate the Transactions. Each
Transaction Document to which the Founder is or will be a party has been or will
be duly and validly executed and delivered by the Founder and constitutes, or
will constitute, when executed and delivered by the other parties thereto (or,
in the case of any Transaction Document that requires only the Founder to sign
to be legally enforceable against the Founder, when executed by the Founder
alone), a legal, valid and binding obligation of the Founder, enforceable
against the Founder in accordance with its respective terms, except as may be
limited by bankruptcy, insolvency, reorganization, moratorium or other Laws
relating to or affecting creditors’ rights generally and by general equitable
principles.

Section 4.13 No Conflict for the Founder. Assuming the receipt of all Required
Governmental Approvals, the execution, delivery and performance by the Founder
of each of the Transaction Documents to which the Founder is or will be a party,
and the consummation of the Transactions, does not and will not:

(a) breach, violate, conflict with, or result in a default under, any provision
of, or constitute an event that, after notice or lapse of time or both, would
result in a breach or violation of, or default under, or accelerate the
performance required under, or result in the termination, cancellation,
modification or acceleration (whether after the filing of notice or the lapse of
time or both) of any right or obligation of the Founder under, or give any
Person the right to terminate, any Contract to which the Founder is a party or
by which the Founder is bound, or result in the creation of any Encumbrance
(other than any Permitted Encumbrance) upon any asset of the Founder; or

(b) breach, violate, conflict with or result in a default under, any provision
of, or constitute an event that, after notice or lapse of time or both, would
result in a breach or violation of, or conflict with, or default under, in each
case in any material respect, any applicable Law or Order binding upon or
applicable to the Founder.

 

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Section 4.14 Consents and Approvals of the Founder. There are no consents,
approvals, notices, Orders, registrations, declarations or filings required to
be obtained, made or given by or with respect to the Founder in connection with
the execution, delivery and performance of any of the Transaction Documents and
the consummation of the Transactions.

Section 4.15 Capitalization of Holding. The Founder directly owns all of the
capital stock of Holding set forth opposite his name on Schedule 3.5(a) of the
Transferor Parties Disclosure Schedule, free and clear of all Encumbrances. The
Founder does not own any capital stock or membership or other equity interests
in any of the Transferor Parties or the Transferred Companies or in any of their
Affiliates, other than his equity interest in Holding.

Section 4.16 No Actions Related to Holding. There is no Action pending or, to
Founder’s Knowledge, threatened, against Holding by any holder of equity
interests in Holding, seeking to prevent, hinder, modify, delay or challenge the
Transactions.

Section 4.17 Disclaimer of Representations and Warranties. The representations
and warranties made by the Transferor Parties, the Founder and the Holders in
Article III (with respect to any Transferor Party) and this Article IV
(including as set forth in the Transferor Parties Disclosure Schedule) are in
lieu of and are exclusive of all other representations and warranties, including
any statutory or implied representations or warranties. Other than the
representations and warranties made by the Transferor Parties, the Founder and
the Holders in Article III (with respect to any Transferor Party) and this
Article IV (including as set forth in the Transferor Parties Disclosure
Schedule), the Transferor Parties, the Founder and the Holders hereby disclaim
any express or implied representations or warranties, whether at law or in
equity, including as to the accuracy or completeness of, or reasonableness of
any assumptions underlying any estimates, projections and forecasts set forth
in, any information, documents or materials regarding the Transferor Parties,
the Founder and the Holders (including any pro forma financial information,
supplemental data or financial projections or other forward-looking statements)
furnished or made available to the Acquiror or Parent in any “data rooms,”
“virtual data rooms,” management presentations or in any other form in
expectation of, or in connection with, the Transactions.

ARTICLE V

REPRESENTATIONS AND WARRANTIES REGARDING THE ACQUIROR

Except as set forth in the corresponding sections or subsections of the
disclosure schedule delivered to the Transferor Parties, the Holders and the
Founder by the Acquiror on or prior to the date hereof (the “Acquiror Disclosure
Schedule”) (it being understood and agreed by the parties hereto that disclosure
of any item in any section or subsection of the Acquiror Disclosure
Schedule shall be deemed disclosure with respect to any other section or
subsection of the Acquiror Disclosure Schedule to which the relevance of such
item is readily apparent) or in the Parent SEC Reports (including the exhibits
thereto) filed during the two (2) year period preceding the date hereof and
prior to five (5) Business Days preceding the date hereof (excluding any risk
factor disclosures contained in such documents under the heading “Risk Factors”
and any disclosure of risks included in any “forward-looking statements”
disclaimer or other statements that are similarly non-specific or are predictive
or forward-looking in nature), each of Parent and the Acquiror

 

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represents and warrants as of the date hereof and as of the Closing (except to
the extent any such representations and warranties speak as of an earlier date)
to the Transferor Parties, the Holders and the Founder as follows:

Section 5.1 Corporate Organization of the Acquiror. The Acquiror has been duly
organized and is validly existing as a limited partnership in good standing
under the Laws of its jurisdiction of organization. The Acquiror has all
requisite corporate power and authority to carry on its business as it is now
being conducted and to own, lease and operate its properties and assets. The
Acquiror is in good standing as a foreign entity, as applicable, in each
jurisdiction where the ownership or operation of its assets or the conduct of
its business requires such qualification, except where the failure to be in good
standing, individually or in the aggregate, has not had and would not reasonably
be expected to have, an Acquiror Material Adverse Effect.

Section 5.2 Due Authorization by the Acquiror. The Acquiror has all requisite
power and authority to execute, deliver and perform each Transaction Document to
which it is or will be a party and to consummate the Transactions. The
execution, delivery and performance by each of the Acquiror and its Subsidiaries
of each Transaction Document to which it is or will be a party and the
consummation of the Transactions has been duly and validly authorized and
approved by all necessary corporate or similar action of the Acquiror and each
such Subsidiary, and no other corporate or similar proceeding, consent or
authorization in respect of the Acquiror or such Subsidiary is necessary to
authorize the execution, delivery and performance by the Acquiror or each such
Subsidiary of any Transaction Document to which the Acquiror or any of its
Subsidiaries is or will be a party or the consummation of the Transactions. Each
Transaction Document to which the Acquiror is or will be a party has been or
will be duly and validly executed and delivered by the Acquiror and constitutes
or will constitute, when executed and delivered by the other parties thereto, a
legal, valid and binding obligation of the Acquiror, enforceable against the
Acquiror in accordance with its respective terms, except as may be limited by
bankruptcy, insolvency, reorganization, moratorium or other Laws relating to or
affecting creditors’ rights generally and by general equitable principles.

Section 5.3 No Conflict for the Acquiror. Assuming the receipt of all Required
Governmental Approvals, the execution, delivery and performance by the Acquiror
of each Transaction Document to which it or any of its Subsidiaries is or will
be a party and the consummation of the Transactions does not and will not:

(a) violate or conflict with the Organizational Documents of the Acquiror;

(b) breach, violate, conflict with in any material respect, or result in a
material default under, any provision of, or constitute an event that, after
notice or lapse of time or both, would result in a material breach or violation
of, or material default under, or accelerate the performance required under, or
result in the termination, cancellation, modification or acceleration (whether
after the filing of notice or the lapse of time or both) of any right or
obligation of the Acquiror under, or give any Person the right to terminate, or
result in a loss of any material benefit to which Acquiror is entitled under,
any material Contract to which it is a party or by which it is bound, or result
in the creation of any Encumbrance (other than any Permitted Encumbrance) upon
any of its assets;

 

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(c) breach, violate, conflict with, or result in a default under, any provision
of, or constitute an event that, after notice or lapse of time or both, would
result in a breach or violation of, or conflict with, or default under, in each
case in any material respect, any applicable material Law or Order binding upon
or applicable to it; or

(d) result in the creation of any Encumbrance, with or without notice or lapse
of time or both, on any of the Securities.

Section 5.4 Consents and Approvals of the Acquiror. There are no material
consents, approvals, notices, Orders, registrations, declarations or filings
required to be obtained, made or given by or with respect to the Acquiror in
connection with the execution, delivery or performance of any Transaction
Document or the consummation of the Transactions, except as otherwise disclosed
on Schedule 5.4 of the Acquiror Disclosure Schedule (collectively, the “Acquiror
Required Governmental Approvals”).

Section 5.5 Investment Purpose. The Acquiror is acquiring the ISI Interests for
its own account and for investment purposes only and not with a view to, or for
sale in connection with, any distribution of such securities.

Section 5.6 Acquiror’s Reliance. The Acquiror acknowledges that except for the
representations and warranties made by the Transferor Parties, the Transferred
Companies, the Founder, and the Holders contained in this Agreement (including
as set forth in the Transferor Parties Disclosure Schedule) or any certificate
delivered pursuant hereto, neither the Transferor Parties, the Transferred
Companies, the Founder nor the Holders nor any other Person has made, and the
Acquiror has not relied on, any other express or implied representations or
warranties, whether at law or in equity, including as to the accuracy or
completeness of, or reasonableness of any assumptions underlying any estimates,
projections and forecasts set forth in, any information, documents or materials
regarding the Transferred Companies or their Affiliates, the Transferor Parties,
the Holders or the Founder (including any pro forma financial information,
supplemental data or financial projections or other forward-looking statements)
furnished or made available to the Acquiror or Parent in any “data rooms,”
“virtual data rooms,” management presentations or in any other form in
expectation of, or in connection with, the Transactions.

Section 5.7 Brokers. There are no brokerage fees, costs and expenses,
commissions, finders’ fees, costs and expenses, financial advisory fees, costs
and expenses or similar compensation in connection with the Transactions based
on any Contract made by or on behalf of the Acquiror or Parent.

Section 5.8 Access to Information. The Acquiror (i) is an informed and
sophisticated participant in the Transactions, (ii) has conducted and completed
its own independent investigation, analysis and evaluation of the Transferred
Companies and their respective operations, businesses, assets, liabilities,
properties and prospects as it has deemed necessary or appropriate, (iii) has
had the opportunity to request all information, documents or materials it has
deemed relevant to its investigation, analysis and evaluation

 

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of the Transferred Companies and their respective operations, businesses,
assets, liabilities, properties and prospects, and (iv) in making its
determination to enter into this Agreement and to consummate the Transactions,
has relied solely upon the representations and warranties regarding the
Transferred Companies in Article III and the representations and warranties in
Article IV (including as set forth in the Transferor Parties Disclosure
Schedule) and the results of its own independent investigation, analysis and
evaluation of the Transferred Companies and their respective operations,
businesses, assets, liabilities, properties and prospects. The Acquiror
acknowledges that, with respect to any estimate, projection or forecast
delivered by or on behalf of the Transferred Companies to the Acquiror or its
Representatives (A) there are uncertainties inherent in attempting to make such
estimates, projections and forecasts, (B) the accuracy and correctness of such
estimates, projections and forecasts may be affected by information which may
become available through discovery or otherwise after the date of such
estimates, projections and forecasts, and (C) it is familiar with each of the
foregoing.

Section 5.9 Issuance of Securities. The Securities of the Acquiror issuable
pursuant to this Agreement, when issued by the Acquiror in accordance with the
provisions of the Acquiror LP Agreement and this Agreement, will be duly issued,
fully paid and subject to the provisions set forth in the Acquiror LP Agreement
and this Agreement. Such issuance of the Securities pursuant to this Agreement
will not require the approval of the stockholders of Parent and will not
otherwise implicate Rule 312.03(c) of the New York Stock Exchange Listed Company
Manual.

Section 5.10 Disclaimer of Representations and Warranties. The representations
and warranties made by the Acquiror in this Article V (including as set forth in
the Acquiror Disclosure Schedule) are in lieu of and are exclusive of all other
representations and warranties, including any statutory or implied
representations or warranties. Other than the representations and warranties
made by the Acquiror in this Article V (including as set forth in the Acquiror
Disclosure Schedule), the Acquiror hereby disclaims any express or implied
representations or warranties, whether at law or in equity, including as to the
accuracy or completeness of, or reasonableness of any assumptions underlying any
estimates, projections and forecasts set forth in, any information, documents or
materials regarding the Acquiror (including any pro forma financial information,
supplemental data or financial projections or other forward-looking statements)
furnished or made available to the Transferor Parties in any “data rooms,”
“virtual data rooms,” management presentations or in any other form in
expectation of, or in connection with, the Transactions.

Section 5.11 Acquiror Tax Representations.

(a) The Acquiror and its Subsidiaries have timely filed all material Tax Returns
required to be filed by or with respect to them, all such Tax Returns are true,
accurate and complete in all material respects and all Taxes shown to be due on
such Tax Returns have been timely paid, collected or withheld, as the case may
be.

(b) The Acquiror and its Subsidiaries have withheld and paid over all material
Taxes required to have been withheld and paid over and complied with all
information reporting and backup withholding requirements in all material
respects, including maintenance of required records with respect thereto, in
connection with amounts paid or owing to any employee, creditor, independent
contractor, Affiliate or other third party.

 

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(c) There are no audits, examinations, investigations or other proceedings,
claims or assessments pending or threatened against the Acquiror or any of its
Subsidiaries in respect of any material Tax, and the Acquiror and its
Subsidiaries have not been notified of any proposed, considered or threatened
Tax claims or assessments against them.

(d) No extensions or waivers of statutes of limitation have been given or
requested with respect to any Taxes of the Acquiror or its Subsidiaries.

(e) None of the Acquiror of its Subsidiaries has participated in a transaction
that is a “listed” transaction within the meaning of Treasury Regulations
Section 1.6011-2 or any similar provision of state, local or foreign law.

(f) No claim has been made by any Tax Authority in a jurisdiction where the
Acquiror or its Subsidiaries does not file Tax Returns that the Acquiror or its
Subsidiaries, as applicable, is or may be subject to any Taxes assessed by such
jurisdiction.

(g) None of the Acquiror or its Subsidiaries is liable for Taxes of any Person
(other than the Transferred Companies) as a result of being a transferee or
successor of such Person.

(h) There are no Encumbrances for Taxes on any of the assets of the Acquiror or
its Subsidiaries, other than Encumbrances for Taxes not yet due and payable or
which are being contested in good faith by appropriate proceedings.

(i) Each of the Acquiror and its Subsidiaries is, and will through the Closing
be, properly treated as a partnership or a “disregarded entity” for U.S. federal
income tax purposes. The Acquiror is not, and will not be immediately after the
consummation of the Transactions, a partnership which would be treated as an
investment company (within the meaning of Section 351 of the Code) for purposes
of Section 721(b) of the Code.

This Section 5.11 constitutes the exclusive representations and warranties of
the Acquiror and its Subsidiaries with respect to Taxes. No representation or
warranty contained in this Agreement that relates to Taxes shall be deemed to
apply directly or indirectly with respect to any taxable period (or portion
thereof) after the date that is fifteen (15) months after the Closing Date.

ARTICLE VI

REPRESENTATIONS AND WARRANTIES REGARDING PARENT

Except as set forth in the corresponding sections or subsections of the Acquiror
Disclosure Schedule (it being understood and agreed by the parties hereto that
disclosure of any item in any section or subsection of the Acquiror Disclosure
Schedule shall be deemed disclosure with respect to any other section or
subsection of the Acquiror Disclosure Schedule to which the relevance of such
item is readily apparent) or the Parent SEC Reports (including the exhibits
thereto) filed during the two (2) year period preceding the date hereof and
prior to five (5) Business Days preceding the date hereof (excluding any risk
factor disclosures contained in such

 

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documents under the heading “Risk Factors” and any disclosure of risks included
in any “forward-looking statements” disclaimer or other statements that are
similarly non-specific or are predictive or forward-looking in nature), Parent
represents and warrants as of the date hereof and as of the Closing (except to
the extent any such representations and warranties speak as of an earlier date)
to the Transferor Parties, the Holders and the Founder as follows:

Section 6.1 Corporate Organization of Parent; Subsidiaries. Parent has been duly
incorporated and is validly existing as a corporation in good standing under the
Laws of Delaware. Parent has all requisite corporate power and authority to
carry on its business as it is now being conducted and to own, lease and operate
its properties and assets. Parent is in good standing as a foreign corporation,
or other entity, as applicable, in each jurisdiction where the ownership or
operation of its assets or the conduct of its business requires such
qualification, except where the failure to be in good standing, individually or
in the aggregate, has not had and would not reasonably be expected to have a
material adverse effect. The Acquiror is the only Subsidiary of Parent that
Parent directly owns and Parent has no other direct Subsidiaries other than the
Acquiror.

Section 6.2 Due Authorization of Parent. Parent has all requisite power and
authority to execute, deliver and perform each Transaction Document to which it
is or will be a party and to consummate the Transactions. The execution,
delivery and performance by Parent and each of its Subsidiaries of each
Transaction Document to which it is or will be a party and the consummation of
the Transactions has been duly and validly authorized and approved by all
necessary corporate or similar action of Parent and each such Subsidiary, and no
other corporate or similar proceeding, consent or authorization in respect of
Parent or such Subsidiary is necessary to authorize the execution, delivery and
performance by Parent or such Subsidiary of any Transaction Document to which it
or any of its Subsidiaries is or will be a party or the consummation of the
Transactions. Each Transaction Document to which Parent is or will be a party
has been or will be duly and validly executed and delivered by Parent and
constitutes or will constitute, when executed and delivered by the other parties
thereto, a legal, valid and binding obligation of Parent, enforceable against
Parent in accordance with its respective terms, except as may be limited by
bankruptcy, insolvency, reorganization, moratorium or other Laws relating to or
affecting creditors’ rights generally and by general equitable principles.

Section 6.3 No Conflict for Parent. Assuming the receipt of all Required
Governmental Approvals, the execution, delivery and performance by Parent of
each Transaction Document to which it is or will be a party and the consummation
of the Transactions does not and will not:

(a) violate or conflict with any provision of the Organizational Documents of
Parent;

(b) breach, violate, conflict with in any material respect or result in a
material default under any provision of, or constitute an event that, after
notice or lapse of time or both, would result in a material breach or violation
of or material default under, or accelerate the performance required under, or
result in the termination, cancellation, modification or acceleration (whether
after the filing of notice or the lapse of time or both) of any right or
obligation of Parent under, or give any Person the right to terminate, or

 

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result in a loss of any material benefit to which Parent is entitled under any
material Contract to which Parent is a party or by which Parent or any of
Parent’s Subsidiaries are bound, or result in the creation of any Encumbrance
(other than any Permitted Encumbrance) upon any of its assets;

(c) breach, violate, conflict with or result in a default under, any provision
of, or constitute an event that, after notice or lapse of time or both, would
result in a breach or violation of, conflict or default under, in each case in
any material respect, any applicable material Law or Order binding upon or
applicable to it; or

(d) result in the creation of any Encumbrance, with or without notice or lapse
of time or both, on any shares of Parent Common Stock issuable upon conversion
of the Class E Units pursuant to the Acquiror LP Agreement and the
Organizational Documents of Parent.

Section 6.4 Consents and Approvals of Parent. There are no material consents,
approvals, notices, Orders, registrations, declarations or filings required to
be obtained, made or given by or with respect to Parent in connection with the
execution, delivery or performance of any Transaction Document to which it is or
will be a party or the consummation of the Transactions, except the Acquiror
Required Governmental Approvals.

Section 6.5 Issuance of Shares. The shares of Parent Common Stock issuable upon
conversion of the Class E Units, when issued by Parent in accordance with the
provisions of the Acquiror LP Agreement and the Organizational Documents of
Parent, will be duly issued, fully paid and non-assessable. Any such issuance of
shares of Parent Common Stock pursuant to the Acquiror LP Agreement and the
Organizational Documents of Parent does not require the approval of the
stockholders of Parent and does not otherwise implicate Rule 312.03(c) of the
New York Stock Exchange Listed Company Manual.

Section 6.6 Parent’s Reliance. Parent acknowledges that except for the
representations and warranties made by the Transferor Parties, the Founder, and
the Holders contained in this Agreement (including as set forth in the
Transferor Parties Disclosure Schedule) or any certificate delivered pursuant
hereto, neither the Transferor Parties, the Founder nor the Holders nor any
other Person has made, and Parent has not relied on, any other express or
implied representations or warranties, whether at law or in equity, including as
to the accuracy or completeness of, or reasonableness of any assumptions
underlying any estimates, projections and forecasts set forth in, any
information, documents or materials regarding the Transferred Companies or their
Affiliates, the Transferor Parties, the Holders or the Founder (including any
pro forma financial information, supplemental data or financial projections or
other forward-looking statements) furnished or made available to the Acquiror or
Parent in any “data rooms,” “virtual data rooms,” management presentations or in
any other form in expectation of, or in connection with, the Transactions.

Section 6.7 Parent SEC Reports; Financial Statements.

(a) Parent has filed all forms, reports, statements and other documents required
to be filed with the SEC pursuant to the Exchange Act or the Securities Act
since June 1, 2012 (collectively and including any amendments thereto, the
“Parent SEC

 

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Reports”). Each of the Parent SEC Reports, as amended prior to the date of this
Agreement, complied in all material respects with the applicable requirements of
the Securities Act and the Exchange Act, each as in effect on the date so filed
or, if amended, as of the date of the last such amendment. None of the Parent
SEC Reports contained, when filed or, if amended, as finally amended prior to
the date of this Agreement, any untrue statement of a material fact or omitted
to state a material fact required to be stated or incorporated by reference
therein or necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading.

(b) The audited consolidated financial statements (including any notes thereto)
contained in Parent’s Annual Report on Form 10-K for the fiscal year ended
December 31, 2013 filed with the SEC (i) were prepared in accordance with GAAP
applied on a consistent basis throughout the period indicated (except as may be
indicated in the notes thereto) and (ii) presented fairly, in all material
respects, the consolidated financial position of Parent and its consolidated
Subsidiaries as of the date thereof and the consolidated results of their
operations, changes in members’ and stockholders’ equity and cash flows for the
fiscal year then ended, except as otherwise noted therein. The unaudited
consolidated financial statements of Parent (including any notes thereto) for
all interim periods included in Parent’s Quarterly Report on Form 10-Q for the
fiscal quarter ended March 31, 2014 (i) were prepared in accordance with GAAP
applied on a consistent basis throughout the periods indicated (except as may be
indicated in the notes thereto) and (ii) presented fairly, in all material
respects, the consolidated financial position of Parent and its consolidated
Subsidiaries as of the date thereof and the consolidated results of their
operations, changes in members’ and stockholders’ equity and cash flows for the
periods indicated, as applicable (except as may be indicated in the notes
thereto and subject to normal year-end adjustments).

(c) Parent has designed disclosure controls and procedures (as defined in
Exchange Act Rules 13a-15(e) and 15d-15(e)) to ensure that material information
relating to Parent, including its consolidated Subsidiaries, is made known to
the Chief Executive Officer and the Chief Financial Officer of Parent by others
within those entities. Parent has disclosed, based on its most recent evaluation
of internal control over financial reporting, to Parent’s auditors and the audit
committee of the Board of Directors of Parent (or persons performing the
equivalent functions) (i) all significant deficiencies and material weaknesses
in the design or operation of internal control over financial reporting which
are reasonably likely to adversely affect Parent’s ability to record, process,
summarize and report financial information and (ii) any material fraud, that
involves management or other employees who have a significant role in Parent’s
internal control over financial reporting.

(d) Except (i) as disclosed in the Acquiror Disclosure Schedule, (ii) for
Liabilities incurred in the ordinary course of business since March 31, 2014,
and (iii) for undisclosed Liabilities which would not, individually or in the
aggregate, constitute an Acquiror Material Adverse Effect, there is no Liability
of any kind, whether accrued, absolute, fixed or contingent that is required to
be disclosed on a consolidated balance sheet prepared in accordance with GAAP,
of Parent or any of its Subsidiaries at Closing that is not reflected or
adequately reserved against in the consolidated financial statements referred to
in Section 6.7(b) above or the notes thereto.

 

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Section 6.8 Regulatory Compliance. Except as would not reasonably be expected to
have an Acquiror Material Adverse Effect and except for Parent SEC Reports that
are covered by Section 6.7, (a) Parent and its Subsidiaries have filed all
material reports, registrations, statements and other filings, together with any
amendments required to be made with respect thereto, that were required to be
filed with or pursuant to the rules with all applicable Governmental Authorities
and (b) all such reports and statements, when filed, complied as to form with,
and the requirements of, such applicable Governmental Authorities.

Section 6.9 No Actions.

(a) There is no material Action pending or, to Parent’s Knowledge, threatened
against or with respect to Parent or any of its Subsidiaries, or the businesses,
properties or assets of Parent or any of its Subsidiaries, that individually or
in the aggregate, would have an Acquiror Material Adverse Effect.

(b) Neither Parent nor any of its Subsidiaries is subject to any Order that,
individually or in the aggregate, would have an Acquiror Material Adverse
Effect.

Section 6.10 Compliance with Law. Parent and its Subsidiaries have been and are
in material compliance with all Laws and Orders to which Parent and its
Subsidiaries are subject, except where the failure to comply, individually or in
the aggregate, has not been and would not reasonably be expected to have an
Acquiror Material Adverse Effect. Parent and its Subsidiaries have not received
written notice from any Governmental Authority that it is not in compliance with
any applicable Law or Order except for such non-compliance as, individually or
in the aggregate, has not been and would not reasonably be expected to have an
Acquiror Material Adverse Effect.

Section 6.11 Parent Tax Representations.

(a) Parent has timely filed all material Tax Returns required to be filed by or
with respect to it, all such Tax Returns are true, accurate and complete in all
material respects and all Taxes shown to be due on such Tax Returns have been
timely paid, collected or withheld, as the case may be.

(b) Parent has withheld and paid over all material Taxes required to have been
withheld and paid over and complied with all information reporting and backup
withholding requirements in all material respects, including maintenance of
required records with respect thereto, in connection with amounts paid or owing
to any employee, creditor, independent contractor, Affiliate or other third
party.

(c) There are no audits, examinations, investigations or other proceedings,
claims or assessments pending or threatened against Parent in respect of any
material Tax, and Parent has not been notified of any proposed, considered or
threatened Tax claims or assessments against it.

(d) No extensions or waivers of statutes of limitation have been given or
requested with respect to any Taxes of Parent.

 

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(e) Parent has not participated in a transaction that is a “listed” transaction
within the meaning of Treasury Regulations Section 1.6011-2 or any similar
provision of state, local or foreign law.

(f) No claim has been made by any Tax Authority in a jurisdiction where Parent
does not file Tax Returns that Parent is or may be subject to any Taxes assessed
by such jurisdiction.

(g) Parent is not liable for Taxes of any Person (other than the Transferred
Companies) as a result of being a transferee or successor of such Person.

(h) There are no Encumbrances for Taxes on any of the assets of Parent, other
than Encumbrances for Taxes not yet due and payable or which are being contested
in good faith by appropriate proceedings.

This Section 6.11 constitutes the exclusive representations and warranties of
the Parent with respect to Taxes, except for the representations and warranties
set forth in Section 6.7 that relate to Taxes. No representation or warranty
contained in this Agreement that relates to Taxes shall be deemed to apply
directly or indirectly with respect to any taxable period (or portion thereof)
after the date that is fifteen (15) months after the Closing Date.

Section 6.12 Absence of Changes. Since March 31, 2014 until the date hereof,
there has not been any Acquiror Material Adverse Effect and no circumstances
have arisen which, individually or in the aggregate, would reasonably be
expected to have an Acquiror Material Adverse Effect.

Section 6.13 Disclaimer of Representations and Warranties. The representations
and warranties made by Parent in this Article VI (including as set forth in the
Acquiror Disclosure Schedule) are in lieu of and are exclusive of all other
representations and warranties, including any statutory or implied
representations or warranties. Other than the representations and warranties
made by Parent in this Article VI (including as set forth in the Acquiror
Disclosure Schedule), Parent hereby disclaims any express or implied
representations or warranties, whether at law or in equity including as to the
accuracy or completeness of, or reasonableness of any assumptions underlying any
estimates, projections and forecasts set forth in, any information, documents or
materials regarding Parent (including any pro forma financial information,
supplemental data or financial projections or other forward-looking statements)
furnished or made available to the Transferor Parties in any “data rooms,”
“virtual data rooms,” management presentations or in any other form in
expectation of, or in connection with, the Transactions.

ARTICLE VII

COVENANTS

Section 7.1 Conduct of Business. During the period from the date of this
Agreement to the earlier of the Closing and the termination of this Agreement
pursuant to its terms, except as required by applicable Law, as otherwise
contemplated by this Agreement or as specifically set forth on Schedule 7.1 of
the Transferor Parties Disclosure Schedule or as consented to in writing by the
Acquiror (which consent shall not be unreasonably withheld, conditioned or
delayed), the Transferor agrees that it shall use

 

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commercially reasonable efforts to cause the Transferred Companies to conduct
their businesses in the ordinary course consistent with past practice and the
management projections set forth on Schedule 7.1 of the Transferor Parties
Disclosure Schedule (the “Management Projections”), including maintaining the
ratio of compensation to revenue (the “Compensation Ratio”) such that the
Compensation Ratio will be consistent with the Compensation Ratio contained in
the Management Projections, and will use commercially reasonable efforts
consistent therewith to cause the Transferred Companies to keep intact their
respective businesses, to maintain and preserve relationships with key
customers, employees, suppliers, regulators and others having business
relationships with the Transferred Companies. Each Transferor Party hereby
agrees that during the period from the date of this Agreement to the earlier of
the Closing and the termination of this Agreement pursuant to its terms, that it
shall not, and shall not permit the Transferred Companies to, (A) amend its
Organizational Documents, (B) issue, repurchase, redeem or sell its equity
interests or any other securities, (C) merge or consolidate with any Person,
(D) consummate any complete or partial liquidation, dissolution, restructuring,
recapitalization or other reorganization or (E) amend, modify, change or
otherwise alter the terms of its equity interests or any other of its securities
(including the Management Holdings Management Units), except in each case, as
expressly contemplated hereby or in connection with and to facilitate the
consummation of the Transactions in accordance with, and as contemplated by, the
terms of this Agreement and in consultation with the Acquiror. Except as
otherwise contemplated by this Agreement, as required by applicable Law, or as
specifically set forth on Schedule 7.1 of the Transferor Parties Disclosure
Schedule, and without limiting the generality of the foregoing, the Transferor
shall not and the Transferor shall not permit any of the Transferred Companies
to, take any of the following actions, prior to the earlier of the Closing and
the termination of this Agreement pursuant to its terms, without the prior
written consent of the Acquiror (which consent shall not be unreasonably
withheld, conditioned or delayed):

(a) (i) Declare, set aside, make or pay any dividend or other distribution in
respect of any of the ISI Interests or (ii) repurchase, redeem, repay or
otherwise acquire any outstanding shares of any capital stock, membership
interests or other securities of the Transferred Companies; provided that the
Transferor may declare, set aside, make or pay dividends or other distributions
in respect of Taxes to the extent of any Taxes payable by the Transferor (or its
beneficial owners) in an aggregate amount equal to the sum of (x) the product of
(1) the taxable income of the Transferor allocable to the period beginning on
January 1, 2014 and ending on the Closing Date, multiplied by (2) the Assumed
Tax Rate plus (y) the amount of any New York City Unincorporated Business Tax
incurred by the Transferor for the period beginning on January 1, 2014 and
ending on the Closing Date; provided, further, that the Transferred Companies
may, immediately prior to the Closing, declare, set aside, make or pay dividends
or other distributions in the amount up to the Excess Working Capital
Distribution;

(b) (i) Issue, sell or pledge, or authorize or propose the issuance, sale or
pledge of, or (ii) split, combine or reclassify any shares of capital stock of
any class or any securities or any type of membership interests of the
Transferred Companies, including any securities convertible into or exchangeable
or exercisable for shares of capital stock or membership or other equity
interests, or any rights, warrants or options to acquire any such shares or such
membership or other equity interests, or other securities, of any of the
Transferred Companies;

 

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(c) Amend the Organizational Documents of any Transferred Company or, to the
extent it could adversely affect the Transactions, the Transferor, or enter
into, adopt or effect a plan of consolidation, merger, share exchange,
reorganization or similar business combination, or complete or partial
liquidation, dissolution, restructuring, recapitalization or other
reorganization with respect to or involving any Transferred Company or the
Transferor;

(d) Purchase, sell, lease, exchange or otherwise dispose of or acquire any
material property or assets, including any Intellectual Property (other than in
the ordinary course of business) or enter into any lease of real property for
which the aggregate consideration paid or payable in any individual transaction
is in excess of $50,000 or in the aggregate in excess of $250,000 or with
respect to sales, other than for fair value;

(e) Make any capital expenditure (other than capital expenditures
(i) contemplated by any Contract to which any Transferred Company is a party
that is in effect as of the date hereof and disclosed to the Acquiror or as
provided in the Management Projections;

(f) Enter into any Intellectual Property Contract or any other Contract with
respect to Intellectual Property other than in the ordinary course of business
consistent with past practices;

(g) Grant, amend, waive, sell, assign, transfer, let lapse, abandon, cancel or
otherwise dispose of any Owned Company Intellectual Property, except in the
ordinary course of business consistent with past practices;

(h) Except as required pursuant to a Transferor Plan existing as of the date
hereof and set forth on Schedule 7.1(h) of the Transferor Parties Disclosure
Schedule, or as otherwise required by applicable Law, (A) increase the
compensation, commission, remuneration payable, bonus, pension, retirement,
welfare, fringe or other benefits, change in control, retention, severance or
termination pay of any of the current or former directors, officers, employees
or consultants of any Transferred Company, (B) pay any bonus to any of the
current or former directors, officers, employees or consultants of any
Transferred Company, other than in accordance with the Management Projections,
(C) adopt, enter into, establish, amend or modify, or terminate any Transferor
Plan or any employment, consulting, collective bargaining, bonus or other
incentive compensation, health or other welfare, pension, retirement, severance,
deferred compensation or other compensation or benefit plan with, for or in
respect of any shareholder, director, officer, other employee or consultant that
would constitute a Transferor Plan had it been in effect as of the date of this
Agreement, (D) promote any employee who is an officer to a position more senior
than such employee’s position as of the date of this Agreement, or promote a
non-officer employee to an officer position, (E) grant any new awards under any
Transferor Plan, (F) amend or modify any outstanding award under any Transferor
Plan, (G) take any action to amend, waive or accelerate the vesting criteria or
vesting requirements of payment of any compensation or benefit under any
Transferor Plan or remove any existing restrictions in any Transferor Plans or
awards made thereunder, (H) take any action to accelerate the payment, or to
fund or in any other way secure the

 

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payment, of compensation or benefits under any Transferor Plan, to the extent
not already provided in any such Transferor Plan, (I) change any actuarial or
other assumptions used to calculate funding obligations with respect to any
Transferor Plan or to change the manner in which contributions to such plans are
made or the basis on which such contributions are determined, except as may be
required by GAAP or U.K. GAAP, or (J) forgive any loans, or issue any loans
(other than routine business expense advances issued in the ordinary course of
business), to directors, officers, contractors or employees of any Transferred
Company;

(i) Hire any employee or engage any independent contractor (who is a natural
person) other than as disclosed in Schedule 7.1(i) of the Transferor Parties
Disclosure Schedule or agree to or grant to any such employee or independent
contractor compensation and benefits, in each case, in a manner that is
inconsistent with the pre-Closing employment and compensation budget previously
provided by the Transferred Companies to the Acquiror;

(j) Issue any communication to any employees of the Transferred Companies
regarding any compensation or benefits to be provided after the Closing unless
such communications are consistent with communications and/or materials
developed in consultation with the Acquiror or Parent or otherwise required by
Law;

(k) Modify or rescind any of the Licenses and Permits, except as required by
Law;

(l) Incur any financial Indebtedness (other than current trade accounts payables
incurred in respect of property or services purchased in the ordinary course of
business and letters of credit issued in the ordinary course of business) or
assume, grant, guarantee or endorse, or otherwise as an accommodation become
responsible for, the obligations of any Person or make any loans or advances
(other than, in each case, in the ordinary course of business), for individual
amounts in excess of $25,000 or in the aggregate in excess of $200,000;

(m) Except as required by GAAP or U.K. GAAP, make any material change in any
method of accounting;

(n) Enter into any new line of business;

(o) Settle any Action involving an amount in excess of $50,000 or the imposition
of non-de minimis injunctive relief against the Transferred Companies;

(p) Make, amend, or revoke any material election relating to Taxes; adopt or
change any material accounting method relating to Taxes; file any amended
material Tax Return; enter into any Tax sharing, Tax allocation, Tax indemnity
or similar agreement; enter into any closing agreement; surrender any right to
claim a refund of Taxes; settle or compromise any material claim or assessment
relating to Taxes; take any action with respect to Taxes which is reasonably
likely to result in a material increase in the Tax liability of the Transferred
Companies for any taxable period (or portion thereof) ending after the Signing
Date;

 

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(q) Cancel any material Indebtedness (individually or in the aggregate) or waive
any claims or rights of material value, other than in the ordinary course of
business consistent with past practices or as permitted pursuant to clause
(o) above;

(r) Acquire by merging or consolidating with, or by purchasing a substantial
portion of the assets of, or by any other manner, any business or any
corporation, partnership, association or other business organization or division
thereof; or

(s) Agree, whether or not in writing, to do any of the foregoing.

Section 7.2 Commercially Reasonable Efforts.

(a) Each of the parties agrees to use its commercially reasonable efforts to
obtain as promptly as practicable all authorizations, consents, Orders and
approvals of all Governmental Authorities, including all Required Governmental
Approvals, that may be or may become reasonably necessary, proper or advisable
under the Transaction Documents and applicable Laws to consummate and make
effective the Transactions. The Transferor, the Transferred Companies, Parent
and the Acquiror shall reasonably cooperate with the requests of each other in
seeking to obtain as promptly as practicable all such authorizations, consents,
Orders and approvals.

(b) The Transferor, the Transferred Companies, Parent and the Acquiror shall
promptly prepare all documentation and promptly make all filings and
notifications with all Governmental Authorities that may be or may become
reasonably necessary, proper or advisable under the Transaction Documents and
applicable Laws to consummate and make effective the Transactions, including
(i) all Required Governmental Approvals and (ii) any other regulatory approvals
or filings. The Transferor, the Transferred Companies, Parent and the Acquiror
each shall supply promptly to the relevant Governmental Authorities any
additional information and documentary material that may be requested by such
Governmental Authorities of them pursuant to any applicable Laws. The Acquiror,
Parent and the Transferor will provide such assistance to each other as is
reasonably required to obtain any Required Governmental Approvals, other
third-party consents and any notices (including Third-Party Consents) and,
subject to applicable Law, will provide each other with the reasonable
opportunity to review any applications, notices or other filings proposed to be
made with respect to the transactions contemplated hereby (and will give due
consideration to any comments and suggestions made with respect thereto by the
other party). In connection therewith, each party will notify the other promptly
following the receipt of any comments from any Governmental Authority and of any
request by any Governmental Authority for amendments, supplements or additional
information in respect of any application, notice or other filing with such
Governmental Authority and will supply the other party with copies of all
material correspondence between such party or any of its Representatives, on the
one hand, and any Governmental Authority in connection with obtaining any
Required Governmental Approval, on the other hand; provided that such disclosure
is permitted under applicable Law. No party shall agree to participate in any
meeting with any Governmental Authority, or submit any request to engage in any
discussions with a Governmental Authority with respect to holding or
participating in any meeting with such Governmental Authority, in each case
relating to the matters that are the subject of this Agreement, unless it
consults with the other parties (other than the Holders) in advance and, to the
extent permitted by such Governmental Authority, gives such other parties the
opportunity to attend and participate at such meeting.

 

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(c) Without limiting the generality of the foregoing, the Transferor, the
Transferred Companies, Parent and the Acquiror will as promptly as practicable,
but in no event later than ten (10) Business Days following the execution and
delivery of this Agreement, file with the FTC and the DOJ the notification and
report form required for the Transactions and any supplemental information
required in connection therewith pursuant to the HSR Act. Each party will use
its commercially reasonable efforts to ensure that it will be in substantial
compliance with the requirements of the HSR Act. The Transferor, Parent and the
Acquiror shall keep each other apprised of the status of any communications
with, and inquiries or requests for additional information from, the FTC or the
DOJ, and shall each use its reasonable best efforts to comply promptly with any
such inquiry or request. The Transferor, Parent and the Acquiror will each use
its commercially reasonable efforts to cause the expiration or early termination
of the waiting period required under the HSR Act as a condition to the purchase
and sale of the ISI Interests under this Agreement and shall use commercially
reasonable efforts to defend against any action of the FTC or the DOJ to enjoin
such purchase and sale and to satisfy any conditions imposed or to avoid the
imposition thereof, by the FTC or DOJ, as applicable.

(d) Parent and the Acquiror shall as promptly as practicable, but in any event
no later than thirteen (13) Business Days after the Signing Date, submit the
notice required under section 178 FSMA (“Notice”).

(e) Subject to the provisions set forth in Section 7.2(a), Section 7.2(b) and
Section 7.2(c) with respect to Governmental Authority approvals, each of the
parties agrees to use its commercially reasonable efforts promptly to take, or
cause to be taken, in good faith, all actions that are necessary, proper or
advisable to consummate and make effective the Transactions as promptly as
practicable, including using its commercially reasonable efforts to (i) take all
reasonable acts necessary to cause the conditions precedent set forth in
Article VIII to be satisfied and (ii) obtain all necessary consents, approvals
or waivers from third parties (including all Third-Party Consents); provided,
however, that no party shall be required to compensate any third party, commence
or participate in litigation or offer or grant any accommodation (financial or
otherwise) to any third party to obtain any such consent or approval.

Section 7.3 Pre-Closing Access and Information.

(a) From the date hereof until the Closing Date, subject to any applicable Law
and subject to any applicable privileges (including the attorney-client
privilege) and contractual confidentiality obligations, upon reasonable prior
written notice, the Transferor shall, and shall cause each Transferred Company
and their respective Representatives to, (i) afford the Representatives of the
Acquiror reasonable access, during normal business hours, to the offices,
properties, books and records of the Transferred Companies, (ii) furnish to the
Representatives of the Acquiror such additional financial data and other
information regarding the Transferred Companies as the Acquiror may from time to
time reasonably request and (iii) make available to the Representatives of the
Acquiror the employees of the Transferred Companies and the Transferor whose
assistance and expertise is necessary to assist the Acquiror in connection with
the Acquiror’s preparation to integrate the Transferred Companies and their
businesses and personnel

 

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into the Acquiror’s organization following the Closing; provided, that such
investigation shall not unreasonably interfere with any of the businesses or
operations of the Transferred Companies or the Transferor; provided, further,
that the auditors and independent accountants of the Transferor and the
Transferred Companies shall not be obligated to make any work papers available
to any Person unless and until such Person has signed a customary
confidentiality and hold harmless agreement relating to such access to work
papers in form and substance reasonably acceptable to such auditors or
independent accountants and nothing set forth in any such agreement shall be
deemed a waiver of or otherwise diminish any right of the Acquiror under this
Agreement, including under Article X. The Acquiror shall reimburse the
Transferor promptly for any reasonable out-of-pocket expenses incurred by the
Transferor or any of its Affiliates in complying with any request by or on
behalf of the Acquiror or any of its Affiliates in connection with this
Section 7.3(a). The Acquiror shall indemnify and hold harmless the Transferor
and its Affiliates from and against any Losses that may be incurred by any of
them arising out of or related to such access (other than any Losses for which
the Acquiror is entitled to be indemnified pursuant to Section 7.14 or
Article X) or the use, storage or handling of any personally identifiable
information relating to employees or customers of any of the Transferred
Companies to which the Acquiror or any of its Affiliates or Representatives is
afforded access pursuant to the terms of this Agreement. Notwithstanding the
foregoing, the Transferor and the Transferred Companies shall not be required to
provide access or to disclose information which is prohibited under applicable
Law or any Contract to which the Transferor or any Transferred Company is a
party or that would cause the Transferor or any Transferred Company to waive its
attorney-client privilege; provided, that the Transferor shall, and shall cause
the Transferred Companies to, cooperate in any reasonable efforts and requests
for waivers that would enable otherwise required disclosure to the Acquiror to
occur without so jeopardizing privilege or contravening such Law or Contract.

(b) Within ten (10) Business Days following execution and delivery of this
Agreement, the Transferor shall make available to the Acquiror (i) true and
correct copies of all written customer complaints received by any Transferred
Company since January 1, 2012 and relating to any Transferred Company or any
Transferred Company’s current or former Associated Persons and all responses and
other correspondence relating thereto, and (ii) true and correct copies of all
reports on Forms U-4 and U-5 filed with respect to an Associated Person of any
Transferred Company since January 1, 2012.

Section 7.4 Post-Closing Access; Books and Records.

(a) From and after the Closing Date, in connection with any reasonable business
purpose, including (x) in response to the request or at the direction of a
Governmental Authority, (y) the preparation of any Tax Returns or the control
of, or participation in, any Tax Claim or any other examination, audit, dispute,
proceeding or claim with respect to Taxes and (z) the determination of any
matter relating to the rights or obligations of any Transferor Party under any
of the Transaction Documents, subject to any applicable Law and any applicable
privileges (including the attorney-client privilege) and contractual
confidentiality obligations, upon reasonable prior written notice, the Acquiror
shall, and shall cause the Transferred Companies and their respective Affiliates
and Representatives to, (i) afford the Transferor Parties and their Affiliates
and Representatives reasonable access, during normal

 

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business hours, to the offices, properties, books, data, files, information and
records of the Acquiror and its Affiliates in respect of the Transferred
Companies and the businesses conducted by them, (ii) furnish to the Transferor
Parties and their Affiliates and Representatives such additional financial data
and other information regarding the Transferred Companies and the businesses
conducted by them as the Transferor Parties and their Affiliates or
Representatives may from time to time reasonably request and (iii) make
available to the Transferor Parties and their Affiliates and Representatives the
employees of the Acquiror and its Affiliates in respect of the Transferred
Companies and the businesses conducted by them whose assistance, expertise,
testimony, notes and recollections or presence is necessary to assist the
Transferor Parties or their Affiliates or Representatives in connection with the
Transferor Parties’ or their Affiliates’ or Representatives’ inquiries for any
of the purposes referred to in this Section 7.4(a) above; provided, however,
that such investigation shall not unreasonably interfere with the business or
operations of the Acquiror or any of its Affiliates; and provided, further, that
the auditors and independent accountants of the Acquiror or its Affiliates shall
not be obligated to make any work papers available to any Person unless and
until such Person has signed a customary confidentiality and hold harmless
agreement relating to such access to work papers in form and substance
reasonably acceptable to such auditors or independent accountants; and provided,
further, that Transferor, its Affiliates or Representatives shall have no right
to access or review any Tax Return or other Tax information of or with respect
to Acquiror, Parent or any of their Affiliates, or otherwise in respect of any
tax period (or portion thereof) beginning after the Closing Date, except for Tax
Returns or other Tax information to the extent it relates solely to the
Transferred Companies for the preparation of Tax Returns by the Founder, any
Transferor Party or any Holder for any tax period beginning on or before the
Closing Date or the defense of any such Tax Return in any examination, audit,
dispute or proceeding, or the control of, or participation in, any Tax Claim by
a Tax Indemnifying Party pursuant to Section 7.14(c). The Transferor Parties
shall reimburse the Acquiror promptly for any reasonable out-of-pocket expenses
incurred by the Acquiror and its Affiliates in complying with any request by or
on behalf of such Transferor Party or its Affiliates or Representatives in
connection with this Section 7.4(a).

(b) The Transferor Parties shall have the right, subject to compliance with all
applicable Laws (including privacy Laws), to retain copies of all books, data,
files, information, records, documents, correspondence and other materials in
any media (including, for the avoidance of doubt, Tax Returns and other
information and documents relating to tax matters) of each of the Transferred
Companies as of the Closing (i) relating to information (including employment
and medical records) regarding the employees or relating to the Tax Returns of,
or that include, the Transferred Companies, (ii) as required by any legal or
regulatory authority, including any applicable Law or regulatory request or
(iii) as may be necessary for the Transferor Parties to perform their respective
obligations pursuant to this Agreement, the Transaction Documents or any other
agreement between the Transferor Parties, the Founder, or the Holders, on the
one hand, and the Transferred Companies, on the other hand, that will remain in
effect after the Closing.

(c) The Acquiror agrees that, with respect to all original books, data, files,
information, records, documents, correspondence and other materials of each of
the Transferred Companies existing as of the Closing Date, it will (and will
cause each of the Transferred Companies and any other Affiliates of the Acquiror
to) (i) comply in all material respects with all applicable Laws

 

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relating to the preservation and retention of records, (ii) apply preservation
and retention policies that are no less stringent than those generally applied
by the Acquiror from time to time with respect to its other businesses and that
are customary for similar businesses and (iii) maintain such books, data, files,
information and other records for examination and copying by the Transferor
Parties (such copying to be at the expense of the Transferor Parties) for six
(6) years following the Closing; provided, that after such six (6)-year period
the Acquiror shall use its reasonable best efforts to provide the Transferor
Parties with at least ninety (90) days’ written notice prior to destroying or
disposing of, and otherwise provide the Transferor Parties with reasonably
opportunity to take possession of, any such books, data, files, information and
other records, at which time and at the option and expense of the Transferor
Parties, the Acquiror shall deliver such books, data, files, information,
records, documents, correspondence and other materials to the Transferor
Parties.

Section 7.5 Employee Benefits Matters.

(a) During the period from the date hereof to the Closing, the Transferor and
the Transferred Companies shall provide the Acquiror with reasonable access to
employee information and with the right to interview the employees of each of
the Transferor Parties and the Transferred Companies in a manner designed to
minimize disruption to the operations of the Transferor and Transferred
Companies. The Transferor and the Transferred Companies agree to supply any
assistance and accurate information (including initial employment dates,
termination dates, reemployment dates, hours of service, compensation and tax
withholding history in a form that shall be usable by the Acquiror) as may be
reasonably requested by the Acquiror in connection with the foregoing. During
the period from the date hereof to the Closing, the Transferred Companies shall
accrue amounts in respect of cash incentive compensation for the second half of
calendar year 2014 consistent with the cash incentive compensation amounts for
such period reflected in the Management Projections.

(b) From and after the Closing, the Acquiror shall provide, or shall cause to be
provided, to employees of the Transferred Companies as of the Closing who
continue to be employed after the Closing with Parent or its Affiliate (the
“Continuing Employees”), with compensation and benefits that are substantially
comparable to the compensation and benefits provided by the Acquiror to
similarly-situated employees of the Business.

(c) For purposes of accrual in the case of any vacation or paid time off, and
eligibility and vesting under any employee benefit plans and for other service
related entitlements (but excluding retiree life insurance, retiree health
benefits and participation in any defined benefit retirement plan), the Acquiror
shall recognize, or shall cause to be recognized, the same years of service
recognized and confirmed by the Transferor and the Transferred Companies
immediately prior to the Closing, subject to the consent of the insurance
carriers for such employee benefit plans, which consent the Acquiror will use
its commercially reasonable efforts to obtain.

(d) If requested by the Acquiror in writing at least ten (10) Business Days
preceding the Closing Date, the Transferor and the Transferred Companies shall
terminate any Transferor Plans that are intended to qualify under Section 401(k)
of the Code (each a “Transferor Entity 401(k) Plan”) not later than one
(1) business day immediately preceding the Closing Date. In the event that the

 

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Acquiror requests that such 401(k) plan(s) be terminated, the Transferor and the
Transferred Companies shall provide the Acquiror with evidence that such 401(k)
plan(s) have been terminated pursuant to resolution of the Board of Directors,
the managing member, or other committees or Persons exercising similar
supervisory authority, of the Transferred Company sponsoring the Transferor
Entity 401(k) Plan (the form and substance of which shall be subject to review
and approval by the Acquiror) not later than the Business Day immediately
preceding the Closing Date.

(e) The provisions of this Section 7.5 are for the sole benefit of the parties
to this Agreement and nothing in this Agreement, expressed or implied, is
intended or shall be construed to (i) constitute an amendment to any of the
compensation or benefits plans maintained for or provided to employees of the
Transferor or any Transferred Company prior to or following the Closing,
(ii) confer upon or give to any Person, other than the parties to this Agreement
and their respective permitted successors and assigns, any legal or equitable or
other rights or remedies with respect to the matters provided for in this
Section 7.5 under or by reason of any provision of this Agreement, (iii) prevent
the Acquiror from amending or terminating any Transferor Plan in accordance with
its terms, (iv) create any third party beneficiary rights in any individual with
respect to the compensation, terms and conditions of employment and/or benefits
that may be provided to any individual by the Transferor or any Transferred
Company or under any benefit plan which the Transferor or any Transferred
Company may maintain or (v) confer a right to continued employment to any
individual.

Section 7.6 Certain Intercompany Matters. Except as specifically contemplated by
any of the Transaction Documents, or to the extent the Acquiror notifies the
Transferor otherwise within sixty (60) days of the date hereof, or as set forth
on Schedule 7.6(a) of the Transferor Parties Disclosure Schedule, (a) all
services provided by the Transferor or any of its Affiliates (other than the
Transferred Companies) to any of the Transferred Companies, (b) all services
provided to the Transferor or any of its Affiliates (other than the Transferred
Companies) by any of the Transferred Companies and (c) all agreements between
the Transferor or any of its Affiliates (other than the Transferred Companies)
on the one hand, and any of the Transferred Companies, on the other hand, in
each case shall be terminated as of immediately prior to the Closing without
payment or incurrence of further liability or obligation (contingent or
otherwise) thereunder. At the Closing, the Acquiror shall, or shall cause a
Subsidiary of the Acquiror to, assume, or otherwise cause to be terminated, the
obligations of the Founder pursuant to the Contract set forth on Schedule 7.6(b)
of the Transferor Parties Disclosure Schedule.

Section 7.7 Other Transaction Documents. The Transferor Parties and the Acquiror
and Parent shall use their respective reasonable best efforts to negotiate in
good faith and finalize each of the Transaction Documents that is required to be
executed prior to or at the Closing as promptly as practicable but no later than
thirty (30) days after the date hereof. At or prior to the Closing, the
Transferor Parties shall, and shall cause each of their Affiliates that is a
party to any Transaction Documents aside from this Agreement to, execute and
deliver such Transaction Documents to which it is a party, and the Acquiror
shall, and shall cause each of its Affiliates that is a party to any such
Transaction Documents to, execute and deliver such Transaction Documents.

 

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Section 7.8 Notice of Developments. Prior to the Closing, the Transferor
Parties, the Acquiror and Parent agree to promptly notify the other in case of a
material development that is reasonably likely to cause a condition to Closing
set forth in Article VIII not to be capable of being satisfied as of the
expected Closing Date or, if later, the Termination Date; provided, that no such
notice shall affect any remedies of either party hereunder other than, if
applicable, the right not to effect the Closing to the extent the condition to
Closing runs in such party’s benefit and cannot be met prior to the Termination
Date. No notice pursuant to this Section 7.8, nor any failure to provide such
notice, shall be considered for purposes of Article VIII or IX, nor shall any
such notice or failure to provide such notice create or waive any claim for
indemnification pursuant to Article X.

Section 7.9 Further Assurances. On and after the Closing Date, the Transferor
Parties (as reasonably requested from time to time by the Acquiror) and the
Acquiror and Parent (as reasonably requested from time to time by the Transferor
Parties) shall take all reasonably appropriate action and execute any additional
documents, instruments or conveyances of any kind (not containing additional
representations and warranties) which may be reasonably necessary to carry out
any of the provisions of this Agreement.

Section 7.10 Confidentiality.

(a) The terms of the Confidentiality Agreement are incorporated into this
Agreement by reference and shall continue in full force and effect until the
Closing, at which time the confidentiality obligations under the Confidentiality
Agreement shall terminate other than any obligations that relate to any period
prior to the Closing.

(b) From and after the Closing, the Transferor Parties shall, and shall cause
their respective Affiliates and Representatives (other than the Founder) to,
maintain in confidence any written, oral or other information relating to or
obtained from the Acquiror or its Affiliates and any information pertaining to
the Transferred Companies or the Transactions, and the Acquiror shall, and shall
cause its respective Affiliates and Representatives to, maintain in confidence
any written, oral or other information relating to or obtained from the
Transferor Parties other than any information pertaining to the Transferred
Companies or the Transactions, except that the foregoing requirements of each
party hereto contained in this Section 7.10(b) shall not apply to the extent
that (i) any such information is published or otherwise becomes available to the
general public other than (A) in the case of the Acquiror, as a result of
disclosure by any Transferor Party and (B) in the case of the Transferor
Parties, as a result of disclosure by the Acquiror or any Transferred Company
(after the Closing Date) or in the case of (A) or (B), any of their respective
Affiliates or any of their respective Representatives, (ii) any such information
(including any report, statement, testimony or other submission to a
Governmental Authority) is required by applicable Law or such Governmental
Authority to be disclosed, after prior notice has been given to the other party
to the extent such notice is permitted by applicable Law or such Governmental
Authority; provided that no such notice is required if prohibited by applicable
Law, and such party uses its reasonable commercial efforts to limit such
disclosure and obtain assurances that any information so disclosed will be
accorded confidential treatment, (iii) any such information is required to be
disclosed to a Governmental Authority in connection with any Action or in any
dispute with respect to the Transaction Documents (including in response to any
summons, subpoena or other legal process or formal or informal investigative
demand issued to the

 

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disclosing party in the course of any litigation, arbitration, mediation,
investigation or administrative proceeding), and such party uses its reasonable
commercial efforts to limit such disclosure and obtain assurances that any
information so disclosed will be accorded confidential treatment to the extent
permitted in connection therewith, (iv) any such information was or becomes
available to such party on a non-confidential basis and from a source (other
than a party hereto or any Affiliate or Representative of such party) that is
not known by the disclosing party to be bound by a confidentiality agreement or
other obligation of confidentiality with respect to such information, (v) any
such information was available to such party prior to the time of disclosure by
or on behalf of the other party or (vi) any such information was independently
developed by such party or its Representatives without reference to or use of
any confidential information of the other party. Each of the parties hereto
shall instruct its Affiliates and Representatives having access to such
information of such obligation of confidentiality; provided, however, that each
party shall be responsible for the breach of this Section 7.10 by any of its
Affiliates or Representatives; it being understood that the parties hereto may
disclose information about the Tax treatment and Tax structure of the
Transactions (including any facts or materials relating thereto or reasonably
necessary to understand such treatment or structure).

Section 7.11 Publicity; Notices. Until the Closing Date, the parties hereto
shall coordinate with each other as soon as practicable in advance as to (a) the
form and content of any external communication, including any communication
intended for dissemination or to reach, or reasonably expected to be
disseminated or to reach, members of the public regarding the Transactions and
(b) the form and content of any communication from the Acquiror to any
Continuing Employee. No party hereto or any Affiliate or Representative of such
party shall issue or cause the publication of any press release or public
announcement or otherwise communicate with any news media in respect of this
Agreement or the Transactions without the prior written consent of the other
party hereto (which consent shall not be unreasonably withheld, conditioned or
delayed), except as may be required by Law or applicable securities exchange
rules, in which case the party hereto required to publish such press release or
public announcement shall allow the other party hereto a reasonable opportunity
to comment on such press release or public announcement in advance of such
publication, and shall use its commercially reasonable efforts to include such
comments. Prior to the Closing, none of the parties hereto, nor any of their
respective Affiliates or Representatives, shall make any disclosure concerning
plans or intentions relating to the customers, agents, employees of, or other
Persons with significant business relationships with, any Transferred Company
without first obtaining the prior written approval of the other parties hereto,
which approval shall not be unreasonably withheld, conditioned or delayed.
Notice and consent given in connection with this Section 7.11 may be given by
email to one or more individuals designated by each of the parties hereto.

Section 7.12 Cooperation. From the date hereof until the Closing Date, the
Transferor shall, and shall make reasonable efforts to cause the Transferred
Companies to, assist the Acquiror and Parent in their efforts to comply with
anti-money laundering, anti-bribery, terrorist financing and “know your
customer” Laws (including the U.S. Foreign Corrupt Practices Act and the U.K.
Bribery Act) in respect of the businesses of the Transferred Companies.

 

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Section 7.13 Transition Plan. Between the date of this Agreement and the Closing
Date, the Transferor and the Acquiror shall, in accordance with mutually
acceptable guidelines and procedures and in all events in accordance with
applicable Law and internal policies: (i) designate certain Persons (including,
in the case of Persons designated by the Transferor, Representatives of the
Transferred Companies) to serve as members of one or more (as agreed by the
Transferor and the Acquiror) transition teams with Representatives of the other
party and cause such Persons to devote a reasonable amount of time to discussing
transition matters, including periodic meetings to discuss planning and
implementation of transition plans, and (ii) reasonably cooperate with the other
party to assist in the formulation of a transition plan.

Section 7.14 Tax Matters.

(a) Indemnification for Transferor Taxes.

(i) Each of Holding and the Holders shall, severally and not jointly, indemnify,
defend and hold harmless the Acquiror Indemnified Parties against, and reimburse
the Acquiror Indemnified Parties for its Class E Pro Rata Percentage (as of such
time as provided in Section 10.7(c)(iv)), or in the case of the Audit Restricted
Units, the Class E Pro Rata Percentage without regard to the exclusion of Class
E Units that were converted from Class G Interests or Class H Interests in the
numerator or the denominator thereof, of any Transferor Taxes.

(ii) Each Holder shall indemnify, defend and hold harmless the Acquiror
Indemnified Parties from the portion, if any, of Specified Amounts that are
attributable to such Holder.

(b) Preparation of Tax Returns.

(i) Holding shall prepare or cause to be prepared and file or cause to be filed
all Tax Returns required to be filed by the Transferred Companies for all
periods ending on or prior to the Closing Date which are required to be filed on
or before the Closing Date. Such Tax Returns shall be prepared consistently with
the past practice of the Transferred Companies, as applicable, unless otherwise
required by applicable Law. Holding shall provide (or cause to be provided)
drafts of any such Tax Returns no later than thirty (30) days prior to the
applicable due date (taking into account all extensions properly obtained) of
such Tax Return for the Acquiror’s review and approval (such approval not to be
unreasonably withheld, delayed or conditioned).

(ii) The Acquiror shall prepare or cause to be prepared and file or cause to be
filed all Tax Returns not described in Section 7.14(b)(i) that are required to
be filed by or with respect to the Transferred Companies. In the case of any Tax
Returns that relate to any Pre-Signing Tax Period or to any portion of a
Straddle Period ending on the Closing Date, the Acquiror shall prepare such Tax
Returns consistent with past practices of the Transferred Companies, as
applicable, unless otherwise required by applicable Law, and shall provide (or
cause to be provided) drafts of such Tax Returns no later than thirty (30) days
prior to the applicable due date (taking into account all extensions properly
obtained) of such Tax Return for the Transferor Parties’ review and approval
(such approval not to be unreasonably withheld, delayed or conditioned). The
Transferor Parties shall pay the Acquiror an amount equal to the Transferor
Taxes due with such Tax Return no later than five (5) Business Days prior to the
due date of such Taxes.

 

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(iii) For purposes of this Section 7.14, in the case of any Taxes that are
imposed on a periodic basis and are payable for a Straddle Period, the portion
of such Tax which relates to the portion of such Straddle Period ending on the
Signing Date shall (A) in the case of any Taxes other than the Taxes based upon
or related to income or receipts, be deemed to be the amount of such Tax for the
entire taxable period multiplied by a fraction the numerator of which is the
number of days in the taxable period ending on the Signing Date and the
denominator of which is the number of days in the entire taxable period, and
(B) in the case of any Tax based upon or related to income or receipts be deemed
equal to the amount which would be payable if the relevant taxable period ended
on the Signing Date.

(c) Contest Provisions.

(i) The Acquiror shall notify the party or parties liable for any
indemnification under Section 7.14(a) (the “Tax Indemnifying Party”) in writing
within ten (10) Business Days after the receipt by the Acquiror or the
Transferred Companies of any written notice of any examination, audit, dispute
or proceeding regarding any Taxes or Tax Return (a “Tax Claim”), which notice
shall specify the amount of the estimated amount of such Tax Claim, with respect
to which the Tax Indemnifying Party may have an indemnification obligation;
provided, however, that the failure to provide such notice shall not release the
Tax Indemnifying Party of any of its obligations under this Section 7.14, except
to the extent that the Tax Indemnifying Party is prejudiced by such failure.

(ii) The Tax Indemnifying Party shall be entitled to control, at its sole cost
and expense, any Tax Claim to the extent such Tax Claim is solely in respect of
(x) Transferor Taxes, and (y) any taxable period ending on or before the Signing
Date and (z) Specified Amounts; provided that (A) the Tax Indemnifying Party
shall provide the Acquiror with notice of its intention to assume the defense of
any such Tax Claim and shall keep the Acquiror fully and timely informed with
respect to the commencement, status and nature of any such Tax Claim, (B) the
Acquiror, at its sole cost and expense, shall have the right to participate in
any such Tax Claim, (C) the Tax Indemnifying Party shall not settle or otherwise
resolve any portion of such Tax Claim that is reasonably likely to adversely
affect the Tax liability of the Transferred Companies for any taxable year (or
portion thereof) beginning after the Signing Date without the prior written
consent of the Acquiror (which consent will not be unreasonably withheld or
delayed) and (D) if the Tax Indemnifying Party does not assume or is not
conducting the defense of any such Tax Claim actively and diligently, the
Acquiror may assume control of such Tax Claim and defend such Tax Claim in a
manner as it may deem appropriate, including settling such Tax Claim, after
giving notice thereof to the Tax Indemnifying Party. The Acquiror shall not
settle any claim that could result in an indemnification obligation under
Section 7.14(a) without the consent of Holding (which consent shall not be
unreasonably withheld or delayed).

(iii) The Acquiror shall be entitled to control, at its sole cost and expense,
any Tax Claim not described in Section 7.14(c)(ii); provided, however, that in
the case of a Tax Claim that could reasonably materially adversely affect the
liability of the Tax Indemnifying Party under Section 7.14(a), (A) Holding, at
its sole cost and expense, shall have the right to participate in any

 

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such Tax Claim and (B) the Acquiror shall not settle or otherwise resolve any
such Tax Claim without the prior written consent of Holding (which consent shall
not be unreasonably withheld or delayed).

(iv) For purposes of this Section 7.14(c), in the event that Tax Indemnifying
Party is a Holder, the term “Tax Indemnifying Party” shall mean the Holders’
Representative, acting on behalf of such Holder.

(v) These provisions, and not Section 10.4, shall apply to any audits,
examinations, proposed adjustments or other type of controversy involving any
Tax Authority.

(d) Transfer Taxes. All Transfer Taxes will be borne equally by the Acquiror on
one hand and the Transferor Parties on the other hand; provided, that the
Acquiror shall be responsible for any UK stamp duty or UK stamp duty reserve Tax
on the transfer of the ISI UK Shares up to the amount of $25,000, with the
amount of any UK stamp duty or UK stamp duty reserve Tax in excess of $25,000 to
be borne equally by the Acquiror, on one hand, and the Transferor Parties on the
other hand. Such Transfer Taxes shall be paid by the party legally responsible
to pay such Taxes (with the other party paying the party that is legally
responsible to pay the tax its share of such tax at least three (3) Business
Days before the tax payment due date). Both parties will join in the execution
of any such Tax Returns and other documentation as required by Law.

(e) Survival of Obligations. Notwithstanding anything to the contrary in this
Agreement, the obligations of the parties set forth in this Section 7.14 shall
be unconditional and absolute and shall remain in effect sixty (60) days after
the expiration of the applicable statute of limitations (taking into account any
tolling periods and other extensions) applicable thereto and shall not be
subject to any limitation provided for in Article X.

(f) U.S. Federal Income Tax Characterization. The parties agree to treat and
report the contribution of the ISI Interests to the Acquiror in exchange for the
Securities and the distribution by the Transferor of Securities in liquidation
of the Transferor pursuant to this Agreement as an “assets over” merger, as such
term is given meaning in Treasury Regulations Section 1.708-1(c)(3)(i), of the
Transferor with and into the Acquiror with the Acquiror as the surviving
partnership, for all federal, state and local income Tax purposes, in each case
except as required by a change in the applicable Law after the date hereof. The
parties hereto shall (A) not take any position on any U.S. federal, state, local
or non-U.S. Tax Return that is contrary to this Section 7.14(f), except as
required by a change in the applicable Law after the date hereof, and
(B) cooperate fully with respect to the reporting and defense of the position
set forth in this Section 7.14(f).

(g) Cooperation with respect to Specified Amounts. Each Holder, the Holders’
Representative (on behalf of the Holders), and the Acquiror, on behalf of the
Acquiror Indemnified Parties, shall cooperate to reduce the Specified Amounts,
including the Holder’s Representative consulting with the Acquiror before making
any payments to any Governmental Authority in respect of such Specified Amounts.

 

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Section 7.15 Registration Rights. Following the Closing, Parent shall provide,
or cause to be provided, the Registration Rights to the Holders, Holding,
Holding II and the Founder on the terms set forth in Annex E hereto.

Section 7.16 Cancellation of Management Holdings Management Units. Each of
Holding and Management Holdings shall take all actions necessary such that the
Management Holdings Management Units will be cancelled at or promptly following
the Closing upon receipt by Management Holdings of the Management Securities
without any further action of either Holding or Management Holdings.

Section 7.17 Dissolution and Liquidation of Management Holdings. Simultaneously
with the Closing, Holding shall take or have taken all actions necessary to
effect the dissolution and liquidation of Management Holdings and, as part of
the dissolution and liquidation process, cause Management Holdings to distribute
the Management Securities to the Holders in accordance with Annex A.

Section 7.18 Dissolution of the Transferor. Simultaneously with the Closing,
Holding shall take or have taken all actions necessary to effect the dissolution
and liquidation of the Transferor, and, as part of the dissolution and
liquidation process, cause the Transferor to distribute the Founder Securities
to Holding and Holding II in accordance with Annex A.

Section 7.19 Bank Regulatory Matters. Each of the Founder and the Holders agrees
that it shall not act in concert with respect to the acquisition of control (as
those terms are defined in 12 C.F.R. Section 5.50) of Parent, the Acquiror or
any bank that is regulated by the Office of the Comptroller of the Currency and
is a Subsidiary of Parent.

Section 7.20 Signing Balance Sheet. As soon as practicable following the date of
this Agreement, but in any event no later than six (6) weeks after the date of
this Agreement, the Transferor shall cause the Transferred Companies to deliver
to the Acquiror the Signing Balance Sheet.

Section 7.21 Valuation and Reporting. The parties agree that value of the ISI
Interests and the consideration to be exchanged therefor pursuant to this
Agreement shall be equal to or higher than (and in any event, not lower than)
$312,000,000 as of the Signing Date, and agree further that the value of the ISI
Interests shall be equal to or higher than (and in any event, not lower than)
$312,000,000 as of the Closing Date; it being understood that the Transferor
Parties shall use commercially reasonable efforts with respect to matters within
their control to preserve such value between the date hereof and the Closing.
The parties hereto shall, and shall cause their Affiliates to, not take any
position inconsistent with this agreed valuation for the ISI Interests (A) for
all accounting and financial reporting purposes (except as otherwise required by
applicable accounting standards) and shareholder reporting purposes (including
in any 8K’s, 10K’s, 10Q’s or similar filings or other Parent SEC Reports),
(B) in communicating the transactions to the public via information statements,
investor calls, reports to analysts or similar communications (except to the
extent permitted pursuant to clause (A)), and (C) in any other public statement
(except to the extent permitted pursuant to clause (A)). In addition, the
parties hereto shall, and shall cause their Affiliates to, use this agreed
valuation, and not take any position inconsistent therewith, for all federal
(and applicable state, local and non-U.S.) Tax purposes. The parties hereto
shall cooperate fully with respect to the reporting and defense of the position
set forth in this Section 7.21.

 

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Section 7.22 Directors & Officers Indemnification and Insurance.

(a) From and after the Closing Date, the Acquiror shall cause the Transferred
Companies to indemnify and hold harmless, to the fullest extent permitted under
applicable Law, pursuant to indemnification agreements existing on the date
hereof and set forth on Schedule 7.22(a) of the Transferor Parties Disclosure
Schedule or the Organizational Documents of the Transferred Companies in effect
on the date hereof (and the Acquiror and the Transferred Companies shall also
advance expenses to the fullest extent required by the Organizational Documents
of the Transferred Companies in effect on the date hereof; provided, that the
Person to whom expenses are advanced provides an undertaking to repay such
advances if it is ultimately determined that such Person is not entitled to
indemnification), each present and former director, officer and employee of any
Transferred Company against any Losses incurred in connection with any Action,
arising out of or related to such Person’s service as a director, officer or
employee of any Transferred Company or services performed by such Persons at the
request of any Transferred Company at or prior to the Closing Date, whether
asserted or claimed prior to, at or after the Closing Date, including the
Transactions, and including any expenses incurred in enforcing such Person’s
rights under this Section 7.22. The indemnification agreements existing on the
date hereof and set forth on Schedule 7.22(a) of the Transferor Parties
Disclosure Schedule with any of the directors, officers or employees of the
Transferred Companies shall continue in full force and effect in accordance with
their terms following the Closing Date.

(b) For not less than six (6) years from and after the Closing Date, the
Organizational Documents of the Transferred Companies shall contain provisions
no less favorable with respect to exculpation, indemnification and advancement
of expenses of directors, officers and employees of the Transferred Companies
for periods at or prior to the Closing Date than are currently set forth in the
Organizational Documents of the Transferred Companies, provided, however, that
after the Closing Date, any amount in respect of which any director, officer, or
employee of the Transferred Companies is entitled to be indemnified pursuant to
Section 7.22(a) or this Section 7.22(b) shall be reduced by the portion of any
claim for which the Parent or Acquiror is entitled to indemnification under
Article X that such indemnified director, officer or employee is responsible for
pursuant to Article X (in his or her capacity as an Indemnifying Party).

(c) For the benefit of the Transferred Companies’ directors and officers,
following the date of this Agreement, the Transferor Parties shall obtain an
insurance and indemnification policy (the “D&O Insurance”) that provides
coverage for a period of six (6) years from and after the Closing Date for
events occurring prior to the Closing Date.

(d) In the event the Acquiror or the Transferred Companies (i) consolidate with
or merge into any other person and shall not be the continuing or surviving
corporation or entity of such consolidation or merger or (ii) transfer all or
substantially all of their properties and assets to any Person, then proper
provision shall be made so that such continuing or surviving corporation or
entity or transferee of such assets, as the case may be, shall assume the
obligations set forth in this Section 7.22.

 

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(e) The obligations under this Section 7.22 shall not be terminated or modified
in such a manner as to adversely affect any past or present directors, officers
and employees of the Transferred Companies to whom this Section 7.22 applies
without the consent of such affected Person (it being expressly agreed that the
Persons to whom this Section 7.22 applies are express third party beneficiaries
of this Section 7.22).

(f) The rights of each such director, officer and employee under this
Section 7.22 shall be in addition to any rights such Person may have under the
Organizational Documents of the Transferred Companies, or under any applicable
Laws or contractual indemnification rights.

Section 7.23 Passporting Undertaking. Within twenty-one (21) days after the date
hereof, Holding will, with respect to each European Economic Area state in which
ISI UK conducts its business, provide, and, with respect to any other European
Economic Area state in which Evercore Partners International LLP conducts
business and for which the Acquiror so requests, cooperate with the Acquiror to
provide, to the Acquiror a completed form of a Passporting Notification as
required to permit ISI UK to carry on its business in such European Economic
Area states and, as soon as reasonably practicable following receipt of comments
from the Acquiror on such Passporting Notification, submit such Passporting
Notification in final form, incorporating any reasonable comments provided by
the Acquiror, to the FCA.

Section 7.24 Transition Services. Prior to the Closing, the Acquiror and the
Transferor shall in good faith reasonably determine whether the Transferred
Companies and ISI Inc. need to enter into a Transition Services Agreement on the
Closing Date, pursuant to which the Transferred Companies will provide certain
transition services to ISI Inc. (the “Transition Services Agreement”). If the
Acquiror and the Transferor so determine there is such a need, the Acquiror and
Transferor shall negotiate in good faith to cause the relevant parties to enter
into such a Transition Services Agreement.

Section 7.25 Distribution Agreement. Prior to the Closing, with respect to any
unwritten distribution arrangements between ISI Group and ISI Inc., ISI Group
and ISI Inc. will enter into an arms’ length Distribution Agreement which shall
replicate the economic terms of such distribution arrangement between ISI Group
and ISI Inc. as of the date hereof and shall include such other terms as the
Transferor and the Acquiror may reasonably agree (the “Distribution Agreement”).

 

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ARTICLE VIII

CONDITIONS TO CLOSING

Section 8.1 Conditions Precedent to the Obligations of Each Party. The
obligations of each party hereto to consummate the Transactions shall be subject
to fulfillment at or prior to the Closing of the following conditions (either
(a) or (b) of which may, to the extent permitted by Law, be waived in writing in
whole or in part by the Acquiror, Parent, the Transferor Parties, the Founder
and the Holders’ Representative in their discretion):

(a) No Governmental Order. There shall be no Law in existence (which is final
and non-appealable) that prohibits the consummation of the Transactions; and

(b) Governmental Approvals. All Required Governmental Approvals shall have been
obtained. The waiting period (and any extension of such period) under the HSR
Act applicable to the consummation of the transactions contemplated by this
Agreement shall have expired or shall have been terminated.

Section 8.2 Conditions Precedent to the Obligations of the Transferor Parties,
the Holders and the Founder. The obligations of the Transferor Parties, the
Holders and the Founder under this Agreement are subject to the fulfillment, as
of the Closing, of the following conditions (all or any of which may, to the
extent permitted by Law, be waived in whole or in part by the Transferor Parties
in their discretion):

(a) Representations and Warranties. Each of the Acquiror Fundamental
Representations shall be true and correct as of the date of this Agreement and
as of the Closing as if made on and as of the Closing (except for such
representations and warranties that are made as of a specific date which shall
speak only as of such date and other than de minimis inaccuracies with respect
to the Acquiror or Parent). Each of the other representations and warranties of
the Acquiror set forth in this Agreement (other than the representations and
warranties set forth in Section 6.12) shall be true and correct, without giving
effect to any limitation as to materiality or Acquiror Material Adverse Effect
set forth therein, as of the date of this Agreement and as of the Closing as if
made on and as of the Closing (except for such representations and warranties
that are made as of a specific date which shall speak only as of such date),
except for such failures of such representations and warranties of the Acquiror
to be so true and correct as, individually or in the aggregate, have not had and
are not reasonably likely to have an Acquiror Material Adverse Effect, and the
representations and warranties set forth in Section 6.12 shall be true and
correct as of the date of this Agreement and as of the Closing;

(b) Compliance with Covenants. Each of the Acquiror and Parent shall have
performed in all material respects its covenants contained in this Agreement to
be complied with or performed prior to the Closing;

(c) No Acquiror Material Adverse Effect. No Acquiror Material Adverse Effect
shall have occurred since the date of this Agreement; and

(d) Certificates. The Acquiror and Parent shall have furnished the Transferor
Parties with a certificate, dated as of the Closing Date, executed by a duly
authorized officer, stating that the conditions set forth in Section 8.2(a) and
Section 8.2(b) have been satisfied or waived.

 

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Section 8.3 Conditions Precedent to the Obligations of the Acquiror and Parent.
The obligations of the Acquiror and Parent under this Agreement are subject to
the fulfillment, as of the Closing, of the following conditions (all or any of
which may, to the extent permitted by Law, be waived in whole or in part by the
Acquiror in its discretion):

(a) Representations and Warranties. Each of the Transferor Parties Fundamental
Representations, the Holder Fundamental Representations and the Founder
Fundamental Representations shall be true and correct as of the date of this
Agreement and as of the Closing as if made on and as of the Closing Date (except
for such representations and warranties that are made as of a specific date
which shall speak only as of such date and other than de minimis inaccuracies
with respect to the Transferor Parties, the Holders, or the Founder, as
applicable). Each of the other representations and warranties of the Transferor
Parties, the Holders and the Founder set forth in this Agreement (other than the
representations and warranties set forth in Section 3.10(b)) shall be true and
correct, without giving effect to any limitation as to materiality or
Transferred Companies Material Adverse Effect set forth therein, as of the date
of this Agreement and as of the Closing as if made on and as of the Closing Date
(except for such representations and warranties that are made as of a specific
date which shall speak only as of such date), except for such failures of such
representations and warranties of the Transferor Parties, the Holders or the
Founder to be so true and correct as, individually or in the aggregate, have not
had and are not reasonably likely to have a Transferred Companies Material
Adverse Effect, and the representations and warranties set forth in
Section 3.10(b) shall be true and correct as of the date of this Agreement and
as of the Closing;

(b) Compliance with Covenants. Each of the Transferor Parties, the Holders, the
Founder and the Transferred Companies shall have performed in all material
respects its covenants contained in this Agreement to be complied with or
performed prior to the Closing Date;

(c) No Transferred Companies Material Adverse Effect. No Transferred Companies
Material Adverse Effect shall have occurred since the Signing Date;

(d) Certificates.

(i) The Transferor Parties shall have furnished the Acquiror with a certificate,
dated as of the Closing Date, executed by a duly authorized officer stating that
the conditions set forth in Section 8.3(a) and Section 8.3(b), as they apply to
each of the Transferor Parties’, the Founder’s and the Transferred Companies’
representations, warranties, covenants and agreements in this Agreement, have
been satisfied or waived, and

(ii) The Holders’ Representative shall have furnished the Acquiror with a
certificate, dated as of the Closing Date, executed on behalf of each Holder
stating that the conditions set forth in Section 8.3(a) and Section 8.3(b), as
they apply to such Holder’s representations, warranties, covenants and
agreements in this Agreement, have been satisfied or waived;

(e) Ancillary Agreements. The Founder shall have executed the Subordinated Loan
Amendments and the Guaranty; and

(f) Employees. Each Key Employee shall have remained actively employed by a
Transferred Company through the Closing, and, to the Transferor’s Knowledge, no
Key Employee shall have informed the Acquiror of such Key Employee’s intention
not to honor such individual’s New Employment Agreement; and such employees as
required by Schedule 8.3(f) of the Transferor Parties Disclosure Schedule shall
be actively employed by the applicable Transferred Companies at the Closing.

 

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ARTICLE IX

TERMINATION

Section 9.1 Termination. This Agreement may be terminated prior to the Closing:

(a) by the mutual written consent of the Acquiror and the Transferor Parties;

(b) by either the Transferor Parties or the Acquiror if the Closing has not
occurred on or before May 3, 2015 (the “Termination Date”); provided, however,
that if the sole reason that the Closing has not occurred is that one or more of
the Required Governmental Approvals have not been obtained on or prior to such
date, such date may be extended by either the Acquiror or the Transferor Parties
to a date not beyond August 3, 2015 (the “End Date”); and provided, further,
that the right to terminate this Agreement under this Section 9.1(b) shall not
be available (i) to the Transferor Parties, if any action or inaction of the
Transferor Parties, the Transferred Companies, the Holders or the Founder
required to fulfill any of such party’s obligations under this Agreement has
caused or resulted in the failure of the Closing to occur prior to the End Date
or (ii) to the Acquiror, if any action or inaction of the Acquiror or Parent,
required to fulfill any of such party’s obligations under this Agreement has
caused or resulted in the failure of the Closing to occur prior to the End Date;

(c) by either the Transferor Parties or the Acquiror in the event of the
issuance of a final, non-appealable Order restraining or prohibiting the
consummation of the Transactions; provided, however, that the right to terminate
this Agreement under this Section 9.1(c) shall not be available (i) to the
Transferor Parties, if any action or inaction of the Transferor Parties, the
Transferred Companies, the Holders or the Founder required to fulfill any of
such party’s obligations under this Agreement has caused or resulted in the
issuance of such Order or (ii) to the Acquiror, if any action or inaction of the
Acquiror or Parent, required to fulfill any of such party’s obligations under
this Agreement has caused or resulted in the issuance of such Order;

(d) by the Acquiror (but only so long as the Acquiror or Parent is not in breach
of its obligations under this Agreement, which breach would cause the conditions
in Section 8.2 not to be satisfied) if there has been a breach of any
representation, warranty, covenant or agreement of the Transferor Parties, the
Holders or the Founder such that one or more of the conditions to Closing set
forth in Section 8.1 and Section 8.3 are not capable of being fulfilled as of
the Termination Date; or

(e) by the Transferor Parties (but only so long as the Transferor Parties are
not in breach of their obligations under this Agreement, which breach would
reasonably be expected to cause the conditions in Section 8.3 not to be
satisfied) if there has been a breach of any representation, warranty, covenant
or agreement of the Acquiror or Parent such that one or more of the conditions
to Closing set forth in Section 8.1 and Section 8.2 are not capable of being
fulfilled as of the Termination Date.

 

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Section 9.2 Notice of Termination. Any party hereto desiring to terminate this
Agreement pursuant to Section 9.1 shall give written notice of such termination.
In the case of any such termination by the Acquiror, such written notice shall
be given to the Transferor Parties and in the case of any such termination by
the Transferor Parties, such written notice shall be given to the Acquiror.

Section 9.3 Effect of Termination. In the event of the termination of this
Agreement as provided in Section 9.1, this Agreement shall terminate and become
void and none of the Transferor Parties, the Holders, the Founder, the Acquiror,
Parent, any of their respective Affiliates or any of the officers, directors or
stockholders of any of them shall have any liability of any nature whatsoever
under this Agreement, or in connection with the Transactions, except that
(i) the provisions of Section 7.10, this Article IX and Article XI shall survive
such termination and (ii) nothing in this Agreement will relieve any part from
liability for any willful and material pre-termination breach by such party of
the terms and provisions of this Agreement; provided, however, that
notwithstanding the termination of this Agreement pursuant to this Section 9.3,
the Confidentiality Agreement shall remain in full force and effect in
accordance with its terms.

ARTICLE X

INDEMNIFICATION

Section 10.1 Survival. The representations and warranties of the Transferor
Parties, the Holders, the Founder, the Acquiror and Parent contained in this
Agreement shall survive in full force and effect until the date that is eighteen
(18) months after the Closing Date, at which time they shall terminate (and no
claims shall be made for indemnification under this Article X thereafter),
except that: (i) the Transferor Parties Fundamental Representations, the Holder
Fundamental Representations, the Founder Fundamental Representations and the
Acquiror Fundamental Representations shall survive the Closing indefinitely, and
if at the time of the termination of the survivability of any representation a
claim has been filed with respect to any representation, such representation
shall survive until the resolution of such claim and (ii) the representations
and warranties set forth in Section 3.12 shall survive in full force and effect
until the expiration of the applicable statute of limitations with respect to
the matters addressed by such representations and warranties. The covenants and
agreements related to actions to be taken, or refrained from being taken, prior
to Closing shall remain in full force and effect until the date that is eighteen
(18) months after the Closing Date. The covenants and agreements related to
actions to be taken, or refrained from being taken following the Closing Date
shall survive until fully performed, or until the expiration of all applicable
statutes of limitations (giving effect to any extensions thereof) with respect
to the matters addressed by such covenants and agreements.

 

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Section 10.2 Indemnification by Holding and the Holders.

(a) From and after the Closing and subject to this Article X, Holding and each
of the Holders shall, severally and not jointly, indemnify, defend and hold
harmless the Acquiror, Parent, their respective Affiliates and each of their
Affiliates’ Representatives (the “Acquiror Indemnified Parties”) against, and
reimburse the Acquiror Indemnified Parties for, its Class E Pro Rata Percentage
(calculated as of the relevant date specified in Section 10.7) of any Losses
that any of the Acquiror Indemnified Parties may at any time suffer or incur, or
become subject to, in each case, to the extent arising out of or in connection
with, or resulting from:

(i) the inaccuracy or breach of any representation or warranty contained in
Article III (other than any representation or warranty relating to Taxes);

(ii) the inaccuracy or breach of any representation or warranty in Section 4.1
to Section 4.6 inclusive;

(iii) any breach or failure by any Transferor Party or the Transferred Companies
to perform any of their covenants or obligations contained in this Agreement
(other than any covenant or obligation relating to Taxes); or

(iv) any Excluded Liabilities.

(b) From and after the Closing and subject to this Article X, each Holder,
severally and not jointly, shall indemnify, defend and hold harmless the
Acquiror Indemnified Parties against, and reimburse the Acquiror Indemnified
Parties for, any Losses that the Acquiror Indemnified Parties may at any time
suffer or incur, or become subject to, in each case, to the extent arising out
of or in connection with, or resulting from, (i) the inaccuracy or breach of any
representation or warranty of such Holder contained in Section 4.7 to
Section 4.11 inclusive or (ii) any breach or failure by such Holder to perform
any of such Holder’s covenants or obligations contained in this Agreement.

(c) From and after the Closing and subject to this Article X, Holding shall
indemnify, defend and hold harmless the Acquiror Indemnified Parties against,
and reimburse the Acquiror Indemnified Parties for, any Losses that any of the
Acquiror Indemnified Parties may at any time suffer or incur, or become subject
to, in each case, to the extent arising out of or in connection with, or
resulting from, the inaccuracy or breach of any representation or warranty
contained in Section 4.12 to Section 4.16 inclusive.

(d) From and after the Closing and subject to this Article X, Holding shall
indemnify, defend and hold harmless the Acquiror Indemnified Parties against,
and reimburse the Acquiror Indemnified Parties for, any Losses that any of the
Acquiror Indemnified Parties may at any time suffer or incur, or become subject
to, in each case, to the extent arising out of or in connection with, or
resulting from, any Specified Liabilities.

(e) For purposes of determining the inaccuracy or breach of any representations
or warranties), any materiality or Transferred Companies Material Adverse Effect
qualification contained in the representations and warranties (other than such
qualifications contained in the representations and warranties set forth in
Section 3.10) shall be disregarded.

 

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(f) Notwithstanding anything to the contrary contained herein, neither Holding
nor any of the Holders shall be required to indemnify, defend or hold harmless
any Acquiror Indemnified Party against, or reimburse any Acquiror Indemnified
Party for, any Losses pursuant to Section 10.2(a)(i), Section 10.2(a)(ii),
Section 10.2(b)(i) or Section 10.2(c) (other than Losses arising out of or in
connection with, or resulting from, the inaccuracy or breach of any Transferor
Parties Fundamental Representations, Holder Fundamental Representations or
Founder Fundamental Representations) (A) with respect to any claim (or series of
related claims arising from the same underlying facts, events or circumstances)
in respect of such Losses, unless such claim (or series of related claims
arising from the same underlying facts, events or circumstances) involves such
Losses in excess of $50,000; and (B) until the aggregate amount of such Losses
(for the avoidance of doubt, taking into account any Losses arising out of or in
connection with, or resulting from, the inaccuracy or breach of any Transferor
Parties Fundamental Representations, Holder Fundamental Representations or
Founder Fundamental Representations) exceeds $1,320,000, and then for any Losses
in excess thereof, subject to the provisions of this Article X. The aggregate
amount of indemnification payments made to all Acquiror Indemnified Parties in
respect of Losses pursuant to Section 10.2(a)(i), Section 10.2(a)(ii),
Section 10.2(b)(i) or Section 10.2(c) (other than Losses arising out of or in
connection with, or resulting from, the inaccuracy or breach of any Transferor
Parties Fundamental Representations, Holder Fundamental Representations or
Founder Fundamental Representations) shall not, individually or in the
aggregate, exceed $23,400,000 (the “Indemnification Cap”).

(g) Notwithstanding anything to the contrary contained herein, (i) the sole
remedy available to the Acquiror Indemnified Parties in respect of any
indemnification claim made pursuant to Section 10.2(a)(i)-(iii), Section 10.2(b)
or Section 10.2(c) (other than in respect of the inaccuracy or breach of any
Transferor Parties Fundamental Representations, Holder Fundamental
Representations or Founder Fundamental Representations), shall be the forfeiture
of the Eligible Class E Units pursuant to the procedures set out in
Section 10.7, and (ii) the sole remedy available to the Acquiror Indemnified
Parties in respect of any indemnification claim made pursuant to
Section 10.2(a)(iv), Section 10.2(d) or Section 7.14 and, with respect to the
inaccuracy or breach of any Transferor Parties Fundamental Representations,
Holder Fundamental Representations or Founder Fundamental Representations only,
Section 10.2(a)(i)-(iii), Section 10.2(b) or Section 10.2(c), shall be the
forfeiture of Securities pursuant to the procedures set out in Section 10.7.

Section 10.3 Indemnification by the Acquiror and Parent.

(a) From and after the Closing and subject to this Article X, the Acquiror and
Parent, jointly and severally, shall indemnify, defend and hold harmless each
Transferor Party, each Holder, the Founder, their respective Affiliates and each
of their and their Affiliates’ Representatives (collectively, the “Transferor
Indemnified Parties”) against, and reimburse the Transferor Indemnified Parties
for, all Losses that any of the Transferor Indemnified Parties may at any time
suffer or incur, or become subject to, in each case, to the extent arising out
of or in connection with, or resulting from:

(i) the inaccuracy or breach of any representation or warranty in Article V or
Article VI of this Agreement;

 

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(ii) any breach or failure by the Acquiror or Parent to perform any of its
covenants or obligations contained in this Agreement; and

(iii) any business, property, asset, liability, operation or activity of the
Transferred Companies, to the extent attributable to the operation or ownership
of the Transferred Companies following the Closing (for the avoidance of doubt
solely in the Transferor Indemnified Parties’ capacity as former owners of the
business being contributed hereby and not in any other connection, including not
(A) in their capacity as employees, (B) in connection with any compensation
payable under the Acquiror LP Agreement, or (C) as holders of equity of the
Acquiror or Parent or any of their Affiliates).

(b) Notwithstanding anything to the contrary contained herein, neither the
Acquiror nor Parent shall be required to indemnify, defend or hold harmless any
Transferor Indemnified Party against, or reimburse any Transferor Indemnified
Party for, any Losses pursuant to Section 10.3(a)(i) (other than Losses arising
out of or in connection with, or resulting from, the inaccuracy or breach of any
Acquiror Fundamental Representations) (A) with respect to any claim (or series
of related claims arising from the same underlying facts, events or
circumstances) in respect of such Loss, unless such claim (or series of related
claims arising from the same underlying facts, events or circumstances) involves
such Losses in excess of $50,000; and (B) until the aggregate amount of such
Losses exceeds $1,320,000. The aggregate amount of indemnification payments made
to all Transferor Indemnified Parties in respect of Losses pursuant to
Section 10.3(a)(i) (other than Losses arising out of or in connection with, or
resulting from, the inaccuracy or breach of any Acquiror Fundamental
Representations) shall not, individually or in the aggregate, exceed the
Indemnification Cap.

Section 10.4 Third-Party Claim Indemnification Procedures.

(a) In the event that any written claim or demand for which an indemnifying
party (an “Indemnifying Party”) may have liability to any party seeking
indemnification pursuant to this Article X (an “Indemnified Party”), other than
those relating to Taxes (which are the subject of Section 7.14(c)), is asserted
against or sought to be collected from any Indemnified Party by a third party (a
“Third-Party Claim”), such Indemnified Party shall promptly, but in no event
more than ten (10) days following such Indemnified Party’s receipt of a
Third-Party Claim, notify the applicable Indemnifying Party (it being understood
that all notices to be provided to the Holders as an Indemnifying Party shall be
provided to the Holders’ Representative) in writing of such Third-Party Claim,
the amount or the estimated amount of damages sought thereunder to the extent
then ascertainable (which estimate shall not be conclusive of the final amount
of such Third-Party Claim), any other remedy sought thereunder, any relevant
time constraints relating thereto and, to the extent practicable, any other
material details pertaining thereto (a “Claim Notice”); provided, however, that
the failure to timely give a Claim Notice shall affect the rights of an
Indemnified Party hereunder only to the extent that such failure has a material
prejudicial effect on the defenses or other rights available to the Indemnifying
Party with respect to such Third-Party Claim. Notwithstanding anything to the
contrary contained herein, if more than one of the Holders are Indemnified
Parties or

 

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Indemnifying Parties, then the terms “Indemnified Party” and “Indemnifying
Party” (to the extent referenced in this Agreement in respect of actions
required to be taken, or notices required to be given, to or by such Indemnified
Parties or Indemnifying Parties, but not in respect of indemnification
obligations of such Indemnifying Parties or the right to indemnification of such
Indemnified Parties) shall mean the Holders’ Representative acting on behalf of
such Holders, and each such Holder shall be responsible for communicating on a
timely basis with the Holders’ Representative in connection therewith. The
Indemnifying Party shall have thirty (30) days (or such lesser number of days
set forth in the Claim Notice as may be required by court proceeding in the
event of a litigated matter) after receipt of the Claim Notice (the “Notice
Period”) to notify the Indemnified Party that it desires to defend the
Indemnified Party against such Third-Party Claim. The Indemnifying Party will
keep the Indemnified Party reasonably advised of the status of such Third-Party
Claim and the defense thereof.

(b) In the event that the Indemnifying Party notifies the Indemnified Party
within the Notice Period that it desires to defend the Indemnified Party against
a Third-Party Claim, the Indemnifying Party shall have the right to defend the
Indemnified Party and shall have the sole power to direct and control such
defense, at its expense. Once the Indemnifying Party has duly assumed the
defense of a Third-Party Claim, the Indemnified Party shall have the right, but
not the obligation, to participate in any such defense and to employ separate
counsel of its choosing at the Indemnified Party’s sole cost and expense. The
Indemnified Party shall participate in any such defense at its sole cost and
expense unless (i) the Indemnifying Party and the Indemnified Party are both
named parties to the proceedings and the Indemnifying Party shall have
reasonably concluded that representation of both parties by the same counsel
would be inappropriate due to actual or potential differing interests between
them, or (ii) the Indemnified Party assumes the defense of a Third-Party Claim
after the Indemnifying Party has failed to diligently pursue a Third-Party Claim
it has assumed, as provided in the first sentence of Section 10.4(c). The
Indemnifying Party shall not, without the prior written consent of the
Indemnified Party (which shall not be unreasonably withheld, conditioned or
delayed), settle, compromise or offer to settle or compromise any Third-Party
Claim on a basis that (A) contains an admission of liability on the part of the
Indemnified Party or any of its Affiliates, (B) does not include as an
unconditional term thereof the giving by the claimant or the plaintiff to the
Indemnified Party of an unconditional release from all liability in respect of
such Third-Party Claim or (C) would impose a judgment that provides for anything
other than monetary damages that are indemnified in accordance with this
Article X (subject to Section 10.7). The Indemnifying Party shall (i) not
encumber any of the material assets of any Indemnified Party or agree to any
restriction or condition that would apply to or materially adversely affect any
Indemnified Party or the conduct of any Indemnified Party’s business without the
prior written consent of the Indemnified Party (which shall not be unreasonably
withheld, conditioned or delayed).

(c) If the Indemnifying Party (i) elects not to defend the Indemnified Party
against a Third-Party Claim by not giving the Indemnified Party timely notice of
its desire to so defend pursuant to Section 10.4(a) or (ii) after assuming the
defense of a Third-Party Claim, fails to take reasonable steps necessary to
defend diligently such Third-Party Claim within ten (10) days after receiving
written notice from the Indemnified Party to the effect that the Indemnifying
Party has so failed, the Indemnified Party shall have the right but not the
obligation to assume its own defense; it being understood that the Indemnified
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Third-Party Claim shall not be adversely affected by assuming the defense of
such Third-Party Claim. The Indemnified Party shall not settle a Third-Party
Claim without the consent of the Indemnifying Party, which consent shall not be
unreasonably withheld, conditioned or delayed.

(d) Notwithstanding anything in this Agreement to the contrary, as promptly as
reasonably practicable following receipt by the Acquiror of a Claim Notice or a
written notice by Holding, Holding II or the Holders’ Representative of a demand
or inquiry by a Governmental Authority, or subpoena or other legal process
served by any Person, relating to any Transferred Company, the Acquiror shall,
and shall cause each Transferred Company to, retain documents that are then
within the Acquiror’s or any Transferred Company’s possession or control and
reasonably related to such Third-Party Claim or such other demand or other legal
process for a period of time that Holding or the Holders’ Representative
reasonably determines, in consultation with the Acquiror, after taking into
account all relevant facts and circumstances (each such period, a “Claim Notice
Period”). For the purposes of this Section 10.4(d), the term “documents” is
defined as synonymous with the term “documents or electronically stored
information” in Federal Rule of Civil Procedure 34(a)(1)(A). If the Indemnifying
Party chooses to assume the defense of any Third-Party Claim, the Indemnifying
Party may direct the Indemnified Party with respect to such Third-Party Claim to
take during the Claim Notice Period reasonable measures (which measures shall be
at least substantially comparable to measures employed by the Indemnified Party
with respect to its own materials following the Closing) designed to preserve
attorney-client privilege or attorney work-product immunity to the extent then
existing in respect of documents reasonably relating to such Third-Party Claim
and the Indemnified Party shall, upon the reasonable written request of the
Indemnifying Party, make reasonably available to the Indemnifying Party such
books, records or other documents and employees and Representatives reasonably
relating to such Third-Party Claim that are within the Indemnified Party’s
possession or control that are reasonably related to the litigation related to
such Third-Party Claim. Except with respect to any sharing of privileged
materials under any common interest agreement or joint defense agreement entered
into by the Transferor Parties and the Acquiror, subject to the following
proviso, the Indemnified Party shall not be required to make available to the
Indemnifying Party any information that is subject to an attorney-client or
other applicable legal privilege that based on the reasonable opinion of its
outside counsel would be impaired by such disclosure or any confidentiality
restriction under applicable Law; provided, however, that the Transferor
Parties, the Holders’ Representative, or Acquiror, as applicable, shall use its
commercially reasonable efforts to permit the Indemnifying Party to become party
to any joint defense or common interest agreement entered into by an Indemnified
Party with any third Person.

(e) Notwithstanding anything to the contrary contained in this Agreement
(including Section 7.14, Section 10.2 and Section 10.3), no Indemnifying Party
shall have any liability under this Article X or Section 7.14 for any Losses
arising out of or in connection with any Third-Party Claim that is settled or
compromised by an Indemnified Party without the consent of such Indemnifying
Party (such consent not to be unreasonably withheld, conditioned or delayed).

Section 10.5 Direct Claims. If an Indemnified Party wishes to make a claim for
indemnification hereunder for a Loss that does not result from a Third-Party
Claim (a “Direct Claim”), the Indemnified Party shall (i) notify the
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such Direct Claim, (ii) specify the amount or the estimated amount of damages
sought thereunder to the extent then ascertainable (which estimate shall not be
conclusive of the final amount of such Direct Claim), (iii) state in reasonable
detail the circumstances giving rise to the Loss, (iv) specify the
representation, warranty, covenant or agreement of this Agreement alleged to
have been breached or not performed by the Indemnifying Party, (v) state any
other remedy sought thereunder, (vi) specify any relevant time constraints
relating thereto, and (vii) to the extent practicable, any other material
details pertaining thereto. The Indemnifying Party shall have a period of thirty
(30) days within which to respond to such Direct Claim. If the Indemnifying
Party does not respond with an objection and a reasonably specific basis for
such objection within such thirty (30)-day period, the Indemnifying Party will
be deemed to have accepted the Direct Claim.

Section 10.6 Payments.

(a) In the event a claim for indemnification under this Article X has been
finally determined, (i) if the Indemnified Party is a Transferor Indemnified
Party, the amount of such final determination shall be paid to the Indemnified
Party by the Acquiror promptly in immediately available funds and (ii) if the
Indemnified Party is an Acquiror Indemnified Party, the provisions of
Section 10.7 shall apply, subject to the provisions of Section 10.2(g).

(b) A claim, and the liability for and amount of damages therefor, shall be
deemed to be “finally determined” for purposes of this Article X when the
parties hereto have so determined by mutual agreement or, if disputed, when a
final, non-appealable Order or arbitral award has been entered into with respect
to such claim or the Action relating to such claim, and, for the avoidance of
doubt, shall include any expenses incurred in respect of prosecuting such claim.

Section 10.7 Payment by Holding and the Holders.

(a) Exchange Restriction. At the Closing, and on each of the first anniversary
of the Closing, the second anniversary of the Closing and the third anniversary
of the Closing, if there is then any pending claims for indemnification made by
the Acquiror pursuant to Section 10.2(a) or Section 7.14(a)(i), then, for each
such claim, a number of Class E Units, rounded down to the nearest whole unit,
that (i) for the non-Founder Class E Units, vest at such time and (ii) for the
Founder Class E Units, that but for this Section 10.7(a) would become
exchangeable for Parent Common Stock at such time (in the case of (i) and (ii),
other than Class E Units that were converted from Class G Interests or Class H
Interests, in each case not exceeding the Class E Units Cap) equal to the
product of (x) the dollar value of such pending claim (subject to
Section 10.9(a)), as set forth in any notice delivered pursuant to Section 10.4,
Section 10.5 or Section 7.14(c), as applicable, multiplied by the aggregate
Class E Pro Rata Percentage of Holding and each Holder (with respect to each
such claim, the total dollar amount of such claim as of any time of measurement,
multiplied by the aggregate Class E Pro Rata Percentage of Holding and each
Holder, the “Reserve Amount”), divided by the Market Price at such time
(together, the “Exchange Restricted Units”), will be subject to the forfeiture
provisions contained in this Section 10.7 and will not be exchangeable into
Parent Common Stock except to the extent permitted by the provisions of this
Section 10.7. The Exchange

 

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Restricted Units shall be allocated across Holding and the Holders in accordance
with their respective Class E Pro Rata Percentages calculated as of the Closing,
the first anniversary of the Closing, the second anniversary of the Closing, and
the third anniversary of the Closing, as applicable. In addition, at any time
there is any pending claim for indemnification made by the Acquiror pursuant to
Section 10.2(b), Section 10.2(c) , Section 10.2(d) or Section 7.14(a)(ii), a
number of Class E Units held by the Person against whom such claim is pending,
rounded down to the nearest whole unit, equal to the dollar value of such
pending claims (subject to Section 10.9(a)), as set forth in any notice
delivered to a particular Holder pursuant to Section 10.4, Section 10.5 or
Section 7.14(c), as applicable (with respect to each such claim against such
Person, the total dollar amount of such claim as of any time of measurement, the
“Individual Reserve Amount”), divided by the Market Price at such time and at
the time of final determination (at each relevant time, the “Individual Exchange
Restricted Units”), will be subject to the forfeiture provisions contained in
this Section 10.7 and will not be exchangeable into Parent Common Stock except
to the extent permitted by the provisions of this Section 10.7.

(b) Release of Exchange Restriction. Within five (5) Business Days following
each of the first three anniversaries of the Closing, a number of then Exchange
Restricted Units with respect to each indemnification claim, rounded down to the
nearest whole unit, equal to, if positive, the excess of (i) the number of then
Exchange Restricted Units previously reserved pursuant to Section 10.7(a)
against such indemnification claim pursuant to Section 10.2(a) or
Section 7.14(a)(i), over (ii) the number of Exchange Restricted Units forfeited
with respect to such indemnification claim pursuant to Section 10.7(c)(i) or
Section 10.7(c)(iv), as applicable (such excess Exchange Restricted Units, the
“Aggregate Exchange Restricted Removal Units”), shall be released from any
exchange restriction hereunder and shall no longer be Exchange Restricted Units;
provided, that if there are any indemnification claims made by the Acquiror
pursuant to Section 10.2(a) or Section 7.14(a)(i) that are still pending as of
such time (including any pending indemnification claims described in the second
sentence of Section 10.7(c)(i)), as set forth in any notices delivered pursuant
to Section 10.4, Section 10.5 or Section 7.14(c) or described in the second
sentence of Section 10.7(c)(i), as applicable, then a number of such Aggregate
Exchange Restricted Removal Units that would otherwise be released pursuant to
this Section 10.7(b) shall become Exchange Restricted Units in respect of any
such still pending claims as shall be allocated and determined by Acquiror (it
being understood that each Exchange Restricted Unit shall be so allocated to a
specific claim as determined by the Acquiror); provided, that the number of
Exchange Restricted Units to be so allocated shall not exceed the amount
necessary so that the aggregate number of Exchange Restricted Units in respect
of each such still pending claim immediately following such release is equal to
(A) the Reserve Amount in respect of such still pending claim as of the time of
such release, divided by (B) the Market Price at such time. Notwithstanding the
foregoing, if there is any indemnification claim made by the Acquiror against a
Person pursuant to Section 10.2(b), Section 10.2(c), Section 10.2(d) or
Section 7.14(a)(ii) that is pending as of such time, as set forth in any notices
delivered pursuant to Section 10.4, Section 10.5 or Section 7.14(c), as
applicable, and if the number of then Individual Exchange Restricted Units of
any Person in respect of such claim is less than (A) the Individual Reserve
Amount of such Person in respect of such claim at such time divided by (B) the
Market Price at such time (such amount, the “Deficit Reserve”), then
contemporaneously with such release of Aggregate Exchange Restricted Removal
Units to such Person pursuant to this Section 10.7(b) (but following any
allocation of such Aggregate Exchange Restricted Removal Units to a claim
pursuant to the immediately preceding sentence), a

 

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number of Aggregate Exchange Restricted Removal Units that otherwise would have
been released to such Person with a value of up to the Deficit Reserve (as
determined using the Market Price at such time) shall remain Individual Exchange
Restricted Units of such Person in respect of such claim. For the avoidance of
doubt, to the extent Aggregate Exchange Removal Units being released pursuant to
this Section 10.7(b) are comprised of Exchange Restricted Units that became
Exchange Restricted Units at different times, the allocation of such Aggregate
Exchange Removal Units among Holding and the Holders shall be determined based
on the Class E Pro Rata Percentage applicable to such Exchange Restricted Units
at the time such units first became Exchange Restricted Units, with the result
that there may be different Class E Pro Rata Percentages applicable with respect
to each finally determined claim. The Aggregate Exchange Restricted Removal
Units that are released pursuant to this Section 10.7(b) shall be allocated
across Holding and each of the Holders in accordance with their respective Class
E Pro Rata Percentages calculated as of the date such units first became
Exchange Restricted Units. For the avoidance of doubt, if the number of then
Exchange Restricted Units at any time is less than (A) the sum of all the
Reserve Amounts in respect of all unresolved claims at such time divided by
(B) the Market Price at such time, then no Exchange Restricted Units shall be
released at such time (and shall be instead reallocated against remaining
unresolved claims as provided in this Section 10.7(b)).

(c) Forfeiture Upon Final Determination of a Claim.

(i) Upon any claim for indemnification pursuant to
Section 10.2(a)(i)-(iii) being finally determined in favor of the Acquiror, a
number of Exchange Restricted Units, rounded down to the nearest whole unit,
equal to the amount payable to the Acquiror pursuant to this Article X in
respect of such finally determined claim divided by the Market Price as of the
date of final determination shall be forfeited to the Acquiror, without any
further action (except as set forth in Section 10.7(d)), with such forfeiture
being allocated in accordance with Holding’s and each Holder’s Class E Pro Rata
Percentage, calculated as of the date that such units first became Exchange
Restricted Units, with apportionment between units withheld from release and
reserved against at each anniversary of the Closing occurring as provided in
Section 10.7(b). If the number of Exchange Restricted Units forfeited pursuant
to the preceding sentence multiplied by the Market Price as of the date of final
determination is less than the product of (x) the amount of such finally
determined claim multiplied by (y) the aggregate Class E Pro Rata Percentages of
Holding and each Holder, then the number of forfeited Exchange Restricted Units,
multiplied by the Market Price as of the date of final determination shall be
subtracted from the amount of the finally determined claim and the amount of
such shortfall shall be considered a pending claim in respect of the next date
on which Class E Units may become Exchange Restricted Units pursuant to
Section 10.7(a) and for purposes of determining the number of Aggregate Exchange
Restricted Removal Units to be released pursuant to Section 10.7(b).

(ii) (A) Upon any claim for indemnification pursuant to Section 10.2(b) (other
than any claim with respect to a Holder Fundamental Representation) being
finally determined against any Holder and in favor of the Acquiror, a number of
Eligible Class E Units of such Holder, rounded down to the nearest whole unit,
equal to the amount payable to the Acquiror pursuant to this Article X in
respect of such finally determined claim divided by the Market Price as of the
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forfeited to the Acquiror, without any further action (except as set forth in
Section 10.7(d)). (B) Upon any claim for indemnification pursuant to
Section 10.2(b) with respect to a Holder Fundamental Representation, or pursuant
to Section 7.14(a)(ii), being finally determined against any Holder and in favor
of the Acquiror, a number of Securities (which may include the Eligible Class E
Units, determined at the Acquiror’s sole discretion) of such Holder, rounded
down to the nearest whole unit, equal to the amount payable to the Acquiror
pursuant to this Article X in respect of such finally determined claim divided
by the Market Price as of the date of final determination shall be forfeited to
the Acquiror, without any further action (except as set forth in
Section 10.7(d)).

(iii) (A) Upon any claim for indemnification pursuant to Section 10.2(c) (other
than any claim with respect to a Founder Fundamental Representation) being
finally determined in favor of the Acquiror, a number of Eligible Class E Units
of Holding, rounded down to the nearest whole unit, equal to the amount payable
to the Acquiror pursuant to this Article X in respect of such finally determined
claim divided by the Market Price as of the date of final determination shall be
forfeited to the Acquiror, without any further action (except as set forth in
Section 10.7(d)). (B) Upon any claim for indemnification pursuant to
Section 10.2(a)(iv) with respect to a Founder Fundamental Representation being
finally determined against the Founder and in favor of the Acquiror, a number of
Securities (which may include the Eligible Class E Units, determined at the
Acquiror’s sole discretion) of the Founder, rounded down to the nearest whole
unit, equal to the amount payable to the Acquiror pursuant to this Article X in
respect of such finally determined claim divided by the Market Price as of the
date of final determination shall be forfeited to the Acquiror, without any
further action (except as set forth in Section 10.7(d)).

(iv) Upon any claim for indemnification pursuant to Section 10.2(a)(iv) or
Section 7.14(a)(i) or, solely with respect of the inaccuracy or breach of any
Transferor Parties Fundamental Representations, Section 10.2(a)(i)-(ii), being
finally determined in favor of the Acquiror, a number of Securities (which may
include the Eligible Class E Units, determined at the Acquiror’s sole
discretion) of Holding or each Holder equal to the amount payable to the
Acquiror pursuant to Section 10.2(a)(iv) or Section 7.14(a)(i), or, solely with
respect of the inaccuracy or breach of any Transferor Parties Fundamental
Representations, Section 10.2(a)(i)-(ii), as applicable, in respect of such
finally determined claim multiplied by Holding’s or such Holder’s Class E Pro
Rata Percentage, without regard to the exclusion of Class E Units that were
converted from Class G Interests or Class H Interests in the numerator or the
denominator thereof, as of the date the claim for indemnification is made (with
respect to claims against Securities other than Exchange Restricted Units) and
as of the date the units in respect of such claim first became Exchange
Restricted Units) divided by the Market Price as of (x) with respect to vested
Class E Units, the date of final determination, and (y) with respect to any
other Securities, the date the Management Securities become vested Class E Units
or the date the Founder Securities become exchangeable for Parent Common Stock,
shall be forfeited to the Acquiror, without any further action (except as set
forth in Section 10.7(d)); provided, that to the extent Securities of one or
more classes are forfeited pursuant to this Section 10.7(c)(iv), such Securities
shall be forfeited by Holding and each Holder in the same or as similar
proportions with respect to each class of Security as is practicable; it being
understood that in the event that any portion of a claim is being satisfied by
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have not yet become vested Class E Units or Founder Securities that have not yet
become exchangeable for Parent Common Stock, such claim shall be satisfied by
such Securities upon their vesting or becoming exchangeable for Parent Common
Stock).

(v) Upon any claim for indemnification pursuant to Section 10.2(d) being finally
determined in favor of the Acquiror, a number of Securities (which may include
the Eligible Class E Units, determined at the Acquiror’s sole discretion) of
Holding equal to the amount payable to the Acquiror pursuant to this Article X
in respect of such finally determined claim divided by the Market Price as of
(x) with respect to vested Class E Units, the date of final determination, and
(y) with respect to any other Securities, the date such Securities become
exchangeable for Parent Common Stock, shall be forfeited to the Acquiror,
without any further action (except as set forth in Section 10.7(d)); it being
understood that in the event that any portion of a claim is being satisfied by
Securities that as of the date of final determination have not yet become
exchangeable for Parent Common Stock, such claim shall be satisfied by such
Securities upon their becoming exchangeable for Parent Common Stock.

(vi) For the avoidance of doubt, in no event shall Securities be forfeited
pursuant to more than one of clauses (i), (ii), (iii), (iv) or (v) of this
Section 10.7(c) in respect of the same underlying Loss.

(d) Forfeiture Notice. No later than five (5) Business Days following the final
determination of a claim for indemnification resulting in a forfeiture of
Securities pursuant to this Section 10.7, the Acquiror shall provide written
notice to each holder of Securities to be so forfeited (a “Forfeiture Notice”),
setting forth (i) the amount payable in respect of the applicable claim pursuant
to this Article X or Section 7.14, as applicable, (ii) the calculation of such
holder’s portion of such payment and (iii) the number and calculation of the
Securities (including any Exchange Restricted Units and Individual Exchange
Restricted Units) being so forfeited pursuant to this Section 10.7.

(e) Holding Distribution. If at any time following the Closing, Holding
distributes any of the Founder Securities (or Management Securities reallocated
to Holding pursuant to the Acquiror LP Agreement) to any of Holding’s equity
holders, notwithstanding anything to the contrary contained herein, such
Securities shall be subject to this Section 10.7 and each provision applicable
to Holding shall, mutatis mutandis, apply to such equity holder following such
distribution.

(f) Tax Reserve.

(i) If, immediately prior to the last Class H Conversion Date (as defined in the
Acquiror LP Agreement), there is any pending audit, examination, investigation
or other proceeding, claim or assessment with respect to Taxes (“Tax Audit”) or
the Acquiror has received notice of any Tax Audit that, as agreed by the
Acquiror and the Holders’ Representative, acting reasonably, could give rise to
an indemnifiable obligation under Section 7.14(a)(i), a number of Class E Units
that a holder of Class G Interests and Class H Interests would receive upon
conversion of such Interest at such time, in each case, rounded down to the
nearest whole unit, with an aggregate value at such time, equal to the product
of (x) the aggregate Class E Pro Rata Percentage of Holding and each Holder
(determined without regard to the exclusion of Class E Units that were converted
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in the numerator or denominator thereof) calculated as of the time of such
restriction, multiplied by (y) the dollar value of the anticipated outcome of
such Tax Audit, as agreed by the Acquiror and the Holders’ Representative,
acting reasonably, divided by (z) the Market Price at such time (together, the
“Audit Restricted Units”) will be subject to the forfeiture provisions of this
Section 10.7 and will not be exchangeable into Parent Common Stock, until such
time as the Tax Audit and any claims resulting therefrom are finally determined.
The Audit Restricted Units shall be allocated across Holding and the Holders in
accordance with their respective Class E Pro Rata Percentages, determined
without regard to the exclusion of Class E Units that were converted from Class
G Interests or Class H Interests in the numerator or the denominator thereof,
calculated as of the time of such restriction.

(ii) If, immediately prior to the last Class H Conversion Date (as defined in
the Acquiror LP Agreement), there is any pending Tax Audit or the Acquiror has
received notice of any Tax Audit that, as agreed by the Acquiror and the
Holders’ Representative, acting reasonably, could give rise to an indemnifiable
obligation under Section 7.14(a)(ii) with respect to a Holder, a number of Class
E Units that such Holder of Class G Interests and Class H Interests would
receive upon conversion of such Interest at such time, in each case, rounded
down to the nearest whole unit, with an aggregate value at such time, equal to
(y) the dollar value of the anticipated outcome of such Tax Audit with respect
to Specified Amounts with respect to such Holder , as agreed by the Acquiror and
the Holders’ Representative, acting reasonably, divided by (z) the Market Price
at such time (together, the “Specified Restricted Units”) will be subject to the
forfeiture provisions of this Section 10.7 and will not be exchangeable into
Parent Common Stock, until such time as the Tax Audit and any claims resulting
therefrom are finally determined.

(iii) To the extent that any Holder who has forfeited Management Securities in
connection with a termination of employment (a “Forfeiting Holder”) has
liability pursuant to Section 7.14(a)(ii), and such forfeited Management
Securities have been reallocated to Holding or other Holders pursuant to the
Acquiror LP Agreement, such reallocated Management Securities shall be subject
to being held in reserve and forfeited in accordance with this Section 10.7 in
respect of the Forfeiting Holder’s liability under Section 7.14(a)(ii) to the
same extent as if such Management Securities continued to be held by the
Forfeiting Holder. In such case, such reservation and/or forfeiture, as
applicable, of such Management Securities shall be allocated among the Persons
to whom such Management Securities were reallocated in proportion to amount
reallocated to each such Person.

(g) Acceleration Trigger Event. If any Exchange Restricted Units, Individual
Exchange Restricted Units or Specified Restricted Units are redeemed in exchange
for Deal Consideration (as defined in the Acquiror LP Agreement) in connection
with an Acceleration Trigger Event (as defined in the Acquiror LP Agreement),
the Deal Consideration received by the Holders and/or Holding, as applicable, in
respect of such units shall be restricted, shall be subject to forfeiture and
shall be subject to release from restriction, in each case, to the same extent
as the redeemed units would have been, with such restriction, forfeiture and
release governed by the provisions of this Section 10.7, applied mutatis
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Section 10.8 Exclusive Remedies. Following the Closing, subject to the
penultimate sentence of Section 7.3(a) and Section 11.12, other than in the case
of fraud, the indemnification provisions of this Article X and the provisions of
Section 7.14 shall be the sole and exclusive remedies of the parties hereto for
any breach of the representations, warranties, covenants or agreements contained
in this Agreement, and notwithstanding anything to the contrary contained
herein, no breach of any representation, warranty, covenant or agreement
contained herein shall give rise to any right on the part of any party hereto to
rescind this Agreement, any other Transaction Document or any of the
Transactions.

Section 10.9 Additional Indemnification Provisions.

(a) The Transferor Parties and the Acquiror agree, for themselves and on behalf
of their respective Affiliates and Representatives, that with respect to each
indemnification obligation set forth in Section 7.14 and this Article X: (i) all
Losses shall be reduced by (A) any insurance or other proceeds actually received
by the Indemnified Party from any third party (including reinsurance or
insurance proceeds and any indemnity, contribution or other similar payment
actually recovered by any Indemnified Party from any such third party, and after
taking into account any deductibles, copayments or other cost sharing
arrangements) on account of the Losses, in each case, net of the present value
of any increase in insurance premiums or other charges paid by the Indemnified
Party resulting from such Losses and all costs and expenses reasonably incurred
by the Indemnified Party in recovering such proceeds from such third party (such
proceeds, “Eligible Third-Party Proceeds”) and (B) the amount of any Tax
benefit, over the amount of any Tax detriment (“Net Tax Benefit”) actually
realized by the Indemnified Party (or by its direct or indirect holders, in the
case of an entity treated as a partnership for U.S. federal income tax purposes,
calculated using the Assumed Tax Rate (but only taking into account the federal,
state and local income taxes to the extent applicable in respect of such tax
benefits and detriments)) for the year of the Loss and the three years following
the year of the Loss as a result of sustaining any Losses, and (ii) in no event
shall an Indemnifying Party have any liability to an Indemnified Party for:
(A) any Losses to the extent arising from special circumstances of the
Indemnified Party that were not communicated prior to the date hereof by the
Indemnified Party to the Indemnifying Party, (B) any punitive or special Losses
other than punitive or special Losses recovered by third parties in connection
with a Third-Party Claim, (C) any indirect or consequential Losses to the extent
not the direct and reasonably foreseeable result of any breach by the
Indemnifying Party of a representation, warranty or covenant contained in this
Agreement (provided, that this clause (C) shall not apply to any Losses that are
recovered by third parties in connection with a Third-Party Claim), (D) any
Losses to the extent based on reputational harm (other than any such Losses that
are recovered by a third party in connection with a Third-Party Claim); and
(E) any costs and expenses of investigation, assertion, dispute, enforcement,
defense or resolution, including attorneys’, actuaries’, accountants’ and other
professionals’ fees, disbursements and expenses, to the extent incurred in
connection with any claim or dispute among the parties hereto as to whether a
Transferor Indemnified Party, on the one hand, or an Acquiror Indemnified Party,
on the other hand, is entitled to indemnification under Section 7.14 or this
Article X for any particular Loss or Losses or to specific enforcement under
Section 11.13 except to the extent that an Indemnified Party prevails with
respect to a direct claim (for the avoidance of doubt, the limitations in this
subsection (E) shall not apply with respect to costs and expenses relating to
the investigation, assertion, dispute, enforcement, defense or resolution in
respect of any Third-Party Claim, including reasonable

 

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attorneys’, actuaries’, accountants’ and other professionals’ fees,
disbursements and expenses in respect of any Third-Party Claim, which costs and
expenses shall be subject to the provisions of Section 10.4. No multiplier or
similar concept shall be applied for the purposes of calculating Losses. In the
event that an Indemnified Party actually realizes a Net Tax Benefit with respect
to a Loss subsequent to being indemnified for such Loss by an Indemnifying
Party, such Indemnified Party shall, as promptly as practicable, reimburse such
Indemnifying Party for the amount of such Net Tax Benefit, to the extent such
amount of Net Tax Benefit exceeds, at such time, the amount of any outstanding
indemnification claims pursuant to Article X or Section 7.14. In connection with
the determination of the amount of any pending or finally determined
indemnification claim pursuant to Article X or Section 7.14, the amount of any
Net Tax Benefit actually realized by any Indemnified Party at the time of such
determination over the amount, at such time, of any outstanding indemnification
claims pursuant to Article X or Section 7.14, shall be taken into account in the
determination of the amount of such pending or finally determined
indemnification claim. To the extent that any Net Tax Benefit is actually
realized following a forfeiture of Securities pursuant to Section 10.7, and
prior to the time that Class G Interests and Class H Interests can no longer
convert to Class E Units, then such forfeited Securities shall, as promptly as
practicable, be restored to Holding or the applicable Holder, as applicable, in
an amount equal to the amount of such Net Tax Benefit actually realized over the
amount, at such time, of any outstanding indemnification claims pursuant to
Article X or Section 7.14, divided by the Market Price as of the date of such
restoration (with such restored Securities allocated among Holding and each
Holder in the same proportions, and as the same class of Securities, as the
applicable forfeiture).

(b) Any amount payable by an Indemnifying Party pursuant to this Article X or
Section 7.14 shall be paid, subject to Section 10.7, promptly and payment shall
not be delayed pending any determination of Eligible Third-Party Proceeds. In
any case where an Indemnified Party recovers from a third Person any Eligible
Third-Party Proceeds or any other amount in respect of any Loss for which an
Indemnifying Party has actually reimbursed it pursuant to Section 7.14 or this
Article X, such Indemnified Party shall promptly pay over to the Indemnifying
Party the amount of such Eligible Third-Party Proceeds, but not in excess of the
sum of (i) any amount previously paid by the Indemnifying Party to or on behalf
of the Indemnified Party in respect of such claim and (ii) any amount expended
by the Indemnifying Party in pursuing or defending any claim arising out of such
matter. In connection with the determination of the amount of any pending or
finally determined indemnification claim pursuant to Article X or Section 7.14,
the amount of any Eligible Third-Party Proceeds recovered by any Indemnified
Party at the time of such determination shall be taken into account in the
determination of the amount of such pending or finally determined
indemnification claim. To the extent that Eligible Third-Party Proceeds are
received following a forfeiture of Securities pursuant to Section 10.7, and
prior to the time that Class G Interests and Class H Interests can no longer
convert to Class E Units, then such forfeited Securities shall, as promptly as
practicable, be restored to Holding or the applicable Holder, as applicable, in
an amount equal to the amount of such Eligible Third-Party Proceeds received
divided by the Market Price as of the date of such restoration (with such
restored Securities allocated among Holding and each Holder in the same
proportions, and as the same class of Securities, as the applicable forfeiture).

(c) The parties hereto shall treat any indemnification payment made under this
Agreement and any adjustment thereto pursuant to Section 10.9 as an adjustment
to the consideration hereunder for all federal, state, local and foreign Tax
purposes and the parties agree to file their Tax Returns accordingly.

 

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(d) If the Indemnified Party becomes aware that any portion of Losses reimbursed
or to be reimbursed by the Indemnifying Party may be covered, in whole or in
part, by third party insurance coverage provided by a third party insurer or by
indemnification or other contribution provided by a third party under a Contract
between or among the Indemnified Party and such third party, the Indemnified
Party shall promptly give notice thereof to the Indemnifying Party. The
Indemnified Party shall use, if requested in writing by the Indemnifying Party,
its commercially reasonable efforts at the sole cost of the Indemnifying Party
to collect such insurance or other recoverable proceeds with respect to any such
Losses.

(e) The parties hereto acknowledge and agree that the same Loss may be subject
to indemnification under more than one subsection of Section 10.2 or
Section 10.3(a), respectively; provided, however, that, in no event shall the
Transferor Indemnified Parties, on the one hand, or the Acquiror Indemnified
Parties, on the other hand, be entitled to duplicative recoveries for the same
underlying Loss.

(f) Notwithstanding anything to the contrary in this Agreement, in no event
shall the Holders or Holding or any Indemnifying Party related to any Holder or
Holding be liable for any Losses that constituted a Current Liability for
purposes of determining Closing Date Net Working Capital in connection with the
calculation of the Final Deficit Amount pursuant to Section 2.8.

Section 10.10 Mitigation. Each of the parties hereto agrees to take all
commercially reasonable steps to mitigate their respective Losses upon and after
becoming aware of any event or condition which would reasonably be expected to
give rise to any Losses that are indemnifiable hereunder. In the event an
Indemnified Party fails to so mitigate an indemnifiable Loss, the Indemnifying
Party shall have no liability for any portion of such Loss that reasonably could
have been avoided had the Indemnified Party made such efforts.

Section 10.11 Holders’ Representative. For the avoidance of doubt, the Holders’
Representative has full power and authority to give and receive any notice to be
given by or to the Holders pursuant to this Article X or Section 7.14(c) and to
make any decision or take any other action required to be made or taken by the
Holders pursuant to this Article X or Section 7.14.

ARTICLE XI

GENERAL PROVISIONS

Section 11.1 Expenses. Except as may be otherwise specified in this Agreement
and the other Transaction Documents, all costs and expenses, including fees and
disbursements of counsel, financial advisers and accountants, incurred in
connection with this Agreement and the other Transaction Documents and the
Transactions shall be paid by the Person incurring such costs and expenses,
whether or not the Closing shall have occurred.

 

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Section 11.2 Notices. All notices, requests, claims, demands and other
communications under this Agreement shall be in writing and shall be given or
made (and shall be deemed to have been duly given or made upon receipt) by
delivery in person, by overnight courier service, by facsimile or email with
receipt confirmed (so long as confirmation of transmission is electronically or
mechanically generated and retained by the sending party) or by registered or
certified mail (postage prepaid, return receipt requested) to the respective
parties hereto at the following respective addresses (or at such other address
for a party hereto as shall be specified in a notice given in accordance with
this Section 11.2):

 

(a)   if to the Transferor Parties:   c/o International Strategy & Investment
Group LLC   666 Fifth Avenue  

11th Floor

New York, NY 10103

  Attention:    Vinayak Singh   Facsimile:    (212) 355-2094   with a copy to:  
Paul, Weiss, Rifkind, Wharton & Garrison LLP   1285 Avenue of the Americas  
New York, New York 10019-6064   Attention:    Toby S. Myerson, Esq.      Steven
J. Williams, Esq.   Facsimile:    (212) 757-3990 (b)   if to the Holders’
Representative, on behalf of each Holder:   c/o International Strategy &
Investment Group LLC   666 Fifth Avenue   11th Floor   New York, NY 10103  
Attention:    Vinayak Singh   Facsimile:    (212) 355-2094   with a copy to:  
Paul, Weiss, Rifkind, Wharton & Garrison LLP   1285 Avenue of the Americas  
New York, New York 10019-6064   Attention:    Toby S. Myerson, Esq.      Steven
J. Williams, Esq.   Facsimile:    (212) 757-3990

 

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(c)   if to the Acquiror or Parent:   Evercore Partners Inc.   55 East 52nd
Street, 38th Floor   New York, New York 10055   Attention:    General Counsel  
Facsimile:    (212) 857-3101   with a copy to:   Sullivan & Cromwell LLP   125
Broad Street   New York, New York 10004-2498   Attention:    Stephen M. Kotran,
Esq.   Facsimile:    (212) 291-9086   Attention:    Alexandra D. Korry, Esq.  
Facsimile:    (212) 291-9085 (d)   if to the Founder or the Holders:   c/o
International Strategy & Investment Group LLC   666 Fifth Avenue   11th Floor  
New York, NY 10103   Attention:    Vinayak Singh   Facsimile:    (212) 355-2094
  with a copy to:   Paul, Weiss, Rifkind, Wharton & Garrison LLP   1285 Avenue
of the Americas   New York, New York 10019-6064   Attention:    Toby S. Myerson,
Esq.      Steven J. Williams, Esq.   Facsimile:    (212) 757-3990

Section 11.3 Severability. If any term or other provision of this Agreement is
invalid, illegal or incapable of being enforced under any Law or as a matter of
public policy, all other conditions and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of the transactions contemplated by this Agreement is not affected in
any manner materially adverse to any party hereto. Upon such determination that
any term or other provision is invalid, illegal or incapable of being enforced,
the parties hereto shall negotiate in good faith to modify this Agreement so as
to effect the original intent of the parties hereto as closely as possible in a
mutually acceptable manner in order that the transactions contemplated by this
Agreement be consummated as originally contemplated to the greatest extent
possible.

 

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Section 11.4 Entire Agreement. Except as otherwise expressly provided in the
Transaction Documents, this Agreement (together with the Annexes hereto, the
Transferor Parties Disclosure Schedule and the Acquiror Disclosure Schedule) and
the other Transaction Documents constitute the entire agreement of the parties
hereto with respect to the subject matter of the Transaction Documents and
supersede all prior agreements and undertakings, both written and oral, other
than the Confidentiality Agreement to the extent not in conflict with this
Agreement, between or on behalf of the parties hereto with respect to the
subject matter of this Agreement.

Section 11.5 Assignment. Neither this Agreement nor any of the rights, interests
or obligations under this Agreement may be assigned, in whole or in part, by
operation of law or otherwise by a party hereto without the prior written
consent of the other parties hereto; provided, that the Acquiror may assign its
rights hereunder to any Subsidiary of the Acquiror; provided, further, that no
such assignment shall relieve the Acquiror of its obligations hereunder. Any
attempted assignment in violation of this Section 11.5 shall be null and void.
Subject to the preceding sentence, this Agreement shall be binding upon, shall
inure to the benefit of, and shall be enforceable by the parties hereto and
their successors and permitted assigns.

Section 11.6 No Third-Party Beneficiaries. Except as provided in Article X with
respect to Transferor Indemnified Parties and Acquiror Indemnified Parties and
Section 7.22 with respect to each present and former director, officer and
employee of any Transferred Company, this Agreement is for the sole benefit of
the parties hereto and their successors and permitted assigns, and nothing in
this Agreement, express or implied, is intended to or shall confer upon any
other Person any legal or equitable right, benefit or remedy of any nature
whatsoever under or by reason of this Agreement.

Section 11.7 Amendment; Waiver. No provision of this Agreement may be amended,
supplemented or modified except by a written instrument signed by all of the
parties thereto. No provision of this Agreement may be waived except by a
written instrument signed by the party against whom the waiver is to be
effective. For the avoidance of doubt, any amendment or waiver of this Agreement
on behalf of any one or more Holders may be signed by the Holders’
Representative. No failure or delay by any party hereto in exercising any right,
power or privilege hereunder shall operate as a waiver thereof nor shall any
single or partial exercise thereof preclude any other or further exercise
thereof or the exercise of any other right, power or privilege. The rights and
remedies herein provided shall be cumulative and not exclusive of any rights or
remedies provided by Law.

Section 11.8 Disclosure Schedules. Matters reflected in any Section of this
Agreement, including any section or subsection of the Transferor Parties
Disclosure Schedule or the Acquiror Disclosure Schedule, are not necessarily
limited to matters required by this Agreement to be so reflected. Such
additional matters are set forth for informational purposes and do not
necessarily include other matters of a similar nature. No reference to or
disclosure of any item or other matter in any Section or Schedule of this
Agreement, including any section or subsection of the Transferor Parties
Disclosure Schedule or the Acquiror Disclosure Schedule, shall be construed as
an admission or indication of liability, that such item or other matter is
material, or that such item or other matter is required to be referred to or
disclosed in this Agreement, the Transferor Parties Disclosure Schedule or the
Acquiror Disclosure Schedule and no such disclosure shall broaden the scope of
any representation, warranty, covenant or agreement contained in this

 

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Agreement. Without limiting the foregoing, no such reference to or disclosure of
a possible breach or violation of any contract, Law or Order shall be construed
as an admission or indication that breach or violation exists or has actually
occurred. The references to, and disclosures of any item or other matter in, any
Section or Schedule of this Agreement, including any section or subsection of
the Transferor Parties Disclosure Schedule or the Acquiror Disclosure
Schedule are disclosed solely for the purposes of this Agreement.

Section 11.9 Governing Law; Submission to Jurisdiction; Waiver of Jury Trial.

(a) The Transaction Documents, the Transactions and all claims and defenses
arising out of or relating to any such transactions or agreements or the
formation, breach, termination or validity of any such agreements, shall in all
respects be governed by, and construed in accordance with, the Laws of the State
of New York without giving effect to any conflicts of Law principles of such
state that would apply the Laws of another jurisdiction.

(b) Each party hereto irrevocably and unconditionally:

(i) submits for itself and its property to the exclusive jurisdiction of any
state or federal court in New York, New York, in any Action directly or
indirectly arising out of or relating to this Agreement, the transactions
contemplated by this Agreement, or the formation, breach, termination or
validity of this Agreement and agrees that all claims in respect of any such
Action shall be heard and determined solely in such courts;

(ii) consents that any such Action may and shall be brought in such courts and
waives any objection that it may now or hereafter have to the venue or
jurisdiction of any such Action in such court or that such court is an
inconvenient forum for the Action and agrees not to assert, plead or claim the
same;

(iii) agrees that the final judgment of such court shall be enforceable in any
court having jurisdiction over the relevant party or any of its assets;

(iv) irrevocably waives any right to remove any such Action from the Delaware
Court of Chancery to any federal court;

(v) agrees that service of process in any such Action may be effected by mailing
a copy of such process by registered or certified mail (or any substantially
similar form of mail), postage prepaid, to such party at its address as provided
in Section 11.2; and

(vi) agrees that nothing in this Agreement shall affect the right to effect
service of process in any other manner permitted by the applicable rules of
procedure.

(c) EACH PARTY HERETO ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY THAT MAY
ARISE UNDER ANY OF THE TRANSACTION AGREEMENTS IS LIKELY TO INVOLVE COMPLICATED
AND DIFFICULT ISSUES, AND THEREFORE EACH SUCH PARTY HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN
RESPECT OF ANY ACTION DIRECTLY OR INDIRECTLY

 

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ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE OTHER TRANSACTION DOCUMENTS OR
THE TRANSACTIONS OR THE FORMATION, BREACH, TERMINATION OR VALIDITY OF THIS
AGREEMENT OR ANY OTHER TRANSACTION DOCUMENT. EACH PARTY HERETO CERTIFIES AND
ACKNOWLEDGES THAT (I) NO REPRESENTATIVE, AGENT OR ATTORNEY OR ANY OTHER PARTY
HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE
EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, (II) EACH PARTY
HERETO UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER, (III)
EACH PARTY HERETO MAKES THIS WAIVER VOLUNTARILY AND (IV) EACH PARTY HERETO HAS
BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL
WAIVERS AND CERTIFICATIONS OF THIS SECTION 11.9. ANY PARTY HERETO 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.

Section 11.10 Scope of Agreements. This Agreement shall not create any
partnership, joint venture or other similar arrangement between any Transferor
Party or any of its Affiliates, on the one hand, and the Acquiror or any of its
Affiliates, on the other hand.

Section 11.11 Rules of Construction. Interpretation of this Agreement and the
other Transaction Documents (except as specifically provided in any such other
Transaction Documents, in which case such specified rules of construction shall
govern with respect to such other Transaction Documents) shall be governed by
the following rules of construction: (a) words in the singular shall be held to
include the plural and vice versa, and words of one gender shall be held to
include the other gender as the context requires; (b) references to the terms
Preamble, Recitals, Article, Section, paragraph, Schedule and Annexes are
references to the Preamble, Recitals, Articles, Sections, paragraphs,
Schedule and Annexes to this Agreement unless otherwise specified;
(c) references to “$” shall mean U.S. dollars; (d) the word “including” and
words of similar import shall mean “including without limitation,” unless
otherwise specified; (e) the word “or” shall not be exclusive; (f) the words
“herein,” “hereof,” “hereunder” or “hereby” and similar terms are to be deemed
to refer to this Agreement as a whole and not to any specific Section; (g) the
headings are for reference purposes only and shall not affect in any way the
meaning or interpretation of the Transaction Documents; (h) the Transaction
Documents shall be construed without regard to any presumption or rule requiring
construction or interpretation against the party drafting or causing any
instrument to be drafted; (i) if a word or phrase is defined, the other
grammatical forms of such word or phrase have a corresponding meaning;
(j) references to any statute, listing rule, rule, standard, regulation or other
law include a reference to (A) the corresponding rules and regulations and
(B) each of them as amended, modified, supplemented, consolidated, replaced or
rewritten from time to time; (k) references to any section of any statute,
listing rule, rule, standard, regulation or other law include any successor to
such section; (l) references to any Person include such Person’s predecessors or
successors, whether by merger, consolidation, amalgamation, reorganization or
otherwise; (m) references to any Contract or organizational document are to the
Contract or organizational document as amended, modified, supplemented or
replaced from time to time, unless otherwise stated; (n) any reference to “days”
means calendar days unless Business Days are expressly specified; (o) when
calculating the period of time

 

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before which, within which or following which any act is to be done or step
taken pursuant to this Agreement, the date that is the reference date in
calculating such period shall be excluded and if the last day of such period is
not a Business Day, then the period shall end on the next succeeding Business
Day; (p) with respect to the determination of any period of time, the word
“from” means “from and including” and the words “to” and “until” each means “to
but excluding”; and (q) notwithstanding anything to the contrary in this
Agreement, for the purposes of Section 2.8, Section 7.14, Article X and any
related defined terms used therein, Holding shall be deemed to be the holder of
all Securities held by Holding II and as a result, any indemnification or other
obligations thereunder shall be borne by Holding and any percentage or other
similar calculation based on the ownership of Securities (including in the
definition of Class E Pro Rata Percentage) shall be made accordingly.

Section 11.12 Specific Performance. The parties hereto agree that irreparable
damage would occur in the event that any of the provisions of this Agreement
were not performed in accordance with their specific terms or were otherwise
breached. It is accordingly agreed that, prior to the valid termination of this
Agreement pursuant to Article IX and without the necessity of posting bond or
other undertaking, the parties hereto shall be entitled to obtain from any court
of competent jurisdiction an injunction or injunctions to prevent breaches or
threatened breaches of this Agreement and to enforce specifically the terms and
provisions of this Agreement in accordance with this Agreement, this being in
addition to any other remedy to which such party is entitled at law or in equity
and in the event that any Action is brought in equity to enforce the provisions
of this Agreement, no party hereto shall allege, and each party hereto hereby
waives the defense or counterclaim that there is (a) an adequate remedy at law
or (b) an award of specific performance is not an appropriate remedy for any
reason at law or equity.

Section 11.13 Counterparts. This Agreement and each of the other Transaction
Documents may be executed in one or more counterparts, and by the different
parties to each such agreement in separate counterparts, each of which when
executed shall be deemed to be an original but all of which taken together shall
constitute one and the same agreement. Delivery of an executed counterpart of a
signature page to any Transaction Document by facsimile or other means of
electronic transmission shall be as effective as delivery of a manually executed
counterpart of such Transaction Document.

[Signature Pages Follow.]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
on the date first written above.

 

ISI Holding, Inc. By:  

/s/ Edward S. Hyman

  Name:   Edward S. Hyman   Title:   President

 

[Signature Page to Contribution and Exchange Agreement]

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

ISI Holding II, Inc. By:  

/s/ Edward S. Hyman

  Name:   Edward S. Hyman   Title:   President

 

[Signature Page to Contribution and Exchange Agreement]

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

ISI Management Holdings, LLC By:   ISI Holding, Inc., its managing member By:  

/s/ Edward S. Hyman

  Name:   Edward S. Hyman   Title:   President

 

[Signature Page to Contribution and Exchange Agreement]

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

ISI Holding, LLC By:   ISI Holding, Inc., its managing member By:  

/s/ Edward S. Hyman

  Name:   Edward S. Hyman   Title:   President

 

[Signature Page to Contribution and Exchange Agreement]

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

The Founder

/s/ Edward S. Hyman

Edward S. Hyman

 

[Signature Page to Contribution and Exchange Agreement]

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

Evercore LP By:   Evercore Partners Inc., its general partner By:  

/s/ Robert B. Walsh

  Name:   Robert B. Walsh   Title:   Chief Financial Officer

 

[Signature Page to Contribution and Exchange Agreement]

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

Evercore Partners Inc. By:  

/s/ Robert B. Walsh

  Name:   Robert B. Walsh   Title:   Chief Financial Officer

 

[Signature Page to Contribution and Exchange Agreement]

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

The Founder, in his capacity as the Holders’ Representative

/s/ Edward S. Hyman

Edward S. Hyman

 

[Signature Page to Contribution and Exchange Agreement]

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

The Holders    

/s/ Vinayak Singh

   

/s/ Omar Saad

Vinayak Singh     Omar Saad

/s/ Mark Schoenebaum

   

/s/ Glenn Schorr

Mark Schoenebaum     Glenn Schorr

/s/ Bill Foley

   

/s/ Ross Muken

Bill Foley     Ross Muken

/s/ David Raso

   

/s/ Jonathan Wolff

David Raso     Jonathan Wolff

/s/ Doug Terreson

   

/s/ Brian Marshall

Doug Terreson     Brian Marshall

/s/ Greg Gordon

   

/s/ Brian Devlin

Greg Gordon     Brian Devlin

/s/ Greg Melich

   

/s/ Dennis Debusschere

Greg Melich     Dennis Debusschere

/s/ Steve Sakwa

   

/s/ Joe Ruggieri

Steve Sakwa     Joe Ruggieri

/s/ Barney Hallingby

   

/s/ Arndt Ellinghorst

Barney Hallingby     Arndt Ellinghorst

/s/ Oscar Sloterbeck

   

/s/ Brad Kott

Oscar Sloterbeck     Brad Kott

/s/ Krishna Guha

   

/s/ David Zion

Krishna Guha     David Zion

 

[Signature Page to Contribution and Exchange Agreement]

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

/s/ Colin Crowley

   

/s/ Dick Hokenson

Colin Crowley     Dick Hokenson

/s/ Vijay Jayant

   

/s/ Chad Doerge

Vijay Jayant     Chad Doerge

/s/ Robert Ottenstein

   

/s/ Charlie Roberson

Robert Ottenstein     Charlie Roberson

/s/ Renee Chang Marquardt

   

/s/ Matt Brittain

Renee Chang Marquardt     Matt Brittain

/s/ Bill Whyman

   

/s/ Mike Pizzi

Bill Whyman     Mike Pizzi

/s/ Donald Straszheim

   

/s/ Neal Griffin

Donald Straszheim     Neal Griffin

/s/ Stephen East

   

/s/ Keith Boran

Stephen East     Keith Boran

/s/ Daniel Fox

   

/s/ Ryan Dawson

Daniel Fox     Ryan Dawson

/s/ Anthony Rose

   

/s/ David Ascioti

Anthony Rose     David Ascioti

/s/ Jaewoo Nakajima

   

/s/ Mark DiBenedetto

Jaewoo Nakajima    

Mark DiBenedetto

/s/ Pankaj Patel

   

/s/ Michael McClory

Pankaj Patel    

Michael McClory

/s/ Carolina Campbell

   

/s/ Robert Merrill

Carolina Campbell    

Robert Merrill

 

[Signature Page to Contribution and Exchange Agreement]

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

/s/ Danny Maida

    Danny Maida    

/s/ Francesc Lleal

    Francesc Lleal    

/s/ Jonathan Stenzler

    Jonathan Stenzler    

/s/ Judy deFazio

    Judy deFazio    

/s/ Marian Rupp

    Marian Rupp    

/s/ Mike Liotti

    Mike Liotti    

/s/ Robert Andrews

    Robert Andrews    

/s/ Scott Manahan

    Scott Manahan    

/s/ Matt McGinley

    Matt McGinley    

/s/ Oliver Wintermantel

    Oliver Wintermantel    

/s/ Michael Montani

    Michael Montani    

/s/ David Lee

    David Lee    

 

[Signature Page to Contribution and Exchange Agreement]