Exhibit 10.1

 

EXECUTION COPY

 

ASSET PURCHASE AGREEMENT

 

by and among

 

VIRTUSA CORPORATION,

 

OSB CONSULTING LLC

 

AND

 

THE SELLER MEMBER OF OSB CONSULTING LLC

 

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

 

TABLE OF CONTENTS

 

 

 

Page

 

 

ARTICLE 1 PURCHASE AND SALE OF ASSETS

1

1.1

Purchase of Assets

1

1.2

Assumption of Liabilities

3

1.3

Assignment of Contracts and Rights

4

1.4

The Closing

4

1.5

Allocation of Purchase Price

5

 

 

 

ARTICLE 2 REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND THE SELLER MEMBER

8

2.1

Organization; Corporate Power and Licenses of the Company

8

2.2

Capitalization and Related Matters

9

2.3

Subsidiaries; Investments

9

2.4

Authorization; No Breach

9

2.5

Financial Statements

10

2.6

Absence of Undisclosed Liabilities

11

2.7

Assets

11

2.8

Tax Matters

11

2.9

Contracts and Commitments

13

2.10

Intellectual Property Rights

15

2.11

Litigation, etc.

17

2.12

Brokers

17

2.13

Insurance

17

2.14

Employees

18

2.15

Employee Benefits

19

2.16

Compliance with Laws

21

2.17

Affiliated Transactions

22

2.18

Customers and Suppliers

22

2.19

Warranties, etc.

23

2.20

Leased Real Property

23

2.21

Environmental and Safety Matters

24

2.22

Governmental Licenses and Permits; Legal Compliance

24

2.23

Absence of Certain Developments

24

2.24

Bank Accounts

26

2.25

Privacy of Individually Identifiable Personal Information

26

2.26

Investment Company Status

26

2.27

Statements True and Correct

26

2.28

No Other Representations or Warranties

26

 

 

 

ARTICLE 3 REPRESENTATIONS AND WARRANTIES OF BUYER

26

3.1

Organization of Buyer

26

3.2

Authorization of Transaction

26

3.3

Noncontravention

27

3.4

Brokers

27

3.5

Statements True and Correct

27

3.6

No Other Representations or Warranties

27

 

i

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

 

ARTICLE 4 ADDITIONAL AGREEMENTS

27

4.1

Expenses

27

4.2

Certain Filings

27

4.3

Trademarks; Tradenames; Domain Names

28

4.4

Payments With Respect to Purchased Assets

28

4.5

Tax Matters

28

4.6

Confidentiality; Non-Compete; Non-Solicitation

29

4.7

Litigation Support

32

4.8

Transition Services

33

4.9

Employee and Related Matters

33

4.10

Seller Personal Information

35

4.11

Company Financial Statements

35

4.12

Maintenance of the Existence of the Company

35

 

 

 

ARTICLE 5 DELIVERABLES

36

5.1

Company Deliverables

36

5.2

Buyer Deliverables

37

 

 

 

ARTICLE 6 REMEDIES FOR BREACHES OF THIS AGREEMENT AND OTHER MATTERS

37

6.1

Survival of Representations and Warranties

37

6.2

Indemnification of Buyer

38

6.3

Indemnification Provisions for Benefit of the Company and the Seller Member

39

6.4

Matters Involving Third Parties

40

6.5

Manner of Payment

41

6.6

Insurance and Third Party Recovery

42

6.7

Offset

42

6.8

Delivery and Release of Holdback Fund

42

 

 

 

ARTICLE 8 Certain Definitions

43

8.1

Additional Definitions

48

 

 

 

ARTICLE 9 MISCELLANEOUS

50

9.1

No Third Party Beneficiaries

50

9.2

Entire Agreement

50

9.3

Successors and Assigns

50

9.4

Counterparts

51

9.5

Headings

51

9.6

Notices

51

9.7

Governing Law

52

9.8

Amendments and Waivers

52

9.9

Incorporation of Schedules

52

9.10

Construction

52

9.11

Severability of Provisions

53

9.12

Specific Performance

53

9.13

Successor Laws

53

9.14

Release

53

9.15

Delivery by Facsimile, etc.

53

9.16

Captions

53

9.17

Consent to Jurisdiction

53

9.18

Waiver of Jury Trial

54

 

ii

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

 

INDEX

 

EXHIBITS

 

None

 

SCHEDULES

 

Schedule 1.1(a)(i)

Schedule 1.1(a)(v)

Schedule 1.1(b)(v)

Schedule 1.1(b)(xi)

 

Tangible Personal Property

Deposits, Prepayments and Prepaid Expenses

Excluded Contracts

Excluded Assets

Schedule 1.5(b)

 

Company Revenues and Operating Profit Margin

Schedule 2.2(a)

 

Capitalization; Pro-Rata Shares

Schedule 2.2(b)

 

Preemptive Rights; Rights of First Refusal

Schedule 2.2(c)

 

Transfer and Voting Agreements

Schedule 2.3

 

Subsidiaries; Investments

Schedule 2.4(b)

 

Authorization; No Breach

Schedule 2.5(a)

Schedule 2.5(c)

 

Financial Statements

Accounts Payable

Schedule 2.6(a)

 

Undisclosed Liabilities

Schedule 2.6(b)

 

Indebtedness

Schedule 2.7(a)

 

Title to Assets

Schedule 2.7(b)

 

Condition of Assets

Schedule 2.8(a)

 

Tax Returns

Schedule 2.8(b)

 

Withholdings

Schedule 2.8(c)

 

Tax Matters

Schedule 2.9(a)

 

Material Contracts

Schedule 2.9(d)

 

Prior Names

Schedule 2.10(a)

 

Company Intellectual Property

Schedule 2.10(b)

 

Ownership of Company Intellectual Property

Schedule 2.10(d)

 

Actions Regarding Company Intellectual Property

Schedule 2.10(e)

 

Infringement of Company Intellectual Property

Schedule 2.10(f)

 

Compensation or Consideration Regarding Company Intellectual Property

Schedule 2.11

Schedule 2.12

 

Litigation, etc.

Brokers

Schedule 2.13

 

Insurance

Schedule 2.14(a)(i)

 

Labor

Schedule 2.14(b)(i)

 

Employees

Schedule 2.14(b)(ii)

 

Contingent Workers

Schedule 2.14(b)(iii)

 

Employee Obligations

Schedule 2.14(b)(iv)

 

Terminations

Schedule 2.14(c)

Schedule 2.14(d)

 

Employee Classification

Employment Laws

Schedule 2.15(a)

 

Employee Benefit Plans

Schedule 2.15(b)

 

Qualification of Employee Benefit Plans

 

iii

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

 

Schedule 2.15(e)

 

Fully Insured Employee Benefit Plans

Schedule 2.16

 

Compliance with Laws

Schedule 2.17

 

Affiliated Transactions

Schedule 2.18(a)

 

Material Customers

Schedule 2.18(b)

 

Non-Written Agreements

Schedule 2.18(c)

 

Material Suppliers

Schedule 2.19(a)

 

Warranties

Schedule 2.19(b)

 

Pricing Schedule

Schedule 2.20(b)

 

Leased Real Property

Schedule 2.22

Schedule 2.23

Schedule 2.24

Schedule 4.9(a)

Schedule 5.1(c)

Schedule 5.1(f)

Schedule 5.1(i)

Schedule 8.1(i)

Schedule 8.1(ii)

 

Governmental Licenses and Permits; Legal Compliance

Absence of Certain Developments

Bank Accounts

Active Employees; Foreign Employees; Inactive Employees

Required Contract Consents

Lien Releases

Lessor Certificates

Terminated Contracts

Assumed Contracts

 

iv

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

 

ASSET PURCHASE AGREEMENT

 

THIS ASSET PURCHASE AGREEMENT (this “Agreement”) is made as of November 1, 2013,
by and among (i) OSB CONSULTING LLC, a New Jersey limited liability company, and
each of its Subsidiaries (collectively, except with respect to Section 2.1
herein, the “Company” or “Seller”), (ii) the sole member of the Company listed
on the signature pages hereto (the “Seller Member”) and (iii) Virtusa
Corporation, a Delaware corporation (“Buyer”).  Terms used herein and not
otherwise defined herein shall have the meaning given to such terms in Article 8
hereof.

 

WHEREAS, the Company is engaged in the business of providing services related to
or involving any business that provides IT consulting, implementation, or
business consulting services or products, including without limitation, services
related to SAP products and services in the banking, financial service and
insurance industries (as currently conducted, and currently proposed to be
conducted, by the Company and its Subsidiaries, the “Business”); and

 

WHEREAS, Buyer desires to acquire from the Company, and the Company desires to
sell to Buyer, certain of the assets of the Company as set forth herein.

 

NOW, THEREFORE, in consideration of the mutual covenants and agreements herein
contained and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Parties hereto, intending to be legally
bound, hereby agree as follows:

 

ARTICLE 1

PURCHASE AND SALE OF ASSETS

 

1.1                               Purchase of Assets.

 

(a)                                 Purchased Assets.  Pursuant to the terms and
subject to the conditions set forth herein, at the Closing, Buyer shall
purchase, and the Company shall sell, convey, assign, transfer and deliver to
Buyer, all of the assets, properties, rights, titles and interests, other than
the Excluded Assets, of every kind or nature owned, leased, licensed or
otherwise held by the Company (including indirect and other forms of beneficial
ownership) as of the Closing Date, whether tangible, intangible, real, personal
or mixed and wherever located, including all of the following assets
(collectively, the “Purchased Assets”):

 

(i)                                     all tangible personal property,
including all machinery, equipment, molds, tools, spare parts, furniture,
accessories, office materials, packaging and shipping materials, office
equipment, personal computers, telephone units, facsimile machines, file
cabinets, artwork and drawings and other tangible personal property, including
those items listed on Schedule 1.1(a)(i);

 

(ii)                                  all raw materials, work-in-progress,
finished goods, supplies and other inventories, wherever situated subject to
Client rights (the “Inventory”);

 

(iii)                               subject to Section 1.1(b) and Section 1.3,
all rights existing under the Assumed Contracts;

 

(iv)                              all rights to the employment of the employees
of the Company;

 

(v)                                 with respect to Assumed Contracts, and with
respect to any of the foregoing rights which accrue after the Closing Date, all
claims, deposits, prepayments, prepaid

 

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

 

expenses, warranties, guarantees, refunds, causes of action, rights of recovery,
rights of set-off and rights of recoupment of every kind and nature (including
rights to insurance proceeds) including those listed on Schedule 1.1(a)(v),
except also for any of the foregoing to the extent they relate to Excluded
Assets or Excluded Liabilities;

 

(vi)                              all Intellectual Property of the Company;

 

(vii)                           all Permits;

 

(viii)                        all books and records, including ledgers,
correspondence, lists, studies and reports and other printed or written
materials, including, without limitation, all lists and records pertaining to
customers, personnel, agents, suppliers, distributors and pricing, purchase and
sale records, quality control records, research and development files, files and
data, company manuals and other business related documents and materials,
whether written, electronic or otherwise, all telephone and facsimile numbers
and internet access (including email) accounts, and all information relating to
Taxes; provided, that the Company may retain copies of any records as may be
required by or to comply with applicable Law or as necessary or advisable to
perform its obligations hereunder;

 

(ix)                              all other assets of any kind or nature of the
Company; and

 

(x)                                 all insurance, warranty and condemnation net
proceeds received after the Closing Date with respect to damage, non-conformance
of or loss to the foregoing Purchased Assets.

 

(b)                                 Excluded Assets.  Notwithstanding the
foregoing, the following assets of the Company are expressly excluded from the
purchase and sale contemplated hereby (the “Excluded Assets”) and, as such, are
not included in the assets to be conveyed as contemplated hereby:

 

(i)                                     all cash and cash equivalents;

 

(ii)                                  all accounts receivable,  unbilled work in
process as of the Closing, notes receivable and other amounts receivable from
third parties, including customers and employees (other than receivables in
connection with any Purchased Assets for services provided following the Closing
Date);

 

(iii)                               the general ledgers, accounting records,
minute books, charter documents, stock books, correspondence and materials
related to the Company’s Tax Returns, including any declarations, reports or
statements, statutory books, corporate seals or other records having to do with
the corporate organization of the Company;

 

(iv)                              the personnel files or records and any other
records that the Company is required by Law to retain in its possession;
provided that Buyer shall be given copies of such records as such documents
exist as of the Closing Date;

 

(v)                                 all rights to the Contracts set forth on
Schedule 1.1(b)(v) ;

 

(vi)                              all bank accounts;

 

(vii)                           the rights which accrue or will accrue to the
Company under this Agreement or the other Transaction Documents;

 

2

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

 

(viii)                        all claims, deposits, prepayments, prepaid
expenses, warranties, guarantees, refunds, causes of action, rights of recovery,
rights of set-off and rights of recoupment of every kind and nature (including
rights to insurance proceeds) relating to the foregoing Excluded Assets; and

 

(ix)                              all insurance policies for the benefit of the
Company or its Affiliates and all rights thereunder relating to the foregoing
Excluded Assets.

 

(x)                                 with respect to Excluded Assets, or with
respect to any Assumed Contract, but only with respect to the foregoing claims
under any Assumed Contract which only accrued prior to the Closing Date, all
claims, deposits, prepayments, prepaid expenses, warranties, guarantees,
refunds, causes of action, rights of recovery, rights of set-off and rights of
recoupment of every kind and nature (including rights to insurance proceeds). To
avoid confusion the parties agree that the Seller will retain any security
deposit paid by Seller on the Lease.

 

(xi)                              Personal items listed on Schedule 1.1(b)(xi).

 

1.2                               Assumption of Liabilities.

 

(a)                                 Assumed Liabilities.  At the Closing, Buyer
shall assume and shall agree to pay, defend, discharge and perform as and when
due and performable all Liabilities arising under each Assumed Contract from and
after the Closing (other than Liabilities attributable to products sold,
services rendered or other actions on or prior to the Closing Date, or to any
failure by the Company to comply with the terms thereof on or prior to the
Closing Date or Liabilities directly related to the transfer of the Purchased
Assets (including Company Transaction Expenses) as contemplated by this
Agreement) (the “Assumed Liabilities”).

 

(b)                                 Excluded Liabilities.  Notwithstanding
anything to the contrary contained herein,  Buyer is assuming only the Assumed
Liabilities and is not assuming any other Liability of the Company or any
Affiliate thereof (or any predecessor owner of all or part of the Company’s
business or assets) of whatever nature whether currently in existence or arising
or asserted hereafter.  All such other Liabilities shall be retained by and
remain Liabilities of the Company and its Affiliates (all such Liabilities not
being assumed are herein referred to as the “Excluded Liabilities”).  Without
limiting the foregoing, none of the following shall be Assumed Liabilities for
purposes of this Agreement:

 

(i)                                     all Excluded Taxes;

 

(ii)                                  all Indebtedness;

 

(iii)                               all Liabilities relating to or arising out
of the Company’s bonus plans, whether written or oral, including any promises to
Company employees,  made or in effect prior to the Closing Date (the “Company
Bonus Plans”);

 

(iv)                              all claims, causes of action, litigation and
other rights of third parties relating to or arising out of (A) the Assumed
Contracts, including, without limitation, any warranty or indemnity obligation
of the Company in respect of products sold or services rendered on or prior to
the Closing Date or claims against the Company directly related to the transfer
of the Purchased Assets as contemplated by this Agreement or (B) the Excluded
Assets, including, without limitation, any Contract that is not an Assumed
Contract;

 

3

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

 

(v)                                 all accounts payable and accrued expenses of
the Company (whether prior to or following the Closing);

 

(vi)                              all Liabilities relating to or arising out of
the Excluded Assets, including, without limitation, any Contract that is not an
Assumed Contract;

 

(vii)                           all Liabilities relating to or arising out of
the Assumed Contracts, including any warranty or indemnity obligation of the
Company, right of refund, rights of set off or other obligations or claims,
solely in respect of products sold or services rendered on or prior to the
Closing Date;

 

(viii)                        all Environmental Liabilities; and

 

(ix)                              all Liabilities relating to or arising out of
the Company’s employment of the employees of the Company, including without
limitation wages, commission, accrued vacation pay, performance and other
bonuses, benefits and ownership interests, all Liabilities arising out of any
Employee Benefit Plan or 401(k) Plan of the Company.

 

1.3                               Assignment of Contracts and Rights. 
Notwithstanding anything to the contrary contained in this Agreement, this
Agreement shall not constitute an agreement to assign any Contract if an
attempted assignment thereof, without consent of a third party thereto, would
constitute a breach or other contravention thereof or in any way adversely
affect the rights of Buyer or the Company thereunder.  The Company will use its
best efforts to obtain the consent of the other parties to any such Contract in
accordance with the Required Contract Consent for the assignment thereof to
Buyer or its designated Affiliate as Buyer may request.  Unless and until such
consent is obtained, or if an attempted assignment thereof would be ineffective
or would adversely affect the rights of Buyer or the Company thereunder so that
Buyer would not in fact receive all rights under such Contract, the Company and
Buyer will cooperate in an arrangement under which Buyer would obtain the
benefits and assume the obligations thereunder in accordance with this
Agreement, including subcontracting, sub-licensing, or subleasing to Buyer, or
under which the Company would enforce, at Buyer’s expense, for the benefit of
Buyer, with Buyer assuming at Buyer’s expense the Company’s obligations and
Liabilities (solely to the extent provided in Section 1.2(a)), any and all
rights of the Company against a third party thereto. The Company will promptly
pay to Buyer when received all monies received by the Company under any such
Contracts relating to or arising out of products delivered, services rendered or
work performed on or after the Closing Date, and Buyer shall pay, defend,
discharge and perform all Liabilities relating to or arising out of products
delivered, services rendered or work performed on or after the Closing Date
under such Contracts.

 

1.4                               The Closing.

 

(a)                                 Subject to the terms and conditions of this
Agreement, the closing of the transactions contemplated by the Transaction
Documents (the “Closing”) shall take place (i) at the offices of Goodwin Procter
LLP, 53 State Street, Exchange Place, Boston, MA 02109, or electronically, at
12:01 a.m. (local time), on November 1, 2013, or at such other place or on such
other date as is mutually acceptable to Buyer, the Company and the Seller
Member.  The date of the Closing is herein referred to as the “Closing Date.” 
All transactions shall be deemed to occur at 12:01 a.m. on the Closing Date, and
the Closing shall be effective as of 12:02 a.m. on the Closing Date.

 

(b)                                 Subject to the terms and conditions set
forth herein, and on the basis of the representations, warranties, covenants and
agreements set forth herein, and in the following order:

 

4

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

 

(i)                                     At the Closing, the initial purchase
price (the “Purchase Price”) to be paid by Buyer for the Purchased Assets shall
be Seven Million Dollars ($7,000,000),  less (A) the Operating Expense Amount,
less (B) the Holdback Amount (as defined below).  With respect to any Purchase
Price payable hereunder which is an Earn-out Amount hereunder, on 30 days prior
written notice to Company and Seller Member, Buyer shall be entitled to deduct
from such Purchase Price any amounts required to be withheld and deducted under
the Code or other applicable Tax law, if any.  Any amount so deducted shall be
remitted by Buyer to the appropriate Governmental Entity.  To the extent such
amounts are withheld by Buyer, such withheld amounts shall be treated for all
purposes of this Agreement as having been paid to the relevant recipient.  The
Purchase Price shall be paid as provided in Section 1.4(b)(ii) and any Earn-out
Amount shall be made per Section 1.5 hereunder.

 

(ii)                                  At the Closing, Buyer shall deliver, in
exchange for the Purchased Assets, the Purchase Price to the Company in
immediately available funds by wire transfer to an account designated by the
Company by notice to Buyer, which notice shall be delivered not later than two
(2) Business Days prior to the Closing Date (the “Seller Account”).

 

(c)                                  In addition to the foregoing, as
applicable, the Company shall deliver to Buyer or one or more of its designees
such deeds, bills of sale, endorsements, Consents (as defined below),
assignments and other good and sufficient instruments of conveyance and
assignment as Buyer shall deem reasonably necessary to vest in Buyer or one or
more of its designees all right, title and interest in, to and under the
Purchased Assets in the manner described herein free and clear of all Liens and
in form and substance reasonably satisfactory to Buyer.

 

(d)                                 At the Closing, Buyer shall deposit the
amount of Six Hundred Eighty-Four Thousand Dollars ($684,000) (the “Holdback
Amount”) in immediately available funds by wire transfer in the Holdback Fund.
The Holdback Amount will serve as one source, but not the exclusive source, for
the satisfaction of any indemnification or other claims of any Buyer Party (as
defined below) pursuant to Article 6.  On the date that is twelve (12) months
following the Closing Date, provided that no Buyer Party has any claim for
indemnification pursuant to Article 6 hereof, any remaining Holdback Amount
shall be delivered by Buyer to the Company from the Holdback Fund in accordance
with Section 6.8.

 

(e)                                  Closing Deliveries.  At the Closing,
subject to and on the terms and conditions set forth in this Agreement:
(i) Buyer shall deliver to the Company or the Seller Member, as appropriate,
each of the documents required to be delivered by Buyer pursuant to Section 5.2
that has not been delivered prior to the Closing Date; and (ii) the Company and
the Seller Member shall deliver to Buyer each of the documents required to be
delivered by such Parties pursuant to Section 5.1 that has not been delivered
prior to the Closing Date.

 

1.5                               Allocation of Purchase Price; Earn-out. 
(a) As promptly as practicable, but no later than sixty (60) days following the
last day of the month in which the Closing occurs, Buyer shall prepare an
allocation of the Purchase Price (and all other allocable costs) among the
assets of the Company in accordance with Code Sections 1060 and the Treasury
Regulations thereunder (and any similar provision of state, local or non-U.S.
law, as appropriate) (the “Allocation”).  Buyer shall promptly submit the
Allocation to the Company for approval.  Buyer will make available to the
Company and its accountant all records of work papers used in preparing the
Allocation.  The Company shall have thirty (30) days to review the Allocation. 
If the Company does not deliver written notice to Buyer of any disagreement with
Buyer’s calculations within such thirty (30) day review period, then the
Allocation shall become final.  If the Company disagrees with any item set forth
in Buyer’s Allocation, the Parties will have fifteen (15) days to attempt to
mutually resolve the disagreement.  If any item remains in dispute at the end of
the fifteen (15) day period, the dispute will be submitted to and settled by
Ernst & Young or another

 

5

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

 

independent accounting firm of nationally recognized standing reasonably
satisfactory to the Company and Buyer (who shall not have any material
relationship with the Company, the Seller Member or Buyer) (the “Independent
Accountant”).  The Company and Buyer shall jointly engage the Independent
Accountant to review this Agreement and to resolve the disputed items or amounts
for the purpose of calculating the Allocation.  In making such calculation, the
Independent Accountant shall, acting as an expert and not an arbiter, consider
only those items or amounts in the Buyer’s calculation of the Allocation as to
which the Company has disagreed.  The Independent Accountant’s determination
will be based solely on presentations by the Company and Buyer and the
Independent Accountants shall deliver to the Company and Buyer as promptly as
practicable (but in any event within thirty (30) days of its engagement) a
report setting forth such calculation.  Such report shall be final and binding
upon the Company, the Seller Member and Buyer.  The fees and expenses of the
Independent Account shall be borne equally by the Company and Buyer.  Buyer, the
Seller Member, the Company and their Affiliates agree (i) that the Allocation
shall represent the fair market values of the Company’s assets, (ii) to prepare
and file all Tax Returns (including, but not limited to, Internal Revenue
Service Forms 8594) in a manner consistent with the Allocation, and (iii) not to
take any Tax position (whether in Tax audits, Tax Returns or otherwise) that is
inconsistent with the Allocation unless required to do so by applicable law. 
All adjustments to the Purchase Price shall also be allocated in accordance with
the methodology set forth in the Allocation.  The Company shall timely and
properly prepare, execute, file and deliver all documents, forms and other
information as Buyer may reasonably request to prepare the Allocation.

 

(b)  Earn-Out Statement.  Promptly, but in any event within sixty (60) days
after the end of the five month period ending March 31, 2014 (“FY14 Target
Period”), the nine month period ending December 31, 2014 (“CY14 Target Period”)
and the 12 month period ending December 31, 2015 (the “CY15 Target Period,” and
together with the FY14 Target Period and the CY14 Target Period, a “Target
Period” or “Target Periods,” as the case may be), Buyer shall in good faith
prepare or cause to be prepared and furnished to the Company and the Seller
Member a written statement (the “Earn-Out Statement”) setting forth its
calculation of the Company Revenues and Operating Profit Margin (each as defined
on Schedule 1.5(b)), in each case, prepared in accordance with Schedule
1.5(b) hereto for the applicable Target Period.  Following receipt of the
Earn-Out Statement for the applicable Target Period, the Seller Member shall be
afforded a period of forty-five (45) days to review the Buyer’s calculation of
the Company Revenues and Operating Profit Margin.  At or before the end of the
forty-five (45) day review period, the Company or Seller Member shall either
(i) accept the Earn-Out Statement in its entirety or (ii) deliver to the Buyer a
written notice (a “Dispute Notice”) setting forth a detailed explanation of
those items in or omitted from the Earn-Out Statement that the Seller Member or
the Company disputes, including the amount thereof (each, an “Item of Dispute”);
provided, that the only basis on which the Seller Member or the Company shall be
permitted to submit an Item of Dispute is that such Item of Dispute was not
prepared in accordance with the terms of this Agreement and Schedule 1.5(b),
including not in accordance with GAAP or due to fraud or misrepresentation, or
contains mathematical or clerical errors.  If the Seller Member or Company does
not deliver a Dispute Notice to the Buyer within the forty-five (45) day review
period, the Seller Member and the Company shall be deemed to have accepted the
Earn-Out Statement in its entirety.  If the Seller Member or the Company
delivers a Notice of Dispute in which some, but not all, of the items in the
Earn-Out Statement are properly disputed, the Seller Member and the Company
shall be deemed to have accepted all of the items not disputed other than those
not directly disputed but which are affected by an Item of Dispute. Buyer shall
pay amounts earned hereunder which are not an Item of Dispute hereunder per this
Section 1.5.  The Parties shall and shall cause their respective Affiliates to
cooperate fully with Buyer in connection with the preparation of the Earn-Out
Statement.  After the delivery of the Earn-Out Statement, Buyer shall cooperate
with the Seller Member and the Company and his or its representatives in
connection with its review of the Earn-Out Statement, including by providing the
Seller Member and the Company and his or its accountants reasonable access
during business hours to materials used in the preparation of the Earn-Out
Statement and the individuals who prepared the Earn-Out Statements.

 

6

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

 

(c) Each quarter during the Earn Out Period the Buyer shall deliver within 40
days after the immediately preceding quarter an earn out statement to the
Company and the Seller Member in sufficient detail to enable the Company and
Seller Member to determine the Operating Profit Margin to that point in time. 
Company or Seller Member may or may not in its or his reasonable discretion
question the quarterly earn out statement.

 

(d) Company Revenue and Operating Profit Margin Record Retention.  During each
applicable Target Period and for three (3) years after the final Target Period,
Buyer shall keep, and shall cause its Affiliates to keep, complete and accurate
books and records of all Company Revenues and Operating Profit Margin.  Upon the
written request of the Company or Seller Member, Buyer shall permit, and shall
cause its Affiliates to permit, at the expense of the Seller Member or the
Company, an independent certified public accounting firm of recognized standing
selected by the Seller Member or the Company and reasonably acceptable to the
Buyer or the Seller Member to have access during normal business hours to such
of the records of the Buyer as may be reasonably necessary to verify the
accuracy of the Earn-Out Statement; provided, however, that such accounting firm
and/or Seller Member has entered into a confidentiality agreement in reasonably
customary form and substance with the Buyer.

 

(e)                                  Dispute Resolution by the Parties.  If the
Seller Member or the Company delivers a Dispute Notice to Buyer within the
required forty-five (45) day period, Buyer, on the one hand, and the Seller
Member and the Company on the other, shall use reasonable best efforts to
resolve their differences concerning the Items of Dispute, and if any Item of
Dispute is so resolved, the Earn-Out Statement shall be modified as necessary to
reflect such resolution.  If all Items of Dispute are so resolved, the Earn-Out
Statement (as so modified) shall be conclusive and binding on all Parties.

 

(f)                                   Determination by Independent Accounting
Firm.  If any Item of Dispute remains unresolved for a period of fifteen (15)
days after Buyer’s receipt of a Dispute Notice, then either the Buyer, on the
one hand, or the Seller Member or the Company, on the other, may, within five
(5) days thereafter, submit the dispute to Independent Accounting Firm.  Buyer,
and the Company or Seller Member, as the case may be, shall each provide their
respective calculations of the Company Revenues and Operating Profit Margin and
the Items of Dispute in writing to each other and the Independent Accounting
Firm and shall request that the Independent Accounting Firm render a written
determination, which determination (i) shall be based solely on whether each
such Item of Dispute was prepared in accordance with the terms of this Agreement
and Schedule 1.5(b)  or whether each such Item of Dispute contains a
mathematical or clerical error or errors or other permissible exception or claim
under this Agreement, and (ii) shall not be resolved so the final amount
determined by the Independent Accounting Firm is more favorable to the Seller
Member or the Company other than the calculation(s) presented in any Item of
Dispute delivered by the Seller Member or Company, as the case may be, or more
favorable to the Buyer than the calculation(s) presented in any Item of Dispute
delivered by Buyer, as to each unresolved Item of Dispute as soon as reasonably
practicable, but in no event later than thirty (30) days after its retention,
and the Parties shall cooperate fully with the Independent Accounting Firm so as
to enable it to make such determination as quickly and as accurately as
practicable.  The Independent Accounting Firm’s determination as to each Item of
Dispute submitted to it shall be in writing and shall be conclusive and binding
upon the Parties, absent manifest error or willful misconduct, and the Company
Revenues and/or Operating Profit Margin shall be modified to the extent
necessary to reflect such determination.  The fees and expenses of the
Independent Accounting Firm shall be paid by the Party whose calculation of the
Company Revenues and/or Operating Profit Margin, as applicable, is furthest from
the determination rendered by the Independent Accounting Firm.

 

(g) Final Company Revenues and Operating Profit Margin.  The Company Revenues
and Operating Profit Margin shall be deemed final for the purposes of this
Section 1.5(b) upon the earliest of (x) the failure of the Seller Member or the
Company to provide Buyer with a Dispute Notice within forty-

 

7

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

 

five (45) days of the Buyer’s delivery of the Earn-Out Statement, (y) the
resolution of all Items of Dispute pursuant to Section 1.5 by the Seller Member
or the Company and the Buyer and (z) the resolution of all Items of Dispute,
pursuant to Section 1.5, by the Independent Accounting Firm.  Upon the final
determination of the Company Revenues and Operating Profit Margin as set forth
in this paragraph, Buyer shall adjust, if applicable, the Earn-Out Statement
accordingly and such adjusted Earn-Out Statement shall be deemed final and Buyer
shall pay all Earn-Out Amounts determined due for the applicable period within
10 business days of such final determination hereunder.

 

(h) Purchase Price Adjustment.

 

(i)                                     For the FY14 Target Period, if the
amount of the Company Revenues and Operating Profit Margin as reflected on the
Final Earn-Out Statement for FY14 is equal to or greater than the Company
Revenue Target and the Company Operating Profit Margin Target or otherwise
eligible for a payment as set forth on Schedule 1.5(b), the Purchase Price shall
be adjusted upward by the amounts as set forth in and subject to the terms and
conditions of Schedule 1.5(b) and this Agreement (“FY14 Earn-out Amount”).

 

(ii)                                  For the CY14 Target Period, if the amount
of the Company Revenues and Operating Profit Margin as reflected on the Final
Earn-Out Statement for CY14 is equal to or greater than the Company Revenue
Target and the Company Operating Profit Margin Target for CY14 or otherwise
eligible for a payment as set forth on Schedule 1.5(b), the Purchase Price shall
be adjusted upward by the amounts as set forth in and subject to the terms and
conditions of Schedule 1.5(b) and this Agreement (“CY14 Earn-out Amount”).

 

(iii)                               For the CY15 Target Period, if the amount of
the Company Revenues and Operating Profit Margin as reflected on the Final
Earn-Out Statement for CY15 is equal to or greater than the Company Revenue
Target and the Company Operating Profit Margin Target for CY15 or is otherwise
eligible for a payment as set forth on Schedule 1.5(b), the Purchase Price shall
be adjusted upward by the amounts as set forth in and subject to the terms and
conditions of Schedule 1.5(b) and this Agreement (the “CY15 Earn-out Amount,”
and together with the FY14 Earn-out Amount and the CY14 Earn-out Amount, an
“Earn-out Amount”).

 

(i) The post-closing adjustment to the Purchase Price and payment of the
applicable Earn-out Amount with respect to the applicable Target Period, if any,
payable by Buyer to the Company pursuant to this Section 1.5 and Schedule
1.5(b) hereto shall be paid in cash to the Company in immediately available
funds by wire transfer within fifteen (15) Business Days after the Closing
Statement for such Target Period becomes approved by the Buyer and by Company or
Seller Member and is final and binding upon the Parties. Any undisputed amounts
will be paid under the terms and timelines of this Agreement.

 

ARTICLE 2
REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND THE SELLER MEMBER

 

As a material inducement to Buyer to enter into and perform its obligations
under this Agreement, the Company and the Seller Member, jointly and severally,
represent and warrant to Buyer that the statements contained in this Article 2
are true and correct as of the Closing Date, unless a different date is set
forth in any such covenant or representation or warranty (in which case, as of
that different date):

 

2.1                               Organization; Corporate Power and Licenses of
the Company.  The Company is a limited liability company duly organized, validly
existing and in good standing under the laws of the State of

 

8

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

 

New Jersey.  The Company is not qualified to do business in any other
jurisdictions and, given the character of the Company’s assets and properties
and the business transacted (or proposed to be transacted) by the Company as of
the date hereof, no such qualification is required, except where the failure to
be so qualified would not have a material adverse effect on the Company’s
business, assets (including intangible assets), liabilities, financial
condition, property, prospects or results of operations.  The Company possesses
all requisite limited liability company power and authority and all licenses,
permits and authorizations necessary to own and operate its properties, to carry
on its businesses (as now conducted and currently proposed to be conducted) and
to carry out the transactions contemplated by this Agreement and the Transaction
Documents.  Copies of the Company’s articles of organization, limited liability
company agreement and other organizational documents, previously made available
to Buyer, reflect all amendments made thereto at any time prior to the Closing
Date and are correct and complete.

 

2.2                               Capitalization and Related Matters.  The
issued and outstanding membership interests in the Company (the “Securities”)
held beneficially and of record by the Seller Member are as set forth on
Schedule 2.2(a).  Except as set forth on Schedule 2.2(a), there are no issued or
outstanding membership interests or any other securities of the Company, or
securities convertible or exchangeable for any Securities or containing any
profit participation features, nor are there any outstanding rights or options
to subscribe for or to purchase any Securities, or any equity appreciation
rights or phantom equity plans.  Each security convertible or exchangeable for
Securities or rights or options to subscribe for or to purchase any Securities
granted by the Company at any time prior to the Closing was granted for no less
than the fair market value of a Security on the date of grant determined in a
manner consistent with Section 409A of the Code, which provide for the issuance
of profits interests and have no exercise price.  All of the Securities have
been validly issued, fully paid and non-assessable and are free and clear of any
Liens.  Except as set forth on Schedule 2.2(b), there are no statutory or
contractual preemptive rights or rights of refusal with respect to the
Securities.  The Company has not violated any applicable federal or state
securities laws in connection with the offer, sale or issuance of any of its
membership interests.  Except as set forth on Schedule 2.2(c), there are no
agreements with respect to the voting or transfer of the Securities.  All of the
Securities are owned (beneficially and of record) by the Seller Member.  To the
Knowledge of the Company, no former member of the Company has any claim or
rights against the Company that remains unresolved or to which the Company has
or may have (now or in the future) any Liability.

 

2.3                               Subsidiaries; Investments.  Each Subsidiary of
the Company is set forth on Schedule 2.3 and the Company does not own an equity
interest in any other Person.  The Company directly owns each of the outstanding
shares of capital stock or other equity interest of each Subsidiary, free and
clear of any Liens.  Each Subsidiary (i) is a corporation or limited liability
company duly incorporated or organized, validly existing and in good standing
under the laws of its jurisdiction of incorporation or organization, (ii) is not
qualified to do business in any jurisdiction other than the jurisdiction in
which such Subsidiary was organized, and (iii) given the character of each
Subsidiary’s assets and properties and the business transacted (or proposed to
be transacted) by such Subsidiary as of the date hereof, no such qualification
is required.  No Subsidiary owns, directly or indirectly, any interest or
investments in any Person of any kind.

 

2.4                               Authorization; No Breach.

 

(a)                                 The Company and the Seller Member has the
power and authority to enter into this Agreement and to carry out his, her or
its obligations hereunder.  The execution and delivery of the Transaction
Documents and the performance by the Company and the Seller Member of his, her
or its obligations hereunder or thereunder have been duly authorized, and no
other proceedings or approvals on the part of the Company or such Seller Member
are necessary to approve and authorize such execution, delivery and performance,
or the consummation of the transactions contemplated hereby and thereby. 

 

9

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

 

Each Transaction Document to which the Company or such Seller Member is a party
has been duly executed by such Party and constitutes a valid and legally binding
obligation of such Person, enforceable in accordance with its terms, subject
only to bankruptcy, insolvency, reorganization, moratoriums or similar laws at
the time in effect affecting the enforceability or rights of creditors generally
and by general equitable principles which may limit the right to obtain
equitable remedies.

 

(b)                                 Except as set forth on Schedule 2.4(b), the
execution and delivery by the Company and such Seller Member of this Agreement,
and all other Transaction Documents to which such Person is a party, and the
fulfillment of and compliance with the respective terms hereof and thereof, do
not and will not (i) conflict with or result in a breach of the terms,
conditions or provisions of, (ii) constitute a default under, (iii) result in
the creation of any Lien upon the Securities or any asset or property of the
Company, including without limitation, the Purchased Assets, pursuant to,
(iv) give any third party the right to modify, terminate or accelerate any
obligation under, (v) result in a violation of, or (vi) require any exemption or
other action by or notice or declaration to, or filing with, or other Consent
from, any Governmental Entity pursuant to, (A) the articles of organization, the
limited liability company agreement or equivalent governing document of the
Company or the Seller Member that is not a natural person, (B) any Legal
Requirement to which the Company or the Seller Member or any of their assets or
properties is subject, or (C) any Contract, order, judgment or decree to which
the Company or such Seller Member or any of their assets or properties is
subject.

 

2.5                               Financial Statements.

 

(a)                                 Attached hereto as Schedule 2.5(a) are
copies of the Company’s (i) Company management prepared consolidated balance
sheet as of August 31, 2013 (the “Latest Balance Sheet”) and the related monthly
profit and loss statement through August 31, 2013 (collectively, the “Interim
Financial Statements”) and (ii) Company management prepared consolidated balance
sheets and related monthly profit and loss statement for the fiscal year ended
December 31, 2012 (collectively, and together with the Interim Financial
Statements, the “Financial Statements”).  Each of the Financial Statements is
accurate and complete in all material respects, is consistent with the books and
records of the Company (which, in turn, are accurate and complete in all
material respects) for periods covered thereby.  Except as set forth on
Schedule 2.5(a), the Financial Statements present fairly, in all material
respects, the financial condition, results of operations of the Company as of
the dates and for the periods referred to therein.

 

(b)                                 The accounts receivable of the Company as
set forth on the Latest Balance Sheet or arising since the date thereof are
valid and genuine; and have arisen solely out of bona fide sales and deliveries
of goods, performance of services and other business transactions in the
ordinary course of business.  The allowance for bad debt on the Latest Balance
Sheet has been determined consistent with the principles, policies, estimates
and procedures used to determine the allowance for bad debt set forth in the
Financial Statements for the period ended August 31, 2013.

 

(c)                                  The accounts payable as set forth on the
Latest Balance Sheet or accruing since the date thereof are valid and genuine;
and have arisen solely out of bona fide arm’s length transactions in the
ordinary course of business and no such account payable is delinquent in its
payment.  Since the date of the Latest Balance Sheet, the Company has paid its
accounts payable in the ordinary course of business and in a manner which is
consistent with its past practices.  Except as set forth on Schedule 2.5(c), the
Company has no account payable to any person who is an Insider (other than
reimbursements to employees in the ordinary course of business, the outstanding
balance of which to any single employee is less than five thousand dollars
($5,000) in the aggregate).

 

(d)                                 The Company has designed and maintains such
internal accounting controls and procedures as are reasonably necessary to
provide assurance regarding the reliability of the consolidated

 

10

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

 

financial statements of the Company, including controls and procedures that
provide reasonable assurance that (i) the financial records and consolidated
financial statements are complete and accurate in all material respects;
(ii) transactions are executed in accordance with management’s specific
authorization where such authorization is required; (iii) transactions are
recorded as necessary to permit preparation of the consolidated financial
statements of the Company and to maintain accountability for assets and
liabilities of the Company; (iv) access to the assets of the Company is
permitted only in accordance with management’s authorization; (v) the reporting
of the assets and liabilities of the Company is compared with the existing
assets and liabilities of the Company at regular intervals; and (vi) accounts
and other receivables are recorded accurately and proper and adequate procedures
are implemented to effect the collection thereof on a current and timely basis.

 

(e)                                  To the extent Buyer determines, in its sole
discretion, that any audited financial statements of the Company are required to
be filed with the SEC pursuant to the Securities Exchange Act or any rules and
regulations thereunder, the Seller Member and the Company shall use commercially
reasonable efforts to assist Buyer in obtaining consent and approval from the
Company’s independent auditor to file its audit opinions with regard to such
audited financial statements within any applicable time period relating to such
filing; provided, however, that the Company and Seller Member shall not be
required to commence litigation against or compensate such independent auditor
or any other Person in connection with obtaining any such consent.

 

2.6                               Absence of Undisclosed Liabilities.  Except as
set forth on Schedule 2.6(a), the Company has no Liabilities of the type
required to be set forth in a balance sheet other than (a) Liabilities reflected
on the face of the Latest Balance Sheet and (b) Liabilities that have arisen
since the date of the Latest Balance Sheet in the ordinary course of business
(none of which relates to breach of Contract, breach of warranty, tort,
infringement, violation of or Liability under any Legal Requirements, or any
action, suit or proceeding).  Except as set forth on Schedule 2.6(b), the
Company has no outstanding Indebtedness.

 

2.7                               Assets.  All of the Company’s tangible assets
are located at the Leased Real Property. Except as set forth on Schedule 2.7(a),
the Company has good and marketable title to, or a valid leasehold interest in,
the properties and assets, tangible or intangible, used by it, located on its
premises or, if applicable, shown on the Latest Balance Sheet or acquired
thereafter, including without limitation, the Purchased Assets, free and clear
of all Liens, except for Permitted Liens.  Except as described on
Schedule 2.7(b), the Company’s equipment and other tangible assets are in good
operating condition (normal wear and tear excepted) and are fit in all respects
for use in the ordinary course of business.  The Purchased Assets and the
Excluded Assets constitute all of the assets necessary or desirable for the
conduct of the Company’s business as presently conducted and as proposed to be
conducted as of the date hereof.

 

2.8                               Tax Matters.

 

(a)                                 Except as set forth on Schedule 2.8(a), the
Company has timely filed all Tax Returns required to be filed by it, each such
Tax Return has been prepared in compliance with all Legal Requirements, and all
such Tax Returns are complete and accurate in all material respects.  All Taxes
due and payable by the Company (whether or not shown on any Tax Return) have
been paid. Since the date of the Latest Balance Sheet, neither the Company nor
any of its Subsidiaries has incurred any Liability for Taxes arising from
extraordinary or non-recurring gains or losses, outside the ordinary course of
business consistent with past custom and practice.  The Company has provided to
Buyer copies of all federal, state and local income Tax Returns (including,
without limitation, all New Jersey Tax Returns), examination reports and
statements of deficiencies assessed against or agreed to by the Company, in each
case, which are correct and complete in all material respects.

 

11

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

 

(b)                                 Except as set forth on Schedule 2.8(b),
(i) the Company has withheld from all employees, customers, independent
contractors, creditors, members and any other applicable payees proper and
accurate amounts for all taxable periods in compliance with all Tax withholding
provisions of applicable law and has remitted, or will remit on a timely basis,
such amounts to the appropriate Governmental Entity, (ii) the Company has
maintained adequate documentation regarding the jurisdictions in which its
employees have provided services, and has properly withheld and paid all
applicable Taxes accordingly, (iii) with respect to each issuance of membership
interests or options to acquire membership interests in the Company, the Company
has maintained adequate documentation of the fair market value of such
membership interests at the time of grant.

 

(c)                                  Except as set forth in Schedule 2.8(c):

 

(i)                                     the Company has not waived any statute
of limitations in respect of Taxes or agreed to any extension of time with
respect to specific tax years, Tax assessment, or deficiency;

 

(ii)                                  the Company has not paid, become liable to
pay or expect to pay, any penalty, fine, or surcharge in relation to any Tax;

 

(iii)                               no deficiency or proposed adjustment, which
has not been settled or otherwise resolved, for any amount of Tax has been
proposed, asserted or assessed by any taxing authority against the Company;

 

(iv)                              there is no Action, suit, taxing authority
proceeding or audit now in progress, pending or, to the Knowledge of the
Company, threatened against or with respect to the Company;

 

(v)                                 the Company will not be required to include
any amount in taxable income or exclude any item of deduction or loss from
taxable income for any taxable period (or portion thereof) ending after the
Closing Date as a result of any (A) change in method of accounting for a taxable
period ending on or prior to the Closing Date, (B) “closing agreement,” as
described in Code Section 7121 (or any corresponding provision of state, local
or non-U.S. income Tax law) entered into on or prior to the Closing Date,
(C) installment sale or open transaction on or prior to the Closing Date,
(D) prepaid amount received on or prior to the Closing Date, or (E) election
under Code Section 108(i).

 

(vi)                              the Company (A) is not a party to, and does
not owe any amount under, any Tax sharing or allocation agreement, (B) is not a
member of an affiliated, combined or unitary group for federal, state or local
income tax purposes, and (C) has no Liability for the payment of Taxes of any
other Person as a transferee or successor, by Contract or otherwise;

 

(vii)                           there are no Liens for Taxes (other than for
current Taxes not yet due and payable) upon the assets of the Company;

 

(viii)                        the Company does not expect any taxing authority
to claim or assess any amount of additional Taxes against the Company;

 

(ix)                              no claim has ever been made by a taxing
authority in a jurisdiction where the Company does not file Tax Returns that the
Company is or may be subject to Taxes assessed by such jurisdiction;

 

12

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

 

(x)                                 to the Knowledge of the Company, the Company
has not made any payment, and is not and will not become obligated (under any
contract entered into on or before the Closing Date) to make any payment, that
will be non-deductible under Section 162 or 404 of the Code (or any
corresponding provision of state, local or non-U.S. income Tax law);

 

(xi)                              no Seller Member is a “foreign person” (as
that term is defined in Section 1445 of the Code);

 

(xii)                           none of the Purchased Assets is subject to any
“Section 467 rental agreement” within the meaning of Section 467(d) of the Code
or Treasury Regulations Section 1.467-1(c);

 

(xiii)                        the Company has not participated in a “reportable
transaction” within the meaning of Treasury Regulations Section 1.6011-4(b); and

 

(xiv)                       the Company is, and from January 1, 2010  has always
been, classified and taxed as a Sub Chapter S Corporation for federal income tax
purposes and in each state, local and non-U.S. jurisdiction where the Company
does business or is required to file Tax Returns.

 

2.9                               Contracts and Commitments.

 

(a)                                 Except as specifically contemplated by this
Agreement or as set forth on Schedule 2.9(a) or as contained in any Contract
provided to the Buyer and posted in the due diligence portal of Company to which
Company provided Buyer full access, the Company is not a party to or bound by
any written or oral:

 

(i)                                     collective bargaining agreement or other
Contract with any labor union;

 

(ii)                                  management agreement or other Contract for
the employment of any officer, individual employee or other Person on a full
time, part-time or consulting basis or providing for the payment of any cash or
other compensation or benefits in connection with the sale of all or a material
portion of its assets or a change of control (other than at-will employment
agreements with its employees that do not commit the Company or its Subsidiaries
to severance, termination or other similar payments);

 

(iii)                               Contract relating to Indebtedness (including
any letter of credit or guaranty arrangements) or to the mortgaging, pledging or
otherwise placing a Lien on any of its assets or any of its membership
interests, or any guaranty of an obligation of a third party;

 

(iv)                              Contract, including, but not limited to,
purchase orders, for the purchase, sale, distribution or marketing of products
or for the furnishing or receipt of services which either calls for performance
over a period of more than one (1) year or involves consideration in excess of
fifty thousand dollars ($50,000) per year or one hundred thousand dollars
($100,000) in the aggregate;

 

(v)                                 Contract that prohibits or limits the
Company, or that would prohibit or limit Buyer after the Closing Date, from
freely engaging in any line of business or with any Person anywhere in the world
or during any period of time;

 

(vi)                              Contract under which it has advanced or loaned
any other Person any amounts (other than advances in the ordinary course of
business to employees who are not

 

13

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

 

officers of the Company, the outstanding balance of which for any such Person is
less than five thousand dollars ($5,000) in the aggregate);

 

(vii)                           Contract under which it is lessee of or holds or
operates any property, real or personal, owned by any other party which involves
annual payments of greater than fifty thousand dollars ($50,000) or group of
such Contracts with the same Person which involve consideration in excess of one
hundred thousand dollars ($100,000) in the aggregate, or under which it is
lessor of or permits any third party to hold or operate any property, real or
personal, owned or controlled by it which involves consideration in excess of
fifty thousand dollars ($50,000);

 

(viii)                        license or other Contract with respect to any
intangible property (including any Intellectual Property), other than
(A) licenses to the Company or its Subsidiaries of unmodified, mass-marketed,
executable desktop software applications with a total license fee of less than
two thousand dollars ($2,000) in the aggregate for any such license or group of
related licenses, and (B) customer or client Contracts entered into in the
ordinary course of business and containing terms and conditions substantially
similar to the terms and conditions of the Company’s standard customer or client
agreement, copies of which have been made available to Buyer;

 

(ix)                              any Contract which contains any provisions
requiring the Company to indemnify any other party;

 

(x)                                 any Contract between the Company and any of
its Affiliates;

 

(xi)                              royalty, dividend or similar arrangement based
on the revenues or profits of the Company or any Contract involving fixed price
or fixed volume arrangements;

 

(xii)                           any bonus, commission, pension, profit sharing,
deferred compensation, severance, incentive compensation, hospitalization,
insurance, membership interest purchase, option or appreciation arrangement, or
other plan, program or arrangement for the benefit of its current or former
directors, officers, employees, or any other Person;

 

(xiii)                        Contract that provides any customer or client with
pricing, discounts or benefits that change based on the pricing, discounts or
benefits offered to other customers of the Company or its Subsidiaries,
including, without limitation, Contracts containing “most favored nation”
provisions;

 

(xiv)                       Contract which contains performance guarantees,
rights of refund, liquidated damages or service credits;

 

(xv)                          Contract involving the settlement of any pending
or threatened Action with respect to which, as of the date of this Agreement,
(A) any unpaid amount exceeds twenty-five thousand dollars ($25,000) or
(B) conditions precedent to the settlement have not been satisfied;

 

(xvi)                       Contract appointing any agent to act on its or their
behalf;

 

(xvii)                    power of attorney;

 

14

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

 

(xviii)                 Contract relating to the acquisition or sale of any
business (or any material portion thereof), whether or not consummated and
including any confidentiality agreements entered into with respect thereto;

 

(xix)                       Contract relating to the ownership of or investment
in any business or enterprise (including investments in joint ventures and
minority equity investments);

 

(xx)                          Contract pursuant to which it subcontracts work to
third parties; or

 

(xxi)                       other Contract (or group of related Contracts) the
performance of which involves consideration in excess of fifty thousand dollars
($50,000) per year or one hundred thousand dollars ($100,000) in the aggregate
or which cannot be canceled by the Company or its Subsidiaries within thirty
(30) days notice without premium or penalty.

 

(b)                                 With respect to the Company’s obligations
thereunder and, with respect to the obligations of the other parties thereto,
all of the Contracts set forth or required to be set forth on Schedule
2.9(a) (each a “Material Contract”) are valid, binding and enforceable against
the Company and, to the Knowledge of the Company, enforceable by the Company
against the other parties thereto, in accordance with their respective terms,
subject only to bankruptcy, insolvency, reorganization, moratoriums or similar
laws at the time in effect affecting the enforceability or rights of creditors
generally and by general equitable principles which may limit the right to
obtain equitable remedies.  The Company has performed all material obligations
required to be performed by it under each Material Contract and the Company has
not received any notice that it is in default under or in breach of, and has not
received notice of any claim of default or breach under, any Material Contract.
No event has occurred which, with the passage of time or the giving of notice or
both, would reasonably be expected to result in a default, breach or event of
non-compliance by the Company under any Material Contract.

 

(c)                                  A true, correct and complete copy of each
written Material Contract, and an accurate description of each oral Material
Contract, has been made available to Buyer, together with all amendments,
waivers and other changes thereto.

 

(d)                                 Except as set forth on Schedule 2.9(d),
during the preceding five (5)-year period, the Company has not used any name or
names under which it invoiced account debtors, maintained records concerning its
assets or otherwise conducted its business, other than the exact names under
which it has executed this Agreement or the Transaction Documents.

 

2.10                        Intellectual Property Rights.

 

(a)                                 The attached Schedule 2.10(a) sets forth
true and complete lists of (i) all registered and unregistered marks, patents
and copyrights owned by the Company or its Subsidiaries (each, a “Company
Entity”) or used or held for use by a Company Entity in connection with the
conduct of the Business (such marks, patents and copyrights, together with all
other Intellectual Property owned by a Company Entity or used or held for use by
a Company Entity in connection with the conduct of the Business, the “Company
Intellectual Property”), (ii) products and/or services currently researched,
designed, developed, manufactured, performed, licensed, sold, distributed and/or
otherwise made commercially available by a Company Entity (the “Products”),
(iii) all licenses or other agreements under which a Company Entity is granted
rights to the Intellectual Property of another Person, other than licenses to a
Company Entity of unmodified, mass-marketed, executable desktop software
applications with a total license fee of less than two thousand dollars ($2,000)
in the aggregate for any such license or group of related licenses, and (iv) all
licenses or other agreements under which a Company Entity has granted rights to
others in the Intellectual Property of a Company Entity, other than customer or
client

 

15

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

 

Contracts entered into in the ordinary course of business and containing terms
and conditions substantially similar to the terms and conditions of such Company
Entity’s standard customer or client agreement, copies of which have been
provided to Buyer.

 

(b)                                 Except as set forth on Schedule 2.10(b),
each Company Entity exclusively owns and possesses all right, title and interest
in and to, or has a valid and enforceable license to use, all Company
Intellectual Property purported to be owned, used or held for use by such
Company Entity, in each case without any conflict with or infringement of the
rights of any Person and free and clear of all Liens (other than Permitted
Liens).  The Company Entities are in full compliance with all licenses set forth
or required to be set forth on Schedule 2.10(a) including, without limitation,
all licenses for Open Source Software.

 

(c)                                  All Company Intellectual Property that is
owned by any Company Entity and that have been issued by, or registered or the
subject of an application filed with, as applicable, the U.S. Patent and
Trademark Office, the U.S. Copyright Office or any similar Governmental Entity
anywhere in the world, have been duly maintained (including the payment of
maintenance fees) and are not expired, cancelled or abandoned and are valid and
enforceable.

 

(d)                                 Except as set forth on Schedule 2.10(d),
there are no pending or, to the Knowledge of the Company, threatened Actions
against any Company Entity alleging that the operation of the Business or any
activity of such Company Entity has infringed, misappropriated or otherwise
conflicted with, or that such Company Entity, by conducting its Business, would
infringe, misappropriate or otherwise conflict with, any rights of any other
Person in Intellectual Property, or that any Company Intellectual Property is
invalid or unenforceable.  To the Knowledge of the Company, neither the
operation of the Business, nor any activity by the Company, infringes,
misappropriates or violates (or in the past infringed, misappropriated or
violated) any rights of any other Person in Intellectual Property.

 

(e)                                  Except as set forth on Schedule 2.10(e), to
the Knowledge of the Company, no third party is infringing, misappropriating or
violating, or has infringed, misappropriated or violated, any of the Company
Intellectual Property.

 

(f)                                   Except as set forth on Schedule 2.10(f),
no compensation or other consideration is owed to any third party by any Company
Entity due to such Company Entity’s ownership, license (as licensor or licensee)
or use (directly or indirectly via another party) of the Company Intellectual
Property, and no Company Entity has received any notice alleging that any such
compensation or other consideration is owed by the Company to any such third
party.

 

(g)                                  All of the computer firmware, computer
hardware, and computer software (whether general or special purpose) and other
similar or related items of automated, computerized, and/or software
system(s) used or relied upon by the Company Entities and in the conduct of its
business are in good operating condition, repair, subject only to the provision
of usual and customary maintenance, and sufficient for the conduct of the
Business.

 

(h)                                 All Company Intellectual Property owned by
each of the Company Entities has been (i) developed by employees of such Company
Entity, (ii) developed by independent contractors to such Company Entity,
(iii) acquired from a third party under a Contract listed on Schedule 2.10(a) or
(iv) created as works made for hire.  Every current and former officer,
director, consultant, independent contractor and employee of the Company
Entities has executed a Contract that assigns to such Company Entity all of
their interests in any and all inventions, improvements, discoveries, writings
and other works of authorship, and information relating to the Business or any
of the products or services being researched, developed, manufactured or sold by
such Company Entity or that may be used with any such

 

16

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

 

products or services, and all rights in Intellectual Property relating thereto. 
To the Knowledge of the Company, (x) no such Person is in breach of his or her
obligations under such Contracts, and (y) no such Person is party to any
conflicting Contract, including any Contract that restricts them from engaging
in activities for the Company Entities.

 

(i)                                     The Company Entities have not (except in
the ordinary course of business under obligations of confidentiality) disclosed
or permitted to be disclosed or undertaken or arranged to disclose to any Person
other than Buyer any trade secrets owned by any Company Entity or used or held
for use by any Company Entity in the Business (the “Company Trade Secrets”). 
The Company Entities have taken all reasonable security measures to protect the
secrecy, confidentiality and value of the Company Trade Secrets, including,
without limitation, requiring each employee and consultant of the Company
Entities and any other person with access to Company Trade Secrets to execute a
binding confidentiality agreement, copies or forms of which have been provided
to Buyer and there has not been any breach by any party to such confidentiality
agreements.

 

(j)                                    None of the Products contain,
incorporate, link or call to or otherwise use Open Source Software, and the
incorporation, linking, calling or other use in or by any such Product of any
such Open Source Software does not obligate any Company Entity to disclose, make
available, offer or deliver any portion of the source code of such Product or
component thereof to any third party other than the applicable Open Source
Software.

 

2.11                        Litigation, etc.  Except as set forth on
Schedule 2.11, there are no Actions pending or, to the Knowledge of the Company,
threatened against the Company or its Subsidiaries (or pending or, to the
Knowledge of the Company, threatened against any of the officers, directors or
employees of the Company or its Subsidiaries with respect to the Company’s or
Subsidiaries’ business or proposed business activities), or pending or
threatened by the Company or its Subsidiaries against any third party, at law or
in equity, or before or by any Governmental Entity (including any actions,
suits, proceedings or investigations with respect to the transactions
contemplated by the Transaction Documents), and, to the Company’s Knowledge,
there is no valid basis for any of the foregoing.  The Company and its
Subsidiaries are not subject to any judgment, order or decree of any court or
other Governmental Entity.  Schedule 2.11 includes a description of all Actions
involving any of the Company’s directors, officers or employees, in their
capacity as such, occurring, arising or existing during the past three
(3) years.

 

2.12                        Brokers.  Except as set forth in Schedule 2.12
hereto, (i) there are no claims for brokerage commissions, finders’ fees or
similar compensation in connection with the transactions contemplated by this
Agreement or any of the Transaction Documents based on any Contract to which the
Company is a party or otherwise binding upon the Company, and (ii) the Company
has not made, and the Company is not obligated to make, any payment for
brokerage commissions, finder’s fees or other similar compensation to any Person
in connection with the transactions contemplated by the Transaction Documents. 
The Company shall pay, and hold Buyer harmless against, any Liability (including
reasonable attorneys’ fees and out-of-pocket expenses) arising in connection
with any such claim or payment.

 

2.13                        Insurance.  Schedule 2.13 lists each insurance
policy maintained for or on behalf of the Company with respect to its
properties, assets and business, together with a list of material claims made in
the past three (3) years.  All of such insurance policies are in full force and
effect, and no default exists with respect to the obligations of the Company
under any such insurance policies and the Company has not received any
notification of cancellation of any of such insurance policies.  All premiums
with respect to such insurance policies have been paid through the date hereof. 
There are no pending claims against such insurance with respect to the Company
as to which the insurers have denied coverage or otherwise

 

17

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

 

reserved rights.  Except as set forth on Schedule 2.13, the Company has no
self-insurance or co-insurance programs.

 

2.14                        Employees.

 

(a)                                 Except as set forth on Schedule 2.14(a)(i),
with respect to the Company: (i) there is no collective bargaining agreement or
relationship with any labor organization; (ii) no labor organization or group of
employees has filed any representation petition or made any written or oral
demand for recognition; (iii) no union organizing efforts are underway or, to
the Knowledge of the Company, threatened; (iv) no labor strike, work stoppage,
slowdown, or other labor dispute has occurred, and none is underway or, to the
Knowledge of the Company, threatened; (v) there is no employment-related charge,
complaint, grievance, investigation, inquiry or Liability of any kind, pending
or threatened in any forum, relating to an alleged violation or breach by the
Company of any Legal Requirements relating to the employment of labor; and (vi) 
no employee or agent of the Company has committed any act or omission giving
rise to any Liability for any violation identified in subsection (v) above.  To
the Knowledge of the Company, neither the Company nor any of the Company’s
employees is subject to any noncompetition, non-solicitation, confidentiality,
employment, consulting or similar Contracts relating to, affecting or in
conflict with the present or proposed business activities of the Company except
as disclosed in any Contract provided to the Buyer and posted in the due
diligence portal of Company to which Company provided Buyer full access.

 

(b)                                 Schedule 2.14(b)(i) sets forth a correct and
complete list of all employees of the Company as of the date hereof, including a
list of all officers and directors of the Company, and whether or not they have
executed and delivered to the Company any (i) Contract providing for the
nondisclosure by such Person of any confidential information of the Company,
(ii) Contract providing for the assignment or license by such Person to the
Company of any Intellectual Property, (iii) any Contract preventing such Person
from competing with the Company during and/or following termination of
employment, (iv) any Contract preventing such Person from soliciting and hiring
employees of the Company during and/or following termination of employment and
(v) any Contract preventing such Person from soliciting and servicing any
customers of the Company.  Schedule 2.14(b)(i) sets forth the classification of
each employee as exempt or nonexempt and, for each employee, the position or
title, base salary or wage rates, and any incentive or other form of
compensation (including bonuses thereto) for each employee for the fiscal year
ended December 31, 2013.  Schedule 2.14(b)(ii) sets forth a complete and
accurate list of all of the independent contractors, consultants, temporary
employees, leased employees or other servants or agents employed, engaged or
used with respect to the operation of the business of the Company and classified
by the Company as other than employees or compensated other than through wages
paid by the Company through the Company’s payroll department (“Contingent
Workers”), showing for each Contingent Worker such individual’s role in the
business, fee or compensation arrangements and other contractual terms with the
Company.  Schedule 2.14(b)(iii) sets forth an itemized list of the wages,
salaries, severance, commissions, accrued vacation, bonuses, fees, benefits or
other amounts to be paid or items of value to be provided to employees of the
Company or Contingent Workers at the Closing or otherwise in connection with the
transactions contemplated by the Transaction Documents, including, without
limitation, any and all withholding, employment or other Taxes incurred in
connection therewith, and all amounts payable under any Bonus Plan of the
Company (the “Employee Obligations”).  No current or former employee of the
Company or Contingent Worker has advised the Company in writing that he or she
has excluded works or inventions made prior to his or her employment with the
Company or its Subsidiaries from any inventions agreement between the Company
and such Person.  To the Knowledge of the Company, all employees of the Company
devote all of their business time and attention to the businesses of the
Company.  Except as contemplated by this Agreement or as set forth on
Schedule 2.14(b)(iv), (i) no officer or employee, or group of employees or
Contingent Workers, has expressed any plans to terminate his or her employment
or service arrangement

 

18

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

 

with the Company (or with Buyer following the Closing) and (ii) in the past
twelve (12) months no officer’s or employee’s employment with the Company has
been terminated for any reason.  The Company has obtained a general release of
claims in favor of the Company and its Affiliates and related entities from all
employees terminated within the past twelve (12) months.

 

(c)                                  Except as set forth on Schedule 2.14(c),
the Company has properly classified and treated each employee of the Company and
any Contingent Worker in accordance with applicable Legal Requirements of all
applicable Governmental Entities and for purposes of all Employee Benefits
Plans. The Employee Obligations represent the only amounts due, or that will
become due, to any employee of the Company or any Contingent Worker that accrued
or otherwise became payable on or before the Closing Date or in connection with
the transactions contemplated by the Transaction Documents.  The Company is not
delinquent in any payments to any employee or Contingent Worker for any wages,
salaries, severance, commissions, accrued vacation, bonuses, fees, benefits or
other compensation due with respect to any services performed for it or amounts
require to be reimbursed to such employees or Contingent Workers.

 

(d)                                 Except as set forth on Schedule 2.14(a), The
Company is in compliance in all respects with all applicable laws respecting
employment and employment practices, terms and conditions of employment, 
classification of employees, wages and hours, occupational safety and health,
including, but not limited to, the National Labor Relations Act, the Immigration
Reform and Control Act of 1986, Title VII of the Civil Rights Act of 1964, the
Civil Rights Act of 1991, the Age Discrimination in Employment Act, the Older
Workers Benefit Protection Act, 42 U.S.C. Section 1981, the Americans With
Disabilities Act, the Fair Labor Standards Act, ERISA, the Occupational Safety
and Health Act, the Family Medical Leave Act, and any other law respecting
employment, including, but not limited to, authorization to work in the United
States, equal employment opportunity (including prohibitions against
discrimination, harassment, and retaliation), payment of wages, hours of work,
occupational safety and health, and labor practices.  In the last three
(3) years, (i) the Company has not effected a “plant closing” (as defined in the
Worker Adjustment and Retraining Notification Act (the “WARN Act”)), affecting
any site of employment or one or more facilities or operating units within any
site of employment or facility, (ii) there has not occurred a “mass layoff” (as
defined in the WARN Act) affecting any site of employment or facility of the
Company and its Subsidiaries, (iii) the Company has not engaged in layoffs or
employment terminations sufficient in number to trigger application of, and
notification requirements under, any state, local or non-U.S. law or regulation
similar to the WARN Act and (iv) during the ninety (90) day period immediately
preceding the date of this Agreement, the Company has not terminated
involuntarily the employment of more than three (3) individuals from employment
in positions, excluding individuals who were “part-time employees” of the
Company or its Subsidiaries within the meaning of the WARN Act, 29 U.S.C. §
2101(a)(8) and applicable regulations at 20 C.F.R. § 639.3(h).  The Company
shall be responsible for any failure to provide any notice required by the WARN
Act or any state law counterpart.

 

2.15                        Employee Benefits.

 

(a)                                 Except as disclosed and set forth on
Schedule 2.15(a), the Company does not maintain, sponsor, contribute to, provide
benefits under or have any actual or potential Liability with respect to any
Employee Benefit Plan.

 

(b)                                 (i) The Company’s Employee Benefit Plans
have been and shall be maintained in compliance in all material respects with
their terms and with the requirements of the Code and ERISA and all other
applicable laws and regulations, and the Company has not received notification
to the contrary from the Internal Revenue Service, Department of Labor, or the
PBGC.  (ii) Except as set forth on the attached Schedule 2.15(b), each Employee
Benefit Plan that is intended to qualify under Section

 

19

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

 

401(a) or 501(c)(9) of the Code is so qualified and has received a favorable
determination or approval letter from the Internal Revenue Service with respect
to such qualification, or may rely on an opinion letter issued by the Internal
Revenue Service with respect to a prototype plan adopted in accordance with the
requirements for such reliance, or has time remaining for application to, or for
receipt in response to a timely filed application of a determination from, the
Internal Revenue Service for a determination of the qualified status of such
Employee Benefit Plan for any period for which such Employee Benefit Plan would
not otherwise be covered by an Internal Revenue Service determination and no
event or omission has occurred that would cause any Employee Benefit Plan to
lose such qualification.  (iii) No asset of the Company is subject to any lien
under ERISA or the Code, and the Company and its Subsidiaries have not incurred
any Liability under Title IV of ERISA or to the PBGC.  (iv) No litigation or
governmental administrative proceeding, audit or other proceeding (other than
those relating to routine claims for benefits) is pending or threatened with
respect to any Employee Benefit Plan or any fiduciary or service provider
thereof, and there is no reasonable basis for any such litigation or proceeding.

 

(c)                                  The Company has never: (i) maintained,
contributed to or had any actual or potential Liability with respect to any
active or terminated, funded or unfunded, Multiemployer Plan or employee benefit
plan subject to Section 302 of Title I of ERISA, Title IV of ERISA or
Section 412 of the Code; (ii) failed to satisfy any minimum funding requirement,
if any, under Section 412 of the Code or Section 302 of ERISA; (iii) failed to
make a required contribution or payment to a Multiemployer Plan (as described in
Section 4001(a)(3) of ERISA); or (iv) made a complete or partial withdrawal
under Sections 4203 or 4205 of ERISA from a Multiemployer Plan.

 

(d)                                 With respect to each Employee Benefit Plan,
all required or recommended (in accordance with historical practices, including
any discretionary matching or profit sharing contributions) payments, premiums,
contributions, reimbursements or accruals for all periods (or partial periods)
ending prior to or as of the Closing Date shall have been made or properly
accrued on the Latest Balance Sheet.

 

(e)                                  The Company does not, and as of the Closing
Date, the Company will not maintain or contribute to any Employee Welfare
Benefit Plan which provides benefits to employees after termination of
employment (other than as required under Section 601 of ERISA or applicable
state law).  The Company has complied in all respects with the health care
continuation requirements of Part 6 of Subtitle B of Title I of ERISA and
Section 4980B of the Code.  Except as set forth on Schedule 2.15(e), each
Employee Benefit Plan that provides health or welfare benefits is fully insured.

 

(f)                                   True, complete and correct copies, to the
extent applicable of (i) all documents pursuant to which the Employee Benefit
Plans are maintained, funded and administered, (ii) the two most recent annual
reports (Form 5500 series) filed with the Internal Revenue Service (with
attachments) with respect to the Employee Benefit Plans, (iii) the two most
recent actuarial valuation reports with respect to the Employee Benefit Plans,
(iv) the two most recent financial statements with respect to the Employee
Benefit Plans, (v) all governmental rulings, determinations and opinions (and
pending requests for governmental rulings, determinations and opinions) with
respect to the Employee Benefit Plans, (vi) the most recent valuation (but in
any case at least one that has been completed within the last calendar year) of
the present and future benefit obligations under each Employee Benefit Plan that
provides post-retirement or post-employment, health, life insurance, accident or
other “welfare-type” benefits, and (vii) all non-routine correspondence to and
from any state or federal agency with respect to the Employee Benefit Plans, in
each case, have been provided or made available to Buyer.

 

(g)                                  Neither the execution and delivery of this
Agreement or any approval of this Agreement by the members of the Company or, if
applicable, the board of managers of the Company, nor the consummation of the
transactions contemplated hereby could (either alone or in conjunction with any
other event) (i) result in, or cause the accelerated vesting payment, funding or
delivery of, or increase the

 

20

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

 

amount or value of, any payment or benefit to any employee, officer, director or
other service provider, including but not limited to any Contingent Workers, of
the Company or any of its Affiliates; (ii) limit the right of the Company or any
of its Affiliates to amend, merge, terminate or receive a reversion of assets
from any Employee Benefit Plan or related trust; or (iii) result in a
requirement to pay any tax “gross-up” or similar “make-whole” payments to any
employee, director or Contingent Worker of the Company or an Affiliate.

 

(h)                                 Neither the Company nor any other
“disqualified person” (within the meaning of Section 4975 of the Code) or “party
in interest” (within the meaning of Section 3(14) of ERISA) has taken any action
with respect to any of the Employee Benefit Plans which could subject any such
Employee Benefit Plan (or its related trust) or the Company or any officer,
director or employee of any of the foregoing to any penalty or tax under
Section 502(i) of ERISA or Section 4975 of the Code.

 

(i)                                     The Company has no Liability (potential
or otherwise) with respect to any “employee benefit plan” (as defined in
Section 3(3) of ERISA) solely by reason of being treated as a single employer
under Section 414 of the Code with any other entity.

 

(j)                                    (i) Each Employee Benefit Plan may be
amended, terminated, or otherwise modified by the Company to the greatest extent
permitted by applicable law, including the elimination of any and all future
benefit accruals thereunder and no employee communications or provision of any
Employee Benefit Plan has failed to effectively reserve the right of the Company
or the Affiliate to so amend, terminate or otherwise modify such Employee
Benefit Plan.  (ii) Neither the Company nor any of its Affiliates has announced
its intention to modify or terminate any Employee Benefit Plan or adopt any
arrangement or program which, once established, would come within the definition
of an Employee Benefit Plan.  (iii) Each asset held under each Employee Benefit
Plan may be liquidated or terminated without the imposition of any redemption
fee, surrender charge or comparable liability.

 

(k)                                 Since the date any Employee Benefit Plan was
first adopted by the Company and through the Closing Date, each Employee Benefit
Plan that constitutes in any part a nonqualified deferred compensation plan
within the meaning of Section 409A of the Code (each, a “NQDC Plan”) has been
operated and maintained in accordance with a good faith, reasonable
interpretation of Section 409A of the Code with respect to amounts deferred
(within the meaning of Section 409A of the Code) after such adoption date.  From
and after January 1, 2009, each NQDC Plan has been operated and maintained in
operational and documentary compliance with Section 409A of the Code and
applicable guidance thereunder.  No payment to be made under any Employee
Benefit Plan is, or will be, subject to the penalties of Section 409A(a)(1) of
the Code.

 

(l)                                     No Employee Benefit Plan is subject to
the laws of any jurisdiction outside the United States.

 

(m)                             No Employee Benefit Plan, nor any Liability of
any kind thereunder or with respect thereto, will be required by operation of
law or otherwise (except as expressly provided herein) to be transferred to
Buyer as a result of the transactions contemplated hereby.

 

2.16                        Compliance with Laws.  Except as set forth on
Schedule 2.16, the Company has complied in all material respects with, and is
currently in compliance in all material respects with, all applicable Legal
Requirements of all Governmental Entities relating to the operation and conduct
of its businesses or any of its properties or facilities, including all Legal
Requirements concerning trade practices, advertising, antitrust or competition
or relating to employment of labor and the Company has not received written
notice of any violation (whether material or not), or non-written notice of a
material violation, of any of the foregoing.

 

21

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

 

2.17                        Affiliated Transactions.  Except as set forth on
Schedule 2.17 or expressly contemplated by this Agreement or the other
Transaction Documents, (i) any and all Contracts between the Company and any
officer, director, employee, member or Affiliate of the Company, or any
individual related by blood, marriage or adoption to any such Person or any
entity in which any such Person or individual owns any beneficial interest
(each, an “Insider”), have been terminated or cancelled and are no longer
enforceable; (ii) no Insider has any interest in any property, real or personal
or mixed, asset or right used by the Company or that is necessary for the
conduct of its business, (iii) there are no services provided to or on behalf of
the Company by any Seller Member or its Affiliates, or to or on behalf of any
Seller Member or its Affiliates by the Company; and (iv) there are no
outstanding loans or advances to, or guarantees for the benefit of, any Insider
from the Company or its Subsidiaries (other than advances in the ordinary course
of business to employees who are not officers of the Company, the outstanding
balance of which for any such Person is less than five thousand dollars ($5,000)
in the aggregate) (each, an “Affiliated Transaction”).

 

2.18                        Customers and Suppliers.

 

(a)                                 Schedule 2.18(a) lists (i) each customer or
client of the Company (including distributors) accounting for more than two
percent (2%) of the gross revenues of the Company for each of the two most
recent fiscal years (and the revenues generated from such customer or client)
and (ii)  any current customers or clients (including distributors) which the
Company reasonably anticipates shall account for more than two percent (2%) of
the gross revenues of the Company for the fiscal year ending December 31, 2013
(each, a “Material Customer”).  No Material Customer has canceled or otherwise
terminated its relationship with the Company or has materially decreased its
usage or purchase of the services or products of the Company.  To the Knowledge
of the Company, no Material Customer has any plan or intention to terminate,
cancel or otherwise materially and adversely modify its relationship with the
Company or to decrease materially or limit its usage, purchase or distribution
of the services or products of the Company (whether as a result of the
consummation of the transactions contemplated by this Agreement or the other
Transaction Documents or otherwise).

 

(b)                                 Except as described on Schedule 2.18(b), the
Company is not performing work for, providing or selling products or services
to, consulting or otherwise engaged by, or collecting fees, commissions or other
payments from, any customer, client or third party without a fully executed and
enforceable written Contract governing the terms of such engagement.  Each of
the arrangements described on Schedule 2.18(b) is legal, valid, binding and
enforceable against the Company and enforceable by the Company against the other
parties thereto, in accordance with their respective terms, subject only to
bankruptcy, insolvency, reorganization, moratoriums or similar laws at the time
in effect affecting the enforceability or rights of creditors generally and by
general equitable principles which may limit the right to obtain equitable
remedies.

 

(c)                                  Schedule 2.18(c) lists each vendor,
supplier, service provider and other similar business relation of the Company
from whom the Company purchased greater than fifty thousand dollars ($50,000) in
goods and/or services over the course of the twelve (12) months ended
December 31, 2012 or the three (3) months ended September 30, 2013 (each, a
“Material Supplier”), the amounts owing to each such Material Supplier, and
whether such amounts are past due.  The Company has not received any indication
from any Material Supplier to the effect that, and the Company has no reason to
believe that, such Material Supplier will stop, decrease the rate of, or change
the terms (whether related to payment, price or otherwise) with respect to,
supplying materials, products or services to the Company (whether as a result of
the consummation of the transactions contemplated by this Agreement or the other
Transaction Documents or otherwise).

 

22

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

 

2.19                        Warranties, etc.  Except as set forth on Schedule
2.19(a) or Schedule 2.19(b), there are no outstanding warranties, guarantees,
pricing discounts, “most favored nation” provisions, rights of refund, or
minimum service levels on any of the products or services that the Company
distributes, services, markets, sells or produces for itself or its customers,
clients or any third party (each such product or service shall be referred to
herein as a “Company Product”).  There are no existing or threatened claims
against the Company relating to any work performed or services provided by the
Company and there are no liabilities for warranty or other claims with respect
to any Company Product.

 

2.20                        Leased Real Property.

 

(a)                                 The Company does not own any real property.

 

(b)                                 Schedule 2.20(b) sets forth a complete list
of all real property leased or subleased by the Company (the “Leased Real
Property”), and the street address thereof.  The Company has a valid leasehold
interest in each Leased Real Property, subject only to Permitted Liens.  The
Company has made available to Buyer complete and accurate copies (including all
amendments) of each of the leases for the Leased Real Property (the “Leases”). 
With respect to each Lease: (i) the Lease is legal, valid, binding and
enforceable against the Company and, to the Knowledge of the Company, the other
parties thereto, and is in full force and effect, and shall continue to be
legal, valid, binding, enforceable and in full force and effect on identical
terms following the Closing subject only to bankruptcy, insolvency,
reorganization, moratoriums or similar laws at the time in effect affecting the
enforceability or rights of creditors generally and by general equitable
principles which may limit the right to obtain equitable remedies; (ii) neither
the Company nor, to the Knowledge of the Company, any other party to the Lease
is in breach or default and no event has occurred which, with notice or lapse of
time or both, would constitute such a breach or default or permit termination,
modification or acceleration under the Lease; (iii) no party to the Lease has
repudiated any provision thereof; (iv) there are no disputes, oral agreements or
forbearance programs in effect as to the Lease; (v) the Lease has not been
modified in any respect, except to the extent that such modifications are
disclosed by the documents delivered to Buyer; (vi) the Company and its
Subsidiaries have not subleased, assigned, transferred, conveyed, mortgaged,
deeded in trust or encumbered any interest in the Lease; (vii) the rental set
forth in the Lease is the actual rental being paid, the Company has paid all
rental payments (and Taxes thereon) incurred up through the Closing Date, and
there are no separate agreements or understandings with respect to the same;
(viii) the Company has not exercised or given any notice of exercise, nor, to
the Knowledge of the Company, has any lessor or landlord exercised or received
any notice of exercise, of any option, right of first offer or right of first
refusal contained in any Lease, including any such option or right pertaining to
purchase, expansion, renewal, extension or relocation; and (ix) the Company’s
possession and quiet enjoyment of the Leased Real Property under such Lease has
not been disturbed and, to the Knowledge of the Company, there are no disputes
with respect to such Lease.

 

(c)                                  To the Knowledge of the Company with
respect to the Leased Real Property:  (i) the current use of such property and
the operation of the Company’s business does not violate the Lease or any
instrument of record or Contract affecting such property or any applicable Legal
Requirements (without any fines or monetary Liabilities attached);  (ii) except
for the Leases, there are no leases, subleases, licenses, concessions or other
Contracts, written or oral, granting to any party or parties the right of use or
occupancy of any portion of the parcel of such property except in favor of the
Company; and (iii) there are no parties in possession of such property.

 

23

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

 

2.21                        Environmental and Safety Matters.

 

(a)                                 The Company has complied in all material
respects and is in material compliance with all Environmental and Safety
Requirements (including all permits and licenses required thereunder) without
any fines or monetary Liabilities attached.

 

2.22                        Governmental Licenses and Permits; Legal Compliance.

 

(a)                                 Schedule 2.22 contains a complete listing of
all material permits, licenses, franchises, certificates, approvals, consents,
certificates of authorization, registrations and other authorizations of any
Governmental Entity (including all applications therefor), or other similar
rights, together with any renewals, extensions, or modifications thereof and
additions thereto (collectively, the “Permits”) owned or possessed by the
Company or used by the Company in the conduct of its Business.  Except as set
forth on Schedule 2.22, the Company owns or possesses all right, title and
interest in and to all Permits that are necessary to conduct its Business as
currently conducted or as proposed to be conducted.  The Company is in
compliance with the terms and conditions of such Permits.  No loss or expiration
of any Permit is pending or, to the Knowledge of the Company, threatened
(including as a result of the transactions contemplated hereby) other than
expiration in accordance with the terms thereof, which terms do not expire as a
result of the consummation of the transactions contemplated hereby. Except as
indicated on Schedule 2.22, all of the Permits relating to any Purchased Assets
are transferable to Buyer and will be transferred by the Company to Buyer on the
Closing Date.

 

(b)                                 The Permits described on Schedule 2.22
constitute all of the Permits, filings, notices, accreditation, waivers, and the
like of, to or with any Governmental Entity or any other Person (collectively,
the “Consents”) which are required for the consummation of the transactions
contemplated by the Transaction Documents or the ownership of the assets or the
conduct of the business of the Company and its Subsidiaries.  All such Consents
have been obtained by the Company, as applicable, as of the Closing and shall
remain in full force and effect after the Closing.

 

2.23                        Absence of Certain Developments.  Except as set
forth on Schedule 2.23, since the date of the Latest Balance Sheet, (i) there
has not been any material adverse change in the business, financial condition,
operating results, assets, Liabilities, operations, applicable regulations,
customer, client, supplier, employee or sales representative or distributor
relations or business prospects of the Company and (ii) the Company has
conducted its Business only in the ordinary course of business.  As
amplification but not limitation of the foregoing, since the date of the Latest
Balance Sheet, the Company has not:

 

(a)                                 redeemed or repurchased, directly or
indirectly, any membership interests or other equity securities;

 

(b)                                 issued, sold or transferred any notes, bonds
or other debt securities or any membership interests, securities convertible,
exchangeable or exercisable into membership interests, or warrants, options or
other rights to acquire membership interests, of the Company or its
Subsidiaries;

 

(c)                                  borrowed any amount or incurred or become
subject to any Indebtedness or other Liabilities, except trade payables and
accrued liabilities incurred in the ordinary course of business;

 

(d)                                 mortgaged, pledged or subjected to any Lien
(other than Permitted Liens) any portion of its properties or assets;

 

(e)                                  sold, leased, licensed (as licensor),
assigned, disposed of or transferred (including transfers to the Company or any
employees or Affiliates of the Company) any of its assets (whether tangible or
intangible), except for sales in the ordinary course of business and sales of
other assets not in

 

24

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

 

excess of ten thousand dollars ($10,000) in the aggregate and other than
licenses granted to customers in the ordinary course of business pursuant to
Contracts containing terms and conditions substantially similar to the terms and
conditions of the Company’s standard customer or client agreement, copies of
which have been previously provided to Buyer;

 

(f)                                   disclosed any proprietary confidential
information to any Person that is not subject to any confidentiality agreement;

 

(g)                                  suffered any extraordinary losses or waived
any rights of material value, whether or not in the ordinary course of business;

 

(h)                                 suffered any theft, damage, destruction or
casualty loss in excess of ten thousand dollars ($10,000), to its assets,
whether or not covered by insurance;

 

(i)                                     entered into, amended, accelerated or
terminated any Contract of the type required to be disclosed on Schedule 2.9(a),
taken any action or entered into any transaction involving more than ten
thousand dollars ($10,000) or otherwise outside the ordinary course of business,
or entered into any transaction with any Insider;

 

(j)                                    (i) made or granted any bonus or increase
in the compensation or benefits of any employee, officer or Contingent Worker of
the Company or (ii) entered into, amended, modified or terminated any Employee
Benefit Plan;

 

(k)                                 conducted its billing and collection of
receivables and inventory purchases other than in the ordinary course of
business or materially changed its pricing structure;

 

(l)                                     made any capital expenditures or
commitments therefor (other than in the ordinary course of business and in
amounts sufficient to support ongoing business operations);

 

(m)                             delayed or postponed the repair and maintenance
of its properties or the payment of accounts payable, accrued liabilities and
other obligations and Liabilities;

 

(n)                                 made loans or advances to, guarantees for
the benefit of, or any investments in, any Persons in excess of ten thousand
dollars ($10,000) in the aggregate;

 

(o)                                 instituted or settled any claim or lawsuit
involving equitable or injunctive relief or the payment by or on behalf of the
Company of more than ten thousand dollars ($10,000) in the aggregate;

 

(p)                                 granted any performance guarantees to its
customers other than in the ordinary course of business and consistent with the
policies and practices disclosed to Buyer;

 

(q)                                 declared, set aside or paid any dividend or
made any similar distribution, redeemed, purchased or otherwise acquired,
directly or indirectly, any of its membership interests (or other equity
securities), or made any loan or entered into any Contract or other transaction
with or distributed any assets or property to any Insiders, except for
compensation paid to Insiders in the ordinary course of business;

 

(r)                                    acquired any other business or entity (or
any significant portion or division thereof), whether by merger, consolidation
or reorganization or by the purchase of its assets or capital stock or other
securities;

 

25

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

 

(s)            changed any Tax election or Tax accounting method, filed any
amended Tax Return or claim for refund, consented to any extension or waiver of
the limitation period applicable to any Tax claim or assessment, settled or
comprised any Action, controversy or audit relating to Taxes, or incurred any
Liability for Taxes other than in the ordinary course of business; or

 

(t)            committed or agreed, in writing or otherwise, to do any of the
foregoing, except as expressly contemplated by the Transaction Documents.

 

2.24        Bank Accounts.  Schedule 2.24 lists all of the Company’s bank
accounts.

 

2.25        Privacy of Individually Identifiable Personal Information.  Any
collection and use of individually identifiable personal information by the
Company complies in all material respects with the Company’s privacy policies,
any Contract between the Company and any other Person relating to privacy and
all applicable Legal Requirements.

 

2.26        Investment Company Status.  The Company is not and has not been at
any time, nor is the Company controlled by (or has ever been controlled by) any
Person who is (or was at such time), an “investment company” as such term is
defined in the Investment Company Act of 1940, as amended.

 

2.27        Statements True and Correct.  No representation, warranty or
disclosure made by the Company in any Transaction Document, or any of the
Schedules, attachments or Exhibits hereto or thereto, contains any untrue
statement of fact or omits to state any fact necessary in order to make
statements contained herein or therein which are material to the business or
operations of the Company, when taken as a whole, not misleading in light of
circumstances under which they were made.

 

2.28        No Other Representations or Warranties.  Except for the
representations and warranties contained in the Transaction Documents, or any of
the Schedules, attachments or Exhibits hereto or thereto, the Company and the
Seller Member make no other representations or warranties, express or implied,
and the Company and the Seller Member hereby disclaim any such other
representations or warranties, whether by the Company, the Seller Member or any
other Person, with respect to this Agreement and the transactions contemplated
hereby.  The Buyer acknowledges that certain representations require disclosure
of information of the same matter on more than one Schedule. A disclosure on any
Schedule will suffice for another item if such disclosure was reasonably
apparent to apply to such other item.

 

ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF BUYER

 

As a material inducement to the Seller Member and the Company to enter into and
perform their respective obligations under this Agreement, Buyer represents and
warrants that the statements contained in this Article 3 are true and correct as
of the Closing Date.

 

3.1          Organization of Buyer.  Buyer is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware. 
The Company possesses all requisite corporate power and authority and all
licenses, permits and authorizations necessary to own and operate its
properties, to carry on its businesses as now conducted and to carry out the
transactions contemplated by the Transaction Documents.

 

3.2          Authorization of Transaction.  Buyer has full corporate power and
authority to execute and deliver the Transaction Documents and to perform its
obligations thereunder.  The execution, delivery and performance of the
Transaction Documents to which Buyer is a party have been duly authorized by

 

26

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

 

Buyer.  Each of the Transaction Documents to which Buyer is a party constitutes
the valid and legally binding obligation of Buyer, enforceable in accordance
with its terms and conditions.

 

3.3          Noncontravention.  The execution and delivery by Buyer of this
Agreement, and all other Transaction Documents to which it is a party, and the
fulfillment of and compliance with the respective terms hereof and thereof, do
not and shall not (i) conflict with or result in a breach of the terms,
conditions or provisions of, (ii) constitute a default under, (iii) result in
the creation of any Lien upon the securities or any asset or property of Buyer
pursuant to, (iv) give any third party the right to modify, terminate or
accelerate any obligation under, (v) result in a violation of, or (vi) require
any exemption or other action by or notice or declaration to, or filing with, or
other Consent from, any Governmental Entity pursuant to, the charter or bylaws
or equivalent governing document of Buyer, or any Legal Requirement to which
Buyer or any of its Affiliates or any of their assets or properties is subject
(excluding any notice, filing or other action that may be required pursuant to
the Securities Exchange Act or any state securities or state “Blue Sky” laws),
or any Contract, order, judgment or decree to which Buyer or any of its
Affiliates or any of their assets or properties is subject.

 

3.4          Brokers.  There are no claims for brokerage commissions, finders’
fees or similar compensation in connection with the transactions contemplated by
this Agreement or any of the Transaction Documents based on any Contract to
which Buyer is a party or otherwise binding upon Buyer.  Except as set forth in
Schedule 3.4, Buyer has not made, and Buyer is not obligated to make, any
payment to any Person in connection with the transactions contemplated by the
Transaction Documents.  Buyer shall pay, and hold the Company harmless against,
any Liability (including reasonable attorneys’ fees and out-of-pocket expenses)
arising in connection with any such claim.

 

3.5          Statements True and Correct.  No representation, warranty or
disclosure made by Buyer in any Transaction Document, or any of the Schedules,
attachments or Exhibits hereto or thereto, contains any untrue statement of fact
or omits to state any fact necessary in order to make statements contained
herein or therein not misleading in light of circumstances under which they were
made.

 

3.6          No Other Representations or Warranties.  Except for the
representations and warranties contained in any Transaction Document, or any of
the Schedules, attachments or Exhibits hereto or thereto, Buyer makes no other
representations or warranties, express or implied, and Buyer hereby disclaims
any such other representations or warranties, whether by Buyer or any other
Person, with respect to this Agreement and the transactions contemplated hereby,
notwithstanding the delivery or disclosure to the Company or the Seller Member
of any documentation or other information by Buyer or any other Person with
respect to any of the foregoing.

 

ARTICLE 4
ADDITIONAL AGREEMENTS

 

4.1          Expenses.  Except as otherwise provided herein or in any other
Transaction Document, each Party hereto shall pay all of its own fees, costs and
expenses (including, without limitation, fees, costs and expenses of legal
counsel, investment bankers, brokers or other representatives and consultants
and appraisal fees, costs and expenses) incurred in connection with the
negotiation of this Agreement and the Transaction Documents, the performance of
its obligations hereunder and thereunder and the consummation of the
transactions contemplated hereby and thereby (whether consummated or not).

 

4.2          Certain Filings.  The Company and the Seller Member, on the one
hand, and Buyer shall cooperate with each other and use their reasonable best
efforts to promptly obtain the authorizations,

 

27

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

 

consents, registrations, permits, confirmations, orders and approvals necessary
for their execution and delivery of, and the performance of their obligations
pursuant to, this Agreement from any Governmental Entity.  The Parties hereto
will not take any action that will have the effect of delaying, impairing or
impeding the receipt of any required approvals and shall promptly respond to any
requests for additional information from any Governmental Entity or other third
party in respect thereof.

 

4.3          Trademarks; Tradenames; Domain Names.  As soon as practicable after
the Closing, the Company shall eliminate the use of all of the trademarks,
tradenames, service marks and service names included in the Purchased Assets, in
any of their forms or spellings, on all advertising, stationery, business cards,
checks, purchase orders and acknowledgments, customer agreements and other
contracts and business documents; provided, however, that the Company shall be
entitled to use such trademarks, tradenames, service marks and service names to
the extent reasonably necessary to deal with Excluded Assets and Excluded
Liabilities.  The Company shall as soon as practicable after the Closing, but in
no event later than thirty (30) days after the Closing, change the corporate
name of the Company so as to bear no resemblance to the current name of the
Company.

 

4.4          Payments With Respect to Purchased Assets.  The Company shall
promptly remit to Buyer all monies received by the Company or any of its
Affiliates following the Closing Date in payment for any Purchased Assets
(including all Assumed Contracts, with respect to services performed after the
Closing Date) acquired by Buyer pursuant to this Agreement (unless such payments
constitute Excluded Assets).  Payments remitted to Buyer pursuant to this
Section 4.4 shall be in the form received by the Company or any of its
Affiliates.  In the case Buyer receives in error payments for any Excluded
Assets or in error payments for services performed by Company prior to the
Closing under any Assumed Contract, Buyer shall promptly remit to Company all
such monies received.

 

4.5          Tax Matters.

 

(a)           Transfer Taxes.  The Company shall be liable for and shall hold
Buyer harmless against any transfer, documentary, sales, use, value added,
excise, stock transfer, stamp, recording, registration and any similar Taxes and
fees, including any penalties and interest thereon, that become payable in
connection with the transactions contemplated by this Agreement (“Transfer
Taxes”).  Buyer may withdraw the amount of any Transfer Taxes from the Holdback
Amount in order to satisfy Company’s obligations hereunder.  The applicable
Parties shall cooperate in filing such forms and documents as may be necessary
to permit any such Transfer Tax to be assessed and paid on or prior to the
Closing Date in accordance with any available pre-sale filing procedure, and to
obtain any exemption or refund of any such Transfer Tax.

 

(b)           Tax Deficiencies.  The Company shall not permit to exist any Tax
deficiencies (including penalties and interest) of any kind assessed against or
relating to the Company with respect to any taxable periods ending on or before,
or including, the Closing Date of a character or nature that could reasonably be
expected to result in Liens (other than Permitted Liens) or claims on any of the
Purchased Assets or on Buyer’s title or use of the Purchased Assets following
the Closing or that would reasonably be expected to result in any claim against
Buyer.

 

(c)           Apportioned Taxes.  Subject to Section 4.5(a), all real property
Taxes, personal property Taxes and similar ad valorem obligations levied with
respect to the Purchased Assets for a taxable period which includes (but does
not end on) the Closing Date (collectively, the “Apportioned Obligations”) shall
be apportioned between the Company and Buyer as of the Closing Date based on the
number of days of such taxable period ending on and including the Closing Date
(“Pre-Closing Apportioned Period”) and the number of days of such taxable period
beginning from the day after the Closing Date through the end of such taxable
period (the “Post-Closing Apportioned Period”).  The

 

28

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

 

Company shall be liable for the proportionate amount of Apportioned Obligations
that is attributable to the Pre-Closing Apportioned Period.  Buyer shall be
liable for the proportionate amount of the Apportioned Obligations that is
attributable to the Post-Closing Apportioned Period.  Within ninety (90) days
after the Closing, the Company and Buyer shall present a statement to the other
setting forth the amount of reimbursement to which each is entitled under this
Section 4.5(c) (which shall take into account, any Taxes previously overpaid by
a party) together with such supporting evidence as is reasonably necessary to
calculate such amount to be reimbursed.  Such amount shall be paid by the Party
owing it to the other Party within ten (10) Business Days after delivery of such
statement.  Thereafter, Buyer shall notify the Company upon receipt of any bill
for real property Taxes, personal property Taxes or similar ad valorem
obligations relating to the Purchased Assets, part or all of which are
attributable to the Pre-Closing Apportioned Period, and shall promptly deliver
such bill to the Company who shall pay the same to the appropriate Governmental
Entity; provided that if such bill also relates to the Post-Closing Apportioned
Period, the Company shall remit, prior to the due date of assessment, to Buyer
payment only for the proportionate amount of such bill that is attributable to
the Pre-Closing Apportioned Period.  If either the Company or Buyer shall make a
payment for which it is entitled to reimbursement under this Section 4.5(c), the
party that is liable for such payment pursuant to this Section 4.5(c) shall make
such reimbursement promptly but in no event later than ten (10) Business Days
after the presentation of a statement setting forth the amount of reimbursement
to which the presenting party is entitled along with such supporting evidence as
is reasonably necessary to calculate the amount of reimbursement.  Any Tax
refunds, credits or overpayments attributable to real property Taxes, personal
property Taxes and similar ad valorem obligations, for a taxable period which
includes (but does not end on) the Closing Date, levied with respect to the
Purchased Assets shall be apportioned between the Buyer and the Company in
accordance with the apportionment provided in this Section 4.5(c).

 

(d)           Cooperation on Tax Matters.  The Parties shall cooperate fully, as
and to the extent reasonably requested by any other Party, in connection with
the filing of Tax Returns, and any audit, litigation or other proceeding with
respect to Taxes.  Such cooperation shall include the retention for the period
of the statute of limitations and (upon the other Party’s reasonable request)
the provision of records and information which are reasonably relevant to any
such audit, litigation or other proceeding and making employees available
(provided that if the Company has no employees it shall be under no obligation
to hire any employees) on a mutually convenient basis to provide additional
information and explanation of any material provided hereunder.  Each Party
shall provide to the others, within ten (10) Business Days of the receipt
thereof, any tax related communications and notices it receives which may impact
the other Party’s Tax Liability or filing responsibilities.  Prior to destroying
or disposing of any records or information relating to Taxes of the Company for
periods (or portions thereof) ending on or prior to the Closing Date, Company
shall give Buyer thirty (30) days’ prior written notice and Buyer shall have the
right to take possession of such records and information.

 

4.6          Confidentiality; Non-Compete; Non-Solicitation. In further
consideration for the payment of the Purchase Price hereunder, the Company and
Seller Member, as applicable, agrees as follows:

 

(a)           Seller Member has had access to Confidential Information of the
Company and its Subsidiaries and related entities (each of the foregoing, an
“OSB Entity,” and collectively, the “OSB Group”).  The Company and Seller Member
agree that unless such Party first secures the written consent of an authorized
representative of Buyer, such Party shall not use (and shall cause its
respective agents, representatives, Affiliates, employees, officers and
directors not to use) for his, her or itself or anyone else, and shall not
disclose to others, any Confidential Information, other than (i) on behalf of
and for the benefit of Buyer or (ii) to the extent such use or disclosure is
required by law or order of any Governmental Entity (in which event the Company
and Seller Member, as applicable, shall inform Buyer in advance of any such
required disclosure, shall cooperate with Buyer in all reasonable ways in
obtaining a protective order or other protection in respect of such required
disclosure at Buyer’s expense, and shall

 

29

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

 

limit such disclosure to the extent reasonably possible while still complying
with such requirements).  The Company and Seller Member shall use reasonable
care to safeguard Confidential Information and to protect it against disclosure,
misuse, espionage, loss and theft.

 

(b)           The Company and Seller Member further agrees that, at any time
requested, such Party shall promptly deliver to Buyer all Confidential
Information and other Intellectual Property (to the extent such Intellectual
Property relates to the Purchased Assets) of the OSB Group in his, her or its
possession and control and all copies thereof, in whatever form or medium,
including, without limitation, written records, optical, magnetic or digital
media, and all other materials containing or embodying any such Confidential
Information and/or Intellectual Property.  If Buyer requests, the Company and
Seller Member, as applicable, shall promptly provide written confirmation that
such Party has returned all such materials. Notwithstanding the foregoing, the
Seller Member and the Company may maintain copies of those items set forth in
Section 1.1(a)(viii) but only for the purposes stated thereunder. .

 

(c)           The Company and Seller Member agree that the Company and its
Subsidiaries have received from third parties confidential or proprietary
information of such third party that may be subject to a duty on the Company’s
and its Subsidiaries’ part to maintain the confidentiality of such information
and to use it only for certain limited purposes.  The Company and Seller Member
agree that he, she or it owes Buyer and such third parties a duty to hold all
such confidential or proprietary information in the strictest confidence to the
extent such information relates to the Purchased Assets and agrees not to
disclose it to any person, firm, or corporation (except as necessary in carrying
out such Party’s future work for Buyer consistent with the agreement with such
third party) or to use it for the benefit of anyone other than for Buyer or such
third party (consistent with the agreement with such third party) without the
express authorization of Buyer.

 

(d)           The Company and the Seller Member each acknowledge that it or he
shall become familiar with Confidential Information concerning the OSB Group and
that his services have been and shall be of special, unique and extraordinary
value to the OSB Group.  For a period of two (2) years from the Closing Date
(the “Non-Compete Period”), neither the Company nor the Selling Member shall,
and neither shall authorize any of its respective Affiliates to, directly or
indirectly (whether as an owner, partner, operator, manager, employee, officer,
director, consultant, advisor, representative, agent or independent contractor
of any Person or otherwise) to, (i) engage in any business or accept employment
with any Buyer Competitor or Company Competitor (as defined below); or
(ii) provide any Competitive Services or Competitive Products (each as defined
below) whether directly or indirectly and whether on his own or on behalf of any
Buyer Competitor or Company Competitor (as defined below) to any third party;
provided that the foregoing restriction shall not apply to ownership of less
than 3% of the outstanding stock of any publicly-traded corporation.  “Buyer
Competitor” shall mean any Person whose principal business, or any business
unit, division or subsidiary of a Person whose principal business, is the
providing of global engineering and/or information technology services using an
off-shore model where at least a majority of the company’s (or in the case of a
business unit, division or subsidiary, majority of its employees, as the case
may be) employees are located in non-U.S. locations (i.e., India, Sri Lanka,
China etc.) to the extent that Seller Member was employed in such business unit,
division or subsidiary of such Buyer Competitor and “Company Competitor” shall
mean any business that provides IT consulting, implementation, or business
consulting services or products, including without limitation,  services related
to SAP products and services in the banking, financial service and insurance
industries.  Each of the Company and Seller Member agrees that this covenant is
reasonable with respect to its duration, geographical area and scope.

 

(e)           As a separate and independent covenant, the Company and the Seller
Member agrees that, during the Non-Compete Period, without the prior written
consent of Buyer, it shall not, and shall not authorize any of its Affiliates
to, directly or indirectly (whether as an owner, partner, operator,

 

30

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

 

manager, employee, officer, director, consultant, advisor, representative, agent
or independent contractor of any Person or otherwise), to (i) divert, take away
or solicit (or attempt to do any of the foregoing) any of the customers of the
OSB Group, including those of the Company or the Buyer (the “Combined
Customers”), or any proposed or prospective customers of the OSB Group,
including those of the Company or the Buyer, for any purpose, other than
pursuant to relationships with Buyer or any of its Subsidiaries on behalf of,
and to the benefit of, the Buyer, (ii) call on, solicit, or service any Combined
Customer, any supplier, licensee, licensor or other business relation or
Prospective Customer of the OSB Group, including Buyer or the Company, or
(iii) induce or attempt to induce any Combined Customer, supplier, licensee,
licensor or other business relation of the OSB Group to cease doing business
with the OSB Group, in each case with respect to products and/or services that
have been provided by the OSB Group, including the Buyer or the Company, are
currently being provided by the OSB Group or which the OSB Group is currently in
the process of developing or which services or products are provided or in the
process of being developed or offered at any time prior to of the expiration of
the Non-Compete Period, such services being referred to hereunder as
“Competitive Services” and such products being referred to as “Competitive
Products.”  A customer shall be deemed a proposed or prospective customer of the
OSB Group if (a) the Buyer or any Subsidiary thereof is actively soliciting the
business of such prospective or proposed customer, (b) the Company or any
Subsidiary thereof was engaged in active negotiations at the time of the
Closing, or (c) the customer is otherwise being actively solicited by the OSB
Group, including Buyer or Company, (the “Prospective Customer”), in each case,
including at any time prior to the expiration of the Non-Compete Period.

 

(f)            During the Non-Compete Period, as a separate and independent
covenant, the Company and the Seller Member each agrees that, without the prior
written consent of Buyer, it shall not, and shall not authorize any of its
Affiliates to, directly or indirectly (whether as an owner, partner, operator,
manager, employee, officer, director, consultant, advisor, representative, agent
or independent contractor of any Person or otherwise) hire, recruit, solicit or
induce, or attempt to hire, recruit, solicit or induce, any employee or
consultant of the OSB Group or any of its Subsidiaries to terminate or otherwise
cease his or her employment or consulting relationship with the OSB Group or any
of its Subsidiaries, or assist directly or indirectly in the recruitment or
solicitation of any employee or consultant of the OSB Group or any of its
Subsidiaries or otherwise hire or attempt to hire any such employee or
consultant of the OSB Group or any of its Subsidiaries for any purpose, other
than on behalf of, and to the benefit of, the Buyer.  For this purpose, an
employee or consultant of the OSB Group or any of its Subsidiaries shall include
any former employee or consultant of the OSB Group or Buyer or any of its
Subsidiaries for a period of six (6) months after termination or cessation of
their employment with the OSB Group.

 

(g)           Each of the Company and the Seller Member acknowledges that, in
the course of his employment with the OSB Group, Seller Member has and will
become familiar with the Confidential Information of the OSB Group.  Each of the
Company and the Seller Member further acknowledges that the scope of the
business of the OSB Group is independent of location (such that is not practical
to limit the restrictions contained in this Section 4.6 to a specified country,
city, or part thereof) and, that such Company and Seller Member each has had
direct or indirect responsibility, oversight or duties with respect to all of
the businesses of the OSB Group and its and their current and prospective
employees, vendors, customers, clients and other business relations, and that,
accordingly, the restrictions contained in this Section 4.6 are reasonable in
all respects and necessary to protect the goodwill and Confidential Information
of the OSB Group and that, without such protection, the OSB Group customer and
client relationship and competitive advantage would be materially adversely
affected.  It is specifically recognized by the Company and the Seller Member
that Seller Member’s services to the OSB Group are special, unique, and of
extraordinary value, that the Company and the other members of the OSB Group
have a protectable interest in prohibiting the Company and Seller Member as
provided in this Section 4.6, that such Seller Member was significantly
responsible for the creation and preservation of the OSB Group goodwill, and
that money damages are insufficient to protect such interest, and that such
prohibitions

 

31

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

 

would be necessary and appropriate without regard to payments being made to the
Company and the Seller Member hereunder.  The Company and the Seller Member each
further acknowledges that the restrictions contained in this Section 4.6 do not
impose an undue hardship on him or it and, since Seller Member has general
business skills which may be used in industries other than that in which each
OSB Entity conducts its business and do not deprive the Seller Member of his
livelihood.

 

(h)           If, at the time of enforcement of this Agreement, a court or
arbitrator’s award holds that the restrictions stated in this Section 4.6 are
unreasonable under circumstances then existing, the Parties hereto agree that
the maximum period, scope or geographical area reasonable under such
circumstances shall be substituted for the stated period, scope or area.  The
Parties hereto agree that money damages would not be an adequate remedy for any
breach of this Agreement.  Therefore, in the event of a breach or threatened
breach of any provisions of this Section 4.6 that is continuing, Buyer, its
successors and permitted assigns may, in addition to other rights and remedies
existing in their favor, apply to any court of competent jurisdiction for
specific performance and/or injunctive or other relief in order to enforce, or
prevent any violations of, the provisions hereof.  In addition, in the event of
a breach or violation by the Company or the Seller Member of this Section 4.6,
the Non-compete Period with respect to such Party shall be tolled until such
breach or violation has been duly cured.  In the event an arbitrator or a court
of competent jurisdiction determines that the Company or Seller Member has
breached any provision of this Section 4.6, in addition to all other rights and
remedies, Buyer shall be entitled to recover from such Party attorneys’ fees
associated with establishing such breach if Buyer gains a final determination of
such breach by an arbitrator or court of competent jurisdiction.  In the event
that Seller Member prevails in such action, as finally determined by the
arbitrator or court of competent jurisdiction, Seller Member shall be entitled
to recover from Buyer attorney’ fees associated with defending such breach or
claim. A party shall be considered the prevailing party if (a) it initiated the
litigation and subsequently obtained the relief it sought, either by or through
a judgment or the non-prevailing party’s voluntary action prior to trial or
judgment; (b) the non-prevailing party withdraws its action without
substantially obtaining the relief it sought; or (c) it did not initiate the
litigation and judgment is entered for either party, but without substantially
granting the relief sought.  The Company and Seller Member agrees that the
restrictions contained in this Section 4.6 are reasonable.

 

(i)            The Company and Seller Member each acknowledges, represents and
warrants that: (i) sufficient consideration has been given to such Party by
Buyer with respect to the transactions contemplated by this Agreement; (ii) he,
she or it has consulted with independent legal counsel regarding his, her or its
rights and obligations under this Section 4.6, (iii) that he, she or it fully
understands the terms and conditions contained herein, and (iv) that the
agreements in this Section 4.6 are reasonable and necessary for the protection
of Buyer and are an essential inducement to Buyer to enter into this Agreement.

 

(j)            The Company and Seller Member each further represents and
warrants that: (i) the execution, delivery and performance of this Agreement
does not and will not conflict with, breach, violate or cause a default under
any contract, agreement, instrument, order, judgment or decree to which such
Party is a party or by which he, she or it is bound; and (ii) this Agreement is
a valid and binding obligation on such Party and is enforceable in accordance
with its terms.

 

4.7          Litigation Support.  In the event that, and for so long as, any
Party is actively contesting or defending against any Action in connection with
(i) any transaction contemplated by any of the Transaction Documents or (ii) any
fact, situation, circumstance, status, condition, activity, practice, plan,
occurrence, event, incident, action, failure to act, or transaction on or prior
to the Closing Date involving the Purchased Assets or the transactions
contemplated by the Transaction Documents, each of the other Parties will
reasonably cooperate (provided that such cooperation shall not materially
prejudice the rights of such party providing the cooperation in the matter for
which cooperation is requested) with such

 

32

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

 

contesting or defending Party and its counsel in the contest or defense, make
available their personnel, and provide such testimony and access to their books
and records as shall be reasonably necessary in connection with the contest or
defense, all at the sole cost and expense of the contesting or defending Party
(unless the contesting or defending Party is entitled to indemnification
therefor under the provisions of this Agreement).

 

4.8          Transition Services.  The Company and Seller Member will not in any
manner take any action which is designed, intended or might reasonably be
anticipated to have the effect of discouraging customers, clients, suppliers,
vendors, service providers, lessors, licensors and other business associates of
the Company from maintaining the same business relationships with Buyer after
the date of this Agreement.

 

4.9          Employee and Related Matters.

 

(a)           Transferred Employees.  As of the Closing Date, the employees of
the Company who are actively employed by the Company as of the Closing Date and
set forth on Schedule 4.9(a) (the “Active Employees”) and all of the key
employees of the Company as of the Closing Date and set forth on Schedule
4.9(a) (the “Key Employees”) shall be offered employment by either Buyer or one
of its Affiliates (the “Employer”).  The Company shall cause all of the Active
Employees and all of the Key Employees to accept employment with the Employer
prior to the Closing and will use its best efforts to cause all Active Employees
to accept employment with the Employer within ten (10) Business Days of the
Closing; provided, however, to the extent that the employment of an Active
Employee is subject to a work visa (a “Foreign Employee”) such ten (10) day
period shall be extended for such time as necessary for the Foreign Employee to
have the necessary paperwork to be employed by the Employer completed so long as
such extended period does not exceed forty-five (45) Business Days after the
Closing Date.  Buyer shall also use all reasonable commercial efforts to take
such actions reasonably required to transfer the Foreign Employees to the employ
of Buyer, including the sponsorship of such Foreign Employees.  Company and
Seller Member shall cooperate and provide all reasonable assistance requested by
Buyer in the immigration process and waive any rights Company has to employ the
Foreign Employees.  The Foreign Employees of the Company are set forth on
Schedule 4.9(a). Not later than the Closing Date (or such later date as may be
agreed in writing by Buyer or, in the case of certain Active Employees and
Foreign Employees, such longer period specified in the preceding sentence), the
Company shall have terminated the employment of all Active Employees.  The
Employer shall not offer employment to any employees of the Company who, as of
the Closing Date, are absent from active employment with the Company for any
reason (including as a result of layoff or leave of absence) as set forth on
Schedule 4.9(a) (the “Inactive Employees” and, together with the Active
Employees and the Key Employees, the “Company Employees”).  The Active Employees
and Key Employees who accept employment with the Employer shall be referred to
herein as “Transferred Employees.”  The Company Employees who are not offered
employment with, or who do not accept employment with, the Employer shall be
referred to herein as “Non-Transferred Employees.”  Nothing in this Agreement
shall limit the Employer’s ability to modify the salary, wage, benefit or
overall compensation level or terminate the employment of any Transferred
Employee at any time and for any reason, including without cause.  Except as
described in this Section 4.9, neither Buyer nor any of its Affiliates shall
have any Liability with respect to any Non-Transferred Employee or former
employee or retiree of the Company (including any Person currently covered by
any benefit plan of the Company who is not a Transferred Employee), regardless
of when such Liability arises or occurred (whether on, prior to or after the
Closing Date).  The Company shall be solely responsible for the payment of all
wages, salaries and other compensation and employee benefits (including any
commissions, accrued vacation, bonuses, incentive compensation payments,
severance pay, notice pay, insurance, supplemental pension, deferred
compensation, “stay” or other similar incentive bonuses, change-in-control
bonuses (or other bonuses or compensation related in any way to the execution,
delivery or performance of this Agreement), retirement and any other benefits,
premiums,

 

33

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

 

claims and related costs) based on or arising under employment with the Company
of the Company Employees, including without limitation Transferred Employees. 
Without limiting the foregoing, the Company shall be responsible for the payment
of any accrued bonuses for the calendar year ending the Closing Date owed to the
Transferred Employees as of the Closing Date.  Buyer shall be solely responsible
for the payment of all wages, salaries and other compensation and employee
benefits (including any severance pay, notice pay, insurance, supplemental
pension, deferred compensation, bonuses, retirement and any other benefits,
premiums, claims and related costs) to any of the Transferred Employees arising
solely out of their employment with the Employer on or after the Closing Date. 
Neither Buyer nor any of its Affiliates shall assume any Liability with respect
to any Employee Benefit Plan of the Company or other employee benefit plan of
any kind or nature maintained by the Company for any of their employees, former
employees or retirees, except as set forth in this Section 4.9.

 

(b)           Benefits Plans.  Prior to or on the Closing Date, the Company
shall make all employee and required employer contributions with respect to the
Transferred Employees’ employment service to the Company’s 401(k) plan (the
“Company 401(k) Plan”), and shall cause the accounts of all Transferred
Employees under the Company 401(k) Plan to become fully vested (if applicable)
and paid in full as of the Closing Date.

 

(c)           Employee Benefits.  As of the Closing Date, Employer shall permit
Transferred Employees to be eligible to participate in all employee plans and
benefit arrangements of Employer with the exception of the Employer 401(k) Plan
(the Transferred Employees shall be eligible to participate in the Employer
401(k) Plan at the next enrollment opportunity in accordance with the Employer’s
401(k) Plan and waiting or other notice periods and other terms and conditions
as set forth in such plans, in which similarly situated employees of Employer
are generally eligible to participate in accordance with the then prevailing
terms of such employee plans and benefit arrangements, provided, however, that
(i) nothing herein shall prevent Employer from terminating the employment of any
such Transferred Employee or modifying or terminating such plans from time to
time, (ii) for purposes of any length of service requirements, waiting periods
or vesting periods in any such plan for which a Transferred Employee may be
eligible after the Closing Date, Employer shall ensure that service by such
Transferred Employee with the Company shall be deemed to have been service with
Employer, provided, further, that such crediting of service does not result in a
duplication of benefits, and (iii) all Transferred Employees of the Company and
their spouses and dependents who are covered under the Company’s health plan at
the time of the Closing shall be covered immediately after the Closing Date
under a group health plan of the Employer.

 

(d)           Mutual Cooperation.  Subject to applicable law (including any
privacy laws) and the Mutual Non-Disclosure Agreement between the Company and
Buyer, dated as of August 1, 2013 (the “NDA”), the Company shall provide
promptly to the Employer, at the Employer’s request, any information or copies
of personnel records (including addresses, dates of birth, dates of hire, work-
and pay-related and dependent information) relating to the Transferred Employees
or relating to the service of Transferred Employees with the Company (and
predecessors of the Company, as applicable) prior to the Closing Date.  The
Company and the Employer shall each cooperate with the other and shall provide
to the other such documentation, information and assistance as is reasonably
necessary to effect the provisions of this Section 4.9.

 

(e)           Additional Covenants.  The Company shall retain all Liabilities in
respect of the Employee Benefit Plans of the Company, whether incurred on, prior
to, or after the Closing.  All claims incurred by Transferred Employees on or
prior to the Closing Date under the Employee Benefit Plans of the Company shall
be covered pursuant to the terms and conditions of such Employee Benefit Plans. 
For purposes of this paragraph, a claim shall be deemed to be incurred on the
date on which medical or other treatment or service is rendered and not the date
of the submission of the claim related thereto.

 

34

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

 

(f)            Employee Wages Tax Reporting.  The Parties may agree to utilize,
or cause their respective Affiliates to utilize, the standard procedure set
forth in Section 4 of Revenue Procedure 2004-53, 2004-34 I.R.B.320 (Aug. 23,
2004) for wage reporting with respect to the Transferred Employees. In the event
the parties agree to utilize successor employer provisions set forth above
Revenue Procedure, each party agrees to cooperate and provide the other any
information required to complete required government reporting.

 

(g)           Employee Resignations.  At the Closing, the Company shall cause
the Key Employees to deliver to Buyer an executed resignation letter, in a form
acceptable to Buyer, evidencing such Key Employee’s resignation from the Company
and any and all Affiliates thereof, with such resignation to be effective
immediately prior to the Closing.

 

4.10        Seller Personal Information.  Buyer shall, and shall cause its
Affiliates and representatives to, comply with all applicable Legal Requirements
regarding, and maintain in confidence, any information relating to the Seller
Member provided to Buyer in connection with the transactions contemplated by
this Agreement.

 

4.11        Company Financial Statements.  On or before November 30, 2013, the
Company shall provide to Buyer the Company’s reviewed consolidated balance
sheets as of October 30, 2013, September 30, 2013, June 30, 2013, March 31,
2013, December 31, 2012, September 30, 2012 and June 30, 2012 and the related
statements of income, changes in members’ equity and cash flows for the 3 month
periods ended on each such date (collectively, the “Quarterly Financial
Statements”).  The Quarterly Financial Statements will be accurate and complete
in all material respects, be consistent with the books and records of the
Company (which, in turn, will be accurate and complete in all material
respects).

 

4.12        Maintenance of the Existence of the Company.  At all times from and
after the Closing Date until the third anniversary of the Closing Date, the
Company shall, and the Seller Member shall cause the Company to, remain in
existence as a corporate entity, and the Company shall not, and the Seller
Member shall cause the Company not to, wind-up, liquidate or dissolve or take
any corporate action contemplating any of the foregoing.

 

4.13        No Payments by Company or Seller Member post Closing.  At all times
from and after 30 days following the Closing Date, the Company shall not and the
Seller Member shall not directly or indirectly pay any consideration or
remuneration or amounts of any kind to any Person who becomes an employee of
Buyer, including without limitation, any amounts from the Purchase Price or any
other consideration received by Company or Seller Member in connection with this
transaction.

 

4.14        With respect to Transferred Employees, from and after the Closing,
Buyer shall use all reasonable commercial efforts to comply with all applicable
employment laws with respect thereto and shall be solely responsible for worker
classification, payroll practices, FLSA compliance, and compliance with other
Laws to the extent any claim or Loss accrues after the Closing for events that
occurred and with respect to actions of Buyer solely after the Closing.

 

4.15        The Company shall, no later than thirty days following the closing,
purchase a minimum of a three year tail on all current claims made insurance
policies of the Company in effect at the time of Closing.  This shall include
executive liability (employment practice liability insurance, fiduciary) and any
and all professional liability / errors and omission coverage.

 

4.16        The Company and Seller Member shall perform all of its obligations
with respect to all employees and contractors and vendors of Company which
accrued prior to the Closing, including without limitation, prompt payment of
all accounts receivable, invoices for fees or expenses,

 

35

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

 

compensation of any kind or benefits earned, expenses properly incurred, or any
other Liability incurred, as of and prior to the Closing date and shall comply
with all applicable Laws with respect to such employees and contractors with
respect to any such obligation or Liability which accrued prior the Closing
Date.

 

ARTICLE 5
DELIVERABLES

 

5.1                               Company Deliverables.  At the Closing, the
Seller Member or the Company, as applicable, shall deliver the following
documents to Buyer:

 

(a)                                 Executed counterparts to each Transaction
Document to which the Company or the Seller Member is a party.

 

(b)                                 Evidence of all filings, notices, licenses,
assignments, permits and other consents of, to or with, any Governmental Entity
or any other Person that are required by the Company for the consummation of the
transactions contemplated by the Transaction Documents.

 

(c)                                  Executed counterparts to all third party
consents and estoppel certificates that Buyer deems necessary or desirable under
any Assumed Contract, each for the contracts with the individuals or entities
set forth on Schedule 5.1(c) hereto and in the form and substance reasonably
satisfactory to Buyer (the “Required Contract Consents”).

 

(d)                                 Deleted;

 

(e)                                  Evidence that all Affiliated Transactions
identified on Schedule 2.17 have been terminated and are no longer of any force
or effect.

 

(f)                                   All releases from third parties of any and
all Liens (other than Permitted Liens) relating to the Purchased Assets, in each
case, as set forth on Schedule 5.1(f).

 

(g)                                  From each Key Employee, a completed and
executed resignation letter, in a form acceptable to Buyer, evidencing such Key
Employee’s resignation from the Company and any and all Affiliates thereof, with
such resignation to be effective immediately prior to the Closing.

 

(h)                                 All of the Active Employees and all of the
Key Employees, as set forth on Schedule 4.9(a), (i) completed and executed
employment agreements or consulting agreements, as applicable, in the forms
acceptable to Buyer and Company (the “Employment Agreements”), and (ii) any
other agreements or documents, completed and executed by such employees, that
are required by Buyer generally of its employees; provided, however, that the
Buyer, in its sole discretion, may agree to receipt of Employment Agreements
from a lower number of Active Employees or Key Employees.

 

(i)                                     For the lessor with respect to each
Lease, a certificate as to the matters set forth on Schedule 5.1(i), in each
case, executed by a duly authorized officer of such lessor.

 

(j)                                    A copy of (i) the articles of
organization, as amended, of the Company certified by a duly authorized officer
of the Company, dated as of the Closing Date, stating that such articles of
organization are true and correct, as filed with the Secretary of State of New
Jersey and that no amendments have been made to such articles of organization
since such date, (ii) the limited liability

 

36

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

 

company agreement of the Company, as amended and currently in effect, certified
by a duly authorized officer of the Company, (iii) copies of the resolutions
duly adopted by the Company’s members and, if applicable, the Company’s board of
managers, authorizing the execution, delivery and performance of this Agreement
and the Transaction Documents and approving the transactions contemplated hereby
and thereby, in each case, certified by a duly authorized officer of the
Company, and (iv) true and correct copies of the corporate records, ledgers of
members and minute books of the Company and such other documents or instruments
as Buyer may reasonably request or may be required to effect the transactions
contemplated hereby.

 

(k)                                 Certificates of the Secretary of State of
the jurisdiction in which the Company is organized stating that the Company is
in good standing, dated no later than the Closing Date.

 

(l)                                     Final invoices and full releases with
respect to all of the Company Transaction Expenses together with a certificate,
dated as of the Closing Date, executed by a duly authorized officer of the
Company certifying that all Company Transaction Expenses have been paid in full.

 

(m)                             Deleted.

 

(n)                                 Such other documents or instruments as Buyer
may reasonably request to effect the transactions contemplated hereby.

 

5.2                               Buyer Deliverables. At the Closing, Buyer
shall deliver the following documents to the Company:

 

(a)                                 Executed counterparts of each Transaction
Document and each Employment Agreement to which Buyer is a party.

 

(b)                                 A certificate of an authorized officer of
Buyer certifying resolutions of the Board of Directors of Buyer adopting and
approving the execution and delivery of this Agreement and any other Transaction
Document to which Buyer is a party, and the consummation of the transactions
contemplated hereby and thereby.

 

(c)                                  Evidence of all filings, notices, licenses,
permits and other consents of, to or with, any Governmental Entity or any other
Person that are required by Buyer (i) for the consummation of the transactions
contemplated by the Transaction Documents; (ii) in order to prevent a breach of
or default under or a right of termination or modification of any Contract to
which the Company is a party or to which any portion of the property of Buyer is
subject; or (iii) for the conduct of the business of Buyer as heretofore
conducted following the Closing.

 

(d)                                 Such other documents or instruments as the
Company may reasonably request to effect the transactions contemplated hereby.

 

ARTICLE 6
REMEDIES FOR BREACHES OF THIS AGREEMENT AND OTHER MATTERS

 

6.1                               Survival of Representations and Warranties. 
All of the representations and warranties of the Company and/or the Seller
Members, on the one hand, and Buyer, on the other hand, set forth in this
Agreement, in any other Transaction Document or in any writing delivered by the
Company or the Seller Member to Buyer in connection herewith or therewith shall
survive the execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby (regardless of any investigation, inquiry or
examination made by or on behalf of, or any knowledge of, or the acceptance of

 

37

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

 

any certificate by or on behalf of, any Party, or the acceptance of any of the
disclosure schedules attached hereto or any certificate).

 

6.2                               Indemnification of Buyer.

 

(a)                                 Subject to the limitations set forth in
Sections 6.2(b) and 6.2(c), the Company and the Seller Member, jointly and
severally, shall indemnify Buyer and each of its Affiliates, officers,
directors, employees, agents, representatives, successors and permitted assigns
(each, a “Buyer Party”), and save and hold each of them harmless from and
against, and pay on behalf of or reimburse any Buyer Party as and when incurred
for, all Losses which any Buyer Party may incur, suffer, sustain or become
subject to as a result of:

 

(i)                                     any breach of any representation or
warranty made by the Company or the Seller Member and contained in this
Agreement, any other Transaction Document or in any schedule or exhibit attached
to this Agreement, any other Transaction Document or in any certificate
delivered by the Company in connection with the Closing;

 

(ii)                                  any breach of any covenant made by or in
respect of the Company or such Seller Member under this Agreement or any other
Transaction Document;

 

(iii)                               any Liability related to a Purchased Asset
arising on or before the Closing Date;

 

(iv)                              any inability to collect or retain in full any
amounts due and payable or paid, respectively, pursuant to the arrangements
listed on Schedule 2.18(b);

 

(v)                                 any Excluded Asset or Excluded Liability;
and

 

(vi)                              any claim by any Person or Persons related to,
or arising out of, any of the foregoing.

 

(b)                                 Survival Date.  Neither the Company nor the
Seller Member will be liable with respect to any claim made pursuant to
Section 6.2(a)(i) above for the breach of any representation or warranty
contained in Article 2 of this Agreement unless written notice of a possible
claim for indemnification with respect to such breach is given by a Buyer Party
to the Company or the Seller Member as applicable, as follows (such date, with
respect to each Section, is referred to herein as its “Survival Date”):

 

(i)                                     on or before the date which is thirty
(30) days after the expiration of the applicable statute of limitations
(including any extension or waivers thereof) with respect to claims arising
under Sections 2.15 (Employee Benefits), 2.16 (Compliance with Laws) and/or 2.21
(Environmental and Safety Matters);

 

(ii)                                  at any time with respect to claims arising
under Sections 2.1 (Organization; Corporate Power and Licenses of the Company),
2.2 (Capitalization and Related Matters), 2.3 (Subsidiaries; Investments), 2.4
(Authorization; No Breach), 2.8 (Tax Matters), 2.14 (Employees), and 2.10
(Intellectual Property Rights), as applicable (the representations and
warranties contained in the Sections referenced in this clause (ii) and clause
(i) are collectively referred to herein as the “Buyer Fundamental
Representations” and, individually, as a “Buyer Fundamental Representation”);

 

38

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

 

(iii)                               on or before the second anniversary of the
Closing Date with respect to claims arising under Sections 2.4(b) (No Breach),
2.18(b) (Certain Customer Contracts) or 2.19 (Warranties);

 

(iv)                              on or before the first anniversary of the
Closing Date with respect to claims arising under any other Section of
Article 2; and

 

(v)                                 notwithstanding the foregoing and subject to
the limitations set forth in Section 6.2(c) below, so long as written notice is
given on or prior to the applicable Survival Date with respect to any claim, the
Company and the Seller Members shall be required to indemnify any Buyer Party
for all Losses that any Buyer Party may suffer with respect to such claim until
such claim is finally resolved.

 

(c)                                  Limitations.

 

(i)                                     Notwithstanding anything in this
Agreement to the contrary, (A) the Company and the Seller Members will not be
liable to any Buyer Party for any Losses under Section 6.2(a)(i) (1) unless and
until the aggregate amount of the Losses relating to all such claims exceeds
twenty five thousand dollars ($25,000) (the “Threshold”), at which time the
Company and the Seller Member shall be liable for the amount of all such Losses
from the first dollar in accordance with the terms hereof; provided, however,
the Company and the Seller Members shall not have any liability for any single
Loss of less than $5,000 (or series of related Losses that in the aggregate do
not exceed $5,000) (the “De Minimis Amount”), and (2) to the extent that the
aggregate liability of the Company and the Seller Member for all such Losses
exceeds four million five hundred thousand dollars ($4,500,000) plus the amount
of any Earn-out Amount paid to the Company (the “Cap”); provided, however, that,
notwithstanding anything to the contrary in this Agreement, none of the
Threshold or the Cap shall apply to the any Losses resulting or arising from
breaches of any Buyer Fundamental Representation or breach of Section 4.13 or
any Losses resulting or arising from any instance of fraud, intentional
misrepresentation, willful misconduct or gross negligence of the Seller Member
or Company.

 

6.3                               Indemnification Provisions for Benefit of the
Company and the Seller Member.

 

(a)                                 Subject to the limitations set forth in
Sections 6.3(b) and 6.3(c), Buyer shall indemnify the Company and the Seller
Member and each of their respective Affiliates, officers, directors, employees,
agents, representatives, heirs, successors and permitted assigns (each, a
“Seller Party”) and save and hold each of them harmless from and against, and
pay on behalf of or reimburse any Seller Party as and when incurred for, all
Losses which any Seller Party may incur, suffer, sustain or become subject to as
a result of:

 

(i)                                     any breach of any representation or
warranty made by Buyer and contained in this Agreement, any other Transaction
Document or in any schedule or exhibit attached to this Agreement, any other
Transaction Document or in any certificate delivered by Buyer in connection with
the Closing;

 

(ii)                                  any breach of any covenant or agreement of
Buyer in any of the Transaction Documents;

 

(iii)                               any Liability related to a Purchased Asset
arising after the Closing Date; and

 

39

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

 

(iv)                              any claim by any Person or Persons related to,
or arising out of, any of the foregoing.

 

(b)                                 Survival Date.  Buyer will not be liable
with respect to any claim made pursuant to Section 6.3(a)(i) above for the
breach of any representation or warranty contained in Article 3 of this
Agreement unless written notice of a possible claim for indemnification with
respect to such breach is given by the Representative to Buyer as follows:

 

(i)                                     at any time with respect to claims
arising under Sections 3.1 (Organization of Buyer) and/or 3.2 (Authorization of
Transaction) (the representations and warranties contained in the Sections
referenced in this clause (i) are collectively referred to herein as the “Seller
Fundamental Representations” and, individually, as a “Seller Fundamental
Representation”);

 

(ii)                                  on or before the first anniversary of the
Closing Date with respect to claims arising under any other Sections of
Article 3; and

 

(iii)                               notwithstanding the foregoing and subject to
the limitations set forth in Section 6.3(c) below, so long as written notice is
given on or prior to the applicable Survival Date with respect to any claim,
Buyer shall be required to indemnify any Seller Party for all Losses that any
Seller Party may suffer with respect to such claim until such claim is finally
resolved.

 

(c)                                  Limitations.

 

(i)                                     Notwithstanding anything in this
Agreement to the contrary, Buyer will not be liable to any Seller Party for any
Losses under Section 6.3(a)(i) unless and until the aggregate amount of the
Losses relating to all such claims exceeds the Threshold, at which time Buyer
shall be liable for the amount of all such Losses from the first dollar in
accordance with the terms hereof; provided, however, (A) Buyer shall not have
any liability for the De Minimis Amount and (B) neither the Threshold nor the De
Minimis Amount shall apply to the Losses resulting from breaches of the Seller
Fundamental Representations or Section 4.13.

 

(ii)                                  The Seller Parties will use commercially
reasonable efforts to mitigate any Losses upon becoming aware of any event, fact
or circumstance that would reasonably be expected to, or does, give rise to such
Loss.

 

6.4                               Matters Involving Third Parties.

 

(a)                                 If any Seller Party or any Buyer Party seeks
indemnification under this Article 6, such Person (the “Indemnified Party”)
shall give written notice to the other Person (the “Indemnifying Party”). In
that regard, if any Loss shall be brought or asserted by any third party which,
if adversely determined, may entitle the Indemnified Party to indemnity pursuant
to this Article 6 (a “Third Party Claim”), the Indemnified Party shall promptly
notify the Indemnifying Party of the same in writing, specifying in detail the
basis of such Loss and the facts pertaining thereto; provided, however, that no
delay on the part of the Indemnified Party in notifying any Indemnifying Party
shall relieve the Indemnifying Party from its obligations hereunder unless the
delay in notice has a material adverse effect on the Indemnifying Party’s
ability to successfully defend such claim or materially increases the amount of
Losses with respect to such claim.

 

(b)                                 Any Indemnifying Party will have the right
to defend the Indemnified Party against the Third Party Claim with counsel of
its choice reasonably satisfactory to the Indemnified Party

 

40

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

 

so long as (i) the Indemnifying Party notifies the Indemnified Party in writing
within fifteen (15) days after the Indemnified Party has given notice of the
Third Party Claim that the Indemnifying Party will indemnify the Indemnified
Party from and against the entirety of any Loss (without any limitations) the
Indemnified Party may suffer resulting from, arising out of, relating to, in the
nature of, or caused by the Third Party Claim (subject to the limitations
contained in this Article 6), (ii) the Indemnifying Party provides the
Indemnified Party with evidence reasonably acceptable to the Indemnified Party
that the Indemnifying Party will have the financial resources to defend against
the Third Party Claim and fulfill its indemnification obligations hereunder,
(iii) the Third Party Claim involves only money damages and does not seek an
injunction or other equitable relief, (iv) settlement of, or an adverse judgment
with respect to, the Third Party Claim is not, in the good faith judgment of the
Indemnified Party, likely to establish a precedent, custom or practice
materially adverse to the continuing business interests of the Indemnified
Party, (v) the Indemnifying Party actively and diligently conducts the defense
of the Third Party Claim, and (vi) if the Third Party Claim relates to Taxes,
the Third Party Claim would not, in the good faith judgment of the Indemnified
Party, materially and adversely affect the Indemnified Party in respect of any
Taxes or any Taxable period for which the Indemnifying Party would not be liable
hereunder.

 

(c)                                  So long as the Indemnifying Party is
conducting the defense of the Third Party Claim in accordance with
Section 6.4(b) above, (i) the Indemnified Party may retain separate co-counsel
at its sole cost and expense and participate in the defense of the Third Party
Claim, (ii) the Indemnified Party will not consent to the entry of any judgment
or enter into any settlement with respect to the Third Party Claim without the
prior written consent of the Indemnifying Party (which consent shall not be
withheld unreasonably) and (iii) except as provided in this Section 6.4(c), the
Indemnifying Party will not consent to the entry or any judgment or enter into
any settlement with respect to the Third Party Claim without the prior written
consent of the Indemnified Party (which consent shall not be withheld
unreasonably).  Notwithstanding the foregoing, 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 of the Indemnified Party and provides 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 offer within thirty (30) Business Days after its
receipt of such notice, the Indemnifying 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 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.

 

(d)                                 In the event that any of the conditions in
Section 6.4(b) above is or becomes unsatisfied, however, (i) the Indemnified
Party may defend against, and consent to the entry of any judgment or enter into
any settlement with respect to, the Third Party Claim in any manner it may deem
appropriate (and the Indemnified Party need not consult with, or obtain any
consent from, any Indemnifying Party in connection therewith), (ii) the
Indemnifying Party will reimburse the Indemnified Party promptly and
periodically for the costs of defending against the Third Party Claim (including
attorneys’ fees and expenses), and (iii) the Indemnifying Party will remain
responsible for any Losses the Indemnified Party may suffer resulting from,
arising out of, relating to, in the nature of, or caused by the Third Party
Claim to the fullest extent provided in this Section 6.4 (but subject to the
limitations contained in this Article 6).

 

6.5                               Manner of Payment.

 

(a)                                 Any indemnification payment to a Buyer Party
pursuant to this Article 6 shall be effected by notice to Buyer under the
Holdback Fund and, if the Holdback Fund is depleted, by wire

 

41

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

 

transfer of immediately available funds to an account designated by Buyer within
five (5) days after the determination of indemnification amounts, in each case,
subject to the limitations contained in this Article 6; provided that in any
indemnification claim by Buyer hereunder, Buyer shall in good faith and on
reasonable grounds provide prior written notice to Seller Member and Company of
such claim with reasonable support for such claim. Buyer Party shall have full
rights after such written notice to collect from the Holdback Fund such amounts
as asserted in such claim.  However, if Company or Seller Member disputes in
good faith and on reasonable grounds such claim that there was no breach within
90 days following Buyer’s claim against the Holdback Fund and an arbitrator or a
court of competent jurisdiction makes a final, un-appealable determination that
each of Company and Seller Member were not in breach of this Agreement such that
Buyer wrongfully collected funds from the Holdback Fund in violation of this
Agreement Company and Seller Member shall be entitled to recover from such Buyer
reasonable attorneys’ fees associated with establishing such breach of this
Agreement by Buyer. A party shall be considered the prevailing party if (a) it
initiated the litigation and subsequently obtained the relief it sought, either
by or through a judgment or the non-prevailing party’s voluntary action prior to
trial or judgment; (b) the non-prevailing party withdraws its action without
substantially obtaining the relief it sought; or (c) it did not initiate the
litigation and judgment is entered for either party, but without substantially
granting the relief sought gains a final determination in a court of competent
jurisdiction.

 

(b)                                 Any indemnification payment to the Company
pursuant to this Article 6 shall be effected by wire transfer of immediately
available funds to an account designated by the Company within five (5) days
after the determination of indemnification amounts, in each case, subject to the
limitations contained in this Article 6.  Any indemnification payment to the
Seller Member pursuant to this Article 6 shall be effected by wire transfer of
immediately available funds to the Seller Member to an account designated by the
Seller Member within five (5) days after the determination of indemnification
amounts.

 

(c)                                  Any indemnification payments made pursuant
to this Agreement shall be treated as adjustments to the Purchase Price for all
Tax purposes, unless otherwise required by applicable law.

 

6.6                               Insurance and Third Party Recovery.  In
determining the liability of a Party for indemnification pursuant to this
Article 6, no Loss shall be deemed to have been sustained to the extent of any
proceeds previously received by such Party from any insurance recovery (net of
all out-of-pocket costs directly related to such recovery) or other recovery
from a third party (net of all out-of-pocket costs directly related to such
recovery).  If an amount is actually recovered from an insurance carrier or
other third party after a payment has been made by the Indemnifying Party
pursuant to this Article 6, then the party receiving such amount shall promptly
remit such amount to the Indemnifying Party.

 

6.7                               Offset.  The Losses which any Buyer Party
suffers, sustains or becomes subject to pursuant to this Article 6 (it being
understood that such Losses must be determined in accordance with the terms and
conditions set forth in this Agreement) may, at the option of such Buyer Party,
be satisfied by setting off all or any portion of such Losses against any
amounts which such Buyer Party owes to the Company or Selling Member, as the
case may be, at such time.

 

6.8                               Delivery and Release of Holdback Fund.

 

(a)                                 Subject to the limitations and terms and
conditions of this Article 6, to the extent that any Buyer Party is entitled to
indemnification for any Loss pursuant to this Article 6, such Buyer Party shall
be entitled to reimbursement out of the Holdback Fund; provided, however, that
to the extent that the amount of such Losses exceed the amount remaining in the
Holdback Fund or arise after the

 

42

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

 

Survival Date, the Buyer Party may collect such Losses directly from the Company
or the Seller Member, jointly and severally.

 

(b)                                       The Company shall give written
instruction to Buyer to release from the Holdback Fund and pay to the Company by
wire transfer of immediately available funds to an account designated by the
Company the amounts set forth below at the following times and subject to the
following conditions:

 

(i)                                     On the one (1) year anniversary of the
Closing Date, the remaining Holdback Amount minus the aggregate amount of any
Good Faith Damages Estimate; or

 

(ii)                                  Within five (5) Business Days after the
final resolution of a particular indemnity claim for which a Good Faith Damages
Estimate is retained in the Holdback Fund pursuant to clause (b)(i) above, the
amount, if any, by which such Good Faith Damages Estimate in respect of such
claim exceeds the final determination of the Losses in respect of such claim.

 

(c)                                  The Buyer shall deposit the Holdback Fund
in a bank account separate and apart from the other general operating accounts
of Buyer for the benefit of and in trust for the Seller and Seller Member under
the terms herein to be used exclusively for the purposes set forth in this
Agreement.

 

ARTICLE 7-INTENTIONALLY DELETED

 

ARTICLE 8
CERTAIN DEFINITIONS

 

“Action” means any action, suit, proceeding, order, investigation, claim,
grievance, arbitration, or complaint.

 

“Affiliate” means, with respect to any Person, any other Person directly or
indirectly controlling, (including, but not limited to, all directors and
officers of such Person) controlled by, or under common control with, such
Person.

 

“Assumed Contracts” means all Contracts to which the Company is a party other
than those Contracts set forth on Schedule 1.1(b)(v)  and those terminated
Contracts set forth on Schedule 8.1(i) (if any) hereto.  For the avoidance of
doubt, Assumed Contracts shall include each Contract set forth on Schedule
8.1(ii) (except where such Contract is also expressly set forth on Schedule
1.1(b)(v) or Schedule 8.1(ii)), and any other Contract of the Company not
disclosed to Buyer if Buyer notifies the Company that such Contract shall be an
Assumed Contract after Buyer becomes aware of the existence thereof.

 

“Business Day” means each day of the week except Saturdays, Sundays and days on
which banking institutions are authorized to be closed by the Federal Reserve
Bank in New York, New York.

 

“Code” means the Internal Revenue Code of 1986, as amended from time to time and
the regulations promulgated and rulings issued thereunder, as amended,
supplemented or substituted therefor from time to time.

 

“Company Competitor” means any Person, or any business unit, division or
subsidiary of any Person, whose principal business, is the providing of IT
consulting, implementation, or business consulting services or products,
including without limitation,  services related to SAP products and services in
the banking, financial service and insurance industries.

 

43

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

 

“Company Customer(s)” means any of the customers or clients of the Company or
Buyer and any of their Subsidiaries or subdivisions as of the Closing Date.

 

“Company Transaction Expenses” means (i) the fees and disbursements payable to
legal counsel and accountants of the Company in connection with the transactions
contemplated by the Transaction Documents and (ii) all other fees and expenses,
in each case, incurred by the Company in connection with the transactions
contemplated by the Transaction Documents as determined on the Closing Date, in
each case, that have not been paid in full prior to the Closing Date.  “Company
Transaction Expenses” shall also include, without limitation, any and all
withholding, employment or other Taxes payable in connection with the amounts
incurred pursuant to the immediately preceding sentence.

 

“Confidential Information” means all information (whether or not specifically
identified as confidential), in any form or medium, that is disclosed to, or
developed or learned by, the Company or the Seller Member as an owner of
membership interests in the Company, as the case may be, in the performance of
duties for, or on behalf of, an OSB Entity or that relates to the business,
products, services or research of an OSB Entity or any of their investors,
partners, affiliates, strategic alliance participants, officers, directors,
employees or members or their respective Affiliates, including, without
limitation: (i) internal business information (including, without limitation,
information relating to strategic plans and practices, business, accounting,
financial or marketing plans, practices or programs, training practices and
programs, salaries, bonuses, incentive plans and other compensation and benefits
information and accounting and business methods); (ii) identities of, individual
requirements of, specific contractual arrangements with, and information about,
an OSB Entity, its Affiliates, their customers and their confidential
information; (iii) industry research compiled by, or on behalf of an OSB Entity,
including, without limitation, identities of potential target companies,
management teams, and transaction sources identified by, or on behalf of, an OSB
Entity; (iv) compilations of data and analyses, processes, methods, track and
performance records, and data and data bases relating thereto; and
(v) information related to the Company’s Intellectual Property and updates of
any of the foregoing, provided, however, “Confidential Information” shall not
include any information that (x) in no way relates or pertains to the Purchased
Assets, or (y) the Company or the Seller Member can demonstrate has become
generally known to and widely available for use within the industry other than
as a result of the acts or omissions of such Seller Member or a person that such
Seller Member has direct control over.

 

“Contract” means any agreement, contract, instrument, lease, guaranty,
indenture, license, or other legally binding arrangement, commitment or
understanding between parties or by one party in favor of another party, whether
written or oral.

 

“Employee Benefit Plan” means any Employee Pension Benefit Plan (including any
Multiemployer Plan), Employee Welfare Benefit Plan, fringe benefit, bonus,
deferred compensation, retirement, vacation, sick leave, severance, employment,
executive compensation, change in control, incentive or other plan, program
policy or arrangement, whether or not subject to ERISA and any plans, programs
or arrangements providing compensation to employee and non-employee directors,
established, maintained, or contributed to by the Company or otherwise for the
benefit of its employees, officers, directors, members, Contingent Workers and
their dependents or beneficiaries.

 

“Employee Pension Benefit Plan” shall have the meaning set forth in
Section 3(2) of ERlSA.

 

“Employee Welfare Benefit Plan” shall have the meaning set forth in
Section 3(1) of ERISA.

 

“Employer 401(k) Plan” means the Defined Contribution Retirement Savings Plan of
Buyer, qualified under Section 401(k) of the Code.

 

44

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

 

“Environmental and Safety Requirements” means all federal, state, local and
non-U.S. statutes, regulations, ordinances, guidelines and similar provisions
whether or not having the force or effect of law, all judicial and
administrative orders and determinations, all contractual obligations and all
common law concerning public health and safety, worker health and safety, and
pollution or protection of the environment, including all those relating to the
presence, use, production, generation, handling, transportation, treatment,
storage, disposal, distribution, labeling, testing, processing, discharge,
release, threatened release, control, or cleanup of any hazardous materials,
substances or wastes, chemical substances or mixtures, pesticides, pollutants,
contaminants, toxic chemicals, petroleum products or byproducts, asbestos,
polychlorinated biphenyls, noise or radiation, as the foregoing are enacted or
in effect prior to, on or after the Closing Date.

 

“Environmental Liabilities” means any and all Liabilities arising in connection
with or in any way relating to the past or current operation of the Business,
whether contingent or fixed, actual or potential, known or unknown, that
(i) arise under or relate to Environmental and Safety Requirements and
(ii) arise from or relate in any way to actions occurring or conditions existing
on or prior to the Closing Date.

 

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended
from time to time, and the regulations promulgated and rulings issued
thereunder, as amended, supplemented or substituted therefor from time to time.

 

“Excluded Taxes” means (i) all Taxes of the Company or any of its Affiliates, or
for which the Company or any of its Affiliates is liable, for any taxable
period, (ii) all Taxes relating to the Excluded Assets or Excluded Liabilities
for any taxable period; and (iii) all Taxes relating to the Purchased Assets or
the Assumed Liabilities for any taxable period ending on or prior to the Closing
Date and, with respect to any taxable period beginning before and ending after
the Closing Date, for the portion of such taxable period ending on the Closing
Date, except as provided in Section 4.5(c).

 

“GAAP” or “US GAAP” means (for the purposes of this Agreement and any Schedules
hereto) United States generally accepted accounting principles, consistently
applied.

 

“Governmental Entity” means any (i) province, region, state, county, city, town,
village, district or other jurisdiction, (ii) federal, provincial, regional,
state, local, municipal, non-U.S. or other government, (iii) governmental or
quasi-governmental authority of any nature (including any governmental agency,
branch, bureau, department or other entity and any court or other tribunal),
(iv) multinational organization, (v) body exercising, or entitled to exercise
any administrative, executive, judicial, legislative, police, regulatory or
taxing authority or power of any nature, or (vi) official of any of the
foregoing.

 

“Good Faith Damages Estimate” means, with respect to any pending or unresolved
claim asserted by a Buyer Party that is reasonably expected to result in
indemnification pursuant to Article 6, an amount equal to the good faith
estimate by the Buyer Party of its indemnifiable Losses in respect of such
claim.

 

“Holdback Fund” means the Holdback Amount deposited by Buyer in a separate
interest bearing account of Buyer solely for that purpose, together with any
interest or earnings thereon.

 

“Indebtedness” means any of the following indebtedness of the Company, whether
or not contingent: (i) indebtedness for borrowed money (including any principal,
premium, accrued and unpaid interest, related expenses, prepayment penalties,
commitment and other fees, sale or liquidity participation amounts,
reimbursements, indemnities and all other amounts payable in connection
therewith), (ii) Liabilities evidenced by bonds, debentures, notes, or other
similar instruments or debt securities, (iii) Liabilities of the Company under
or in connection with letters of credit or bankers’ acceptances or

 

45

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

 

similar items, (iv) Liabilities to pay the deferred purchase price of property
or services (other than those trade payables incurred in the ordinary course of
business), (v) all Liabilities arising from cash/book overdrafts, (vi) all
Liabilities under capitalized leases (as determined in accordance with GAAP),
(vii) all Liabilities of the Company under conditional sale or other title
retention agreements, (viii) all Liabilities with respect to vendor advances or
any other advances made to the Company, (ix) all Liabilities of the Company
arising out of interest rate and currency swap arrangements and any other
arrangements designed to provide protection against fluctuations in interest or
currency rates, (x) any deferred purchase price Liabilities related to past
acquisitions, (xi) all Liabilities of the Company arising from any breach of any
of the foregoing and (xii) all indebtedness of others guaranteed by the Company
or secured by any Lien or security interest on the assets of the Company.

 

“Intellectual Property” means trademarks, service marks, trade dress, trade
names, corporate names, logos, slogans and Internet domain names, together with
all goodwill associated with each of the foregoing, patents and patent
applications, inventions, invention disclosures, trade secrets, technology,
technical data, know how, methods and processes, copyrights and copyrightable
works (including, without limitation, computer software, Open Source Software,
source code, executable code, data, databases and documentation), proprietary
information and data, all other intellectual property and registrations and
applications for any of the foregoing.

 

“Knowledge” or “knowledge” “ means respect to any Person the actual knowledge
after reasonable inquiry of any director, governing body member or executive
officer of such Person; provided that in the case of the Company’s “Knowledge”
or “knowledge” means the actual knowledge after reasonable inquiry of the Seller
Member and senior executives of the Company or its Subsidiaries.

 

“Law” or “law” means any federal, national, supranational, state, provincial,
local or similar statute, law, ordinance, regulation, rule, code, order,
requirement or rule of law (including common law).

 

“Legal Requirement” means any requirement arising under any constitution, law,
statute, code, treaty, decree, rule, ordinance or regulation or any
determination or direction of any arbitrator or any Governmental Entity,
including any Environmental and Safety Requirements and including any of the
foregoing that relate to data use, privacy or protection.

 

“Liability” or “Liabilities” means any liability, debt, obligation, deficiency,
interest, Tax, penalty, fine, claim, demand, judgment, cause of action or other
loss (including, without limitation, loss of benefit or relief), cost or expense
of any kind or nature whatsoever, whether asserted or unasserted, absolute or
contingent, accrued or unaccrued, liquidated or unliquidated, and whether due or
becoming due and regardless of when asserted.

 

“Lien” means any security interest, pledge, bailment (in the nature of a pledge
or for purposes of security), mortgage, deed of trust, the grant of a power to
confess judgment, conditional sales and title retention agreement (including any
lease in the nature thereof), charge, encumbrance or other similar arrangement
or interest in real or personal property.

 

“Loss” or “Losses” means any and all Liabilities, damages, fines, dues, Taxes,
penalties, charges, assessments, deficiencies, judgments, defaults, settlements
and other losses (including diminution in value) and fees, costs and expenses
(including interest, expenses of investigation, defense, prosecution and
settlement of claims, court costs, reasonable fees and expenses of attorneys,
accountants and other experts, and all other fees and expenses) as the same are
incurred in connection with any Action, Third Party Claim or any other claim,
default or assessment (including any claim asserting or disputing any right
under this Agreement or any Transaction Documents against any party hereto or
otherwise), plus any interest that may accrue on any of the foregoing.

 

46

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

 

“Multiemployer Plan” shall have the meaning set forth in Section 3(37) of ERISA
(Code Section 29 USC Section 1002(37)).

 

“Open Source Software” means computer software (including, without limitation,
source code, object code, libraries and middleware) subject to the GNU General
Public License, the Lesser GNU Public License or other similar licensing regimes
commonly called “open source.”

 

“Operating Expense Amount” shall mean $160,000.

 

“Operating Profit Margin” shall mean, as a percentage of applicable Seller US
GAAP revenue, operating profit of Seller per US GAAP, excluding interest and
taxes and excluding acquisition amortization and transaction related costs under
this transaction. The costs of revenue consist of payroll and related fringe
benefits, reimbursable and non-reimbursable costs, immigration-related expenses,
fees for subcontractors working on client engagements and share-based
compensation expense for Seller IT professionals including account management
personnel and operating expenses of Seller include and consist of payroll and
related fringe benefits, commissions, selling, share-based compensation and
non-reimbursable costs, as well as promotion, communications, management,
finance, administrative, occupancy, marketing and depreciation and amortization
(excluding amortization of this transaction) expenses directly related to the
business of the Seller consistent with past practice..  For the avoidance of
doubt the cost of revenue and expenses shall not include Buyer or other related
entity charges for legal, finance, accounting, service, marketing, SEC, NASDAQ
or other compliance or other corporate charges of any kind that are not directly
related to the business of Seller or expenses which are not otherwise in
Seller’s business plans as approved in writing by Buyer.

 

“ordinary course of business” means the ordinary course of the Company’s
business consistent with past custom and practice, including as to frequency and
amount.

 

“Party” or “Parties” means any party hereto.

 

“PBGC” means the Pension Benefit Guaranty Corporation or any successor thereto.

 

“Permitted Liens” means (i) statutory Liens for current property Taxes not yet
due and payable, (ii) mechanic’s, carriers’, workers’, repairers’ and similar
statutory Liens arising or incurred in the ordinary course of business for
amounts which are not delinquent or due and which are not, individually or in
the aggregate, material, (iii) zoning, entitlement, building and other land use
regulations imposed by Government Entities having jurisdiction over the Leased
Real Property which are not violated by the current or proposed use, operation
or occupancy of the Leased Real Property by the Company or otherwise, and
(iv) covenants, conditions, restrictions, easements and other similar matters of
record affecting title to the Leased Real Property which do not materially
impair the occupancy or use of the Leased Real Property for the purposes for
which it is currently used or proposed to be used by the Company.

 

“Person” means an individual, a partnership, a corporation, an association, a
limited liability company, a joint stock company, a trust, a joint venture, an
unincorporated organization, or a Governmental Entity.

 

“Prospective Customer” means any proposed or prospective customer or client of
the Company or Buyer and any of their subsidiaries, subdivisions, or Affiliates
that (i) has had any correspondence with the Company, Buyer or any of their
subsidiaries, subdivisions, or Affiliates, (ii) is listed on any of the
Company’s, Buyer’s or any of their subsidiaries’, subdivisions’, or Affiliates’
internal pipeline discussions or related memoranda, (iii) is engaged in active
negotiations with the Company, Buyer or any

 

47

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

 

of their subsidiaries, subdivisions, or Affiliates on the Closing Date, or
(iv) is otherwise being solicited by the Company or Buyer or any of their
subsidiaries, subdivisions, or Affiliates, in each case within six (6) months
prior to the Closing Date.

 

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

 

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

 

“Subsidiary(ies)” means any corporation or other Person which is an entity with
respect to which another specified entity either (i) has the power to vote or
direct the voting of sufficient securities to elect a majority of the directors
or managers of such Person, or (ii) owns a majority of the ownership interests
of such entity.

 

“Tax” or “Taxes” means any federal, state, local, non-U.S. or other taxes,
including, without limitation, income, gross receipts, license, payroll,
employment, excise, severance, stamp, occupation, premium, windfall profits,
environmental (including taxes under Section 59A of the Code), custom, duty,
capital stock, branch, franchise”, profits, withholding, social security (or
similar), unemployment, disability, real property, personal property, sales,
use, transfer, registration, value added, goods and services, alternative or
add-on minimum, estimated, or other tax, charge, custom, duty, fee, impost, levy
or assessment imposed by any Governmental Entity including (i) any interest,
penalty, or addition thereto, whether disputed or not, and (ii) any obligation
to indemnify or otherwise assume or succeed to the tax Liability of any other
Person.

 

“Tax Return” means any return, declaration, report, estimate, claim for refund,
information return or statement (including any attachment, amendment or schedule
thereto) required to be filed, or which is otherwise filed, with any
Governmental Entity in respect of any Tax.

 

“Transaction Documents” means this Agreement and any other Contracts or
documents contemplated to be delivered or executed in connection herewith.

 

8.1                               Additional Definitions.

 

Term

 

Section

Active Employees

 

4.9(a)

Affiliated Transaction

 

2.17

Agreement

 

Preface

Allocation

 

1.5

Apportioned Obligations

 

4.5(c)

Assumed Liabilities

 

1.2(a)

Business

 

Preface

Buyer

 

Preface

Buyer Competitor

 

4.6(d)

Buyer Fundamental Representation(s)

 

6.2(b)(ii)

Buyer Party

 

6.2(a)

Cap

 

6.2(c)(i)

Causes of Action

 

9.14(a)

Closing

 

1.4(a)

Closing Date

 

1.4(a)

Combined Customers

 

4.6(e)

Company

 

Preface

Company 401(k) Plan

 

4.9(b)

 

48

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

 

Term

 

Section

Company Bonus Plans

 

1.2(b)(iii)

Company Competitor

 

4.6(d)

Company Employees

 

4.9(a)

Company Entity

 

2.10(a)

Company Intellectual Property

 

2.10(a)

Company Product

 

2.19

Company Trade Secrets

 

2.10(i)

Competitive Products

 

4.6(e)

Competitive Services

 

4.6(e)

Consents

 

2.22

Contingent Workers

 

2.14(b)

Current D&O Policy

 

2.13

CY14 Earn-Out Amount

 

1.5(g)(ii)

CY14 Target Period

 

1.5(b)

CY15 Earn-Out Amount

 

1.5(g)(iii)

CY15 Target Period

 

1.5(b)

De Minimis Amount

 

6.2(c)(i)

Dispute Notice

 

1.5(b)

Earn-Out Amount

 

1.5(g)(iii)

Earn-Out Statement

 

1.5(b)

Employee Obligations

 

2.14(b)

Employer

 

4.9(a)

Employment Agreements

 

5.1(h)

Excluded Assets

 

1.1(b)

Excluded Liabilities

 

1.2(b)

Financial Statements

 

2.5(a)

Foreign Employee

 

4.9(a)

FY14 Earn-Out Amount

 

1.5(g)(i)

FY14 Target Period

 

1.5(b)

Holdback Amount

 

1.4(d)

Inactive Employees

 

4.9(a)

Indemnified Party

 

6.4(a)

Indemnifying Party

 

6.4(a)

Independent Accountant

 

1.5

Insider

 

2.17

Interim Financial Statements

 

2.5(a)

Inventory

 

1.1(a)(ii)

Item of Dispute

 

1.5(b)

Key Employees

 

4.9(a)

Latest Balance Sheet

 

2.5(a)

Leased Real Property

 

2.20(b)

Leases

 

2.20(b)

Material Contract

 

2.9(b)

Material Customer

 

2.18(a)

Material Supplier

 

2.18(c)

Non-compete Period

 

4.6(d)

Non-Transferred Employees

 

4.9(a)

Permits

 

2.22(a)

 

49

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

 

Term

 

Section

Post-Closing Apportioned Period

 

4.5(c)

Pre-Closing Apportioned Period

 

4.5(c)

Pre-Closing Indemnitees

 

2.13

Products

 

2.10(a)

Prospective Customer

 

4.6(e)

Purchase Price

 

1.4(b)(i)

Purchased Assets

 

1.1(a)

Quarterly Financial Statements

 

4.11

 

 

 

Required Contract Consents

 

5.1(c)

Securities

 

2.2

Seller Account

 

1.4(b)(ii)

Seller Fundamental Representation(s)

 

6.3(b)(i)

Seller Members

 

Preface

Seller Party

 

6.3(a)

Survival Date

 

6.2(b)

Third Party Claim

 

6.4(a)

Threshold

 

6.2(c)(i)

Transfer Taxes

 

4.5(a)

Transferred Employees

 

4.9(a)

WARN Act

 

2.14(d)

 

ARTICLE 9
MISCELLANEOUS

 

9.1                               No Third Party Beneficiaries.  This Agreement
shall not confer any rights or remedies upon any Person other than the Parties
(and, where indicated herein, with respect to Article 4, the Affiliates of the
Parties and such other Persons designated therein) and their respective
successors and permitted assigns.

 

9.2                               Entire Agreement.  This Agreement (including
the Schedules, attachments and exhibits hereto and the documents referred to
herein) constitutes the entire agreement between the Parties and supersedes any
prior understandings, agreements or representations by or between the Parties,
written or oral, that may have related in any way to the subject matter hereof.

 

9.3                               Successors and Assigns.  This Agreement shall
be binding upon and inure to the benefit of the Parties named herein and their
respective successors and permitted assigns, but neither this Agreement nor any
of the rights or obligations hereunder may be assigned (whether by operation of
law, through a change in control or otherwise) by the Company, the Seller Member
without the prior written consent of Buyer, or by Buyer without the prior
written consent of the Company or the Seller Member; provided, however, Buyer
and its Affiliates shall have the right to assign (a) all or any portion of this
Agreement and the other Transaction Documents (including its rights and
obligations hereunder and thereunder), including its rights to indemnification,
to any of its (whether prior to or subsequent to the Closing) lenders as
collateral security, and (b) all or any portion of this Agreement and the other
Transaction Documents and its rights and obligations hereunder and thereunder,
including its rights to indemnification, in connection with a (i) merger or
consolidation involving Buyer or its Subsidiaries, (ii) a sale of stock or
assets (including any real estate) of Buyer or its Subsidiaries or
(iii) dispositions of the

 

50

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

 

business of the Company and its Subsidiaries or any part thereof; provided,
further, that no such assignment shall release Buyer from any liability or
obligation under this Agreement and provided that any successor or assign shall
agree in writing to be bound by the obligations under this Agreement.

 

9.4                               Counterparts.  This Agreement may be executed
in two or more counterparts, each of which shall be deemed an original but all
of which together shall constitute one and the same instrument.

 

9.5                               Headings.  The section headings contained in
this Agreement are inserted for convenience only and shall not affect in any way
the meaning or interpretation of this Agreement.

 

9.6                               Notices.  All notices, requests, demands,
claims, and other communications hereunder shall be in writing.  Any notice,
request, demand, claim or other communication hereunder shall be deemed duly
given when delivered personally to the recipient or sent to the recipient by
telecopy (receipt confirmed) or by reputable express courier service (charges
prepaid), and addressed to the intended recipient as set forth below:

 

If to the Company or Seller Member:

 

Address

3 Arlington Court

Warren, NJ 07059

 

Attn:      Sunny Bathla

Facsimile No:

 

With a copy to (which shall not constitute notice):

 

Marc D. Freedman

Law Offices of Marc D. Freedman LLC

777 Terrace Avenue, 5th Floor

Hasbrouck Heights, NJ 07604

 

Telephone (201) 288-7773

Facsimile (201) 288-7009

 

If to Buyer:

 

Virtusa Corporation

2000 West Park Drive

Westborough, MA 01581

Attention: Ranjan Kalia

                 Paul Tutun

Facsimile No.:  (508) 366-9901

 

51

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

 

with a copy to (which shall not constitute notice):

 

Goodwin Procter LLP

Exchange Place

Boston, MA 02109

Attention:

John J. Egan

 

Edward A. King

Facsimile No.:

(617) 523-1231

 

Any Party may send any notice, request, demand, claim or other communication
hereunder to the intended recipient at the address set forth above using any
other means, but no such notice, request, demand, claim or other communication
shall be deemed to have been duly given unless and until it is actually received
by the intended recipient.  Any Party may change the address to which notices,
requests, demands, claims, and other communications hereunder are to be
delivered by giving the other Party notice in the manner herein set forth.

 

9.7                               Governing Law.  This Agreement shall be
governed by and construed in accordance with the domestic laws of the State of
Delaware without giving effect to any choice or conflict of law provision or
rule that would cause the application of the laws of any jurisdiction other than
the State of Delaware.

 

9.8                               Amendments and Waivers.  No amendment of any
provision of this Agreement shall be valid unless the same shall be in writing
and signed by the Parties hereto.  No waiver by any Party of any default,
misrepresentation, or breach of warranty or covenant hereunder, whether
intentional or not, shall be deemed to extend to any prior or subsequent
default, misrepresentation, or breach of warranty or covenant hereunder or
affect in any way any rights arising by virtue of any prior or subsequent such
occurrence.

 

9.9                               Incorporation of Schedules.  The Schedules
identified in this Agreement are incorporated herein by reference and made a
part hereof.

 

9.10                        Construction.  Where specific language is used to
clarify by example a general statement contained herein (such as by using the
word “including”), such specific language shall not be deemed to modify, limit
or restrict in any manner the construction of the general statement to which it
relates.  The language used in this Agreement shall be deemed to be the language
chosen by the Parties to express their mutual intent, and no rule of strict
construction shall be applied against any Party.  Whenever required by the
context, any pronoun used in this Agreement shall include the corresponding
masculine, feminine or neuter forms, and the singular form of nouns, pronouns
and verbs shall include the plural and vice versa.  Nothing in the Schedules
hereto shall be deemed adequate to disclose an exception to a representation or
warranty made herein unless the Schedule identifies the exception with
reasonable particularity and describes the relevant facts in reasonable detail
or unless the disclosure would be reasonably apparent to apply to another
exception in the Schedule.  Without limiting the generality of the foregoing,
the mere listing (or inclusion of a copy) of a document or other item shall not
be deemed adequate to disclose an exception to a representation or warranty made
herein (unless the representation or warranty has to do with the existence of
the document or other item itself) or such disclosure would be reasonably
apparent that the listing of the document was adequate disclosure.  The
disclosure of an item in one section or subsection of the Schedules shall be
deemed to modify the representations and warranties of the Party contained in
the section or subsection of this Agreement to which it corresponds but not any
other representation and warranty of the Party in this Agreement unless such
disclosure item is expressly cross-referenced as applying to such other
representation and warranty of the Party or unless such disclosure item would be
reasonably apparent to apply to such other representation or warranty.  The
Parties intend that each representation, warranty, and covenant contained herein
shall have independent significance.  If any Party has breached any
representation, warranty, or covenant contained herein (or is otherwise

 

52

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

 

entitled to indemnification) in any respect, the fact that there exists another
representation, warranty, or covenant (including any indemnification provision)
relating to the same subject matter (regardless of the relative levels of
specificity) which the Party has not breached (or is not otherwise entitled to
indemnification with respect thereto) shall not detract from or mitigate the
fact that the Party is in breach of the first representation, warranty, or
covenant (or is otherwise entitled to indemnification pursuant to a different
provision).

 

9.11                        Severability of Provisions.  If any covenant,
agreement, provision or term of this Agreement is held to be invalid for any
reason whatsoever, then such covenant, agreement, provision or term will be
deemed severable from the remaining covenants, agreements, provisions and terms
of this Agreement and will in no way affect the validity or enforceability of
any other provision of this Agreement.

 

9.12                        Specific Performance.  Each of the Parties
acknowledges and agrees that the other Parties would be damaged irreparably in
the event any of the provisions of this Agreement are not performed in
accordance with their specific terms or otherwise are breached.  Accordingly,
each of the Parties agrees that the other Parties shall be entitled to an
injunction or injunctions to prevent breaches of the provisions of this
Agreement and to enforce specifically this Agreement and the terms and
provisions hereof in any court of the United States or any state thereof having
jurisdiction over the Parties and the matter in addition to any other remedy to
which they may be entitled, at law or equity.

 

9.13                        Successor Laws.  Any reference to any particular
Code section or any other Legal Requirement will be interpreted to include any
revision of or successor to that section regardless of how it is numbered or
classified.

 

9.14                        Release.

 

(a)                                 Deleted

 

9.15                        Delivery by Facsimile, etc.  This Agreement and any
signed Contract entered into in connection herewith or contemplated hereby, and
any amendments hereto or thereto, to the extent signed and delivered by means of
a facsimile machine or “PDF” transmission, shall be treated in all manner and
respects as an original Contract and shall be considered to have the same
binding legal effects as if it were the original signed version thereof
delivered in person.  At the request of any party hereto or to any such
Contract, each other party hereto or thereto shall re-execute original forms
thereof and deliver them to all other parties.  No party hereto or to any such
Contract shall raise the use of a facsimile machine or “PDF” transmission to
deliver a signature or the fact that any signature or Contract was transmitted
or communicated through the use of a facsimile machine or “PDF” transmission as
a defense to the formation of a Contract and each such party forever waives any
such defense.

 

9.16                        Captions.  The captions used in this Agreement are
for convenience of reference only and do not constitute a part of this Agreement
and shall not be deemed to limit, characterize or in any way affect any
provision of this Agreement, and all provisions of this Agreement shall be
enforced and construed as if no caption had been used in this Agreement.

 

9.17                        Consent to Jurisdiction.  THE PARTIES AGREE THAT
JURISDICTION AND VENUE IN ANY ACTION BROUGHT BY ANY PARTY PURSUANT TO THIS
AGREEMENT SHALL PROPERLY AND EXCLUSIVELY LIE IN ANY FEDERAL OR STATE COURT
LOCATED IN THE COMMONWEALTH OF MASSACHUSETTS.  BY EXECUTION AND DELIVERY OF THIS
AGREEMENT, EACH PARTY IRREVOCABLY SUBMITS TO THE EXCLUSIVE JURISDICTION OF SUCH
COURTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY WITH RESPECT TO

 

53

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

 

SUCH ACTION.  THE PARTIES IRREVOCABLY AGREE THAT VENUE WOULD BE PROPER IN SUCH
COURT, AND HEREBY WAIVE ANY OBJECTION THAT SUCH COURT IS AN IMPROPER OR
INCONVENIENT FORUM FOR THE RESOLUTION OF SUCH ACTION.  THE PARTIES FURTHER AGREE
THAT THE MAILING BY CERTIFIED OR REGISTERED MAIL, RETURN RECEIPT REQUESTED, OF
ANY PROCESS REQUIRED BY ANY SUCH COURT SHALL CONSTITUTE VALID AND LAWFUL SERVICE
OF PROCESS AGAINST THEM, WITHOUT NECESSITY FOR SERVICE BY ANY OTHER MEANS
PROVIDED BY STATUTE OR RULE OF COURT.

 

9.18                        Waiver of Jury Trial.  EACH PARTY HERETO HEREBY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE
TO A TRIAL BY JURY IN RESPECT OF ANY SUIT, ACTION OR PROCEEDING DIRECTLY OR
INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT.

 

ARTICLE 10

POST CLOSING OPERATIONS

 

10.1                        Buyer Covenants.  During the period beginning on the
Closing Date and ending December 31, 2015 (the “Earnout Term”), Buyer shall:

 

At or prior to the Closing create, and thereafter maintain: true, complete and
correct separate financial books and records of the results of operations
(“Business Segment Records”), of a Company business segment (“Business Segment”)
of sufficient detail so as to permit the accurate calculation of the Earn-Out
and the production of financial statements of and for the Business Segment,
including without limitation, a profit and loss statement, aged accounts
receivables schedule and bad debts schedule; and record all transactions in the
Business Segment Records, and prepare such financial statements in accordance
with generally accepted accounting principles applied on a consistent basis and
on a basis consistent with Buyer’s prior practices, except as herein expressly
provided to the contrary.

 

10.2                        Negative Covenants of
Buyer.                            Without limiting the generality of
Section 10.1 hereof and in furtherance and not in limitation thereof, Buyer
shall, during the Earn-Out Term:

 

(a) Provide the Company and Selling Member: with the full and complete financial
and operating reporting package customarily provided to other members of
business units of the Buyer, including the Earn-out Reports provided by Buyer to
Company and Seller Member set forth in Section 1.5 herein.

 

(b) Selling Member may also request and should be provided (without undue delay)
such additional reports as may be necessary for the management of the business
consistent those reports which Buyer provides to other business units of the
Buyer.

 

10.3  The parties will agree in writing upon general operating plans for the
Business Segment for each applicable fiscal period, including each Target Period
through December 31, 2015 and upon a methodology by which, for purposes of the
earn-out provisions described in this Agreement, Target Revenue and Operating
Profit Margin of the Company during such period can be calculated as if Company
were operated as an independent entity.

 

54

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

 

[Remainder of Page Intentionally Left Blank]

 

55

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

 

IN WITNESS WHEREOF, the Parties have executed this Asset Purchase Agreement as
of the date first above written.

 

 

 

OSB CONSULTING LLC

 

 

 

By:

/s/Sanjeev Bathla

 

Name:

Sanjeev Bathla

 

Title:

Managing Partner

 

 

 

 

 

VIRTUSA CORPORATION

 

 

 

By:

Thomas R. Holler

 

Name:

/s/ Thomas R. Holler

 

Title:

EVP & CSO

 

[Signature Page to Asset Purchase Agreement]

 

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

 

 

SELLER MEMBER

 

 

 

By:

/s/ Sanjeev Bathla

 

Name:

Sanjeev Bathla

 

Title:

Managing Partner

 

[Signature Page to Asset Purchase Agreement]

 

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