Exhibit 10.48

 

 

 

 

 

ASSET PURCHASE AGREEMENT

 

 

between

 

 

HIGHER ONE, INC.

 

 

and

 

 

CL NEWCO, INC.

 

dated as of

 

October 14, 2015

 

 

 

 

 

 

 
 

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TABLE OF CONTENTS

 

ARTICLE I DEFINITIONS

1

   

ARTICLE II PURCHASE AND SALE

10

   

Section 2.01 Purchase and Sale of Assets

10

   

Section 2.02 Excluded Assets

11

   

Section 2.03 Assumed Liabilities

12

   

Section 2.04 Excluded Liabilities

12

   

Section 2.05 Purchase Price

13

   

Section 2.06 Purchase Price Adjustment

14

   

Section 2.07 Allocation of Purchase Price

16

   

Section 2.08 Non-assignable Assets

17

   

ARTICLE III CLOSING

18

   

Section 3.01 Closing

18

   

Section 3.02 Closing Deliverables

18

   

ARTICLE IV REPRESENTATIONS AND WARRANTIES OF SELLER

19

   

Section 4.01 Organization and Qualification of Seller

19

   

Section 4.02 Authority of Seller

20

   

Section 4.03 No Conflicts; Consents

20

   

Section 4.04 Financial Statements; Absence of Undisclosed Liabilities

21

   

Section 4.05 Absence of Certain Changes, Events and Conditions

21

   

Section 4.06 Material Contracts

22

   

Section 4.07 Title to Tangible Personal Property

23

   

Section 4.08 Sufficiency of Assets

24

   

Section 4.09 Real Property

24

   

Section 4.10 Intellectual Property

24

   

Section 4.11 Legal Proceedings; Governmental Orders

26

   

Section 4.12 Compliance With Laws; Permits

26

   

Section 4.13 Environmental Matters

26

 

 
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Section 4.14 Employee Benefit Matters

27

   

Section 4.15 Employment Matters

28

   

Section 4.16 Taxes

29

   

Section 4.17 Brokers

30

   

Section 4.18 Affiliate Transactions

30

   

Section 4.19 Insurance

30

   

Section 4.20 Compliance with FCPA

30

   

Section 4.21 Business Products; Warranties; Defects; Liabilities

31

   

Section 4.22 No Other Representations and Warranties

31

   

ARTICLE V REPRESENTATIONS AND WARRANTIES OF BUYER

32

   

Section 5.01 Organization and Authority of Buyer

32

   

Section 5.02 Authority of Buyer

32

   

Section 5.03 No Conflicts; Consents

33

   

Section 5.04 Brokers

33

   

Section 5.05 Sufficiency of Funds

33

   

Section 5.06 Solvency

33

   

Section 5.07 Legal Proceedings

33

   

Section 5.08 Independent Investigation

33

   

Section 5.09 No Other Representations and Warranties

34

   

ARTICLE VI COVENANTS

34

   

Section 6.01 Conduct of Business Prior to the Closing

34

   

Section 6.02 Access to Information

35

   

Section 6.03 Supplement to Disclosure Schedules

35

   

Section 6.04 Employees and Employee Benefits

35

   

Section 6.05 Confidentiality

38

   

Section 6.06 Governmental Approvals and Consents

39

   

Section 6.07 Books and Records

40

   

Section 6.08 Closing Conditions

41

   

Section 6.09 Public Announcements

41

   

Section 6.10 Bulk Sales Laws

41

 

 
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Section 6.11 Transfer Taxes

42

   

Section 6.12 Further Assurances

42

   

Section 6.13 Non-Competition and Non-Solicitation Covenants

42

   

Section 6.16 Intercompany Accounts

44

   

Section 6.17 Exclusive Dealing

44

   

Section 6.18 Cooperation Concerning Financing

44

   

ARTICLE VII CONDITIONS TO CLOSING

45

   

Section 7.01 Conditions to Obligations of All Parties

45

   

Section 7.02 Conditions to Obligations of Buyer

46

   

Section 7.03 Conditions to Obligations of Seller

47

   

ARTICLE VIII INDEMNIFICATION

48

   

Section 8.01 Survival

48

   

Section 8.02 Indemnification By Seller

48

   

Section 8.03 Indemnification By Buyer

49

   

Section 8.04 Certain Limitations

49

   

Section 8.05 Indemnification Procedures

50

   

Section 8.06 Tax Treatment of Indemnification Payments

52

   

Section 8.07 Exclusive Remedies

52

   

ARTICLE IX TERMINATION

53

   

Section 9.01 Termination

53

   

Section 9.02 Effect of Termination

54

   

ARTICLE X MISCELLANEOUS

54

   

Section 10.01 Expenses

54

   

Section 10.02 Notices

54

   

Section 10.03 Interpretation

55

   

Section 10.04 Headings

56

   

Section 10.05 Severability

56

   

Section 10.06 Entire Agreement

56

   

Section 10.07 Successors and Assigns

56

   

Section 10.08 No Third Party Beneficiaries

57

 

 
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Section 10.09 Amendment and Modification; Waiver

57

   

Section 10.10 Governing Law; Submission to Jurisdiction; Waiver of Jury Trial

57

   

Section 10.11 Specific Performance

58

   

Section 10.12 Counterparts

59

   

Section 10.13 Non-Recourse

59

 

 
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ASSET PURCHASE AGREEMENT

 

This Asset Purchase Agreement (this “Agreement”), dated as of October 14, 2015,
is entered into between Higher One, Inc., a Delaware corporation (“Seller”) and
CL NewCo, Inc., a Delaware corporation (“Buyer”).

 

RECITALS

 

WHEREAS, Seller is engaged, through its data analytics division (doing business
as Campus Labs), in the business of developing, marketing and supporting
assessment, planning, accreditation, organization, evaluation, retention and
compliance software and services which enable data collection, reporting,
organization and campus-wide integration for its higher education institutional
clients, including through its Baseline, Compliance Assist, Course Evaluations,
CollegiateLink, Beacon and Insight solutions (the “Business”); and

 

WHEREAS, Seller wishes to sell and assign to Buyer, and Buyer wishes to purchase
and assume from Seller, substantially all of the assets and certain specified
liabilities of the Business, subject to the terms and conditions set forth
herein;

 

NOW, THEREFORE, in consideration of the mutual covenants and agreements
hereinafter set forth and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:

 

ARTICLE I
DEFINITIONS

 

The following terms have the meanings specified or referred to in this Article
I:

 

“Affiliate” of a Person means any other Person that directly or indirectly,
through one or more intermediaries, controls, is controlled by, or is under
common control with, such Person. The term “control” (including the terms
“controlled by” and “under common control with”) means the possession, directly
or indirectly, of the power to direct or cause the direction of the management
and policies of a Person, whether through the ownership of voting securities, by
contract or otherwise.

 

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

 

“Allocation Schedule” has the meaning set forth in Section 2.06.

 

“Alternative Transaction” has the meaning set forth in Section 6.17.

 

“Annual Financial Statements” has the meaning set forth in Section 4.04.

 

“Assigned Contracts” has the meaning set forth in Section 2.01(b).

 

 
 

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“Assignment and Assumption Agreement” has the meaning set forth in Section
3.02(a)(ii).

 

“Assignment and Assumption of Lease” has the meaning set forth in Section
3.02(a)(iii).

 

“Assumed Liabilities” has the meaning set forth in Section 2.03.

 

“Assumed Taxes” has the meaning set forth in Section 2.03(d).

 

“Benefit Plan” has the meaning set forth in Section 4.14(a).

 

“Bill of Sale” has the meaning set forth in Section 3.02(a)(i).

 

“Books and Records” has the meaning set forth in Section 2.01(j).

 

“Business” has the meaning set forth in the recitals.

 

“Business Day” means any day except Saturday, Sunday or any other day on which
commercial banks located in New York, New York are authorized or required by Law
to be closed for business.

 

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

 

“Business Products” has the meaning set forth in Section 4.21.

 

“Buyer” has the meaning set forth in the preamble.

 

“Buyer Benefit Plans” has the meaning set forth in Section 6.04(c).

 

“Buyer Closing Certificate” has the meaning set forth in Section 7.03(d).

 

“Buyer Indemnified Party” has the meaning set forth in Section 8.02.

 

“Closing” has the meaning set forth in Section 3.01.

 

“Closing Adjustment” has the meaning set forth in Section 2.06(a)(ii).

 

“Closing Amount” has the meaning set forth in Section 2.05.

 

“Closing Date” has the meaning set forth in Section 3.01.

 

“Closing Working Capital” means: (a) Current Assets, less (b) Current
Liabilities, determined as of the close of business on the Closing Date, but
without giving effect to the Closing, determined in the manner set forth in
Section 2.06(b)(i) of the Disclosure Schedules.

 

“Closing Working Capital Statement” has the meaning set forth in Section
2.06(b)(i).

 

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

 

“Confidentiality Agreement” means the Confidentiality Agreement, dated as of
June 16, 2015, between Leeds Equity Partners and Seller.

 

 
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“Contracts” means all legally binding contracts, leases, mortgages, licenses,
instruments, notes, commitments, undertakings, indentures and other agreements.

 

“Current Assets” means the current assets of the Business included in the line
items set forth on Section 2.06(b)(i) of the Disclosure Schedules to the extent
included among the Purchased Assets.

 

“Current Liabilities” means the current liabilities of the Business included in
the line items set forth on Section 2.06(b)(i) of the Disclosure Schedules to
the extent included among the Assumed Liabilities.

 

“Data Room” means the electronic documentation site established by Intralinks on
behalf of Seller containing the documents set forth in the index included in
Section 1.01(a) of the Disclosure Schedules.

 

“Direct Claim” has the meaning set forth in Section 8.05(d).

 

“Disclosure Schedules” means the Disclosure Schedules delivered by Seller and
Buyer concurrently with the execution and delivery of this Agreement.

 

“Disputed Amounts” has the meaning set forth in Section 2.06(c)(iii).

 

“Dollars or $” means the lawful currency of the United States.

 

“Drop Dead Date” has the meaning set forth in Section 9.01(b)(i).

 

“Employees” means those Persons employed by Seller who worked primarily for the
Business immediately prior to the Closing, a list of which is set forth on
Section 4.15(e) of the Disclosure Schedules.

 

“Encumbrance” means any lien, pledge, mortgage, deed of trust, lease, security
interest, pledge, deposit, charge, option, claim, infringement, hypothecation,
contingent sale, title retention, covenant, easement, encroachment,
right-of-way, or other encumbrance or agreement to file any of the foregoing,
whether voluntarily or involuntarily incurred, arising by operation of law, by
contract or otherwise, and including any Contract to give any of the foregoing
in the future.

 

“Environmental Claim” means any Governmental Order, action, suit, claim,
investigation or other legal proceeding by any Person alleging liability of
whatever kind or nature (including liability or responsibility for the costs of
enforcement proceedings, investigations, cleanup, governmental response, removal
or remediation, natural resources damages, property damages, personal injuries,
medical monitoring, penalties, contribution, indemnification and injunctive
relief) arising out of, based on or resulting from: (a) the presence, Release
of, or exposure to, any Hazardous Materials; or (b) any actual or alleged
non-compliance with any Environmental Law or term or condition of any
Environmental Permit.

 

 
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“Environmental Law” means any applicable Law, and any Governmental Order or
binding agreement with any Governmental Authority: (a) relating to pollution (or
the cleanup thereof) or the protection of natural resources, endangered or
threatened species, human health or safety, or the environment (including
ambient air, soil, surface water or groundwater, or subsurface strata); or (b)
concerning the presence of, exposure to, or the management, manufacture, use,
containment, storage, recycling, reclamation, reuse, treatment, generation,
discharge, transportation, processing, production, disposal or remediation of
any Hazardous Materials.

 

“Environmental Notice” means any written directive, notice of violation or
infraction, or notice respecting any Environmental Claim relating to actual or
alleged non-compliance with any Environmental Law or any term or condition of
any Environmental Permit.

 

“Environmental Permit” means any Permit, letter, clearance, consent, waiver,
closure, exemption, decision or other action required under or issued, granted,
given, authorized by or made pursuant to Environmental Law.

 

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended,
and the regulations promulgated thereunder.

 

“ERISA Affiliate” has the meaning set forth in Section 4.14(a).

 

“Escrow Agent” means SunTrust Bank, a Georgia banking corporation.

 

“Escrow Agreement” has the meaning set forth in Section 3.02(a)(vi).

 

“Escrow Amount” means the sum of the Indemnity Escrow Amount, plus the Working
Capital Escrow Amount.

 

“Estimated Closing Working Capital” has the meaning set forth in Section
2.06(a)(i).

 

“Estimated Closing Working Capital Statement” has the meaning set forth in
Section 2.06(a)(i).

 

“Excluded Assets” has the meaning set forth in Section 2.02.

 

“Excluded Liabilities” has the meaning set forth in Section 2.04.

 

“Financial Statements” has the meaning set forth in Section 4.04(a).

 

“Financing” means debt financing provided by a lender to Buyer or an Affiliate
of Buyer for the purposes of consummating the transactions contemplated by this
Agreement on the Closing, including to pay the fees and expenses of Buyer and
its Affiliates in connection with the negotiation, execution and delivery of
this Agreement, the other Transaction Documents and such financing documents and
the consummation of the transactions contemplated hereby and thereby.

 

“Financing Sources” shall mean any entities that have committed to provide or
otherwise entered into agreements to provide Financing, together with their
Affiliates.

 

“FIRPTA Certificate” has the meaning set forth in Section 7.02(g).

 

 
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“Fundamental Representations” shall mean the representation and warranties set
forth in Sections 4.01, 4.02, 4.08, 4.16, 4.17 and the first sentence of Section
4.07.

 

“GAAP” means United States generally accepted accounting principles in effect
from time to time.

 

“General Release” has the meaning set forth in Section 3.02(a)(vii).

 

“Governmental Authority” means any federal, state, local or foreign government
or political subdivision thereof, or any agency or instrumentality of such
government or political subdivision, or any self-regulated organization or other
non-governmental regulatory authority or quasi-governmental authority (to the
extent that the rules, regulations or orders of such organization or authority
have the force of Law), or any arbitrator, court or tribunal of competent
jurisdiction.

 

“Governmental Order” means any order, writ, judgment, injunction, decree,
stipulation, determination or award entered by or with any Governmental
Authority.

 

“Hazardous Materials” means: (a) any material, substance, chemical, waste,
product, derivative, compound, mixture, solid, liquid, mineral or gas, in each
case, whether naturally occurring or man-made, that is hazardous, acutely
hazardous, toxic, or words of similar import or regulatory effect under
Environmental Laws; and (b) any petroleum or petroleum-derived products, radon,
radioactive materials or wastes, asbestos in any form, lead or lead-containing
materials, urea formaldehyde foam insulation and polychlorinated biphenyls.

 

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

 

“Indebtedness” means (a) any indebtedness for borrowed money, (b) any
indebtedness evidenced by any note, bond, debenture or other debt security, (c)
any indebtedness for the deferred purchase price of property or services with
respect to which a Person is liable, contingently or otherwise, as obligor or
otherwise, (d) any commitment by which a Person assures a creditor against loss
(including contingent reimbursement liability with respect to letters of
credit), (e) any indebtedness guaranteed in any manner by a Person (including
guarantees in the form of an agreement to repurchase or reimburse), (f) any
liabilities under leases that would be considered capitalized leases under GAAP,
(g) any indebtedness secured by an Encumbrance on a Person’s assets and (h) any
accrued and unpaid interest on, and any prepayment premiums, penalties or
similar contractual charges in respect of, any of the foregoing obligations.

 

“Indemnified Party” has the meaning set forth in Section 8.04.

 

“Indemnifying Party” has the meaning set forth in Section 8.04.

 

“Indemnity Escrow Amount” means $1,365,000.

 

“Independent Accountant” has the meaning set forth in Section 2.06(c)(iii).

 

“Inside Date” has the meaning set forth in Section 3.01.

 

 
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“Intellectual Property” means any and all of the following in any jurisdiction
throughout the world: (a) trademarks and service marks, including all
applications and registrations and the goodwill connected with the use of and
symbolized by the foregoing; (b) copyrights, including all applications and
registrations, and works of authorship, whether or not copyrightable; (c) trade
secrets and confidential know-how; (d) patents and patent applications; (e)
websites and internet domain name registrations; (f) all computer software,
including all source code, object code and firmware, and (g) all other
intellectual property and industrial property rights and assets, and all rights,
interests and protections that are associated with, similar to, or required for
the exercise of, any of the foregoing.

 

“Intellectual Property Agreements” means all licenses, sublicenses and other
agreements by or through which other Persons grant Seller or Seller grants any
other Persons any exclusive or non-exclusive rights or interests in or to any
Intellectual Property that is used primarily in connection with the Business.

 

“Intellectual Property Assets” means all Intellectual Property that is owned by
Seller and primarily used in connection with the Business, including the
Intellectual Property Registrations set forth on Section 4.10(a) of the
Disclosure Schedules.

 

“Intellectual Property Assignment” has the meaning set forth in Section
3.02(a)(iv).

 

“Intellectual Property Registrations” means all Intellectual Property Assets
that are subject to any issuance, registration, application or other filing by,
to or with any Governmental Authority or authorized private registrar in any
jurisdiction, including registered trademarks, domain names, and copyrights,
issued and reissued patents and pending applications for any of the foregoing.

 

“Interim Statement” has the meaning set forth in Section 4.04.

 

“Interim Statement Date” has the meaning set forth in Section 4.04.

 

“Interim Financial Statements” has the meaning set forth in Section 4.04.

 

“Knowledge of Seller or Seller’s Knowledge” or any other similar knowledge
qualification, means the actual knowledge of any of those persons listed on
Section 1.01(b) of the Disclosure Schedules, after reasonable inquiry of the
other personnel of Seller responsible for the applicable subject matter.

 

“Law” means any statute, law, ordinance, regulation, rule, code, order,
constitution, treaty, common law, judgment, decree, other requirement or rule of
law of any Governmental Authority.

 

“Leased Real Property” has the meaning set forth in Section 4.09(b).

 

“Leases” has the meaning set forth in Section 4.09(b).

 

 
6

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“Losses” means losses, damages, liabilities, costs or expenses, including
reasonable attorneys’ and consultants’ fees, awards, fines, and penalties
(including amounts paid in settlement and costs of investigation).

 

“Material Adverse Effect” means any event, occurrence, fact, condition, change
or circumstance that is, or could reasonably be expected to be, materially
adverse to (a) the business, results of operations, financial condition or
assets of the Business, taken as a whole, or (b) the ability of Seller to
consummate the transactions contemplated hereby; provided, however, that
“Material Adverse Effect” shall not include any event, occurrence, fact,
condition or change, directly or indirectly, arising out of or attributable to:
(i) general economic or political conditions; (ii) conditions generally
affecting the industries in which the Business operates; (iii) any changes in
financial, banking or securities markets in general, including any disruption
thereof and any decline in the price of any security or any market index or any
change in prevailing interest rates; (iv) acts of war (whether or not declared),
armed hostilities or terrorism, or the escalation or worsening thereof; (v) any
action required by this Agreement or any action taken (or omitted to be taken)
with the written consent of or at the written request of Buyer; (vi) any changes
in applicable Laws or accounting rules (including GAAP) or the enforcement,
implementation or interpretation thereof; (vii) the announcement, pendency or
completion of the transactions contemplated by this Agreement; (viii) any
natural or man-made disaster or acts of God; or (ix) any failure by the Business
to meet any internal or published projections, forecasts or revenue or earnings
predictions (provided that the underlying causes of such failures (subject to
the other provisions of this definition) shall not be excluded), provided that
in case of clauses (i), (ii), (iii), (iv), (vi), or (viii), such event,
occurrence, fact, condition, change or circumstance does not have a
disproportionate adverse effect on the Business as compared to the majority of
other companies or businesses in the industry in which the Business operates.

 

“Material Contracts” has the meaning set forth in Section 4.06(a).

 

“Named Employee” has the meaning set forth in Section 6.04(h).

 

“New Hire Documents” means: (i) an employment offer letter, (ii) Buyer’s form of
confidentiality, non-competition, non-solicitation and proprietary information
and inventions assignment agreement and (iii) such other agreements and
documents as Buyer may reasonably require.

 

“Non-Competition Period” has the meaning set forth in Section 6.15(a).

 

“Non-Transferred Employee” has the meaning set forth in Section 6.04(a).

 

“Open Source Software” means any software (in source or object code form) that
is subject to (A) a license or other agreement commonly referred to as an open
source, free software, copyleft or community source code license (including any
code or library licensed under the GNU General Public License, GNU Lesser
General Public License, BSD License, Apache Software License, or any other
public source code license arrangement) or (B) any other license or other
agreement that requires, as a condition of the use, modification or distribution
of software subject to such license or agreement, that such software or other
software linked with, called by, combined or distributed with such software be
(1) disclosed, distributed, made available, offered, licensed or delivered in
source code form, (2) licensed for the purpose of making derivative works, (3)
licensed under terms that allow reverse engineering, reverse assembly, or
disassembly of any kind, or (4) redistributable at no charge, including any
license defined as an open source license by the Open Source Initiative as set
forth on www.opensource.org.

 

 
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“Permits” means all permits, licenses, franchises, approvals, authorizations and
consents required to be obtained from Governmental Authorities.

 

“Permitted Encumbrances” means (a) liens for Taxes not yet due and payable; (b)
mechanics’, carriers’, workmen’s, repairmen’s or other like liens arising or
incurred in the ordinary course of business consistent with past practices; (c)
easements, rights of way, zoning ordinances and other similar encumbrances
affecting Leased Real Property that do not adversely affect the current use
thereof in any material respect; (d) liens arising under original purchase price
conditional sales contracts and equipment leases with third parties entered into
in the ordinary course of business consistent with past practices; and (e) other
imperfections of title or Encumbrances, if any, that do not adversely affect the
current use of the applicable asset or property in any material respect.

 

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

 

“Post-Closing Adjustment” has the meaning set forth in Section 2.06(b)(ii).

 

“Post-Closing Tax Period” has the meaning set forth in Section 6.12.

 

“Pre-Closing Tax Period” has the meaning set forth in Section 6.12.

 

“Products” means all products and services developed, produced, marketed,
licensed, sold, distributed or performed by or on behalf of Seller primarily
related to the Business and all products and services primarily related to the
Business currently under development by Seller.

 

“Proscribed Recipients” has the meaning set forth in Section 4.20.

 

“Purchase Price” has the meaning set forth in Section 2.05.

 

“Purchased Assets” has the meaning set forth in Section 2.01.

 

“Qualified Benefit Plan” has the meaning set forth in Section 4.14(b).

 

“Release” means any actual or threatened release, spilling, leaking, pumping,
pouring, emitting, emptying, discharging, injecting, escaping, leaching,
dumping, abandonment, disposing or allowing to escape or migrate into or through
the environment (including ambient air (indoor or outdoor), surface water,
groundwater, land surface or subsurface strata or within any building,
structure, facility or fixture).

 

 
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“Representative” means, with respect to any Person, any and all directors,
officers, employees, consultants, financial advisors, counsel, accountants and
other agents of such Person. Financing Sources shall be Representatives of
Buyer.

 

“Resolution Period” has the meaning set forth in Section 2.06(c)(ii).

 

“Review Period” has the meaning set forth in Section 2.06(c)(i).

 

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

 

“Seller Closing Certificate” has the meaning set forth in Section 7.02(d).

 

“Seller Confidential Information” has the meaning set forth in Section 6.05(c).

 

“Statement” has the meaning set forth in Section 4.04.

 

“Statement Date” has the meaning set forth in Section 4.04.

 

“Statement of Objections” has the meaning set forth in Section 2.06(c)(ii).

 

“Tangible Personal Property” has the meaning set forth in Section 2.01(d).

 

“Target Working Capital” has the meaning set forth in Section 2.06(a)(ii).

 

“Taxes” means all federal, state, local, foreign and other income, gross
receipts, sales, use, production, ad valorem, unclaimed property, escheat,
transfer, franchise, registration, profits, license, lease, service, service
use, withholding, payroll, employment, unemployment, estimated, excise,
severance, environmental, stamp, occupation, premium, property (real or
personal), real property gains, windfall profits, customs, duties or other
taxes, fees, assessments or charges of any kind whatsoever, together with any
interest, additions or penalties with respect thereto and any interest in
respect of such additions or penalties.

 

“Tax Return” means any return, declaration, report, claim for refund,
information return or statement or other document filed or required to be filed
with respect to Taxes, including any schedule or attachment thereto, and
including any amendment thereof.

 

“Third Party IP Assets” has the meaning set forth in Section 4.10(c).

 

“Third Party Claim” has the meaning set forth in Section 8.05(a).

 

“Transaction Documents” means this Agreement, the Bill of Sale, the Assignment
and Assumption Agreement, Assignment and Assumption of Leases, the Intellectual
Property Assignments, the Transition Services Agreement, the Escrow Agreement,
the General Release and the other agreements, instruments and documents required
to be delivered at the Closing.

 

“Transferred Employee” or “Transferred Employees” has the meaning set forth in
Section 6.04(a).

 

“Transition Services Agreement” has the meaning set forth in Section 3.02(a)(v).

 

 
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“WARN Act” means the federal Worker Adjustment and Retraining Notification Act
of 1988, and similar state, local and foreign laws related to plant closings,
relocations, mass layoffs and employment losses.

 

“Working Capital Escrow Amount” means $500,000.

 

ARTICLE II
PURCHASE AND SALE

 

Section 2.01     Purchase and Sale of Assets. Subject to the terms and
conditions set forth herein, at the Closing, Seller shall sell, assign,
transfer, convey and deliver to Buyer, and Buyer shall purchase from Seller,
free and clear of all Encumbrances other than Permitted Encumbrances, all of
Seller’s and its Affiliates’ right, title and interest in, to and under the
assets, properties and rights of Seller and its Affiliates, to the extent that
such assets, properties and rights exist as of the Closing Date and relate
primarily to the Business (collectively, the “Purchased Assets”), including the
following:

 

(a)     all accounts or notes receivable of the Business;

 

(b)     all Contracts primarily related to the Business, including those set
forth on Section 2.01(b) of the Disclosure Schedules, the Leases set forth on
Section 4.09(b) of the Disclosure Schedules and the Intellectual Property
Agreements set forth on Section 4.10(a) of the Disclosure Schedules
(collectively, the “Assigned Contracts”);

 

(c)     all Intellectual Property Assets and all copies and tangible embodiments
thereof in whatever form or medium;

 

(d)     all furniture, fixtures, equipment, supplies and other tangible personal
property of the Business (i) located at Seller’s offices in Buffalo, New York,
or (ii) located elsewhere and listed on Section 2.01(d) of the Disclosure
Schedules (the “Tangible Personal Property”);

 

(e)     all rights with respect to all Leased Real Property;

 

(f)     all Permits listed on Section 2.01(f) of the Disclosure Schedules;

 

(g)     all prepaid expenses, credits, advance payments, security, deposits,
charges, sums and fees set forth on Section 2.01(g) of the Disclosure Schedules;

 

(h)     without duplication of any other clause in this Section 2.01, all
Current Assets included in the Closing Working Capital Statement;

 

(i)     all of Seller’s rights under warranties, indemnities, claims, credits,
causes of action or rights of set-off against third parties and all similar
rights against third parties to the extent related to any other Purchased
Assets;

 

 
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(j)     originals, or where not available or contained within records or
electronic systems of Seller also used for businesses other than the Business,
copies, of all books and records, including books of account, ledgers and
general, financial and accounting records, Tax Returns that exclusively relate
to the Business or the Purchased Assets, customer lists, customer purchasing
histories, price lists, distribution lists, supplier lists, customer complaints
and inquiry files, research and development files, records and data (including
all correspondence with any Governmental Authority), sales material and records,
strategic plans, internal financial statements and marketing and promotional
surveys, material and research, that primarily relate to the Business or the
Purchased Assets, other than books and records set forth in Section 2.02(d)
(“Books and Records”); and

 

(k)     all goodwill associated with the Business and any of the Purchased
Assets.

 

Section 2.02     Excluded Assets. Buyer expressly understands and agrees that it
is not purchasing or acquiring, and Seller is not selling or assigning, the
following assets or properties of Seller, and all such assets and properties
shall be excluded from the Purchased Assets (the “Excluded Assets”):

 

(a)     all cash and cash equivalents, bank accounts and securities of Seller;

 

(b)     all Contracts that are not Assigned Contracts;

 

(c)     all Intellectual Property other than the Intellectual Property Assets;

 

(d)     the corporate seals, organizational documents, minute books, stock
books, Tax Returns that do not exclusively relate to the Business or the
Purchased Assets, books of account or other records having to do with the
corporate organization of Seller, all employee-related or employee
benefit-related files or records, other than personnel files of Transferred
Employees and any other books and records which Seller is prohibited from
disclosing or transferring to Buyer under applicable Law and is required by
applicable Law to retain;

 

(e)     all insurance policies of Seller and all rights to applicable claims and
proceeds thereunder;

 

(f)     subject to Section 6.04, all Benefit Plans and trusts or other assets
attributable thereto;

 

(g)     all Tax assets (including duty and Tax refunds, rebates and prepayments)
of Seller or any of its Affiliates other than with respect to the Assumed Taxes;

 

(h)     all rights to any action, suit or claim of any nature available to or
being pursued by Seller, whether arising by way of counterclaim or otherwise,
except to the extent included in the Purchased Assets or primarily relating to
Assumed Liabilities;

 

(i)     all assets, properties and rights used by Seller primarily in its
businesses other than the Business, including all such assets, properties and
rights relating to Seller’s administrative operations at Seller’s offices other
than Buffalo, New York;

 

(j)     any assets, properties and rights specifically set forth on Section
2.02(j) of the Disclosure Schedules; and

 

 
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(k)     the rights which accrue or will accrue to Seller under the Transaction
Documents.

 

Section 2.03     Assumed Liabilities. Subject to the terms and conditions set
forth herein, Buyer shall assume and agree to pay, perform and discharge when
due only the following liabilities and obligations of Seller to the extent
arising out of or relating to the Business or the Purchased Assets after the
Closing (collectively, the “Assumed Liabilities”):

 

(a)     all trade accounts payable of Seller to third parties in connection with
the Business incurred in the ordinary course of business that remain unpaid as
of the Closing Date and that are reflected on the Closing Working Capital
Statement;

 

(b)     all liabilities and obligations arising under or relating to the
Assigned Contracts that do not arise primarily from any breach or non-compliance
by Seller on or prior to the Closing Date;

 

(c)     except as specifically provided in Section 6.04, all liabilities and
obligations of Buyer or its Affiliates relating to employee benefits,
compensation or other arrangements with respect to any Transferred Employee
arising after the Closing and relating to the employment of such Transferred
Employees by Buyer;

 

(d)     all liabilities and obligations for (i) Taxes relating to the operation
of the Business or ownership or use of the Purchased Assets by Buyer beginning
the day after the Closing Date and (ii) Taxes for which Buyer is liable pursuant
to Section 6.11 (the “Assumed Taxes”);

 

(e)     any liabilities and obligations of Seller as set forth on Section
2.03(e) of the Disclosure Schedules; and

 

(f)     any liabilities or obligations for severance arising after the Closing
pursuant to the severance agreement between each Named Employee and Seller, as
in effect on the date hereof, with respect to any Named Employee who becomes a
Transferred Employee and does not sign a general release of Seller in the form
of Exhibit H.

 

Section 2.04     Excluded Liabilities. Buyer shall not assume and shall not be
responsible to pay, perform or discharge any liabilities of Seller or its
Affiliates other than the Assumed Liabilities, including any of the following
liabilities or obligations of Seller or its Affiliates (collectively, the
“Excluded Liabilities”):

 

(a)     any liabilities or obligations relating to or arising out of the
Excluded Assets;

 

 
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(b)     any liabilities or obligations for (i) Taxes relating to the operation
of the Business or ownership or use of the Purchased Assets on or prior to the
Closing Date; (ii) Taxes related to the Excluded Assets (iii) any Taxes of
Seller or any stockholders or Affiliates of Seller (other than Taxes allocated
to Buyer under Section 6.11 or Assumed Taxes) and including Taxes of any Person
for which Seller is or has been liable under Section 1.1502-6 of the Treasury
regulations (or any similar provision of state, local or foreign law), as a
transferee or successor, by contract, or otherwise which such Taxes relate to an
event or transaction occurring on or before the Closing Date; and (iv) any
employment Taxes (including withholding Taxes) required with respect to any
payments made to employees of Seller in connection with the Closing.

 

(c)     except as specifically provided in Section 6.04, any liabilities or
obligations of Seller relating to or arising out of (i) the employment, or
termination of employment, of any Employee on or prior to the Closing Date; (ii)
workers’ compensation; (iii) claims of any Employee which relate to events
occurring on or prior to the Closing Date; (iv) the employment or termination
from employment of Non-Transferred Employees; or (v) the establishment,
maintenance, operation or termination of any Benefit Plans, including any
transaction bonuses;

 

(d)     any liabilities arising from (i) violations of laws, (ii) breaches of
Contracts, or (iii) infringements of intellectual property or other rights, in
each case by Seller or its Affiliates prior to, on or after the Closing Date;

 

(e)     any claims or litigation to the extent relating to events occurring or
conditions existing on or prior to the Closing Date;

 

(f)     all Indebtedness of Seller or any of its Affiliates;

 

(g)     any liabilities or obligations of Seller arising or incurred in
connection with the negotiation, preparation, investigation and performance of
this Agreement, the other Transaction Documents and the transactions
contemplated hereby and thereby, including fees and expenses of counsel,
accountants, consultants, advisers and others;

 

(h)     any liabilities relating to non-compliance with any applicable bulk
sales, bulk transfer or similar Law in connection with the transactions
contemplated hereby; and

 

(i)     any liabilities and obligations of Seller set forth on Section 2.04(h)
of the Disclosure Schedules.

 

Section 2.05     Purchase Price. In consideration for the conveyance of the
Purchased Assets and the assumption of the Assumed Liabilities, Buyer shall pay
$91,000,000, as adjusted by Section 2.06(a) (the “Closing Amount”), which is
subject to further adjustment pursuant to Section 2.06(b) hereof (as so further
adjusted, the “Purchase Price”). The Closing Amount shall be paid at Closing as
follows: (i) the Escrow Amount to the Escrow Agent, to be held and released
pursuant to the terms of the Escrow Agreement, and (ii) the remainder, by wire
transfer of immediately available funds to an account designated in writing by
Seller to Buyer, which account shall be designated by Seller to Buyer no later
than two (2) Business Days prior to the Closing Date.

 

 
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Section 2.06     Purchase Price Adjustment.

 

(a)           Closing Adjustment.

 

(i)     At least three (3) Business Days before the Closing, Seller shall
prepare and deliver to Buyer a statement setting forth its good faith estimate
of Closing Working Capital (the “Estimated Closing Working Capital”), which
statement shall contain an estimated balance sheet of the Business as of the
Closing Date (without giving effect to the transactions contemplated herein), a
calculation of Estimated Closing Working Capital (the “Estimated Closing Working
Capital Statement”), and a certificate of the Chief Financial Officer of Seller
that the Estimated Closing Working Capital Statement was prepared in accordance
with Section 2.06(b)(i) of the Disclosure Schedules.

 

(ii)     The “Closing Adjustment” shall be an amount equal to the Estimated
Closing Working Capital, minus an amount equal to negative Three Million Six
Hundred Thousand Dollars (i.e. - $3,600,000) (the “Target Working Capital”). If
the Closing Adjustment is a positive number, the Closing Amount shall be
increased by the amount of the Closing Adjustment. If the Closing Adjustment is
a negative number, the Closing Amount shall be reduced by the absolute value of
the Closing Adjustment.

 

(b)           Post-Closing Adjustment.

 

(i)     Within sixty (60) days after the Closing Date, Buyer shall prepare and
deliver to Seller (A) a statement setting forth its calculation of Closing
Working Capital, which statement shall be substantially in the form of Section
2.06(b)(i) of the Disclosure Schedules (the “Closing Working Capital
Statement”), and (B) a certificate of the Chief Financial Officer of Buyer that
the Closing Working Capital Statement was prepared in accordance with Section
2.06(b)(i) of the Disclosure Schedules.

 

(ii)     The “Post-Closing Adjustment” shall be an amount equal to the Closing
Working Capital, as finally determined pursuant to this Section 2.06(b), minus
the Estimated Closing Working Capital. If the Post-Closing Adjustment is a
positive number, Buyer shall pay to Seller an amount equal to the Post-Closing
Adjustment in accordance with Section 2.06(c)(vi) and the Working Capital Escrow
Amount shall be released to Seller in accordance with the Escrow Agreement. If
the Post-Closing Adjustment is a negative number, (i) an amount equal to the
lower of the absolute value of the Post-Closing Adjustment and the Working
Capital Escrow Amount shall be released to Buyer in accordance with the Escrow
Agreement, (ii) if the Working Capital Escrow Amount is less than the absolute
value of the Post-Closing adjustment, Seller shall pay to Buyer an amount equal
to such difference in accordance with Section 2.06(c)(vi) , and (iii) if the
Working Capital Escrow Amount is greater than the absolute value of the
Post-Closing Adjustment, the remainder of the Working Capital Escrow Amount
shall be released to Seller in accordance with the Escrow Agreement.

 

 
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(c)           Examination and Review.

 

(i)     Examination. After receipt of the Closing Working Capital Statement,
Seller shall have thirty (30) days (the “Review Period”) to review the Closing
Working Capital Statement. During the Review Period, Seller and any accountants
designated by Seller shall have reasonable access to the relevant books and
records of Buyer, the personnel of, and work papers prepared by, Buyer and/or
any accountants engaged to assist Buyer with the determination of the
Post-Closing Adjustment to the extent that they relate to the Closing Working
Capital Statement and to such historical financial information (to the extent in
Buyer’s possession) relating to the Closing Working Capital Statement as Seller
may reasonably request for the purpose of reviewing the Closing Working Capital
Statement and to prepare a Statement of Objections (defined below).

 

(ii)     Objection. On or prior to the last day of the Review Period, Seller may
object to the Closing Working Capital Statement by delivering to Buyer a written
statement setting forth Seller’s objections in reasonable detail, indicating
each disputed item or amount and the basis for Seller’s disagreement therewith,
provided that such basis could only be (A) mathematical errors or (B) that
Closing Working Capital Statement was not prepared in accordance with this
Agreement (the “Statement of Objections”). If Seller fails to deliver the
Statement of Objections before the expiration of the Review Period, the Closing
Working Capital Statement and the Post-Closing Adjustment, as the case may be,
reflected in the Closing Working Capital Statement shall be deemed to have been
accepted by Seller. If Seller delivers the Statement of Objections before the
expiration of the Review Period, Buyer and Seller shall negotiate in good faith
to resolve such objections within thirty (30) days after the delivery of the
Statement of Objections (the “Resolution Period”), and, if the same are so
resolved within the Resolution Period, the Post-Closing Adjustment and the
Closing Working Capital Statement with such changes as may have been previously
agreed in writing by Buyer and Seller, shall be final and binding. Each item not
included by Seller in the Statement of Objections shall be deemed to have been
accepted by Seller.

 

(iii)     Resolution of Disputes. If Seller and Buyer fail to reach an agreement
with respect to all of the matters set forth in the Statement of Objections
before expiration of the Resolution Period, then any amounts remaining in
dispute (“Disputed Amounts”) shall be submitted for resolution to the office of
a nationally recognized firm of independent certified public accountants that
has not been engaged by Seller or Buyer in the past three (3) years (the
“Independent Accountant”) who, acting as experts and not arbitrators, shall
resolve the Disputed Amounts only and make any adjustments to the Post-Closing
Adjustment, as the case may be, and the Closing Working Capital Statement. The
parties hereto agree that all adjustments shall be made without regard to
materiality. The Independent Accountant shall only decide the specific items
under dispute by the parties and their decision for each Disputed Amount must be
within the range of values assigned to each such item in the Closing Working
Capital Statement and the Statement of Objections, respectively.

 

(iv)     Fees of the Independent Accountant. The fees and expenses of the
Independent Accountant shall be paid by Seller, on the one hand, and Buyer, on
the other hand, based upon the percentage that the amount actually contested but
not awarded to Seller or Buyer, respectively, bears to the aggregate amount
actually contested by Seller and Buyer.

 

 
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(v)     Determination by Independent Accountant. The Independent Accountant
shall make a determination as soon as practicable, but in any event within
thirty (30) days (or such other time as the parties hereto shall agree in
writing) after their engagement, and their resolution of the Disputed Amounts
and their adjustments to the Closing Working Capital Statement and/or the
Post-Closing Adjustment shall be conclusive and binding upon the parties hereto.

 

(vi)     Payments of Post-Closing Adjustment. Except as otherwise provided
herein, any payment of the Post-Closing Adjustment or any portion thereof shall:
(A) be due (x) within five (5) Business Days of acceptance of the applicable
Closing Working Capital Statement or (y) if there are Disputed Amounts, then
within five (5) Business Days of the resolution described in clause (v) above;
and (B) be paid by wire transfer of immediately available funds to such account
as is directed by Buyer or Seller, as the case may be, as set forth in Section
2.06(b)(ii). Buyer and Seller shall instruct the Escrow Agent promptly, and in
any case within three (3) Business Days of the acceptance of the final Closing
Working Capital Statement, to release the Working Capital Escrow Amount as set
forth in this Section 2.06.

 

(d)           Adjustments for Tax Purposes. Any payments made pursuant to this
Section 2.06 shall be treated as an adjustment to the Purchase Price by the
parties for Tax purposes, unless otherwise required by Law.

 

Section 2.07     Allocation of Purchase Price. Within thirty (30) days after the
Closing Date, Seller shall deliver a schedule allocating the Purchase Price
(including any Assumed Liabilities treated as consideration for the Purchased
Assets for Tax purposes) (the “Allocation Schedule”). The Allocation Schedule
shall be prepared in accordance with Section 1060 of the Code. The Allocation
Schedule shall be deemed final unless Buyer notifies Seller in writing that
Buyer objects to one or more items reflected in the Allocation Schedule within
fifteen (15) days after delivery of the Allocation Schedule to Buyer. In the
event of any such objection, Seller and Buyer shall negotiate in good faith to
resolve such dispute; provided, however, that if Seller and Buyer are unable to
resolve any dispute with respect to the Allocation Schedule within thirty (30)
days after the delivery of the Allocation Schedule to Buyer, such dispute shall
be resolved by the Independent Accountant. The Independent Accountant shall only
resolve the items under dispute. The fees and expenses of such accounting firm
shall be borne equally by Seller and Buyer. Seller and Buyer agree to file their
respective IRS Forms 8594 and all federal, state and local Tax Returns in
accordance with the Allocation Schedule. Any adjustments to the Purchase Price
pursuant to Section 2.06 herein shall be allocated in a manner consistent with
the Allocation Schedule.

 

 
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Section 2.08     Non-assignable Assets.

 

(a)     Notwithstanding anything to the contrary in this Agreement, and subject
to the provisions of this Section 2.08, to the extent that the sale, assignment,
transfer, conveyance or delivery, or attempted sale, assignment, transfer,
conveyance or delivery, to Buyer of any Purchased Asset would result in a
violation of applicable Law, or would require the consent, authorization,
approval or waiver of a Person who is not a party to this Agreement or an
Affiliate of a party to this Agreement (including any Governmental Authority),
and such consent, authorization, approval or waiver shall not have been obtained
prior to the Closing, this Agreement shall not constitute a sale, assignment,
transfer, conveyance or delivery, or an attempted sale, assignment, transfer,
conveyance or delivery, thereof; provided, however, that, subject to the
satisfaction or waiver of the conditions contained in Article VII, the Closing
shall occur notwithstanding the foregoing without any adjustment to the Purchase
Price on account thereof. Following the Closing, Seller and Buyer shall use
commercially reasonable efforts, and shall cooperate with each other, to obtain
any such required consent, authorization, approval or waiver, or any release,
substitution or amendment required to novate all liabilities and obligations
under any and all Assigned Contracts or other liabilities that constitute
Assumed Liabilities or to obtain in writing the unconditional release of all
parties to such arrangements, so that, in any case, Buyer shall be solely
responsible for such liabilities and obligations from and after the Closing
Date; provided, however, that neither Seller nor Buyer shall be required to pay
any consideration therefor. Once such consent, authorization, approval, waiver,
release, substitution or amendment is obtained, Seller shall sell, assign,
transfer, convey and deliver to Buyer the relevant Purchased Asset to which such
consent, authorization, approval, waiver, release, substitution or amendment
relates for no additional consideration. Applicable sales, transfer and other
similar Taxes in connection with such sale, assignment, transfer, conveyance or
license shall be paid in accordance with Section 6.11.

 

(b)     To the extent that any Purchased Asset and/or Assumed Liability cannot
be transferred to Buyer following the Closing pursuant to this Section 2.08,
Buyer and Seller shall enter into such arrangements (such as subleasing,
sublicensing or subcontracting) to provide to the parties the economic and, to
the extent permitted under applicable Law, operational equivalent of the
transfer of such Purchased Asset and/or Assumed Liability to Buyer as of the
Closing and the performance by Buyer of its obligations with respect thereto.
Buyer shall, as agent or subcontractor for Seller pay, perform and discharge
fully the liabilities and obligations of Seller thereunder from and after the
Closing Date. To the extent permitted under applicable Law, Seller shall, at
Buyer’s expense, hold in trust for and pay to Buyer promptly upon receipt
thereof, such Purchased Asset and all income, proceeds and other monies received
by Seller to the extent related to such Purchased Asset in connection with the
arrangements under this Section 2.08. Seller shall be permitted to set off
against such amounts all direct third-party costs associated with the retention
and maintenance of such Purchased Assets to the extent not paid by Buyer.
Notwithstanding anything herein to the contrary, the provisions of this Section
2.08 shall not apply to any consent or approval required under any antitrust,
competition or trade regulation Law, which consent or approval shall be governed
by Section 6.06.

 

 
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ARTICLE III
CLOSING

 

Section 3.01     Closing. Subject to the terms and conditions of this Agreement,
the consummation of the transactions contemplated by this Agreement (the
“Closing”) shall take place at the offices of Wiggin and Dana LLP, 450 Lexington
Avenue, New York, NY, at 10:00 a.m. local time, on the second (2nd) Business Day
after all of the conditions to Closing set forth in Article VII are either
satisfied or waived (other than conditions which, by their nature, are to be
satisfied on the Closing Date), or at such other time, date or place as Seller
and Buyer may mutually agree upon in writing; provided, however, in no event
shall the Closing occur before the twentieth (20th) day (the “Inside Date”)
following the date hereof, without Buyer’s prior written consent. The date on
which the Closing is to occur is herein referred to as the “Closing Date”.

 

Section 3.02     Closing Deliverables.

 

(a)           At the Closing, Seller shall deliver to Buyer the following:

 

(i)     a bill of sale in the form of Exhibit A hereto (the “Bill of Sale”) and
duly executed by Seller, transferring the tangible personal property included in
the Purchased Assets to Buyer;

 

(ii)     an assignment and assumption agreement in the form of Exhibit B hereto
(the “Assignment and Assumption Agreement”) and duly executed by Seller,
effecting the assignment to and assumption by Buyer of the Purchased Assets and
the Assumed Liabilities;

 

(iii)     with respect to each Lease, an Assignment and Assumption of Lease
substantially in the form of Exhibit C (each, an “Assignment and Assumption of
Lease”) duly executed by Seller;

 

(iv)     each intellectual property assignment in the Form of Exhibit D (each,
an “Intellectual Property Assignment”) duly executed by Seller;

 

(v)     a transition services agreement in the form of Exhibit E (the
“Transition Services Agreement”) duly executed by Seller;

 

(vi)     the escrow agreement in the form of Exhibit F (the “Escrow Agreement”)
duly executed by Seller;

 

(vii)     the general release in the form of Exhibit G (the “General Release”)
duly executed by Seller;

 

(viii)     Seller Closing Certificate;

 

(ix)     the FIRPTA Certificate;

 

 
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(x)     evidence of release of all Encumbrances on the Purchased Assets, other
than Permitted Encumbrances;

 

(xi)     the certificates of the Secretary or Assistant Secretary of Seller
required by Section 7.02(e) and Section 7.02(f); and

 

(xii)     such other customary instruments of transfer, assumption, filings or
documents, in form and substance reasonably satisfactory to Buyer, as may be
required to give effect to this Agreement.

 

(b)           At the Closing, Buyer shall deliver to Seller the following:

 

(i)     the Closing Amount less the Escrow Amount;

 

(ii)     the Assignment and Assumption Agreement duly executed by Buyer;

 

(iii)     with respect to each Lease, an Assignment and Assumption of Lease duly
executed by Buyer;

 

(iv)     the Transition Services Agreement duly executed by Buyer;

 

(v)     the License Agreement duly executed by Buyer;

 

(vi)     Buyer Closing Certificate; and

 

(vii)     the certificates of the Secretary or Assistant Secretary of Buyer
required by Section 7.03(e) and Section 7.03(f).

 

(viii)     the Escrow Agreement duly executed by Buyer and the Escrow Agent.

 

ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF SELLER

 

Except as set forth in the Disclosure Schedules, Seller represents and warrants
to Buyer that the statements contained in this Article IV are true and correct.

 

Section 4.01     Organization and Qualification of Seller. Seller is a
corporation duly organized, validly existing and in good standing under the Laws
of the state of Delaware and has all necessary corporate power and authority to
own, operate or lease the properties and assets now owned, operated or leased by
it and to carry on the Business as currently conducted. Seller is duly licensed
or qualified to do business, and is in good standing, in each jurisdiction in
which the ownership of the Purchased Assets or the operation of the Business as
currently conducted makes such licensing or qualification necessary, except
where the failure to be so licensed, qualified or in good standing would not
have a Material Adverse Effect.

 

 
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Section 4.02     Authority of Seller. Seller has all necessary corporate power
and authority to enter into this Agreement and the other Transaction Documents
to which Seller is a party, to carry out its obligations hereunder and
thereunder and to consummate the transactions contemplated hereby and thereby.
The execution and delivery by Seller of this Agreement and any other Transaction
Document to which Seller is a party, the performance by Seller of its
obligations hereunder and thereunder and the consummation by Seller of the
transactions contemplated hereby and thereby have been duly and validly
authorized by all requisite corporate action on the part of Seller and no other
action on the part of Seller is necessary to authorize the execution and
delivery by Seller of this Agreement and any Transaction Document to which
Seller is a party. This Agreement has been duly executed and delivered by
Seller, and (assuming due authorization, execution and delivery by Buyer) this
Agreement constitutes a legal, valid and binding obligation of Seller,
enforceable against Seller in accordance with its terms, except as such
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar Laws affecting creditors’ rights generally and by general
principles of equity (regardless of whether enforcement is sought in a
proceeding at law or in equity). When each other Transaction Document to which
Seller is or will be a party has been duly executed and delivered by Seller
(assuming due authorization, execution and delivery by each other party
thereto), such Transaction Document will constitute a legal and binding
obligation of Seller enforceable against it in accordance with its terms, except
as such enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar Laws affecting creditors’ rights generally and by general
principles of equity (regardless of whether enforcement is sought in a
proceeding at law or in equity).

 

Section 4.03     No Conflicts; Consents. The execution, delivery and performance
by Seller of this Agreement and the other Transaction Documents to which it is a
party, and the consummation of the transactions contemplated hereby and thereby,
do not and will not: (a) conflict with or result in a violation or breach of any
provision of the certificate of incorporation or by-laws of Seller; (b) conflict
with or result in a violation or breach of any provision of any Law or
Governmental Order applicable to Seller, the Business or the Purchased Assets in
any material respect; (c) except as set forth in Section 4.03 of the Disclosure
Schedules, require the consent, notice or other action by any Person under,
conflict with, result in a violation or breach of, constitute a default (or an
event which, with the giving of notice or passage of time, or both, would become
a default) under or result in the termination, cancellation or acceleration of,
or give rise to any such right of termination, cancellation or acceleration of
any Material Contract, in each case in any material respect; or (d) result in
the creation or imposition of any Encumbrance (other than any Permitted
Encumbrance) upon any of the Purchased Assets. No consent, approval, Permit,
Governmental Order, declaration, registration or filing with, or notice to, any
Governmental Authority is required by or with respect to Seller in connection
with the execution and delivery of this Agreement or any of the other
Transaction Documents and the consummation of the transactions contemplated
hereby and thereby, except for such filings as may be required under the HSR Act
and as set forth in Section 4.03 of the Disclosure Schedules and such consents,
approvals, Permits, Governmental Orders, declarations, filings or notices which,
in the aggregate, would not be material to the Business.

 

 
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Section 4.04     Financial Statements; Absence of Undisclosed Liabilities.

 

(a)      Copies of the unaudited financial statements consisting of the
statement of assets and liabilities of the Business as at December 31, 2014 and
the related statements of income and cash flows for the year then ended (the
“Annual Financial Statements”), and unaudited financial statements consisting of
the statement of assets and liabilities of the Business as at June 30 and the
related statements of income and cash flows for the six-month period then ended
(the “Interim Financial Statements” and together with the Annual Financial
Statements, the “Financial Statements”) have been made available to Buyer in the
Data Room. The statement of assets and liabilities of the Business as of
December 31 is referred to herein as the “Statement” and the date thereof as the
“Statement Date” and the statement of assets and liabilities of the Business as
of June 30 is referred to herein as the “Interim Statement” and the date thereof
as the “Interim Statement Date”. The Financial Statements have been extracted
from the books and records of Seller. Except as disclosed in the Financial
Statements or in Section 4.04 of the Disclosure Schedule, the Financial
Statements fairly present in all material respects the financial position and
the results of operations of the Business as of the respective dates thereof for
the respective periods indicated in accordance with GAAP, subject, in the case
of the Interim Financial Statements, to normal year-end accruals and
adjustments, none of which are material, and the absence of notes.

 

(b)     There are no material liabilities of the Business other than liabilities
or obligations (i) disclosed, reflected or reserved against in the Financial
Statements or (ii) incurred since the Interim Statement Date in the ordinary
course of business consistent with past practices.

 

Section 4.05     Absence of Certain Changes, Events and Conditions. Except as
expressly contemplated by this Agreement or as set forth on Section 4.05 of the
Disclosure Schedules, from the Interim Statement Date until the date of this
Agreement, Seller has operated the Business in the ordinary course of business
consistent with past practice in all material respects and there has not been,
with respect to the Business, any:

 

(a)     event, occurrence or development that has had, or would reasonably be
expected to have a Material Adverse Effect;

 

(b)     imposition of any Encumbrance upon any of the Purchased Assets, except
for Permitted Encumbrances;

 

(c)     increase in the compensation of any Employees, other than as provided
for in any written agreements or in the ordinary course of business consistent
with past practices;

 

 
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(d)       adoption of any plan of liquidation or dissolution or filing of a
petition in bankruptcy under any provisions of federal or state bankruptcy Law
or consent to the filing of any bankruptcy petition against it under any similar
Law;

 

(e)       change in any Tax election, change to any annual Tax accounting
period, adoption of or change to any method of Tax accounting, filing of any
amended Tax Return, entering into of any closing agreement with respect to
Taxes, settlement of any Tax claim or assessment, creation of any Lien for Taxes
upon any of the Purchased Assets (other than Liens for current Taxes not yet due
and payable);

 

(f)       sale, transfer, lease, license or other disposition of any of the
Purchased Assets shown or reflected in the Interim Statement, except for the
sale of products in the ordinary course of business consistent with past
practices;

 

(g)       cancellation of any debts or claims or amendment, termination or
waiver of any rights constituting Purchased Assets, except in the ordinary
course of business consistent with past practices;

 

(h)       material change in the manner in which the Business extends discounts,
credits or warranties to customers or otherwise deals with its customers;

 

(i)       material casualty, damage, destruction or loss affecting, or material
interruption in the use of, whether or not covered by insurance, the Purchased
Assets or the Business;

 

(j)       commencement or settlement of any litigation involving an amount in
excess of $25,000 for any one case;

 

(k)       settlement or compromise of any claims that would have been Purchased
Assets;

 

(l)       other than in the ordinary course of business consistent with past
practices, entry into, extending, materially amending, cancelling or terminating
any Contract that is a Purchased Asset; or

 

(m)      any agreement to do any of the foregoing, or any action or omission
that would result in any of the foregoing.

 

Section 4.06     Material Contracts.

 

(a)     Section 4.06(a) of the Disclosure Schedules lists each of the following
Contracts (x) by which any of the Purchased Assets are bound or affected or (y)
to which Seller is a party or by which it is bound in connection with the
Business or the Purchased Assets (together with all Leases listed in Section
4.09(b) of the Disclosure Schedules and all Intellectual Property Agreements
listed in Section 4.10(a) of the Disclosure Schedules, collectively, the
“Material Contracts”):

 

(i)     all Contracts involving aggregate annual consideration in excess of
$40,000 or requiring performance by any party more than one year from the date
hereof, which, in each case, cannot be cancelled without penalty or without more
than sixty (60) days’ notice;

 

 
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(ii)     all Contracts that relate to the sale or purchase of any of the
Purchased Assets, other than in the ordinary course of business;

 

(iii)     except for agreements relating to trade receivables, all Contracts
relating to Indebtedness (whether, secured or unsecured, whether contingent or
not;

 

(iv)     all Contracts between or among Seller on the one hand and any Affiliate
of Seller on the other hand;

 

(v)     all collective bargaining agreements or Contracts with any labor
organization, union or association or employment agreements, retention
agreements and agreements that contain severance or bonus provisions;

 

(vi)     all contracts and agreements that limit or purport to limit the ability
of the Business to compete in any line of business or with any Person or in any
geographic area or during any period of time;

 

(vii)     each contract creating or relating to any partnership or joint venture
or any other arrangement that relates to the sharing of revenues, earnings,
profits, losses, costs or liabilities

 

(viii)     each Contract involving any Government Authority, excluding any
Contract with an institution of higher education;

 

(ix)     each Contract containing an agreement by Seller to provide any Person
with access to the source code for any computer software included among the
Intellectual Property Assets or to provide for the source code for any such
computer software to be placed in escrow; and

 

(x)     each reseller, distributor, royalty or similar Contract.

 

(b)          Except as set forth on Section 4.06(b) of the Disclosure Schedules,
(i) Seller is not in breach in any material respect of, or default under, any
Material Contract, (ii) each Material Contract is a valid, binding and
enforceable obligation of Seller and/or its Affiliate, as the case may be, and
to Seller’s Knowledge, of each other Party thereto, enforceable against each
Party thereto in accordance with its terms.

 

Section 4.07     Title to and Condition of Tangible Personal Property. Except as
set forth in Section 4.07 of the Disclosure Schedules, Seller has good and valid
title to, or a valid leasehold interest in, all Tangible Personal Property
included in the Purchased Assets, free and clear of Encumbrances except for
Permitted Encumbrances. All of the tangible Purchased Assets, whether real or
personal, owned or leased, have been maintained in accordance with Seller’s
normal maintenance practices and are in operating condition (with the exception
of normal wear and tear).

 

 
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Section 4.08     Sufficiency of Assets. The Purchased Assets, together with the
assets made available under the Transition Services Agreement, are sufficient
for the continued conduct of the Business after the Closing in substantially the
same manner as conducted prior to the Closing and constitute all of the material
rights, property and assets used or held for use by Seller and its Affiliates
primarily for the operation of the Business, and necessary to conduct the
Business as currently conducted; provided that Buyer acknowledges that (i) the
parties have agreed to an amount of Target Working Capital that may require
Buyer to provide Working Capital to the Business at Closing and (ii) certain
human resources, legal, commercial banking, insurance, tax and travel related
functions provided to the Business by the Seller will be taken over by Buyer at
the Closing.

 

Section 4.09     Real Property.

 

(a)     Seller does not own any real property used primarily in connection with
the Business.

 

(b)     Section 4.09(b) of the Disclosure Schedules sets forth all material real
property leased by Seller and primarily used in connection with the Business
(collectively, the “Leased Real Property”), and a list, as of the date of this
Agreement, of all leases for each Leased Real Property (collectively, the
“Leases”).

 

(c)     Seller has not received any written notice of existing, pending or
threatened (i) condemnation proceedings affecting the Leased Real Property, or
(ii) zoning, building code or other moratorium proceedings, or similar matters
which would reasonably be expected to materially and adversely affect the
ability to operate the Leased Real Property as currently operated. Neither the
whole nor any material portion of any Leased Real Property has been damaged or
destroyed by fire or other casualty.

 

Section 4.10     Intellectual Property.

 

(a)     Section 4.10(a) of the Disclosure Schedules lists (i) all Intellectual
Property Registrations and material unregistered trademarks and service marks
and (ii) all Intellectual Property Agreements. Except as set forth in Section
4.10(a) of the Disclosure Schedules, Seller (x) exclusively owns or has the
right to use all Intellectual Property Assets, free and clear of all
Encumbrances (other than Permitted Encumbrances) and (y) has the right to use
the Intellectual Property licensed to Seller under the Intellectual Property
Agreements.

 

(b)     Except as set forth in Section 4.10(b) of the Disclosure Schedules: (i)
the conduct of the Business as currently conducted does not infringe,
misappropriate, dilute or otherwise violate the Intellectual Property of any
Person; and (ii) to Seller’s Knowledge, no Person is infringing,
misappropriating or otherwise violating any Intellectual Property Assets.
Notwithstanding anything to the contrary in this Agreement, this Section 4.10(b)
constitutes the sole representation and warranty of Seller under this Agreement
with respect to any actual or alleged infringement, misappropriation or other
violation by Seller of any Intellectual Property of any other Person.

 

 
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(c)     Except as set forth in Section 4.10(c) of the Disclosure Schedules,
there are no pending or, to Seller’s Knowledge, threatened claims against Seller
alleging that any of the conduct of the Business, infringes, misappropriates,
dilutes or otherwise violates (or in the past infringed, misappropriated,
diluted or otherwise violated) the rights of others in or to any Intellectual
Property assets of any Person (“Third Party IP Assets”) or that any of the
Intellectual Property Assets is invalid or unenforceable.

 

(d)     Except as set forth in Section 4.10(d) of the Disclosure Schedules, all
Employees, consultants and contractors of Seller currently working for the
Business have executed written instruments with Seller that assign to Seller all
rights, title and interest in and to any and all (A) inventions, improvements,
ideas, discoveries, writings, works of authorship, other Intellectual Property,
and information relating to the Business and any of the products or services
being researched, developed, manufactured or sold by Seller related to the
Business and (B) Intellectual Property Assets relating thereto.

 

(e)     Except as set forth in Section 4.10(e) of the Disclosure Schedules, (A)
Seller has not granted, directly or indirectly, any current or contingent
rights, licenses or interests in or to any source code of any of the Products,
and (B) Seller has not provided or disclosed any source code of any Product to
any Person.

 

(f)     Seller uses industry standard methods to detect and prevent viruses and
any software routines designed to permit unauthorized access, to disable or
erase software, hardware or data, or to perform any other similar actions (and
subsequently to correct or remove such viruses) that may be present in the
Products.

 

(g)     Except as set forth in Section 4.10(g) of the Disclosure Schedules, the
development of any Product with any such Open Source Software, and the
incorporation, linking, calling, distribution or other use in, by or with any
such Product of any such Open Source Software, does not obligate Seller to
disclose, make available, offer or deliver any portion of the source code of
such Product or component thereof to any Person other than the applicable Open
Source Software.

 

(h)     Except as set forth in Section 4.10(h) of the Disclosure Schedules,
there have been no (i) losses or thefts of data or security breaches of data
used in the Business, including customer data subject to any Intellectual
Property Agreement that would be material to the Business; (ii) violations by
Seller or any Person acting on its behalf of any security policy regarding any
such data that would be material to the Business; (iii) unauthorized access or
unauthorized use of any data, including customer data subject to any
Intellectual Property Agreement; or (iv) unintended or improper disclosure of
any personally identifiable information or customer data subject to any
Intellectual Property Agreement by Seller or any Person acting on its behalf, in
each of cases (i)-(iv) with respect to data in the possession, custody or
control of Seller or a Person acting on behalf of Seller. Each of Seller and its
Affiliates has complied in all material respects with its publicly available
privacy and data security policies, and privacy and data security requirements
under contractual obligations and applicable Laws (including the Family
Educational Rights and Privacy Act and the Health Insurance Portability and
Accountability Act) concerning the collection, storage, use and dissemination of
personal data collected by Seller, its Affiliates and any third parties in
connection with the Business.

 

 
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Section 4.11     Legal Proceedings; Governmental Orders.

 

(a)     Except as set forth in Section 4.11(a) of the Disclosure Schedules,
there are no actions, suits, material claims, investigations or other legal
proceedings pending or, to Seller’s Knowledge, threatened against or by Seller
arising out of or materially impacting the Business, the Purchased Assets or the
Assumed Liabilities.

 

(b)     Except as set forth in Section 4.11(b) of the Disclosure Schedules,
there are, and since August 7, 2012 there has been, no outstanding Governmental
Orders and no unsatisfied judgments, penalties or awards against or arising out
of or affecting primarily the Business or the Purchased Assets. To the Knowledge
of Seller, no employee of the Business is subject to any Governmental Order that
prohibits such employee from engaging in or continuing any conduct, activity or
practice relating to the Business.

 

Section 4.12     Compliance With Laws; Permits.

 

(a)     Except as set forth in Section 4.12(a) of the Disclosure Schedules,
Seller is, and has since August 7, 2012 been, in compliance with all Laws and
Governmental Orders applicable to the conduct of the Business or the ownership
and use of the Purchased Assets, in each case, in all material respects.

 

(b)     All material Permits required for Seller to conduct the Business as
currently conducted or for the ownership and use of the Purchased Assets have
been obtained by Seller and are valid and in full force and effect.

 

(c)     None of the representations and warranties in Section 4.12 shall be
deemed to relate to environmental matters (which are governed by Section 4.13),
employee benefits matters (which are governed by Section 4.14), employment
matters (which are governed by Section 4.15) or tax matters (which are governed
by Section 4.16).

 

Section 4.13     Environmental Matters.

 

(a)     Except as set forth in Section 4.13(a) of the Disclosure Schedules, or
as would not have a Material Adverse Effect, to Seller’s Knowledge, the
operations of Seller with respect to the Business and the Purchased Assets are
in compliance with all Environmental Laws. Seller has not received from any
Person, with respect to the Business or the Purchased Assets, any: (i)
Environmental Notice or Environmental Claim; or (ii) written request for
information pursuant to Environmental Law, which, in each case, either remains
pending or unresolved, or is the source of ongoing obligations or requirements
as of the Closing Date.

 

 
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(b)     Except as set forth in Section 4.13(b) of the Disclosure Schedules, or
as would not have a Material Adverse Effect, to Seller’s Knowledge, Seller has
obtained and is in material compliance with all material Environmental Permits
(each of which is disclosed in Section 4.13(b) of the Disclosure Schedules)
necessary for the conduct of the Business as currently conducted or the
ownership, lease, operation or use of the Purchased Assets.

 

(c)     Seller has previously made available to Buyer in the Data Room any and
all material environmental reports, studies, audits, records, sampling data,
site assessments and other similar documents with respect to the Business, the
Purchased Assets or any Leased Real Property which are in the possession or
control of Seller.

 

(d)     The representations and warranties set forth in this Section 4.13 are
Seller’s sole and exclusive representations and warranties regarding
environmental matters.

 

Section 4.14     Employee Benefit Matters.

 

(a)     Section 4.14(a) of the Disclosure Schedules contains a list of each
benefit, retirement, employment, consulting, compensation, incentive, bonus,
stock option, restricted stock, stock appreciation right, phantom equity, change
in control, severance, vacation, paid time off, welfare and fringe-benefit
agreement, plan, policy and program maintained, sponsored, contributed to, or
required to be contributed to by Seller for the benefit of one or more
Employees, former employees of the Business or the beneficiaries or dependents
of any such Persons, or under which Seller has or could reasonably be expected
to have any material liability (including by reason of having been an ERISA
Affiliate with any other Person (each, a “Benefit Plan”). “ERISA Affiliate”
means, with respect to Seller, any trade or business (whether or not
incorporated) that, together with Seller, is treated as a single employer within
the meaning of Sections 414(b), (c), (m) or (o) of the Code.

 

(b)      Except as set forth in Section 4.14(b) of the Disclosure Schedules,
each Benefit Plan and related trust complies in all material respects with all
applicable Laws (including ERISA and the Code). Each Benefit Plan that is
intended to be qualified under Section 401(a) of the Code (a “Qualified Benefit
Plan”) has a current favorable determination letter from the Internal Revenue
Service, or with respect to a prototype plan, can rely on an opinion letter from
the Internal Revenue Service to the prototype plan sponsor, to the effect that
such Qualified Benefit Plan is so qualified and that the plan and the trust
related thereto are exempt from federal income Taxes under Sections 401(a) and
501(a), respectively, of the Code.

 

 
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(c)     No Benefit Plan: (i) is subject to the minimum funding standards of
Section 302 of ERISA or Section 412 of the Code or Title IV of ERISA; or (ii) is
a “multi-employer plan” (as defined in Section 3(37) of ERISA). Neither Seller
nor any ERISA Affiliate of Seller has: (A) withdrawn from any pension plan under
circumstances resulting (or expected to result) in liability; (B) engaged in any
transaction which would give rise to a liability under Section 4069 or Section
4212(c) of ERISA, or (C) incurred any liability to the Pension Benefit Guaranty
Corporation which has not been fully satisfied.

 

(d)     Other than as required under Section 4980B of the Code or other
applicable Law, no Benefit Plan provides benefits or coverage in the nature of
health, life or disability insurance following retirement or other termination
of employment (other than death benefits when termination occurs upon death).

 

(e)     Neither the execution of this Agreement nor the consummation of the
transactions contemplated hereby will: (i) result in the payment to any
Employee, director or consultant of the Business of any money or other property;
(ii) accelerate the vesting of or provide any additional rights or benefits
(including funding of compensation or benefits through a trust or otherwise) to
any Employee, director or consultant of the Business; or (iii) result in “excess
parachute payments” within the meaning of Section 280G(b) of the Code.

 

(f)     The representations and warranties set forth in this Section 4.14 are
Seller’s sole and exclusive representations and warranties regarding employee
benefit matters.

 

Section 4.15     Employment Matters.

 

(a)     Seller is not a party to any collective bargaining or other agreement
with a labor organization representing any of the Employees. In the past three
(3) years, there has not been, nor, to Seller’s Knowledge, has there been any
threat of, any strike, slowdown, work stoppage, lockout, concerted refusal to
work overtime or other similar labor activity or dispute affecting Seller or any
of the Employees.

 

(b)     Seller is, and has since August 7, 2012 been, in compliance in all
material respects with all applicable Laws pertaining to employment and
employment practices to the extent they relate to the Employees, including with
respect to wage and hour Laws and the classification of workers as independent
contractors.

 

(c)     (i) Seller is not delinquent in any required payments to any of the
Employees; (ii) there are no, and within the last three (3) years there have
been no, formal grievances, complaints or charges with respect to employment or
labor matters (including claims of employment discrimination, retaliation or
unfair labor practices) pending or threatened in writing against Seller in
connection with the Business; (iii) none of the employment policies or practices
of Seller are currently being audited or investigated or, to the Knowledge of
Seller, subject to imminent audit or investigation by any Governmental
Authority; (iv) Seller and all of its officers and senior managers are not, and
within the last three (3) years have not been, subject to any order, decree,
injunction or judgment by any Governmental Authority, arbitrator or private
settlement contract in respect of any labor or employment matters of the
Business;

 

 
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(d)     Section 4.15(e) of the Disclosure Schedules contains a complete and
accurate list of all Employees as of the date of this Agreement, setting forth
for each Employee: his or her position or title; whether classified as exempt or
non-exempt for wage and hour purposes; whether paid on a salary, hourly or
commission basis and the employee’s actual annual base salary or other rates of
compensation; and business location. Schedule 4.15(e) also contains a list of
any independent contractors, temporary employees, leased employees or any other
servants or agents compensated other than through reportable wages paid by
Seller and reported on a Form W-2. To Seller’s Knowledge, no key Employee of the
Business intends to terminate his or her employment with the Seller.

 

(e)     The representations and warranties set forth in this Section 4.15 are
Seller’s sole and exclusive representations and warranties regarding employment
matters.

 

Section 4.16     Taxes.

 

(a)      Seller has timely filed all Tax Returns with respect to the Business
that are required to be filed, and all such Tax Returns are true, correct and
complete in all material respects.

 

(b)     All Taxes due and payable by Seller with respect to the Business,
whether or not shown or required to be shown on any Tax Return, have been timely
paid and no Taxes are delinquent.

 

(c)     There are no Liens for Taxes upon any of the Purchased Assets, other
than clause (a) of the definition of Permitted Encumbrances.

 

(d)     Seller has withheld and paid all Taxes in connection with the Business
required to have been withheld and paid in connection with amounts paid or owing
to any employee, independent contractor, creditor, securityholder or other third
party.

 

(e)     Seller has not waived any statute of limitations in respect of Taxes of
the Business nor has agreed to, nor is subject to, any extension of time with
respect to a Tax assessment or deficiency.

 

(f)     No deficiency for any amount of Tax has been asserted in writing, or
assessed by a Governmental Authority against Seller with respect to the
Business.

 

(g)     There is no action, suit, proceeding or audit or any notice of inquiry
of any of the foregoing currently in progress or pending against or with respect
to Seller with respect to the Business regarding Taxes, and to Seller’s
Knowledge no action, suit, proceeding or audit has been threatened against or
with respect to the Business regarding Taxes.

 

 
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(h)     No claim has ever been made by an authority in a jurisdiction where
Seller does not file Tax Returns that it is or may be subject to taxation by
that jurisdiction with respect to the Business or that it must file Tax Returns
related to the Business.

 

(i)     Seller is not a party to any Tax allocation or sharing agreement with
respect to the Business.

 

(j)     Seller is not a “foreign person” as that term is used in Treasury
Regulations Section 1.1445-2.

 

(k)     Except for certain representations related to Taxes in Section 4.14, the
representations and warranties set forth in this Section 4.16 are Seller’s sole
and exclusive representations and warranties regarding Tax matters.

 

Section 4.17     Brokers. Except for Raymond James & Associates, Inc., whose
fees will be paid by Seller, no broker, finder or investment banker is entitled
to any brokerage, finder’s or other fee or commission in connection with the
transactions contemplated by this Agreement or any other Transaction Document
based upon arrangements made by or on behalf of Seller.

 

Section 4.18     Affiliate Transactions. Neither Seller nor any Affiliate of
Seller has any claim against the Business that will continue after the Closing,
other than any claims or rights arising under this Agreement, any of the
Transaction Documents or in connection with the transactions contemplated hereby
or thereby.

 

Section 4.19     Insurance. Seller has been covered during the past three (3)
years by insurance in scope and amount customary and reasonable for the Business
during the aforementioned period. Section 4.19 of the Disclosure Schedule lists
all claims made or outstanding against any of the Seller’s insurance policies
relating to the Business over the past three (3) years, other than any such
claims made in the ordinary course of business in connection with a Benefit
Plan.

 

Section 4.20     Compliance with FCPA and OFAC. Seller is, and has been at all
times during the last three (3) years, in compliance in all material respects
with the provisions of the Foreign Corrupt Practices Act of 1977, 15 U.S.C. §§
78dd-1, et seq., and each other applicable anticorruption and/or anti-bribery
Law in each case, in the conduct of the Business. Neither Seller, any of its
directors or officers, nor, to the Knowledge of Seller, any of its managers,
agents, employees or any of their other Affiliates or Persons acting on behalf
of the Business has, directly or indirectly, paid, offered or promised to pay,
or authorized payment of, or will, directly or indirectly, pay, offer or promise
to pay, or authorize payment of, any monies or any other thing of value to any
government official or employee (including employees of government-owned or
controlled entities) or any political party or candidate for political office
(collectively, a “Proscribed Recipient”) for the purpose of, (a) influencing any
act or decision of such Proscribed Recipient, (b) inducing such Proscribed
Recipient to do or omit to do any act in violation of the lawful duty of such
Proscribed Recipient, or to use his, her or its influence with a Governmental
Authority to affect or influence any act or decision of such Governmental
Authority or (c) assisting in obtaining or retaining business for or with, or
directing business to, any Person in each case, in the conduct of the Business.
Neither Seller nor its respective directors, officers, managers, or employees or
agents (x) is a Person with whom transactions are prohibited or limited under
any U.S. economic sanctions Laws, including those administered by the Office of
Foreign Assets Control or (y) within the past three (3) years, to the Knowledge
of Seller, has violated any U.S. economic sanctions Laws in each case, in the
conduct of the Business. Within the past three (3) years, Seller has not made
any voluntary disclosures to any Governmental Authority under U.S. economic
sanctions Laws or U.S. export control Laws nor has it been the subject of any
legal proceeding regarding the compliance of Seller with such Laws in each case,
in the conduct of the Business.

 

 
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Section 4.21     Business Products; Warranties; Defects; Liabilities. To the
Knowledge of Seller, each of the products that are, as of the date hereof,
owned, created, designed, developed, marketed, licensed or sold (whether in
existence or in development) by or on behalf of the Business (hereinafter
referred to collectively as the “Business Products” and individually as a
“Business Product”) was in conformity in all material respects with the
specifications for such Business Product, all applicable contractual commitments
and all applicable express warranties at the time of the sale, license, lease or
provision of such Business Product, except for such nonconformities for which
(and to the extent) there is a reserve set forth on the Interim Financial
Statements or as otherwise disclosed on Section 4.21 of the Disclosure Schedule.

 

Section 4.22     No Other Representations and Warranties. Except for the
representations and warranties contained in this Article IV (including the
related portions of the Disclosure Schedules) and except in the case of fraud or
intentional misrepresentation, neither Seller nor any other Person has made or
makes any other express or implied representation or warranty, either written or
oral, on behalf of Seller, including any representation or warranty as to the
accuracy or completeness of any information regarding the Business and the
Purchased Assets furnished or made available to Buyer and its Representatives
(including the Project Winchester Confidential Information Memorandum dated
Summer 2015 and any information, documents or material made available to Buyer
in the Data Room, management presentations or in any other form in expectation
of the transactions contemplated hereby) or as to the future revenue,
profitability or success of the Business, or any representation or warranty
arising from statute or otherwise in law.

 

 
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ARTICLE V
REPRESENTATIONS AND WARRANTIES OF BUYER

 

Except as set forth in the Disclosure Schedules, Buyer represents and warrants
to Seller that the statements contained in this Article V are true and correct.

 

Section 5.01     Organization and Authority of Buyer. Buyer is a corporation
duly organized, validly existing and in good standing under the Laws of the
state of Delaware.

 

Section 5.02     Authority of Buyer. Buyer has all necessary corporate power and
authority to enter into this Agreement and the other Transaction Documents to
which Buyer is a party, to carry out its obligations hereunder and thereunder
and to consummate the transactions contemplated hereby and thereby. The
execution and delivery by Buyer of this Agreement and any other Transaction
Document to which Buyer is a party, the performance by Buyer of its obligations
hereunder and thereunder and the consummation by Buyer of the transactions
contemplated hereby and thereby have been duly and validly authorized by all
requisite corporate action on the part of Buyer and no other action on the part
of Buyer is necessary to authorize the execution and delivery by Buyer of this
Agreement and any Transaction Document to which Buyer is a party. This Agreement
has been duly executed and delivered by Buyer, and (assuming due authorization,
execution and delivery by Seller) this Agreement constitutes a legal, valid and
binding obligation of Buyer enforceable against Buyer in accordance with its
terms, except as such enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar Laws affecting creditors’ rights generally
and by general principles of equity (regardless of whether enforcement is sought
in a proceeding at law or in equity). When each other Transaction Document to
which Buyer is or will be a party has been duly executed and delivered by Buyer
(assuming due authorization, execution and delivery by each other party
thereto), such Transaction Document will constitute a legal and binding
obligation of Buyer enforceable against it in accordance with its terms, except
as such enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar Laws affecting creditors’ rights generally and by general
principles of equity (regardless of whether enforcement is sought in a
proceeding at law or in equity).

 

 
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Section 5.03     No Conflicts; Consents. The execution, delivery and performance
by Buyer of this Agreement and the other Transaction Documents to which it is a
party, and the consummation of the transactions contemplated hereby and thereby,
do not and will not: (a) conflict with or result in a violation or breach of any
provision of the certificate of incorporation or by-laws of Buyer; (b) conflict
with or result in a violation or breach of any provision of any Law or
Governmental Order applicable to Buyer; or (c) except as set forth in Section
5.03 of the Disclosure Schedules, require the consent, notice or other action by
any Person under, conflict with, result in a violation or breach of, constitute
a default (or an event which, with the giving of notice or lapse of time, or
both, would become a default) under or result in the termination, cancellation
or acceleration of, or give rise to any such right of termination, cancellation
or acceleration of any agreement to which Buyer is a party or (d) violate any
order, injunction, decree, statute, rule or regulation applicable to Buyer. No
consent, approval, Permit, Governmental Order, declaration or filing with, or
notice to, any Governmental Authority is required by or with respect to Buyer in
connection with the execution and delivery of this Agreement and the other
Transaction Documents and the consummation of the transactions contemplated
hereby and thereby, except for such filings as may be required under the HSR Act
and as set forth in Section 5.03 of the Disclosure Schedules and such consents,
approvals, Permits, Governmental Orders, declarations, filings or notices which
would not have a material adverse effect on Buyer’s ability to consummate the
transactions contemplated hereby and thereby.

 

Section 5.04     Brokers. No broker, finder or investment banker is entitled to
any brokerage, finder’s or other fee or commission in connection with the
transactions contemplated by this Agreement or any other Transaction Document
based upon arrangements made by or on behalf of Buyer.

 

Section 5.05     Sufficiency of Funds. At Closing, Buyer will have sufficient
cash on hand or other sources of immediately available funds to enable it to
make payment of the Purchase Price and consummate the transactions contemplated
by this Agreement.

 

Section 5.06     Solvency Assuming the accuracy in all material respects of each
of the representations and warranties of Seller set forth in this Agreement and
the performance in all material respects by Seller of its obligations under this
Agreement and each other Transaction Document to which Seller is or will be a
party, immediately after giving effect to the transactions contemplated hereby,
Buyer shall be solvent and shall: (a) be able to pay its debts as they become
due; (b) own property that has a fair saleable value greater than the amounts
required to pay its debts (including a reasonable estimate of the amount of all
contingent liabilities); and (c) have adequate capital to carry on its business.

 

Section 5.07     Legal Proceedings. There are no actions, suits, claims,
investigations or other legal proceedings pending or, to Buyer’s knowledge,
threatened against or by Buyer or any Affiliate of Buyer that challenge or seek
to prevent, enjoin or otherwise delay the transactions contemplated by this
Agreement.

 

Section 5.08     Independent Investigation. Buyer has conducted its own
independent investigation, review and analysis of the Business and the Purchased
Assets, and acknowledges that it has been provided access to the personnel,
properties, assets, premises, books and records, and other documents and data of
Seller for such purpose. Buyer acknowledges and agrees that: (a) in making its
decision to enter into this Agreement and to consummate the transactions
contemplated hereby, Buyer has relied solely upon its own investigation and the
express representations and warranties of Seller set forth in Article IV of this
Agreement (including related portions of the Disclosure Schedules); and (b)
neither Seller nor any other Person has made any representation or warranty as
to Seller, the Business, the Purchased Assets or this Agreement, except as
expressly set forth in Article IV of this Agreement (including the related
portions of the Disclosure Schedules).

 

 
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Section 5.09     No Other Representations and Warranties. Except for the
representations and warranties contained in this Article V and except in the
case of fraud or intentional misrepresentation, neither Buyer nor any other
Person has made or makes any other express or implied representation or
warranty, either written or oral, on behalf of Buyer.

 

ARTICLES VI
COVENANTS

 

Section 6.01     Conduct of Business Prior to the Closing. From the date hereof
until the Closing, except as expressly required in this Agreement or consented
to in writing by Buyer (which consent shall not be unreasonably withheld or
delayed), Seller shall (a) conduct the Business in the ordinary course of
business consistent with past practices; and (b) use commercially reasonable
efforts to maintain and preserve intact its current Business organization,
operations and franchise and to preserve the rights, franchises, goodwill and
relationships of its Employees, customers, suppliers, regulators and others
having relationships with the Business. From the date hereof until the Closing
Date, except as consented to in writing by Buyer (which consent shall not be
unreasonably withheld or delayed), Seller shall not, and shall not permit any of
its Affiliates to, (i) take any action that would cause any of the changes,
events or conditions described in Section 4.05 to occur or (ii) incur any
liabilities that would become Assumed Liabilities, other than in the ordinary
course of business consistent with past practices. Seller shall, prior to
October 31, 2015, provide written notice to Warehouse Lofts Tenant, LLC (the
“Landlord”) exercising its option to extend the term of the Leases to June 30,
2016, in accordance with the provisions of the Lease Agreement Amendment dated
August 15, 2015 by and between the Landlord and Seller.

 

 
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Section 6.02     Access to Information. From the date hereof until the Closing,
Seller shall (a) afford Buyer and its Representatives reasonable access to and
the right to inspect all of the properties, assets, premises, Books and Records,
Assigned Contracts and other documents and data relating to the Business and the
Purchased Assets; (b) furnish Buyer and its Representatives with such financial,
operating and other data and information related to the Business as Buyer or any
of its Representatives may reasonably request, including such data and
information as is customary for the arrangement of loans in accordance with
Section 6.18; and (c) instruct the Representatives of Seller to cooperate with
Buyer in its investigation of the Business; provided, however, that any such
investigation shall be conducted during normal business hours upon reasonable
advance notice to Seller, under the supervision of Seller’s personnel and in
such a manner as not to interfere with the conduct of the Business or any other
businesses of Seller. All requests by Buyer for access pursuant to this Section
6.02 shall be submitted or directed exclusively to Kate MacLeay Crespo (Senior
Vice President, Investment Banking, Raymond James & Associates), or such other
individuals as Seller may designate in writing from time to time.
Notwithstanding anything to the contrary in this Agreement, Seller shall not be
required to disclose any information to Buyer if such disclosure would, in
Seller’s sole discretion: (x) cause significant competitive harm to Seller and
its businesses, including the Business, if the transactions contemplated by this
Agreement are not consummated; (y) jeopardize any attorney-client or other
privilege; or (z) contravene any applicable Law, fiduciary duty or binding
agreement entered into prior to the date of this Agreement. Prior to the
Closing, without the prior written consent of Seller, which may be withheld for
any reason, Buyer shall not contact any suppliers to, or customers of, the
Business and Buyer shall have no right to perform invasive or subsurface
investigations of the Leased Real Property. Buyer shall, and shall cause its
Representatives to, abide by the terms of the Confidentiality Agreement with
respect to any access or information provided pursuant to this Section 6.02.

 

Section 6.03     Supplement to Disclosure Schedules. From time to time prior to
the Closing, Seller shall have the right (but not the obligation) to supplement
or amend the Disclosure Schedules hereto with respect to any matter hereafter
arising (each a “Schedule Supplement”). Any disclosure in any such Schedule
Supplement shall not be deemed to have cured any inaccuracy in or breach of any
representation or warranty contained in this Agreement, including for purposes
of the indemnification or termination rights contained in this Agreement or of
determining whether or not the conditions set forth in Section 7.02(a) have been
satisfied; provided, however, that if Buyer has the right to, but does not elect
to, terminate this Agreement within fifteen (15) Business Days of its receipt of
such Schedule Supplement, then Buyer shall be deemed to have irrevocably waived
any right to terminate this Agreement with respect to such matter and, further,
in such case shall have irrevocably waived its right to indemnification under
Section 8.02 with respect to such matter.

 

Section 6.04     Employees and Employee Benefits.

 

(a)     Buyer shall, or shall cause an Affiliate of Buyer to, offer employment
effective on the Closing Date, to all Employees, including Employees who are
absent due to vacation, family leave, short-term disability or other approved
leave of absence. Seller shall cooperate with Buyer in connection with Buyer’s
efforts to hire the Employees and to obtain the execution and delivery of their
New Hire Documents, such New Hire Documents to be effective as of the Closing
Date. The Employees who accept employment with Buyer, execute and return their
New Hire Documents and commence employment on the Closing Date are referred to
herein as the “Transferred Employees”). The Employees who do not accept
employment with Buyer, or who do not execute and deliver their New Hire
Documents to Buyer prior to or on the Closing Date, shall be referred to herein
as “Non-Transferred Employees.”

 

 
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(b)     During the period commencing on the Closing Date and ending on the date
which is twelve (12) months from the Closing (or if earlier, the date of the
Transferred Employee’s termination of employment with Buyer or an Affiliate of
Buyer), Buyer shall, or shall cause an Affiliate of Buyer to, provide each
Transferred Employee with: (i) base salary or hourly wages which are no less
than the base salary or hourly wages provided by Seller immediately prior to the
Closing, subject to compliance with applicable Law; (ii) target bonus
opportunities (excluding equity-based compensation), if any, which are
substantially comparable to the target bonus opportunities (excluding
equity-based compensation) provided by Seller immediately prior to the Closing;
(iii) retirement and welfare benefits that are substantially comparable in the
aggregate than those provided by Seller immediately prior to the Closing; and
(iv) severance benefits that are substantially comparable to the practice, plan
or policy of Seller in effect for such Transferred Employee immediately prior to
the Closing. Nothing in this Agreement shall limit Buyer’s ability to terminate
the employment of any Transferred Employee at any time and for any reason,
including without cause.

 

(c)     With respect to any employee benefit plan maintained by Buyer or an
Affiliate of Buyer (collectively, “Buyer Benefit Plans”) for the benefit of any
Transferred Employee, effective as of the Closing, Buyer shall, or shall cause
its Affiliate to, recognize all service of the Transferred Employees with
Seller, as if such service were with Buyer, for vesting, and eligibility
purposes; provided, however, such service shall not be recognized to the extent
that (x) such recognition would result in a duplication of benefits or (y) such
service was not recognized under the corresponding Benefit Plan. Without
limiting the generality of the foregoing, Buyer shall pay all bonuses to
Transferred Employees that are included in the Closing Working Capital Statement
promptly following the end of calendar year 2015 and otherwise in accordance
with the applicable Buyer Benefit Plan.

 

(d)     Effective as of Closing and thereafter, Buyer shall waive any
eligibility waiting periods and evidence of insurability requirements under any
health plan of Buyer or an Affiliate of Buyer extended to Transferred Employees
and their eligible dependents, and shall credit each Transferred Employee with
all deductible payments, co-payments and other out-of-pocket expenses paid by
such Employee under the health benefit plans of Seller prior to the Closing with
respect to the plan year in which the Closing occurs for purposes of determining
the extent to which any such Employee and his dependents have satisfied his, her
or their deductible and/or reached an out of pocket maximum under any health
benefit plan of Buyer (or Affiliate of Buyer) extended to Transferred Employees
after the Closing.

 

 
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(e)     With respect to any defined contribution plan maintained by Seller as of
the Closing, Buyer shall accept a rollover of account balances into its defined
contribution plan, including a rollover of any loan notes outstanding as of
Closing, and shall cooperate with Seller to effect such rollovers.

 

(f)     Effective as of the Closing, the Transferred Employees shall cease
active participation in the Benefit Plans. Seller shall remain liable for all
claims for benefits under the Benefit Plans that are incurred by the Employees
prior to or on the Closing Date, and, with respect to Non-Transferred Employees,
at any time, including with respect to severance and accrued but unused vacation
time. For purposes of this Agreement, the following claims shall be deemed to be
incurred as follows: (i) life, accidental death and dismemberment, short-term
disability, and workers’ compensation insurance benefits, on the event giving
rise to such benefits; (ii) medical, vision, dental, and prescription drug
benefits, on the date the applicable services, materials or supplies were
provided; and (iii) long-term disability benefits, on the eligibility date
determined by the long-term disability insurance carrier for the plan in which
the applicable Employee participates.

 

(g)     Buyer and Seller intend that the transactions contemplated by this
Agreement should not result in a payment of severance under either Buyer’s or
Seller’s severance plan or policy with respect any Employee who receives an
employment offer by Buyer that is consistent with the requirements of Section
6.04(b), and, accordingly, Buyer and Seller shall, prior to Closing, take all
actions necessary or advisable to amend their severance policies or plans to so
provide.   Buyer shall be liable and hold Seller harmless for any claims
relating to the employment of any Transferred Employee by Buyer arising
following the Closing.

 

(h)     Buyer shall include in offer materials provided to each of Eric Reich,
John White, Sean Casey, Robert Willer and Annemieke Rice (each a “Named
Employee”), a general release of Seller in the form of Exhibit H, and shall use
its reasonable efforts to cause each such Employee to execute such release. The
offer of employment made by Buyer to each Named Employee shall consist of terms
that in a reasonable interpretation do not constitute grounds for such employee
to resign for “Good Reason” under the terms of the severance agreement between
each such Named Employee and Seller, as in effect on the date hereof.

 

(i)     This Section 6.04 shall be binding upon and inure solely to the benefit
of each of the parties to this Agreement, and nothing in this Section 6.04,
express or implied, shall confer upon any other Person any rights or remedies of
any nature whatsoever under or by reason of this Section 6.04. Nothing contained
herein, express or implied, shall be construed to establish, amend or modify any
benefit plan, program, agreement or arrangement. The parties hereto acknowledge
and agree that the terms set forth in this Section 6.04 shall not create any
right in any Transferred Employee or any other Person to any continued
employment with Buyer or any of its Affiliates or compensation or benefits of
any nature or kind whatsoever.

 

 
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Section 6.05     Confidentiality.

 

(a)     The Confidentiality Agreement remains in full force and effect until the
Closing and shall terminate and be of no further force or effect as of the
Closing. If this Agreement is, for any reason, terminated prior to the Closing,
the Confidentiality Agreement and the provisions of this Section 6.05 shall
nonetheless continue in full force and effect.

 

(b)     From and after the Closing, except in accordance with Section 6.09,
Seller shall, and shall cause its Affiliates, employees and the Representatives
of Seller and its Affiliates to, treat and hold, as confidential and not
disclose any non-public, confidential or proprietary information to the extent
concerning Buyer, the Purchased Assets, the Assumed Liabilities and the
Business, including any notes, analyses, compilations, studies, forecasts,
interpretations or other documents that are derived from, contain, reflect or
are based upon any such information (the “Business Confidential Information”),
refrain from using any of the Business Confidential Information, and deliver
promptly to Buyer, at the request and option of Buyer, tangible embodiments (and
copies) of the Business Confidential Information that constitute Purchased
Assets or Assumed Liabilities which are in its possession or under its control;
provided, however, Seller shall be permitted to retain copies of such Business
Confidential Information; provided, further, that Seller and its Affiliates
shall be permitted to disclose in any securities filing any such Person makes
pursuant to an applicable securities Law, or filing required by any stock
exchange rule or regulation, the identity of Buyer, a copy of this Agreement and
a description of the transactions contemplated hereby, to the extent any such
Person determines in good faith and after consultation with counsel that such
disclosure is required thereby. Notwithstanding the foregoing, Business
Confidential Information shall not include information that is (i) generally
available to the public other than as a result of a breach of this Section
6.05(b) or other act or omission of Seller or any of its Affiliates, (ii)
lawfully received after the Closing Date from a third party not known to Seller
to be under any obligation of confidentiality with respect to such information
or fiduciary duty with respect to the secrecy of such information, or (iii)
concerning the Excluded Assets or the Excluded Liabilities. In the event that
Seller is required in any legal proceeding, discovery, or any subpoena, civil
investigative demand, or similar process to disclose any Business Confidential
Information, Seller shall notify Buyer promptly of the requirement to the extent
permitted by applicable Law so that Buyer may seek an appropriate protective
order or waive compliance with the provisions of this Section 6.05(b). If, in
the absence of a protective order or the receipt of a waiver hereunder, Seller
is, on the advice of counsel, required to disclose any Business Confidential
Information in any legal proceeding to any Governmental Authority, Seller may
disclose such Business Confidential Information to such Governmental Authority;
provided, that Seller shall use commercially reasonable efforts to obtain, at
the request of Buyer, an order or other assurance that confidential treatment
shall be accorded to such portion of the Business Confidential Information
required to be disclosed as Buyer shall designate.

 

 
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(c)     From and after the Closing, except in accordance with Section 6.09,
Buyer shall, and shall cause its Affiliates, employees and the Representatives
of Buyer and its Affiliates to, treat and hold, as confidential and not disclose
any and all documents or information disclosed or otherwise made available by
inspection, observation or otherwise to Buyer concerning Seller, its Affiliates
or its businesses other than the Business, including any notes, analyses,
compilations, studies, forecasts, interpretations or other documents that are
derived from, contain, reflect or are based upon any such information (the
“Seller Confidential Information”), except to the extent that Buyer can show
that such information is (i) generally available to the public other than as a
result of a breach of this Section 6.05(c) or other act or omission of Buyer or
any of its Affiliates, (ii) lawfully received after the Closing Date from a
third party not known to Buyer to be under any obligation of confidentiality
with respect to such information or fiduciary duty with respect to the secrecy
of such information, or (iii) constitutes Business Confidential Information. In
the event that Buyer is required in any legal proceeding, discovery, or any
subpoena, civil investigative demand, or similar process to disclose any Seller
Confidential Information, Buyer shall notify Seller promptly of the requirement
to the extent permitted by applicable Law so that Buyer may seek an appropriate
protective order or waive compliance with the provisions of this Section
6.05(c). If, in the absence of a protective order or the receipt of a waiver
hereunder, Buyer is, on the advice of counsel, required to disclose any Seller
Confidential Information in any legal proceeding to any Governmental Authority,
Buyer may disclose such Seller Confidential Information to such Governmental
Authority; provided, that Buyer shall use commercially reasonable efforts to
obtain, at the request of Seller, an order or other assurance that confidential
treatment shall be accorded to such portion of Seller Confidential Information
required to be disclosed as Seller shall designate.

 

Section 6.06     Governmental Approvals and Consents.

 

(a)     Each party hereto shall, as promptly as possible, use its reasonable
best efforts to obtain, or cause to be obtained, all consents, authorizations,
orders and approvals from all Governmental Authorities that may be or become
necessary for its execution and delivery of this Agreement and the performance
of its obligations pursuant to this Agreement and the other Transaction
Documents. Each party shall cooperate fully with the other party and its
Affiliates in promptly seeking to obtain all such consents, authorizations,
orders and approvals. The parties hereto shall not willfully take any action
that will have the effect of delaying, impairing or impeding the receipt of any
required consents, authorizations, orders and approvals. If required by the HSR
Act and if the appropriate filing pursuant to the HSR Act has not been filed
prior to the date hereof, each party hereto agrees to make an appropriate filing
pursuant to the HSR Act with respect to the transactions contemplated by this
Agreement within ten (10) Business Days after the date hereof and to supply as
promptly as practicable to the appropriate Governmental Authority any additional
information and documentary material that may be requested pursuant to the HSR
Act.

 

 
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(b)     Without limiting the generality of Buyer’s undertakings pursuant to this
Section 6.06, Buyer agrees to use its reasonable best efforts and to take any
and all steps necessary to avoid or eliminate each and every impediment under
any antitrust, competition or trade regulation Law that may be asserted by any
Governmental Authority or any other party so as to enable the parties hereto to
close the transactions contemplated by this Agreement as promptly as possible,
including proposing, negotiating, committing to and effecting, by consent
decree, hold separate orders, or otherwise, the sale, divestiture or disposition
of any of its assets, properties or businesses or of the assets, properties or
businesses to be acquired by it pursuant to this Agreement as are required to be
divested in order to avoid the entry of, or to effect the dissolution of, any
injunction, temporary restraining order or other order in any suit or
proceeding, which would otherwise have the effect of materially delaying or
preventing the consummation of the transactions contemplated by this Agreement.
In addition, Buyer shall use its reasonable best efforts to defend through
litigation on the merits any claim asserted in court by any party in order to
avoid entry of, or to have vacated or terminated, any Governmental Order
(whether temporary, preliminary or permanent) that would prevent the
consummation of the Closing.

 

(c)     All analyses, appearances, meetings, discussions, presentations,
memoranda, briefs, filings, arguments, and proposals made by or on behalf of
either party before any Governmental Authority or the staff or regulators of any
Governmental Authority, in connection with the transactions contemplated
hereunder (but, for the avoidance of doubt, not including any interactions
between Seller or Buyer with Governmental Authorities in the ordinary course of
business consistent with past practices, any disclosure which is not permitted
by Law or any disclosure containing confidential information) shall be disclosed
to the other party hereunder in advance of any filing, submission or attendance,
it being the intent that the parties will consult and cooperate with one
another, and consider in good faith the views of one another, in connection with
any such analyses, appearances, meetings, discussions, presentations, memoranda,
briefs, filings, arguments, and proposals. Each party shall give notice to the
other party with respect to any meeting, discussion, appearance or contact with
any Governmental Authority or the staff or regulators of any Governmental
Authority, with such notice being sufficient to provide the other party with the
opportunity to attend and participate in such meeting, discussion, appearance or
contact.

 

(d)     Seller and Buyer shall use commercially reasonable efforts to give all
notices to, and obtain all consents from, all third parties that are described
in Section 4.03 and Section 5.03 of the Disclosure Schedules; provided, however,
that Seller shall not be obligated to pay any consideration therefor to any
third party from whom consent or approval is requested.

 

 
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Section 6.07     Books and Records.

 

(a)           In order to facilitate the resolution of any claims made against
or incurred by Seller prior to the Closing, or for any other reasonable purpose,
for a period of five (5) years after the Closing, Buyer shall:

 

(i)     retain the Books and Records (including personnel files) relating to
periods prior to the Closing in a manner reasonably consistent with Buyer’s
record keeping policies; and

 

(ii)     upon reasonable notice, afford Seller’s Representatives reasonable
access (including the right to make, at Seller’s expense, photocopies), during
normal business hours, to such Books and Records.

 

(b)           In order to facilitate the resolution of any claims made by or
against or incurred by Buyer after the Closing, or for any other reasonable
purpose, for a period of five (5) years after the Closing, Seller shall:

 

(i)     retain the books and records (including personnel files) of Seller which
relate to the Business and its operations for periods prior to the Closing; and

 

(ii)     upon reasonable notice, afford Buyer’s Representatives reasonable
access (including the right to make, at Buyer’s expense, photocopies), during
normal business hours, to such books and records.

 

(c)           Neither Buyer nor Seller shall be obligated to provide the other
party with access to any books or records (including personnel files) pursuant
to this Section 6.07 where such access would violate any Law.

 

Section 6.08     Closing Conditions. From the date hereof until the Closing,
each party hereto shall use commercially reasonable efforts to take such actions
as are necessary to expeditiously satisfy the closing conditions set forth in
Article VII hereof.

 

Section 6.09     Public Announcements. Unless otherwise required by applicable
Law or stock exchange requirements (based upon the reasonable advice of
counsel), no party to this Agreement shall make any public announcements in
respect of this Agreement or the transactions contemplated hereby or otherwise
communicate with any news media without the prior written consent of the other
party (which consent shall not be unreasonably withheld or delayed), and the
parties shall cooperate as to the timing and contents of any such announcement.

 

Section 6.10     Bulk Sales Laws. The parties hereby waive compliance with the
provisions of any bulk sales, bulk transfer or similar Laws of any jurisdiction
that may otherwise be applicable with respect to the sale of any or all of the
Purchased Assets to Buyer; provided that such waiver shall not otherwise limit
Buyer’s rights to indemnification under Article VII and any liability arising
from such waiver shall constitute an Excluded Liability.

 

 
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Section 6.11     Transfer Taxes. All transfer, documentary, sales, use, stamp,
registration, value added and other such Taxes and fees (including any penalties
and interest) incurred in connection with this Agreement and the other
Transaction Documents (including any real property transfer Tax and any other
similar Tax) shall be borne and paid by Buyer when due; provided that Seller
shall reimburse Buyer for 50% of such Taxes and fees. Buyer shall, at its own
expense, timely file any Tax Return or other document with respect to such Taxes
or fees (and Seller shall cooperate with respect thereto as necessary).

 

Section 6.12     Apportionment of Taxes. All personal property Taxes and similar
ad valorem obligations levied with respect to the Purchased Assets for a taxable
period that includes (but does not end on) the Closing Date shall be apportioned
between Seller and Buyer as of the Closing Date based on the number of days of
such taxable period included in the period ending with and including the Closing
Date (with respect to any such taxable period, the “Pre-Closing Tax Period”),
and the number of days of such taxable period beginning after the Closing Date
(with respect to any such taxable period, the “Post-Closing Tax Period”). Seller
shall be liable for the proportionate amount of such Taxes that is attributable
to the Pre-Closing Tax Period, and Buyer shall be liable for the proportionate
amount of such Taxes that is attributable to the Post-Closing Tax Period. If
bills for such Taxes have not been issued as of the Closing Date, and, if the
amount of such Taxes for the period including the Closing Date is not then
known, the apportionment of such Taxes shall be made at Closing on the basis of
the prior period’s Taxes. After Closing, upon receipt of bills for the period
including the Closing Date, adjustments to the apportionment shall be made by
the parties, so that if either party paid more than its proper share at the
Closing, the other party shall promptly reimburse such party for the excess
amount paid by them.

 

Section 6.13     Tax Cooperation. Buyer and Seller agree to furnish or cause to
be furnished to each other, upon request, as promptly as practicable, such
information and assistance relating to the Business, the Purchased Assets and
Assumed Liabilities (including access to books and records) as is reasonably
necessary for the filing of all Tax Returns, the making of any election relating
to Taxes, the preparation for any Tax audit by any Governmental Authority, and
the prosecution or defense of any other action relating to any Tax. Any expenses
incurred in furnishing such information or assistance shall be borne by the
party requesting it.

 

Section 6.14     Further Assurances. Following the Closing, each of the parties
hereto shall, and shall cause their respective Affiliates to, execute and
deliver such additional documents, instruments, conveyances and assurances and
take such further actions as may be reasonably required to carry out the
provisions hereof and give effect to the transactions contemplated by this
Agreement and the other Transaction Documents.

 

 
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Section 6.15     Non-Competition and Non-Solicitation Covenants. As a material
inducement to Buyer to enter into this Agreement and to consummate the
Transactions, Seller hereby agrees as follows:

 

(a)     During the period beginning on the Closing Date and ending on the third
(3rd) anniversary of the Closing Date (the “Non-Competition Period”), Seller
shall not, and, except as set forth in Section 6.15(d), shall cause each of its
Affiliates to not, directly, through a controlled Affiliate, or otherwise
indirectly (i) participate in, own, operate, manage, control, invest in, lend
to, or otherwise have any interest (of record or beneficial) in, or otherwise
aid or assist in any manner, any Person or other business (other than Buyer)
that engages in the Business or other business that is directly competitive with
the Business or (ii) intentionally interfere in any material respects with the
business relationships (whether formed prior to or after the date hereof)
between the Business and customers, suppliers and other business relations of
the Business; provided, however, that (x) Seller shall not be prohibited from
owning up to one percent (1%) of the outstanding stock of a corporation that is
publicly traded on a national securities exchange or in the over the counter
market so long as Seller has no active participation in connection with the
business of such corporation, (y) Seller’s other businesses, as presently
conducted, shall not be deemed to be competitive with the Business and (z) the
data analytics solutions that Seller offers to clients of its payments and
disbursements business shall not be deemed competitive with the Business, so
long as such data analytics solutions are only used in the Seller’s payments and
disbursements businesses.

 

(b)     During the Non-Competition Period, Seller shall not, directly or
indirectly, solicit or hire, attempt to solicit or hire, or assist any other
Person to solicit, hire or attempt to solicit or hire, any employee of the
Business as of the Closing Date or who was an employee of the Business at any
time during the six (6)-month period preceding the Closing Date. The posting of
a general advertisement for job openings or employment opportunities and
solicitations for employee candidates generally via newspaper, television,
radio, the Internet, and similar media shall not be a violation of Section
6.15(b) provided such actions are directed to the general population and not
targeted at Buyer’s employees.

 

(c)     Seller agrees that the scope of the restrictive provisions set forth in
this Section 6.15 are reasonable with respect to subject matter, time and scope
and that the provisions contained in this Section 6.15 are a material inducement
to Buyer’s entering into this Agreement and but for the provisions contained in
this Section 6.15 Buyer would not have entered into this Agreement. In the event
that any court determines that the subject matter, duration or geographic scope,
or all of the foregoing, is unreasonable and that such provision is to that
extent unenforceable, Buyer and Seller agree that the provision shall remain in
full force and effect for the greatest time period and for the broadest subject
matter and in the greatest area, as the case may be, that would not render it
unenforceable. It is specifically understood and agreed that any breach of the
provisions of this Section 6.15 by Seller may result in irreparable injury to
Buyer, that the remedy at law alone may be an inadequate remedy for such breach
and that, in addition to any other remedy it may have, Buyer shall be entitled
to enforce the specific performance of this Section 6.15 by Seller through both
temporary and permanent injunctive relief without the necessity of proving
actual damages, but without limitation of their right to damages and any and all
other remedies available to them, it being understood that injunctive relief is
in addition to, and not in lieu of, such other remedies.

 

 
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(d)     The restrictions set forth in this Section 6.15 shall not apply with
respect to any Person that becomes an acquirer of Seller or the stockholder of
Seller after the date hereof or any of its Affiliates (other than the
stockholder of Seller and its Subsidiaries).

 

Section 6.16     Intercompany Accounts. At or prior to the Closing, all
intercompany accounts between the Business and Seller and/or any of its
Affiliates, if any, shall be settled or otherwise eliminated.

 

Section 6.17     Exclusive Dealing. From the date hereof until the Closing,
Seller shall, and shall cause its respective Affiliates and Representatives (and
Representatives of Affiliates) to, cease any and all existing activities,
discussions or negotiations with any Person other than Buyer with respect to,
and to deal exclusively with Buyer and its designated Affiliates and
Representatives (and Representatives of Affiliates) regarding, any and all
acquisitions of, and investments in, or financings of the Business and/or
Purchased Assets, whether by way of merger, consolidation or other business
combination with any other Person, purchase or exchange of equity interests,
purchase of assets or otherwise (an “Alternative Transaction”) and, without the
prior consent of Buyer, Seller shall not, and shall cause its respective
Affiliates and Representatives (and Representatives of Affiliates) not to: (a)
solicit, initiate or otherwise engage in any negotiations, discussions or other
communications with any other Person relating to any Alternative Transaction;
(b) provide information or documentation to any other Person with respect to
Seller or any of its Affiliates in respect of any Alternative Transaction; or
(c) enter into any contract or agreement with any other Person in respect of any
Alternative Transaction. Notwithstanding the foregoing, Alternative Transaction
does not include any transaction regarding the acquisition of, investment in or
financing of the stockholder of Seller or any of the businesses of Seller other
than the Business, in each case whether by merger, consolidation or other
business combination with any other Person, purchase or exchange of equity
interests, purchase of assets or otherwise; provided that, for the avoidance of
doubt, no such transaction shall prevent or materially delay the consummation of
the transactions contemplated hereby.

 

Section 6.18     Cooperation Concerning Financing. Seller shall from time to
time, as and when reasonably requested by Buyer and upon reasonable notice to
Seller, cooperate with Buyer and use its commercially reasonable efforts to
cause its Representatives to cooperate, in connection with Buyer’s efforts to
obtain the Financing, provided that any such requested cooperation shall not
disrupt any other businesses of Seller. Without limiting the generality of the
foregoing, Seller shall, and shall use its commercially reasonable efforts to
cause its Representatives, to, at the request of Buyer permit Buyer and Buyer’s
Representatives, at the sole cost of Buyer, to (a) have reasonable access to
their respective premises, books and records, during normal business hours and
with reasonable prior written notice in accordance with Section 6.02, and (b)
discuss its affairs, finances and accounts with the key employees of the
Business; provided, however, that Buyer shall coordinate all contact with any of
the key employees through Seller or its designee.

 

 
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Section 6.19     Accounts Receivable. After the Closing, Seller shall (a)
promptly deliver to Buyer any payments received from third parties in connection
with any account receivable of the Business existing as of Closing that
constitutes a Purchased Asset, and (b) in the event Seller receives any
instrument of payment of any of the accounts receivable of the Business, Seller
shall forthwith deliver such instrument to Buyer, endorsed where necessary,
without recourse, in favor of Buyer.

 

Section 6.20     Trademarks. Seller shall, and shall cause its affiliates to,
not use and shall not license or permit any third party to use any name, slogan,
logo or trademark which is deceptively similar to any of the trademarks or other
name used in connection with the Business including the names “Campus Labs,”
“Student Voice,” “Baseline,” “Compliance Assist,” “Course Evaluations,”
“CollegiateLink,” “Beacon” and “Insight”.

 

ARTICLE VII
CONDITIONS TO CLOSING

 

Section 7.01     Conditions to Obligations of All Parties. The obligations of
each party to consummate the transactions contemplated by this Agreement shall
be subject to the fulfillment, at or prior to the Closing, of each of the
following conditions:

 

(a)     The filings of Buyer and Seller pursuant to the HSR Act, if any, shall
have been made and the applicable waiting period and any extensions thereof
shall have expired or been terminated.

 

(b)     No Governmental Authority shall have enacted, issued, promulgated,
enforced or entered any Governmental Order which is in effect and has the effect
of making the transactions contemplated by this Agreement illegal, otherwise
restraining or prohibiting consummation of such transactions or causing any of
the transactions contemplated hereunder to be rescinded following completion
thereof.

 

(c)     Seller shall have received all consents, authorizations, orders and
approvals from the Governmental Authorities referred to in Section 4.03 and
Buyer shall have received all consents, authorizations, orders and approvals
from the Governmental Authorities referred to in Section 5.03, in each case, in
form and substance reasonably satisfactory to Buyer and Seller, and no such
consent, authorization, order and approval shall have been revoked.

 

 
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Section 7.02     Conditions to Obligations of Buyer. The obligations of Buyer to
consummate the transactions contemplated by this Agreement shall be subject to
the fulfillment or Buyer’s waiver, at or prior to the Closing, of each of the
following conditions:

 

(a)     (i) The Fundamental Representations of Seller shall be true and correct
in all material respects as of the date hereof and as of the Closing Date with
the same effect as though made at and as of such date (except those
representations and warranties that address matters only as of a specified date,
which shall be true and correct in all material respects as of that specified
date) and (ii) all other representations and warranties of Seller contained in
Article IV shall be true and correct in all respects as of the Closing Date with
the same effect as though made at and as of such date (except those
representations and warranties that address matters only as of a specified date,
which shall be true and correct in all respects as of that specified date),
except where the failure of such representations and warranties to be true and
correct would not have a Material Adverse Effect.

 

(b)     Seller shall have duly performed and complied in all material respects
with all agreements, covenants and conditions required by this Agreement and
each of the other Transaction Documents to be performed or complied with by it
prior to or on the Closing Date.

 

(c)     Seller shall have delivered to Buyer duly executed counterparts to the
Transaction Documents (other than this Agreement) and such other documents and
deliveries set forth in Section 3.02(a).

 

(d)     Buyer shall have received a certificate, dated the Closing Date and
signed by a duly authorized officer of Seller, that each of the conditions set
forth in Section 7.02(a) and Section 7.02(b) have been satisfied (the “Seller
Closing Certificate”).

 

(e)     Buyer shall have received a certificate of the Secretary or an Assistant
Secretary (or equivalent officer) of Seller certifying that attached thereto are
true and complete copies of all resolutions adopted by the board of directors of
Seller authorizing the execution, delivery and performance of this Agreement and
the other Transaction Documents and the consummation of the transactions
contemplated hereby and thereby, and that all such resolutions are in full force
and effect and are all the resolutions adopted in connection with the
transactions contemplated hereby and thereby.

 

(f)     Buyer shall have received a certificate of the Secretary or an Assistant
Secretary (or equivalent officer) of Seller certifying the names and signatures
of the officers of Seller authorized to sign this Agreement, the Transaction
Documents and the other documents to be delivered hereunder and thereunder.

 

(g)     Buyer shall have received a certificate pursuant to Treasury Regulations
Section 1.1445-2(b) (the “FIRPTA Certificate”) that Seller is not a foreign
person within the meaning of Section 1445 of the Code duly executed by Seller.

 

 
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(h)     Since the date of this Agreement, there shall not have occurred any
Material Adverse Effect.

 

(i)     Buyer shall have received evidence of the receipt of all third party
consents set forth on Schedule 7.02(j).

 

Section 7.03     Conditions to Obligations of Seller. The obligations of Seller
to consummate the transactions contemplated by this Agreement shall be subject
to the fulfillment or Seller’s waiver, at or prior to the Closing, of each of
the following conditions:

 

(a)     The representations and warranties of Buyer contained in Article V shall
be true and correct in all respects as of the Closing Date with the same effect
as though made at and as of such date (except those representations and
warranties that address matters only as of a specified date, which shall be true
and correct in all respects as of that specified date), except where the failure
of such representations and warranties to be true and correct would not have a
material adverse effect on Buyer’s ability to consummate the transactions
contemplated hereby.

 

(b)     Buyer shall have duly performed and complied in all material respects
with all agreements, covenants and conditions required by this Agreement and
each of the other Transaction Documents to be performed or complied with by it
prior to or on the Closing Date.

 

(c)     Buyer shall have delivered to Seller the Closing Amount, duly executed
counterparts to the Transaction Documents (other than this Agreement) and such
other documents and deliveries set forth in Section 3.02(b).

 

(d)     Seller shall have received a certificate, dated the Closing Date and
signed by a duly authorized officer of Buyer, that each of the conditions set
forth in Section 7.03(a) and Section 7.03(b) have been satisfied (the “Buyer
Closing Certificate”).

 

(e)     Seller shall have received a certificate of the Secretary or an
Assistant Secretary (or equivalent officer) of Buyer certifying that attached
thereto are true and complete copies of all resolutions adopted by the board of
directors of Buyer authorizing the execution, delivery and performance of this
Agreement and the other Transaction Documents and the consummation of the
transactions contemplated hereby and thereby, and that all such resolutions are
in full force and effect and are all the resolutions adopted in connection with
the transactions contemplated hereby and thereby.

 

(f)     Seller shall have received a certificate of the Secretary or an
Assistant Secretary (or equivalent officer) of Buyer certifying the names and
signatures of the officers of Buyer authorized to sign this Agreement, the
Transaction Documents and the other documents to be delivered hereunder and
thereunder.

 

(g)     Seller shall have obtained all necessary consents of the lenders party
to the Credit Facility described in Section 4.03 of the Disclosure Schedule in
connection with the transactions contemplated by this Agreement.

 

 
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ARTICLE VIII
INDEMNIFICATION

 

Section 8.01     Survival. Subject to the limitations and other provisions of
this Agreement, the representations and warranties contained herein or in any
certificate delivered pursuant hereto shall survive the Closing, regardless of
any investigation with respect thereto, and shall remain in full force and
effect until the date that is twelve (12) months from the Closing Date; provided
that (i) the Fundamental Representations (other than the representations and
warranties set forth in Section 4.16) and (ii) claims arising from fraud and
intentional misrepresentation, shall survive the Closing Date indefinitely; and
provided, further, that the representations and warranties set forth in Section
4.16 shall remain in full force and effect until the date that is thirty (30)
days after the expiration of the applicable statute of limitations in respect of
the subject matter thereof. None of the covenants or other agreements contained
in this Agreement shall survive the Closing Date other than (x) those which by
their terms contemplate performance after the Closing Date, and each such
surviving covenant and agreement shall survive the Closing for the period
contemplated by its terms and (y) covenants set forth in Section 6.01, which
shall survive the Closing for a period of twelve (12) months. Notwithstanding
the foregoing, any claims asserted in good faith with reasonable specificity (to
the extent known at such time) and in writing by notice from the non-breaching
party to the breaching party prior to the expiration date of the applicable
survival period shall not thereafter be barred by the expiration of such
survival period and such claims shall survive until finally resolved.

 

Section 8.02     Indemnification By Seller. Subject to the other terms and
conditions of this Article VIII, Seller shall indemnify Buyer and its Affiliates
and their respective directors, officers, shareholders, employees, Affiliates,
agents, successors and assigns (collectively, the “Buyer Indemnified Parties”)
against, and shall hold Buyer Indemnified Parties harmless from and against, any
and all Losses incurred or sustained by, or imposed upon, Buyer Indemnified
Parties based upon, arising out of, with respect to or by reason of:

 

(a)     any inaccuracy in or breach of any of the representations or warranties
of Seller contained in this Agreement or in Seller Closing Certificate;

 

 
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(b)     any breach or non-fulfillment of any covenant, agreement or obligation
to be performed by Seller pursuant to this Agreement; or

 

(c)     any Excluded Asset or any Excluded Liability.

 

Section 8.03     Indemnification By Buyer. Subject to the other terms and
conditions of this Article VIII, Buyer shall indemnify Seller against, and shall
hold Seller harmless from and against, any and all Losses incurred or sustained
by, or imposed upon, Seller based upon, arising out of, with respect to or by
reason of:

 

(a)     any inaccuracy in or breach of any of the representations or warranties
of Buyer contained in this Agreement or in Buyer Closing Certificate;

 

(b)     any breach or non-fulfillment of any covenant, agreement or obligation
to be performed by Buyer pursuant to this Agreement; or

 

(c)     any Assumed Liability.

 

Section 8.04     Certain Limitations. The party making a claim under this
Article VIII is referred to as the “Indemnified Party”, and the party against
whom such claims are asserted under this Article VIII is referred to as the
“Indemnifying Party”. The indemnification provided for in Section 8.02 and
Section 8.03 shall be subject to the following limitations:

 

(a)     The Indemnifying Party shall not be liable to the Indemnified Party for
indemnification under Section 8.02(a) or Section 8.03(a), as the case may be, in
each case other than with respect to (i) breaches of Fundamental Representations
and (ii) claims involving fraud or intentional misrepresentation, until the
aggregate amount of all Losses in respect of indemnification under Section
8.02(a) or Section 8.03(a) exceeds one-half percent (0.5%) of the Purchase Price
(the “Deductible”), in which event the Indemnifying Party shall only be required
to pay or be liable for Losses in excess of the Deductible. With respect to any
claim as to which the Indemnified Party may be entitled to indemnification under
Section 8.02(a) or Section 8.03(a), in each case other than with respect to
claims involving fraud or intentional misrepresentation, as the case may be, the
Indemnifying Party shall not be liable for any individual or series of related
Losses which do not exceed $25,000 (which Losses shall not be counted toward the
Deductible).

 

(b)     The aggregate amount of all Losses for which an Indemnifying Party shall
be liable pursuant to Section 8.02(a) or Section 8.03(a), as the case may be, in
each case other than with respect to (i) breaches of Fundamental Representations
and (ii) claims involving fraud or intentional misrepresentation, shall not
exceed one and one-half percent (1.5%) of the Purchase Price.

 

(c)     Payments by an Indemnifying Party pursuant to Section 8.02 or Section
8.03 in respect of any Loss shall be limited to the amount of any liability or
damage that remains after deducting therefrom any insurance proceeds and any
indemnity, contribution or other similar payment received by the Indemnified
Party in respect of any such claim, net of any costs of such recovery or
increased premiums with respect thereto. The Indemnified Party shall use its
commercially reasonable efforts to recover under indemnity, contribution or
other similar agreements for any Losses, keep Seller reasonably informed with
respect to the status of such efforts, and, in the event any such Losses are so
recovered from third parties (other than the Buyer’s representation and warranty
insurance policy) following the receipt of any indemnification payments from an
Indemnifying Party, the Indemnified Party shall refund to the Indemnifying Party
any such duplicative recovery, net of the cost of obtaining such recovery.

 

 
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(d)     In no event shall any Indemnifying Party be liable to any Indemnified
Party for any punitive damages except to the extent awarded by a court of
competent jurisdiction in connection with a Third Party Claim.

 

(e)     Notwithstanding anything in this Agreement to the contrary, for purposes
of the parties indemnification obligations under this Article VIII, all of the
representations and warranties set forth in this Agreement that are qualified as
to “material,” “materiality,” “material respects,” “Material Adverse Effect” or
words of similar import or effect shall be deemed to have been made without any
such qualification for purposes of determining (i) whether a breach of any such
representation or warranty has occurred, and (ii) the amount of Losses resulting
from, arising out of or relating to any such breach of representation or
warranty.

 

(f)     Subject to limitations set forth in this Section 8.04, any
indemnification payments payable by Seller hereunder shall be made (i) first, by
release of any Indemnity Escrow Amount in accordance with the Escrow Agreement,
and (ii) after no amounts are remaining in escrow, by payment from Seller
directly.

 

Section 8.05     Indemnification Procedures.

 

(a)     Third Party Claims. If any Indemnified Party receives notice of the
assertion or commencement of any action, suit, claim or other legal proceeding
made or brought by any Person who is not a party to this Agreement or an
Affiliate of a party to this Agreement or a Representative of the foregoing (a
“Third Party Claim”) against such Indemnified Party with respect to which the
Indemnifying Party is obligated to provide indemnification under this Agreement,
the Indemnified Party shall give the Indemnifying Party prompt written notice
thereof. The failure to give such prompt written notice shall not, however,
relieve the Indemnifying Party of its indemnification obligations, except and
only to the extent that the Indemnifying Party forfeits rights or defenses by
reason of such failure. Such notice by the Indemnified Party shall describe the
Third Party Claim in reasonable detail, shall include copies of all material
written evidence thereof and shall indicate the estimated amount, if reasonably
practicable, of the Loss that has been or may be sustained by the Indemnified
Party. The Indemnifying Party shall have the right to participate in, or by
giving written notice to the Indemnified Party (which notice shall state that
the Indemnifying Party would be liable under the provisions hereof for indemnity
in the amount claimed by such third party if such claims by such third party are
valid), to assume the defense of any Third Party Claim at the Indemnifying
Party’s expense and by the Indemnifying Party’s own counsel, and the Indemnified
Party shall cooperate in good faith in such defense at the expense of the
Indemnifying Party, provided that the Indemnifying Party shall not be entitled
to assume the defense of any Third Party Claim (i) that involves criminal
allegation against the Indemnified Party, (ii) with a material customer of the
Indemnified Party or (iii) the amount of which exceeds the amount of the
remaining Indemnity Escrow Amount.

 

 
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(b)     Defense of Third Party Claims. In the event that the Indemnifying Party
assumes the defense of any Third Party Claim, subject to Section 8.05(c), it
shall have the right to take such action as it deems necessary to avoid,
dispute, defend, appeal or make counterclaims pertaining to any such Third Party
Claim in the name and on behalf of the Indemnified Party. The Indemnified Party
shall have the right, at its own cost and expense, to participate in the defense
of any Third Party Claim with counsel selected by it subject to the Indemnifying
Party’s right to control the defense thereof, provided that, in the event that
there exists a conflict of interest, the Indemnifying Party shall pay the
reasonable costs and expenses of one counsel to the Indemnified Party in each
relevant jurisdiction. If the Indemnifying Party elects not to compromise or
defend such Third Party Claim or fails to promptly notify the Indemnified Party
in writing of its election to defend as provided in this Agreement, the
Indemnified Party may, subject to Section 8.05(c), pay, compromise, defend such
Third Party Claim and seek indemnification for any and all Losses based upon,
arising from or relating to such Third Party Claim. Seller and Buyer shall
cooperate with each other in all reasonable respects in connection with the
defense of any Third Party Claim, including making available (subject to the
provisions of Section 6.05) records relating to such Third Party Claim and
furnishing, without expense (other than reimbursement of actual out-of-pocket
expenses) to the defending party, management employees of the non-defending
party as may be reasonably necessary for the preparation of the defense of such
Third Party Claim.

 

(c)     Settlement of Third Party Claims. Notwithstanding any other provision of
this Agreement, the Indemnifying Party shall not enter into settlement of any
Third Party Claim without the prior written consent of the Indemnified Party
(which consent shall not be unreasonably withheld or delayed), except as
provided in this Section 8.05(c). If a firm offer is made to settle a Third
Party Claim without leading to liability or the creation of a financial or other
obligation on the part, or restriction on, of the Indemnified Party and
provides, in customary form, for the unconditional release of each Indemnified
Party from all liabilities and obligations in connection with such Third Party
Claim and the Indemnifying Party desires to accept and agree to such offer, the
Indemnifying Party shall give written notice to that effect to the Indemnified
Party. If the Indemnified Party fails to consent to such firm offer within ten
(10) days after its receipt of such notice, the Indemnified Party may continue
to contest or defend such Third Party Claim and in such event, the maximum
liability of the Indemnifying Party as to such Third Party Claim shall not
exceed the amount of such settlement offer. If the Indemnified Party fails to
consent to such firm offer and also fails to assume defense of such Third Party
Claim, the Indemnifying Party may settle the Third Party Claim upon the terms
set forth in such firm offer to settle such Third Party Claim. If the
Indemnified Party has assumed the defense pursuant to Section 8.05(a), it shall
not agree to any settlement without the written consent of the Indemnifying
Party (which consent shall not be unreasonably withheld or delayed).

 

 
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(d)     Direct Claims. Any claim by an Indemnified Party on account of a Loss
which does not result from a Third Party Claim (a “Direct Claim”) shall be
asserted by the Indemnified Party giving the Indemnifying Party prompt written
notice thereof. The failure to give such prompt written notice shall not,
however, relieve the Indemnifying Party of its indemnification obligations,
except and only to the extent that the Indemnifying Party forfeits rights or
defenses by reason of such failure. Such notice by the Indemnified Party shall
describe the Direct Claim in reasonable detail, shall include copies of all
material written evidence thereof and shall indicate the estimated amount, if
reasonably practicable, of the Loss that has been or may be sustained by the
Indemnified Party. The Indemnifying Party shall have thirty (30) days after its
receipt of such notice to respond in writing to such Direct Claim. During such
period, the Indemnified Party shall allow the Indemnifying Party and its
professional advisors to investigate the matter or circumstance alleged to give
rise to the Direct Claim, and whether and to what extent any amount is payable
in respect of the Direct Claim and the Indemnified Party shall assist the
Indemnifying Party’s investigation by giving such information and assistance
(including access to the Indemnified Party’s premises and personnel and the
right to examine and copy any accounts, documents or records) as the
Indemnifying Party or any of its professional advisors may reasonably request.
If the Indemnifying Party does not so respond within such period, the
Indemnifying Party shall be deemed to have accepted such claim.

 

Section 8.06     Tax Treatment of Indemnification Payments. All indemnification
payments made under this Agreement shall be treated by the parties as an
adjustment to the Purchase Price for Tax purposes, unless otherwise required by
Law.

 

Section 8.07     Exclusive Remedies. Subject to Section 10.11, the parties
acknowledge and agree that their sole and exclusive remedy with respect to any
and all claims (other than claims arising from fraud or intentional
misrepresentation on the part of a party hereto in connection with the
transactions contemplated by this Agreement) for any breach of any
representation, warranty, covenant, agreement or obligation set forth herein or
otherwise relating to the subject matter of this Agreement, shall be pursuant to
the indemnification provisions set forth in this Article VIII. In furtherance of
the foregoing, each party hereby waives, to the fullest extent permitted under
Law, any and all rights, claims and causes of action for any breach of any
representation, warranty, covenant, agreement or obligation set forth herein or
otherwise relating to the subject matter of this Agreement it may have against
the other parties hereto and their Affiliates and each of their respective
Representatives arising under or based upon any Law, except pursuant to the
indemnification provisions set forth in this Article VIII. Nothing in this
Section 8.07 shall limit any Person’s right to seek and obtain any equitable
relief to which any Person shall be entitled pursuant to Section 10.11 or to
seek any remedy on account of any fraud or intentional misrepresentation.

 

 
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ARTICLE IX
TERMINATION

 

Section 9.01     Termination. This Agreement may be terminated at any time prior
to the Closing:

 

(a)           by the mutual written consent of Seller and Buyer;

 

(b)           by Buyer by written notice to Seller if:

 

(i)     Buyer is not then in material breach of any provision of this Agreement
and there has been a material breach, inaccuracy in or failure to perform any
representation, warranty, covenant or agreement made by Seller pursuant to this
Agreement that would give rise to the failure of any of the conditions specified
in Article VII and such breach, inaccuracy or failure cannot be cured by Seller
by December 31, 2015 (the “Drop Dead Date”); or

 

(ii)     the Closing has not occurred by the Drop Dead Date, unless such failure
shall be due to the failure of (A) Buyer to perform or comply with any of the
covenants, agreements or conditions hereof to be performed or complied with by
Buyer prior to the Closing, or (B) the condition specified in Section 7.01(a)
with regard only to the expiration or termination of the applicable waiting
period and any extensions thereof under the HSR Act, in which case the Drop Dead
Date shall be March 31, 2016 for purposes of this clause (ii);

 

(c)           by Seller by written notice to Buyer if:

 

(i)     Seller is not then in material breach of any provision of this Agreement
and there has been a material breach, inaccuracy in or failure to perform any
representation, warranty, covenant or agreement made by Buyer pursuant to this
Agreement that would give rise to the failure of any of the conditions specified
in Article VII and such breach, inaccuracy or failure cannot be cured by Buyer
by the Drop Dead Date; or

 

(ii)     the Closing has not occurred by the Drop Dead Date, unless such failure
shall be due to the failure of (A) Seller to perform or comply with any of the
covenants, agreements or conditions hereof to be performed or complied with by
it prior to the Closing, or (B) the condition specified in Section 7.01(a) with
regard only to the expiration or termination of the applicable waiting period
and any extensions thereof under the HSR Act, in which case the Drop Dead Date
shall be March 31, 2016 for purposes of this clause (ii);

 

(d)           by Buyer or Seller in the event that:

 

(i)     there shall be any Law that makes consummation of the transactions
contemplated by this Agreement illegal or otherwise prohibited; or

 

 
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(ii)     any Governmental Authority shall have issued a Governmental Order
restraining or enjoining the transactions contemplated by this Agreement, and
such Governmental Order shall have become final and non-appealable.

 

Section 9.02     Effect of Termination. In the event of the termination of this
Agreement in accordance with this Article, this Agreement shall forthwith become
void and there shall be no liability on the part of any party hereto except:

 

(a)     as set forth in this Article IX, Section 6.05 and Article X hereof; and

 

(b)     that nothing herein shall relieve any party hereto from liability for
any material breach of any provision hereof.

 

ARTICLE X
MISCELLANEOUS

 

Section 10.01     Expenses. Except as otherwise expressly provided herein
(including Section 6.11 hereof), all costs and expenses, including fees and
disbursements of counsel, financial advisors and accountants, incurred in
connection with this Agreement and the transactions contemplated hereby shall be
paid by the party incurring such costs and expenses, whether or not the Closing
shall have occurred; provided, however, that Buyer shall be responsible for all
filing and other similar fees payable in connection with any filings or
submissions under the HSR Act.

 

Section 10.02     Notices. All notices, requests, consents, claims, demands,
waivers and other communications hereunder shall be in writing and shall be
deemed to have been given (a) when delivered by hand (with written confirmation
of receipt); (b) when received by the addressee if sent by a nationally
recognized overnight courier (receipt requested); (c) on the date sent by
facsimile or e-mail of a PDF document (with confirmation of transmission) if
sent during normal business hours of the recipient, and on the next Business Day
if sent after normal business hours of the recipient or (d) on the thirty (3rd)
day after the date mailed, by certified or registered mail, return receipt
requested, postage prepaid. Such communications must be sent to the respective
parties at the following addresses (or at such other address for a party as
shall be specified in a notice given in accordance with this Section 10.02):

 

 

If to Seller:

115 Munson Street

New Haven, CT 06511

Attention:  Christopher Wolf, Executive VP
                    and Chief Financial Officer

Facsimile:  (203) 776-7796

E-mail:        christopher.wolf@higherone.com

 

 
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with a copy to:

Wiggin and Dana LLP

One Century Tower

265 Church Street

P.O. Box 1832

New Haven, CT 06508-1832

Attention: Paul A. Hughes

Facsimile:  (203) 782-2889

E-mail:        phughes@wiggin.com

Attention: Paul A. Hughes

   

 

If to Buyer:

 

iModules, Inc.
c/o iModules Software, Inc.

5101 College Blvd.

Leawood, KS 66211

Attention:      Fred Weiss

Facsimile:       913-341-2986

E-mail:             fweiss@imodules.com

   

with copies to:

Leeds Equity Partners

350 Park Avenue, 23rd Floor

New York, NY 10022

Attention:      Jacques V. Galante

Facsimile:      (212) 835-2020

E-mail: Jacques.Galante@leedsequity.com

 

and

 

Goodwin Procter LLP

Exchange Place

53 State Street

Boston, MA 02109

Attention:       John R. LeClaire and Jane Greyf

Facsimile:       (617) 649-1486, (646) 558-4100

E-mail: jleclaire@goodwinprocter.com, JGreyf@goodwinprocter.com

 

 

Section 10.03     Interpretation. For purposes of this Agreement, (a) the words
“include,” “includes” and “including” shall be deemed to be followed by the
words “without limitation”; (b) the word “or” is not exclusive; and (c) the
words “herein,” “hereof,” “hereby,” “hereto” and “hereunder” refer to this
Agreement as a whole. Unless the context otherwise requires, references herein:
(x) to Articles, Sections, Disclosure Schedules and Exhibits mean the Articles
and Sections of, and Disclosure Schedules and Exhibits attached to, this
Agreement; (y) to an agreement, instrument or other document means such
agreement, instrument or other document as amended, supplemented and modified
from time to time to the extent permitted by the provisions thereof and (z) to a
statute means such statute as amended from time to time and includes any
successor legislation thereto and any regulations promulgated thereunder. This
Agreement shall be construed without regard to any presumption or rule requiring
construction or interpretation against the party drafting an instrument or
causing any instrument to be drafted. The Disclosure Schedules and Exhibits
referred to herein shall be construed with, and as an integral part of, this
Agreement to the same extent as if they were set forth verbatim herein.

 

 
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Section 10.04     Headings. The headings in this Agreement are for reference
only and shall not affect the interpretation of this Agreement.

 

Section 10.05     Severability. If any term or provision of this Agreement is
invalid, illegal or unenforceable in any jurisdiction, such invalidity,
illegality or unenforceability shall not affect any other term or provision of
this Agreement or invalidate or render unenforceable such term or provision in
any other jurisdiction. Upon such determination that any term or other provision
is invalid, illegal or unenforceable, the parties hereto shall negotiate in good
faith to modify this Agreement so as to effect the original intent of the
parties as closely as possible in a mutually acceptable manner in order that the
transactions contemplated hereby be consummated as originally contemplated to
the greatest extent possible.

 

Section 10.06     Entire Agreement. This Agreement and the other Transaction
Documents constitute the sole and entire agreement of the parties to this
Agreement with respect to the subject matter contained herein and therein, and
supersede all prior and contemporaneous representations, warranties,
understandings and agreements, both written and oral, with respect to such
subject matter. In the event of any inconsistency between the statements in the
body of this Agreement and those in the other Transaction Documents, the
Exhibits and Disclosure Schedules (other than an exception expressly set forth
as such in the Disclosure Schedules), the statements in the body of this
Agreement will control.

 

Section 10.07     Successors and Assigns. This Agreement shall be binding upon
and shall inure to the benefit of the parties hereto and their respective
successors and permitted assigns. Neither party may assign its rights or
obligations hereunder without the prior written consent of the other party,
which consent shall not be unreasonably withheld or delayed; provided, that
Buyer may assign as collateral its rights hereunder to any person extending
credit to Buyer or any of their respective Affiliates, provided that no such
assignment shall relieve Buyer of any liability or obligation hereunder. No
assignment shall relieve the assigning party of any of its obligations
hereunder.

 

 
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Section 10.08     No Third Party Beneficiaries. This Agreement is for the sole
benefit of the parties hereto and their respective successors and permitted
assigns and nothing herein, express or implied, is intended to or shall confer
upon any other Person or entity any legal or equitable right, benefit or remedy
of any nature whatsoever under or by reason of this Agreement. Notwithstanding
the foregoing or anything herein to the contrary, the Financing Sources and each
of their respective equityholders, members, officers, directors, employees,
agent and representatives involved in the Financing and all of their respective
successors and assigns shall be third party beneficiaries of, and the Financing
Sources shall be entitled to enforce, Section 10.09 (Amendment and Modification;
Waiver), this Section 10.08, Section 10.10 (Governing Law, Submission to
Jurisdiction, Waiver of Jury Trial), and Section 10.13 (Non-Recourse), which
Sections shall survive any termination of this Agreement.

 

Section 10.09     Amendment and Modification; Waiver. This Agreement may only be
amended, modified or supplemented by an agreement in writing signed by each
party hereto; provided, that this Section 10.09, Section 10.08 (Third Party
Beneficiaries), Section 10.10 (Governing Law, Submission to Jurisdiction, Waiver
of Jury Trial ), and Section 10.13 (Non-Recourse) and any related definitions
used in such Sections shall not be amended in a manner adverse to the Financing
Sources without the Financing Source’s prior written consent. No waiver by any
party of any of the provisions hereof shall be effective unless explicitly set
forth in writing and signed by the party so waiving. No waiver by any party
shall operate or be construed as a waiver in respect of any failure, breach or
default not expressly identified by such written waiver, whether of a similar or
different character, and whether occurring before or after that waiver. No
failure to exercise, or delay in exercising, any right, remedy, power or
privilege arising from this Agreement shall operate or be construed as a waiver
thereof; nor shall any single or partial exercise of any right, remedy, power or
privilege hereunder preclude any other or further exercise thereof or the
exercise of any other right, remedy, power or privilege.

 

Section 10.10     Governing Law; Submission to Jurisdiction; Waiver of Jury
Trial.

 

(a)     This Agreement shall be governed by and construed in accordance with the
internal laws of the State of New York without giving effect to any choice or
conflict of law provision or rule (whether of the State of New York or any other
jurisdiction).

 

(b)     ANY LEGAL SUIT, ACTION OR PROCEEDING ARISING OUT OF OR BASED UPON THIS
AGREEMENT, THE OTHER TRANSACTION DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED
HEREBY OR THEREBY MAY BE INSTITUTED IN THE FEDERAL COURTS OF THE UNITED STATES
OF AMERICA OR THE COURTS OF THE STATE OF NEW YORK IN EACH CASE LOCATED IN THE
CITY OF NEW YORK AND COUNTY OF NEW YORK, AND EACH PARTY IRREVOCABLY SUBMITS TO
THE EXCLUSIVE JURISDICTION OF SUCH COURTS IN ANY SUCH SUIT, ACTION OR
PROCEEDING. SERVICE OF PROCESS, SUMMONS, NOTICE OR OTHER DOCUMENT BY MAIL TO
SUCH PARTY’S ADDRESS SET FORTH HEREIN SHALL BE EFFECTIVE SERVICE OF PROCESS FOR
ANY SUIT, ACTION OR OTHER PROCEEDING BROUGHT IN ANY SUCH COURT. THE PARTIES
IRREVOCABLY AND UNCONDITIONALLY WAIVE ANY OBJECTION TO THE LAYING OF VENUE OF
ANY SUIT, ACTION OR ANY PROCEEDING IN SUCH COURTS AND IRREVOCABLY WAIVE AND
AGREE NOT TO PLEAD OR CLAIM IN ANY SUCH COURT THAT ANY SUCH SUIT, ACTION OR
PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.

 

 
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(c)     EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE
UNDER THIS AGREEMENT OR THE OTHER TRANSACTION DOCUMENTS IS LIKELY TO INVOLVE
COMPLICATED AND DIFFICULT ISSUES AND, THEREFORE, EACH SUCH PARTY IRREVOCABLY AND
UNCONDITIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF
ANY LEGAL ACTION ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE OTHER
TRANSACTION DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY. EACH
PARTY TO THIS AGREEMENT CERTIFIES AND ACKNOWLEDGES THAT (A) NO REPRESENTATIVE OF
ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY
WOULD NOT SEEK TO ENFORCE THE FOREGOING WAIVER IN THE EVENT OF A LEGAL ACTION,
(B) SUCH PARTY HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER, (C) SUCH PARTY
MAKES THIS WAIVER VOLUNTARILY, AND (D) SUCH PARTY HAS BEEN INDUCED TO ENTER INTO
THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN
THIS SECTION 10.10(c).

 

(d)     WITHOUT LIMITING THE FOREGOING, ANY ACTION (WHETHER AT LAW, IN CONTRACT
OR IN TORT) OR PROCEEDING INVOLVING ANY FINANCING SOURCE THAT MAY BE BASED UPON,
ARISE OUT OF OR RELATING TO ANY FINANCING, OR THE NEGOTIATION, EXECUTION OR
PERFORMANCE OF ANY DOCUMENTATION IN CONNECTION THEREWITH, SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT
REGARD TO PRINCIPALS OF CONFLICTS OF LAW WHICH WOULD REQUIRE THE APPLICATION OF
THE LAWS OF ANOTHER JURISDICTION AND SHALL BE SUBJECT TO THE EXCLUSIVE
JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF
NEW YORK OR ANY STATE COURT SITTING IN THE BOROUGH OF MANHATTAN AND ANY
APPELLATE COURT THEREFROM.

 

Section 10.11     Specific Performance. The parties agree that irreparable
damage would occur if any provision of this Agreement were not performed in
accordance with the terms hereof and that the parties shall be entitled to
specific performance of the terms hereof, in addition to any other remedy to
which they are entitled at law or in equity.

 

 
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Section 10.12     Counterparts. This Agreement may be executed in counterparts,
each of which shall be deemed an original, but all of which together shall be
deemed to be one and the same agreement. A signed copy of this Agreement
delivered by facsimile, e-mail or other means of electronic transmission shall
be deemed to have the same legal effect as delivery of an original signed copy
of this Agreement.

 

Section 10.13     Non-Recourse. This Agreement may only be enforced against, and
any claim, action, suit or other legal proceeding based upon, arising out of, or
related to this Agreement, or the negotiation, execution or performance of this
Agreement, may only be brought against the entities that are expressly named as
parties hereto and then only with respect to the specific obligations set forth
herein with respect to such party. No past, present or future director, officer,
employee, incorporator, manager, member, partner, stockholder, Affiliate, agent,
attorney or other Representative of any party hereto or of any Affiliate of any
party hereto, or any of their successors or permitted assigns, shall have any
liability for any obligations or liabilities of any party hereto under this
Agreement or for any claim, action, suit or other legal proceeding based on, in
respect of or by reason of the transactions contemplated hereby. For the
avoidance of doubt, no claim shall be brought or maintained by Seller, Seller’s
Representative, or any of their respective Affiliates, successors or assigns
against any Financing Source and each of their respective equityholders,
members, officers, directors, employees, agent and representatives involved in
the Financing and all of their respective successors and assigns in connection
with this Agreement, any commitment letter or the transactions contemplated
hereby or thereby whether at law or equity, in contract tort or otherwise.
Notwithstanding the immediately preceding sentence, Seller retains the right to
bring claims against Buyer for any breach of Section 6.05(c) in connection with
the use or disclosure of Seller Confidential Information by a Financing Source.

 

 

 

 

[SIGNATURE PAGE FOLLOWS]

 

 
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
as of the date first written above by their respective officers thereunto duly
authorized.

 

HIGHER ONE, INC.

 

 

By   /s/ Christopher Wolf

Name: Christopher Wolf

Title: EVP and CFO

 

 

CL NEWCO, INC.

 

 

By   /s/ Jacques V. Galante

Name: Jacques V. Galante

Title: Authorized Officer

 

 

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