Exhibit 10.5

 

Execution Copy

 

STOCK PURCHASE AGREEMENT

 

dated as of June 11, 2003

 

by and among

 

INVESTMENT TECHNOLOGY GROUP, INC.,

 

RADICAL CORPORATION

 

and

 

THE INDIVIDUALS LISTED HEREIN

 

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TABLE OF CONTENTS

 

ARTICLE ONE

 

DEFINITIONS

 

SECTION 1.1

Definitions

 

 

 

 

ARTICLE TWO

 

PURCHASE AND SALE; OPTION

 

 

 

 

SECTION 2.1

Purchase and Sale

 

SECTION 2.2

Purchase Price

 

SECTION 2.3

Payment of Purchase Price and Delivery of Shares

 

SECTION 2.4

Option

 

SECTION 2.5

Additional Option Payment Amounts

 

SECTION 2.6

Change of Control

 

SECTION 2.7

Certain Acquisitions

 

 

 

 

ARTICLE THREE

 

REPRESENTATIONS AND WARRANTIES

 

 

 

 

SECTION 3.1

Representations and Warranties of the Company

 

SECTION 3.2

Representations and Warranties of the Selling Stockholders

 

SECTION 3.3

Representations and Warranties of the Purchaser

 

 

 

 

ARTICLE FOUR

 

GOVERNANCE

 

 

 

 

SECTION 4.1

Board Composition

 

SECTION 4.2

Board Action

 

SECTION 4.3

Cessation of Rights

 

 

 

 

ARTICLE FIVE

 

COVENANTS

 

 

 

 

SECTION 5.1

Transfers

 

SECTION 5.2

Right of First Refusal; Tag Along Rights

 

SECTION 5.3

Validity of Transfer

 

SECTION 5.4

By-laws

 

SECTION 5.5

Spartan License Agreement

 

SECTION 5.6

Purchaser Reporting Obligations

 

 

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SECTION 5.7

Company Reporting Obligations

 

SECTION 5.8

No Solicitation

 

SECTION 5.9

System Marketing

 

SECTION 5.10

US Trading Corporation License Agreement

 

 

 

 

ARTICLE SIX

 

TERMINATION OF OBLIGATIONS; SURVIVAL

 

 

 

 

SECTION 6.1

Termination

 

SECTION 6.2

Effect of Termination

 

 

 

 

ARTICLE SEVEN

 

CONFIDENTIALITY

 

 

 

 

SECTION 7.1

Confidential Information

 

SECTION 7.2

Confidentiality Obligations

 

SECTION 7.3

Notice Preceding Compelled Disclosure

 

SECTION 7.4

Consultation as to Announcements

 

 

 

 

ARTICLE EIGHT

 

INDEMNIFICATION

 

 

 

 

SECTION 8.1

Indemnity

 

SECTION 8.2

Claims for Indemnification

 

SECTION 8.3

Survival of Representations, Warranties and Covenants

 

SECTION 8.4

Limitation of Liability

 

SECTION 8.5

Sole Remedy

 

SECTION 8.6

New Escrow

 

SECTION 8.7

Sellers’ Representative

 

 

 

 

ARTICLE NINE

 

GENERAL PROVISIONS

 

 

 

 

SECTION 9.1

Notices

 

SECTION 9.2

Interpretation

 

SECTION 9.3

Amendment

 

SECTION 9.4

Waiver

 

SECTION 9.5

Counterparts; Effectiveness

 

SECTION 9.6

Entire Agreement; No Third Party Beneficiaries

 

SECTION 9.7

Governing Law; Consent to Jurisdiction

 

SECTION 9.8

Waiver of Jury Trial

 

SECTION 9.9

Severability

 

SECTION 9.10

Assignment

 

 

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SECTION 9.11

Specific Performance

 

SECTION 9.12

Time of Essence

 

 

 

 

Exhibit A

Form of License Agreement

 

Exhibit B

Selling Stockholder Shares

 

Exhibit C

Form of Employment Agreements

 

Exhibit D

Form of Escrow Agreement

 

Exhibit E

Budget

 

Exhibit F

Current Form of License Agreement

 

Exhibit G

Form of Amended and Restated By-Laws

 

Exhibit H

Form of Officer Certificate

 

 

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STOCK PURCHASE AGREEMENT

 

THIS STOCK PURCHASE AGREEMENT, dated as of June 11, 2003 (this “Agreement”) is
made by and among Investment Technology Group, Inc., a Delaware corporation (the
“Purchaser”), Radical Corporation, a Delaware corporation (the “Company”), and
the individuals listed on the signature page(s) hereto (collectively, the
“Selling Stockholders” and each individually, a “Selling Stockholder”).

 

WHEREAS, the Selling Stockholders own an aggregate of 42,160 shares of the
Company Common Stock (as hereinafter defined), which shares prior to giving
effect to the issuance of the Purchased Shares (as hereinafter defined),
constitute 100% of the issued and outstanding shares of Company Common Stock;

 

WHEREAS, the Purchaser desires to purchase from the Company and the Company
desires to issue and sell to the Purchaser 14,053 shares of the Company Common
Stock (the “Purchased Shares”), which shares upon issuance shall constitute 25%
of the issued and outstanding shares of Company Common Stock;

 

WHEREAS, the Selling Stockholders desire to grant to the Purchaser an option to
purchase an aggregate of 42,160 shares of Company Common Stock, which shares
after giving effect to the issuance of the Purchased Shares shall constitute 75%
of the issued and outstanding shares of Company Common Stock; and

 

WHEREAS, the Company has entered into an amended and restated software license
and network access agreement with the Purchaser’s Affiliate (the “License
Agreement”) for use of the System (as hereinafter defined) in the form of
Exhibit A hereto.

 

NOW, THEREFORE, in consideration of the foregoing and the respective
representations, warranties, covenants and agreements set forth herein, the
parties hereto, intending to be legally bound, agree as follows:

 

ARTICLE ONE

 

DEFINITIONS

 

SECTION 1.1.  Definitions.  For all purposes in this Agreement, the following
terms shall have the respective meanings set forth in this Section 1.1 (such
definitions to be equally applicable to both the singular and plural forms of
the terms herein defined):

 

“Additional Option Payment Amounts” shall have the meaning specified in
Section 2.5(a) of this Agreement.

 

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“Additional Payment Calculation Date” shall have the meaning specified in
Section 2.5(a) of this Agreement.

 

“Additional Payment Date” shall have the meaning specified in Section 2.5(b) of
this Agreement.

 

“Affiliate” of a Person shall mean any and all Persons that directly or
indirectly through one or more intermediaries, controls, or is controlled by, or
is under common control with such Person.

 

“Agreement” shall have the meaning specified in the Preamble of this Agreement.

 

“Average Daily Revenue” shall mean, for any period, the Gross Revenues for such
period divided by the number of Business Days in such period.

 

“Budget” shall have the meaning specified in Section 4.2(i) of this Agreement.

 

“Business Day” shall mean any day when all of the New York Stock Exchange, the
American Stock Exchange and Nasdaq are open for trading.

 

“Change of Control” shall mean entering into a Contract with respect to any of
the following, occurring in a single transaction or as part of a series of
related transactions: (a) the direct or indirect acquisition by any Person or
group of Persons acting in concert of more than 50% of the voting power of the
Purchaser or (b) the acquisition by any Person or group of Persons acting in
concert of all or substantially all of the assets of the Purchaser and its
subsidiaries, taken as a whole; provided that, a Change of Control shall include
any subsequent Change of Control of the Purchaser or a surviving entity if the
Purchaser has merged into another entity.

 

“Change of Control Event” shall have the meaning specified in Section 2.6 of
this Agreement.

 

“Closing” shall have the meaning specified in Section 2.3 of this Agreement.

 

“Closing Date” shall have the meaning specified in Section 2.3 of this
Agreement.

 

“Company” shall have the meaning specified in the Preamble of this Agreement.

 

“Company Common Stock” shall mean the common stock, $.001 par value, of the
Company.

 

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“Company Financial Statements” shall have the meaning specified in
Section 3.1(e) of this Agreement.

 

“COMPETING ACQUISITION” SHALL MEAN THE PURCHASER OR ANY OF ITS AFFILIATES
ENTERING INTO A CONTRACT TO ACQUIRE, DIRECTLY OR INDIRECTLY, OF ANY TITLE,
INTEREST OR RIGHT TO USE, MARKET, DISTRIBUTE, LICENSE OR SUBLICENSE A TRADING
SYSTEM THAT COMPETES WITH THE SYSTEM; PROVIDED THAT, LIST TRADING SYSTEMS WILL
NOT BE CONSIDERED TO COMPETE WITH THE SYSTEM.

 

“Competing Acquisition Event” shall have the meaning specified in Section 2.7 of
this Agreement.

 

“CONFIDENTIAL INFORMATION” SHALL HAVE THE MEANING SPECIFIED IN SECTION 7.1(A) OF
THIS AGREEMENT.

 

“Contract” shall mean any written or oral agreement, contract, understanding,
arrangement, instrument, note, insurance policy, benefit plan, commitment,
covenant, assurance or undertaking.

 

“Disclosing Party” shall have the meaning specified in Section 7.1(a) of this
Agreement.

 

“Employment Agreements” shall have the meaning specified in Section 2.4(c) of
this Agreement.

 

“Encumbrance” shall mean any mortgage, pledge, hypothecation, assignment,
encumbrance, lien (statutory or other), other charge or security interest, or
any preference, priority or other agreement or preferential arrangement of any
kind or nature whatsoever.

 

“Escrow Agent” shall mean JPMorgan Chase Bank or any other Person reasonably
acceptable to the Purchaser, Hemant Sharma and Thomas George.

 

“Escrow Agreement” shall have the meaning specified in Section 2.4(d) of this
Agreement.

 

“Expiration Date” shall have the meaning specified in Section 2.4(b) of this
Agreement.

 

“Final Payment Date” shall have the meaning specified in Section 2.5(b) of this
Agreement.

 

“Fiscal Month” shall mean, for the first fiscal month of the year, the period
beginning on the first day of January, and ending on the last Friday in
January and, for each subsequent fiscal month, the period beginning on the day
after the last day of the prior fiscal month and ending on the last Friday of
such month; provided that, the last fiscal month in any year shall end on
December 31st of such year.

 

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“Fiscal Quarter” shall mean, for the first fiscal quarter of the year, the
period beginning on the first day of January, and ending on the last Friday in
March and, for each subsequent fiscal quarter, the period beginning on the day
after the last day of the prior fiscal quarter and ending on the last Friday of
such quarter; provided that, the last fiscal quarter in any year shall end on
December 31st of such year.

 

“GAAP” shall mean accounting principles generally accepted in the United States
in effect from time to time.

 

“Governmental Entity” shall mean any federal, state, local or foreign court,
administrative agency or commission or other governmental authority or
instrumentality, or self-regulatory organization.

 

“Gross Revenue” shall mean, for any period, any and all gross commissions, fees
or other remuneration accrued during such period to the ITG Group in respect of
trades executed via the System, which amount shall not include any revenues from
commissions, fees or other remuneration related to trades executed (a) by the
trading desks of the ITG Group or (b) through POSIT by existing ITG Group
customers as of the date hereof that have executed trades through POSIT within
three months prior to the date hereof or prior to using the System, whichever is
earlier, and which amount shall be determined after deduction of volume or other
discounts actually granted, soft dollar credits and verified trade differences
(including errors and accommodations, as such term is used in the brokerage
industry); provided that, any deductions with respect to soft dollar credits
shall not include any credits to the ITG Group which are not consistent with the
ITG Group’s soft dollar practices and any deductions with respect to any
discounts shall not include any discounts which are not consistent with the ITG
Group’s ordinary course of business and ITG Group’s practices with respect to
discounts.

 

“Gross Revenue Statement” shall have the meaning specified in Section 5.6 of
this Agreement.

 

“Indemnitee” shall have the meaning specified in Section 8.1 of this Agreement.

 

“Intellectual Property” shall mean all of the following, in whatever form or
medium, anywhere in the world: patents, trademarks, service marks, trade names,
corporate names, domain names, copyrights, and copyrighted works; registrations
thereof and applications (including provisional applications) therefore;
derivatives, continuations, continuations-in-part, extensions, divisionals,
re-examinations, reissues and renewals thereof; trade secrets, software (in any
form, including source code and object code), firmware, mask works, programs,
flow charts, research records, documentation, inventions (whether patentable or
unpatentable), utility models, discoveries, proprietary processes, and items of
proprietary know-how, information, data (whether or not protected by copyright
or other intellectual property), proprietary prospect lists, customer lists,
projections, analyses,

 

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proprietary market studies and any other intellectual property, including any
enhancements or improvements of any of the above.

 

“ITG Group” shall mean the Purchaser and all its direct and indirect Affiliates.

 

“Legal Requirement” shall mean any federal, state, local or foreign statute,
law, rule, regulation, ordinance, code, constitution, treaty, or Order or
determination of any Governmental Entity.

 

“License Agreement” shall have the meaning specified in the Recitals of this
Agreement.

 

“Losses” shall have the meaning specified in Section 8.1 of this Agreement.

 

“Material Adverse Effect” shall mean, with respect to any Person, a material
adverse effect on the business, assets, financial condition or results of
operation of such Person.

 

“Minimum Interest” shall mean a 20% or more beneficial ownership interest in the
aggregate issued and outstanding Company Common Stock.

 

“New Escrow Agreement” shall have the meaning specified in Section 8.6 of this
Agreement.

 

“Option” shall have the meaning specified in Section 2.4(a) of this Agreement.

 

“Option Closing Date” shall have the meaning specified in Section 2.4(b) of this
Agreement.

 

“Option Exercise Date” shall have the meaning specified in Section 2.4(b) of
this Agreement.

 

“Option Exercise Notice” shall have the meaning specified in Section 2.4(b) of
this Agreement.

 

“Option Exercise Price” shall have the meaning specified in Section 2.4(a) of
this Agreement.

 

“Option Shares” shall have the meaning specified in Section 2.4(a) of this
Agreement.

 

“Order” shall mean any order, judgment, injunction, edict, decree, ruling,
pronouncement, determination, decision, opinion, arbitration, verdict, sentence,
subpoena,

 

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writ or award made, entered, rendered or otherwise put into effect by or under
the authority of any Governmental Entity or any arbitrator or arbitration panel.

 

“Patent Infringement Losses” shall mean any Losses incurred subsequent to the
Option Exercise Date resulting from or arising out of Intellectual Property of
the Company infringing any patents issued as of the Option Closing Date (or
continuations, continuations-in-part, extensions, divisionals, re-examinations,
reissues and renewals thereof) or any patents issued in respect of patent
applications published as of the Option Closing Date (or continuations,
continuations-in-part, extensions, divisionals, re-examinations, reissues and
renewals thereof).

 

“Payment Instructions” shall have the meaning specified in Section 2.4(b) of
this Agreement.

 

“Permit” shall mean any permit, license, franchise, concession, variance,
exemption, or approval of any Governmental Entity.

 

“Permitted Investments” shall mean obligations denominated in U.S. dollars
maturing or capable of redemption by the holder not more than twelve months
after the date of acquisition which are (a) issued or guaranteed by the U.S.
Government or any agency or instrumentality thereof, (b) demand deposits, time
deposits, certificates of deposit or other obligations issued, accepted or
guaranteed by a bank having a rating at time of such investment or acquisition
of at least A2 from Moody’s Investors Service, Inc. or A from Standard & Poor’s
Ratings Services and having a combined capital, surplus and undivided profits
(less any undivided losses) of not less than $100 million, or (c) money market
funds having a rating from Moody’s Investors Service, Inc. or Standard & Poor’s
Ratings Services in the highest investment category granted thereby at the time
of acquisition.

 

“Person” shall mean any individual, corporation, partnership, limited liability
company, incorporated or unincorporated association, joint venture, joint stock
company, estate, trust, unincorporated organization, firm or other enterprise,
association, entity or Governmental Entity.

 

“Proceeding” shall have the meaning specified in Section 3.1(i) of this
Agreement.

 

“Purchase Price” shall have the meaning specified in Section 2.2 of this
Agreement.

 

“Purchased Shares” shall have the meaning specified in the Recitals of this
Agreement.

 

“Purchaser” shall have the meaning specified in the Preamble of this Agreement.

 

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“Purchaser Indemnitee” shall have the meaning specified in Section 8.1 of this
Agreement.

 

“Receiving Party” shall have the meaning specified in Section 7.1(a) of this
Agreement.

 

“Representative” shall mean, with respect to any party to this Agreement, any
officer, director, manager, employee, affiliate, agent, representative or
advisor.

 

“Restricted Transfer Period” shall mean the period commencing the date hereof
and ending on the earlier of (a) the Option Closing Date and (b) the Expiration
Date.

 

“Scheduled Patents” shall mean the patents listed on Schedule 8.4 to this
Agreement.

 

“Securities Act” shall mean the Securities Act of 1933, as amended.

 

“Sellers’ Representative” shall have the meaning specified in Section 8.7 of
this Agreement.

 

“Selling Stockholder” shall have the meaning specified in the Preamble of this
Agreement.

 

“Stockholder Indemnitee” shall have the meaning specified in Section 8.1 of this
Agreement.

 

“Stockholders” shall mean the Purchaser and each of the Selling Stockholders.

 

“Software” shall mean any and all computer programs (including any and all
software implementations of algorithms, models and methodologies, whether in
source code or object code but excluding any off-the-shelf software except
off-the-shelf software that is both material and relates to the Company
business) and computer databases and computer compilations (including any and
all data and collections of data, whether machine readable or otherwise).

 

“Source Code Escrow Agreement” shall have the meaning specified in the License
Agreement.

 

“Spartan License Agreement” shall mean the software license agreement between
the Company and Spartan Technologies, LLC, dated March 22, 2002.

 

“System” shall mean (i) the “Licensed Product” and/or (ii) the “Radical Network”
as defined in the License Agreement.

 

“Tag Along Shares” shall have the meaning specified in Section 5.2(d) of this
Agreement.

 

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“Taxes” shall mean all federal, state, local and foreign income, profits,
franchise, gross receipts, payroll, sales, employment, use, property,
withholding, excise, occupancy, custom, duty, capital stock, ad valorem, value
added, estimated, stamp, alternative and other taxes, governmental duties or
governmental assessments of any nature whatsoever, together with all interest,
penalties and additions imposed with respect to such amounts.

 

“Transaction Agreements” shall mean (a) this Agreement, (b) the License
Agreement, (c) the Source Code Escrow Agreement, (d) the Employment Agreements,
(e) the Escrow Agreement, if any, (f) the Spartan Assignment Agreement between
the Company and Hemant Sharma and Thomas George, dated the date hereof and (g)
the New Escrow Agreement, if any.

 

“Transfer” shall have the meaning specified in Section 5.1 of this Agreement.

 

“Transferee” shall have the meaning specified in Section 5.2(a) of this
Agreement.

 

“Transfer Notice” shall have the meaning specified in Section 5.2(a) of this
Agreement.

 

“Transferring Stockholder” shall have the meaning specified in Section 5.2(a) of
this Agreement.

 

“Transfer Shares” shall have the meaning specified in Section 5.2(a) of this
Agreement.

 

“Violation” shall have the meaning specified in Section 3.1(c)(i)(A) of this
Agreement.

 

“Voting Debt” shall have the meaning specified in Section 3.1(d) of this
Agreement.

 

ARTICLE TWO

 

PURCHASE AND SALE; OPTION

 

SECTION 2.1.  Purchase and Sale.  On the date hereof, and upon the terms and
subject to the conditions hereinafter set forth, the Company shall issue and
sell to the Purchaser the Purchased Shares, and the Purchaser shall purchase
from the Company the Purchased Shares.

 

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SECTION 2.2.  Purchase Price.  The purchase price for the Purchased Shares shall
be $750,000 (the “Purchase Price”), payable by the Purchaser to the Company as
provided in Section 2.3 below.

 

SECTION 2.3.  Payment of Purchase Price and Delivery of Shares.  On the date
hereof (the “Closing Date”), the Purchaser shall pay the Purchase Price to the
Company in cash by wire transfer of immediately available funds to the Company’s
account at JPMorgan Chase Bank, Account Number 305-0671403-65, ABA Routing
Number 021000021, the Company shall deliver to the Purchaser a certificate
representing the Purchased Shares issued in the Purchaser’s name, and the
Selling Stockholders shall deliver the Option Shares, duly endorsed for transfer
to the Purchaser or accompanied by stock powers executed in blank to the Company
to be held in escrow by it.  The consummation of the purchase and sale of the
Purchased Shares shall occur at the offices of Boies, Schiller and Flexner LLP,
570 Lexington Avenue, 16th Floor, New York, New York 10022, or at such other
place as the Purchaser and the Company may agree (the “Closing”).

 

SECTION 2.4.  Option. (a) On the Closing Date, and upon the terms and subject to
the conditions hereinafter set forth, the Selling Stockholders hereby grant to
the Purchaser an option, exercisable in whole and not in part in the Purchaser’s
sole discretion, to purchase an aggregate of 42,160 shares of Company Common
Stock (the “Option”) for the Option Exercise Price, which shares represent,
after giving effect to the issuance of the Purchased Shares contemplated in
Section 2.1 above, 75% of the issued and outstanding shares of Company Common
Stock.  The number of shares of Company Common Stock to be sold by each Selling
Stockholder (in each case, the “Option Shares”) upon exercise of the Option is
set forth next to such Selling Stockholders’ name in Exhibit B hereto.  The
“Option Exercise Price” for the Option shall be equal to the product of (i) the
Average Daily Revenue for the three Fiscal Months immediately prior to the
Option Exercise Date and (ii) 252.  In the event that the Option Exercise Price
as calculated in accordance with the preceding sentence is (A) less than
$4,000,000, the Option Exercise Price shall be $4,000,000 or (B) greater than
$18,000,000, the Option Exercise Price shall be $18,000,000.  Notwithstanding
the foregoing, if the Exercise Price is less than $18,000,000, Additional Option
Payment Amounts, as set forth in Section 2.5 below, if any, shall be paid to the
Selling Stockholders towards the purchase of Option Shares.

 

(b)                                 In the event that the Purchaser wishes to
exercise the Option, the Purchaser shall deliver a written notice to the Company
and each of the Selling Stockholders (the “Option Exercise Notice”) specifying a
date for the exercise of the Option which date shall be one of February 28,
2004, March 27, 2004, May 1, 2004 or May 29, 2004 (each, an “Option Exercise
Date”).  Such notice may be delivered at any time within the 30 day period prior
to and including any such Option Exercise Date.  If an Option Exercise Notice is
not delivered on or prior to May 29, 2004 (the “Expiration Date”), the Option
shall expire and the parties hereto shall have no further rights or obligations
with respect to such Option.  Within 10 days of delivery of the Option Exercise
Notice, each of the Selling Stockholders shall provide the Purchaser with
written payment instructions for their pro rata portion of the Option Exercise
Price (the “Payment Instructions”) and each of the Selling Stockholders

 

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shall provide written notice to the Purchaser of any updates to the
representations and warranties set forth in Section 3.1 or 3.2 below, as the
case may be, to be made or confirmed on the Option Closing Date pursuant to
Section 2.4(c) below which are necessary to make such representations and
warranties true and correct on the Option Closing Date, which update may only
reflect events that occurred subsequent to, and not prior to, the Closing Date. 
The closing of the purchase and sale of the Option Shares shall take place at
the offices of the Purchaser on the thirtieth day after the Option Exercise Date
(or if such date is not a Business Day, the immediately succeeding Business Day)
(the “Option Closing Date”) unless on or prior to such date the Purchaser
determines, in its sole judgment, as a result of any updates to the
representations and warranties not to exercise the Option.  Failure of one or
more Selling Stockholders to provide Payment Instructions shall not affect each
such Selling Stockholder’s obligation to deliver the Option Shares on the Option
Closing Date.  In the event one or more Selling Stockholders (other than Hemant
Sharma or Thomas George) fails to provide Payment Instructions, payment will be
made by certified check to any such Selling Stockholder as provided in
Section 9.1 hereof.

 

(c)                                  On the Option Closing Date, unless the
Purchaser shall have elected not to exercise the Option pursuant to
Section 2.4(b) above, the Purchaser shall (i) pay the portion of the Option
Exercise Price to each Selling Stockholder in the manner set forth in
Section 2.4(d) below on a pro rata basis based on the number of Option Shares
sold by each Selling Stockholder and (ii) provide written confirmation that the
representations and warranties of the Purchaser set forth in Section 3.3 below
are true and correct as if made on the Option Closing Date.  Simultaneously, on
the Option Closing Date, unless the Purchaser shall have elected not to exercise
the Option pursuant to Section 2.4(b) above, (A) the Company shall release from
escrow to the Purchaser the Option Shares duly endorsed for transfer to the
Purchaser or accompanied by stock powers executed in blank, (B) the Selling
Stockholders shall jointly and severally make the representations and warranties
set forth in Section 3.1 below as of the Option Closing Date, with such updates
as previously disclosed in writing to the Purchaser pursuant to Section 2.4(b)
above, (C) each Selling Stockholder shall provide written confirmation that the
representations and warranties of each Selling Stockholder set forth in
Section 3.2 below are true and correct as if made on the Option Closing Date
with such updates as previously disclosed in writing to the Purchaser pursuant
to Section 2.4(b) above, and (D) each of Hemant Sharma and Thomas George shall
have entered into separate employment agreements with the Purchaser or any of
its Affiliates as designated by the Purchaser substantially in the form of
Exhibit C hereto (the “Employment Agreements”).

 

(d)                                 The Option Exercise Price shall be paid by
the Purchaser to the Selling Stockholders in the following manner: (i) their
respective pro rata portion of the first $1,575,000 of the Option Exercise Price
shall be paid in cash by certified check or by wire transfer of immediately
available funds, and (ii) the remainder of the Option Exercise Price shall be
paid in cash by certified check or by wire transfer of immediately available
funds to the Escrow Agent to hold in an interest bearing escrow account
maintained by the Escrow Agent in accordance with an escrow agreement
substantially in the form of Exhibit D hereto (the “Escrow Agreement”) for the
benefit of each of the Selling Stockholders and shall,

 

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subject to the terms of the Escrow Agreement, be released by the Escrow Agent to
each of the Selling Stockholders in their respective pro rata shares on the date
that is one calendar year from the Option Exercise Date (or if such date is not
a Business Day, the immediately succeeding Business Day).  Notwithstanding
anything to the contrary in this Agreement, but subject to the terms of the
Escrow Agreement, after the Option Closing Date, (A) if cumulative Gross
Revenues for the period beginning as of the date hereof exceeds (x)
$100,000,000, then an amount equal to 25% of the Escrow Fund (as defined in the
Escrow Agreement) shall be released by the Escrow Agent to the Selling
Stockholders or (y) $150,000,000, then an amount equal to 50% of such remaining
Escrow Fund shall be released by the Escrow Agent to the Selling Stockholders,
and (B) if there is a Change of Control, an amount equal to 50% of the amounts
then in Escrow Fund shall be released by the Escrow Agent to the Selling
Stockholders, and in the event of this clause (B), any subsequent Additional
Option Payment Amounts, if any, to be paid to the Escrow Agent pursuant to
Section 2.5(b) in respect of any Purchaser Claims subsequent to the Change of
Control shall instead be paid directly to the Selling Stockholders.

 

SECTION 2.5.  Additional Option Payment Amounts.  (a) Subject to Sections 2.6
and 2.7 below, to the extent that the Purchaser has exercised the Option, each
of the Selling Stockholders shall be entitled to their pro rata share based on
the number of Option Shares sold by each Selling Stockholder of up to four
additional payments (together, the “Additional Option Payment Amounts”) to be
calculated, with respect to the first Additional Option Payment Amount, as of
the date that is the last day of the second Fiscal Month after the Fiscal Month
in which the Option Exercise Date occurs and, with respect to the second, third,
and fourth Additional Option Payment Amounts, as of the date that is the last
day of the third Fiscal Month from the previous calculation date (each, an
“Additional Payment Calculation Date”).  Each Additional Option Payment Amount
shall be an amount, if any, equal to (i) the product of (A) 25% and (B) the
difference between (1) the Gross Revenues during the period from and including
the Option Exercise Date to and including the relevant Additional Payment
Calculation Date and (2) the Option Exercise Price less (ii) any Additional
Option Payment Amounts corresponding to a previous Additional Payment
Calculation Date; provided that, in no event shall the aggregate Additional
Option Payment Amounts be greater than the difference between (I) $18,000,000
and (II) the Option Exercise Price.

 

(b)                                 Subject to Sections 2.6 and 2.7 below, the
Additional Option Payment Amounts shall be payable in cash as follows: (i) 50%
of each Additional Option Payment Amount, if any, shall be payable on the
fifteenth day after the corresponding Additional Payment Calculation Date (or if
such date is not a Business Day, the immediately preceding Business Day) and
(ii) 50% of each of the first, second and third Additional Option Payment
Amounts, if any, shall be payable on the fifteenth day after the fourth
Additional Payment Calculation Date (or if such date is not a Business Day, the
immediately preceding Business Day) and (iii) 50% of the fourth Additional
Option Payment Amount, if any, shall be payable no later than 90 days after the
fourth Additional Payment Calculation Date (or if such date is not a Business
Day, the immediately succeeding Business Day) (the “Final Payment Date”, and
such Final Payment Date and each such other payment date, an “Additional Payment

 

11

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Date”); provided that, the amount to be paid pursuant to clauses (ii) and (iii)
above shall be increased or decreased, as the case may be, to reflect any
adjustments to the Gross Revenues as reflected in the Purchaser’s books and
records during the applicable period; provided further that, at the time of any
payment of any Additional Option Payment Amount pursuant to clauses (i), (ii) or
(iii) above, to the extent that any Purchaser Claim Amount (as defined in the
Escrow Agreement) exceeds the amount of any related Purchaser Reserve (as
defined in the Escrow Agreement), any such Additional Payment Amounts to be paid
up to an amount equal to any such excess amounts shall be paid to the Escrow
Agent and held pursuant to the Escrow Agreement.

 

SECTION 2.6.  Change of Control.  In the event of a Change of Control (a) that
results in the ITG Group discontinuing or being unable to continue the use,
marketing and distribution of the System in a manner substantially similar to
the marketing and distribution of the System prior to the Change of Control, or
(b) in which the acquiring Person, directly or indirectly, owns a trading system
that competes with the System (provided that any list trading system shall not
be considered to compete with the System) (each such event, a “Change of Control
Event”), then:

 

(i)                                     The Purchaser shall promptly notify the
Selling Stockholders of the Change of Control Event in writing.

 

(ii)                                  To the extent such Change of Control Event
has occurred prior to the Expiration Date and the Option has not been exercised,
then the Purchaser shall have the right to exercise the Option pursuant to
Section 2.4 hereof only within five Business Days of the Change of Control
Event, by delivery of a written notice to the Company and each of the Selling
Stockholders within five Business Days of the Change of Control Event electing
to exercise such Option, which notice shall constitute an Option Exercise
Notice.

 

(A)                              If the Purchaser elects to exercise the Option,
then, notwithstanding anything to the contrary, (1) the Option Exercise Date
shall be the date of such Option Exercise Notice, (2) the Option Exercise Price
shall be $18,000,000 which entire amount shall be payable on the Option Closing
Date directly to the Selling Stockholders, (3) no Additional Option Payment
Amounts shall be payable, and (4) the Option Closing Date shall be fifteen days
after the Option Exercise Date (or if such date is not a Business Day, the
immediately succeeding Business Day).

 

(B)                                If the Purchaser does not elect to exercise
the Option, then, on the fifth Business Day after the date of the Change of
Control Event, notwithstanding anything to the contrary, (1) the License
Agreement shall become non-exclusive and terminable by the Company at any time
upon six months notice pursuant to Section 2 of the License Agreement, (2) the
Purchaser and the Company shall give joint instructions to the source code
escrow agent to terminate the Source Code Escrow Agreement, (3) the Option shall
terminate and the Expiration Date shall be the last day the Purchaser may elect
to exercise such Option pursuant to clause (ii) above, and (4) the

 

12

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Purchaser shall pay a purchase price adjustment to the Company towards the
purchase of Purchased Shares as follows:

 

if the Change of Control Event occurs within

 

less than 6 months after Closing Date

 

$3 million or 35% of aggregate Gross Revenues from the date hereof to such date,
whichever is higher

 

 

 

6-9 months after Closing Date

 

$4 million or 35% of aggregate Gross Revenues from the date hereof to such date,
whichever is higher

 

 

 

more than 9 months after Closing Date

 

$5 million or 35% of aggregate Gross Revenues from the date hereof to such date,
whichever is higher

 

(iii)                               To the extent such Change of Control Event
has occurred prior to the fourth Additional Payment Calculation Date and the
Option has been exercised, then

 

(A)                              No further Additional Option Payment Amounts
shall be paid (including any Additional Option Payment Amounts accrued but
unpaid) unless the sum of such unpaid amounts calculated in accordance with
Section 2.5 is higher than the amounts paid pursuant to (B) below in which case
the difference between the two shall be paid to the Selling Stockholders on the
Final Payment Date.

 

(B)                                The Purchaser shall pay to each of the
Selling Stockholders their pro rata share based on the number of Option Shares
sold by each Selling Stockholder:

 

(1)                                  if the Option Exercise Price was $4 million
or more, but less than $6 million, $12 million,

 

(2)                                  if the Option Exercise Price was $6 million
or more, but less than $9 million, 16 million, and

 

(3)                                  if the Option Exercise Price was $9 million
or more, $18 million.

 

In each case less (x) the Option Exercise Price and (y) any Additional Option
Payment Amounts actually paid.

 

(C)                                Subject to the terms of the Escrow Agreement,
the Escrow Fund shall be released by the Escrow Agent to the Selling
Stockholders.

 

13

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SECTION 2.7.  Certain Acquisitions.  (a)  In the event of a Competing
Acquisition that results in the ITG Group either (x) discontinuing or being
unable to continue the use, marketing and distribution of the System in a manner
substantially similar to the marketing and distribution of the System prior to
the Competing Acquisition or (y) replacing the use of the System with a
competing system (each, a “Competing Acquisition Event”), then:

 

(i)                                     The Purchaser shall promptly notify the
Selling Stockholders of the Competing Acquisition Event in writing.

 

(ii)                                  To the extent such Competing Acquisition
Event has occurred prior to the Expiration Date, the Option has not been
exercised and no Change of Control Event shall have occurred, then

 

(A)                              (1) The License Agreement shall become
non-exclusive and shall be terminable by the Company at any time upon six months
notice pursuant to Section 2 of the License Agreement, (2) the Purchaser and the
Company shall give joint instructions to the source code escrow agent to
terminate the Source Code Escrow Agreement, (3) the Option shall terminate and
the Expiration Date shall be the date of the Competing Acquisition Event, and
(4) the Purchaser shall pay a purchase price adjustment to the Company towards
the purchase of Purchased Shares equal to the higher of (x) $1,000,000 and (y)
25% of the aggregate Gross Revenues for the period beginning on the date hereof
and ending on the date of the Competing Acquisition Event; provided that, if
Gross Revenues have not exceeded $1,250,000 within the first six calendar
months, or $2,500,000 within the first nine calendar months, from the Closing
Date, as applicable, then no such purchase price adjustment shall be paid.

 

(B)                                The Company shall have an option, for six
months from the date of the Competing Acquisition Event, to repurchase the
Purchased Shares from the Purchaser for $750,000.

 

(iii)                               To the extent such Competing Acquisition
Event has occurred prior to the fourth Additional Payment Calculation Date, the
Option has been exercised and no Change of Control Event shall have occurred,
then

 

(A)                              No further Additional Option Payment Amounts
shall be paid (including any Additional Option Payment Amounts accrued but
unpaid) unless the sum of such unpaid amounts calculated in accordance with
Section 2.5 is higher than the amounts paid pursuant to (B) below in which case
the difference between the two shall be paid to the Selling Stockholders on the
Final Payment Date.

 

(B)                                The Purchaser shall pay to each of the
Selling Stockholders their pro rata share based on the number of Option Shares
sold by each Selling Stockholder:

 

14

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(1)               if the Option Exercise Price was $4 million or more, but less
than $6 million, $12 million,

 

(2)               if the Option Exercise Price was $6 million or more, but less
than $9 million, $16 million, and

 

(3)               if the Option Exercise Price was $9 million or more, $18
million.

 

In each case less (x) the Option Exercise Price and (y) any Additional Option
Payment Amounts actually paid.

 

(C)                                Subject to the terms of the Escrow Agreement,
the Escrow Fund shall be released by the Escrow Agent to the Selling
Stockholders.

 

(b)                                 In the event that ITG Group enters into
negotiations (but not a binding contract) for a Competing Acquisition prior to
the Expiration Date, the Option has not been exercised and no Change of Control
Event shall have occurred, then the Purchaser shall promptly notify the Company
of such fact in writing and the License Agreement shall become non-exclusive
pursuant to Section 2 of the License Agreement.

 

ARTICLE THREE

 

REPRESENTATIONS AND WARRANTIES

 

SECTION 3.1.  Representations and Warranties of the Company.  The Company hereby
makes the following representations and warranties to the Purchaser:

 

(a)                                  Organization, Qualification and Corporate
Power.  The Company is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware, with the requisite
corporate power and authority to own, lease, operate and use its properties and
assets and to carry on its business as currently conducted.  The Company does
not own any interest in any other Person.

 

(b)                                 Authorization; Enforcement.  The Company has
all requisite corporate power and authority to enter into the Transaction
Agreements to which it is a party and to consummate the transactions
contemplated thereby.  The execution and delivery of the Transaction Agreements
to which the Company is a party and the consummation of the transactions
contemplated thereby have been duly authorized by all necessary corporate action
on the part of the Company.  The Transaction Agreements to which the Company is
a party have been duly executed and delivered by the Company and constitute
valid and binding obligations of the Company, enforceable against it in
accordance with their terms, except as may be limited by bankruptcy, insolvency
or other similar laws affecting the rights

 

15

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and remedies of creditors generally, and subject to general principles of
equity, whether applied by a court of law or equity.

 

(c)                                  No Conflicts; No Consents.  (i) The
execution and delivery of the Transaction Agreements to which the Company is a
party do not, and the consummation of the transactions contemplated thereby and
the compliance with the terms thereof will not, (A) conflict with, or result in
any violation of, or constitute a default (with or without notice or lapse of
time, or both) under, or give rise to a right of termination, cancellation,
acceleration or increase of any obligation, liability or fee, or the loss of a
benefit under (any such conflict, violation, default, right of termination,
cancellation, acceleration or increase, or loss, including under any “change of
control” provision, a “Violation”) any provision of the certificate of
incorporation or by-laws of the Company, (B) result in any Violation of any
Contract to which the Company is a party or by which any of its properties,
assets or businesses are bound or (C) result in any Violation of any Permit,
Order or Legal Requirement applicable to the Company or its properties, assets
or business or (D) result in the creation or imposition of any Encumbrance on
any properties or assets of the Company.

 

(ii)                                  No consent, waiver, approval, order or
authorization of, or registration, declaration or filing with, or notice to, any
Person is required in connection with the execution and delivery of the
Transaction Agreements by the Company, or the consummation of the transactions
contemplated thereby or the compliance with the terms thereof.

 

(d)                                 Capitalization.  The authorized capital
stock of the Company consists solely of 10,000,000 shares of Company Common
Stock.  At the close of business on June 11, 2003, 56,213 shares of Company
Common Stock were issued and outstanding, no shares of Company Common Stock were
held by the Company in its treasury and, except as set forth on Schedule 3.1(d)
hereto, no shares of Company Common Stock were authorized and reserved for
issuance.  Exhibit B sets forth a true and complete list of the names of each of
the holders of the outstanding shares of Company Common Stock and the number of
shares of Company Common Stock owned by each such holder.  All of the
outstanding shares of Company Common Stock have been duly authorized and validly
issued and are fully paid and non-assessable, are not subject to any preemptive
rights (and were not issued in violation of any preemptive rights) and have been
issued in full compliance with all applicable securities laws and other
applicable Legal Requirements.  No bonds, debentures, notes or other
indebtedness having the right to vote on any matters on which holders of the
Company Common Stock may vote (“Voting Debt”) are issued or outstanding.  Except
for this Agreement, there are no options, warrants, calls, rights, commitments
or agreements of any character to which the Company is a party or by which the
Company is bound relating to the issued or unissued capital stock or Voting Debt
of the Company, or obligating the Company to issue, transfer, deliver or sell
any shares of capital stock or other equity interest or any Voting Debt, or any
securities convertible or exchangeable for any capital stock or other equity
interest or any Voting Debt, of the Company or obligating the Company to issue,
grant, extend or enter into any such option, warrant, call, right, commitment or
agreement.  There are no outstanding contractual obligations of the Company to
repurchase, redeem or otherwise acquire any shares of capital stock of the
Company or pursuant to which the

 

16

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Company is or could be required to register shares of Company Common Stock or
other securities under the Securities Act.  The Company has, and upon delivery
of the Purchased Shares by the Company to the Purchaser pursuant to the terms of
this Agreement, the Purchaser will acquire, good and valid title to the
Purchased Shares free and clear of any Encumbrances.

 

(e)                                  Financial Statements.  The Company has
delivered to the Purchaser true and complete copies of the balance sheet of the
Company as of May 31, 2003, November 30, 2002, and November 30, 2001, together
with statements of operations and changes in stockholders’ equity for the six
month period ended May 31, 2003 and for the years ended November 30, 2002 and
2001 (the “Company Financial Statements”).  The Company Financial Statements (i)
comply with all applicable accounting requirements, and (ii) are true and
correct and fairly present the financial condition, results of operations, and
changes in stockholders’ equity of the Company as of and for the periods
indicated.  Except for those liabilities that are fully reflected or reserved
for in the balance sheet of the Company as of November 30, 2002, and liabilities
incurred since November 30, 2002 in the ordinary course of business consistent
with past practice, at November 30, 2002 the Company did not have, and since
such date, except as set forth in Schedule 3.1(e) hereto, the Company has not
incurred, any liabilities or obligations of any nature whatsoever (whether
accrued, absolute, contingent or otherwise).  The Company Financial Statements
have not been audited by an independent auditor.

 

(f)                                    Compliance with Applicable Laws.  The
business of the Company has not been and is not being conducted in violation of
any material Legal Requirement or Order of any Governmental Entity applicable to
the Company.  No Governmental Entity has initiated any proceeding or, to the
knowledge of Company, investigation into the business or operations of Company. 
To the knowledge of the Company, there is no unresolved or uncured violation or
exception noted by any Governmental Entity in any report, comment letter or
other statement relating to or based on any examinations of the Company or
otherwise, and the Company is not a party to any written agreement, commitment
letter or other similar undertaking with or to any Governmental Entity with
respect to the conduct of its business.  The Company has filed all material
regulatory reports, schedules, forms, registrations and other documents,
together with any amendments required to be made with respect thereto, that it
was required to file with any Governmental Entity, and has paid all fees and
assessments due and payable in connection therewith.

 

(g)                                 [Intentionally omitted.]

 

(h)                                 Certificate of Incorporation and Bylaws;
Records.  The Company has delivered to the Purchaser true and complete copies
of: (i) the Company’s certificate of incorporation and by-laws, including all
amendments thereto, (ii) the stock records of the Company, and (iii) the minutes
and other records of the meetings and other proceedings (including any actions
taken by written consent or otherwise without a meeting) of the stockholders of
the Company, the board of directors of the Company and all committees of the
board of directors of the Company.  There have been no meetings or other
proceedings of the stockholders of the Company, the board of directors of the
Company or any committee of

 

17

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the board of directors of the Company that are not fully reflected in such
minutes or other records.  The accounting records, stock records, minute books
and other records of the Company are accurate, up-to-date and complete, and to
the knowledge of the Company, have been maintained in accordance with sound and
prudent business practices.

 

(i)                                     Legal Proceedings.  Except as set forth
in Schedule 3.1(i), there is no claim, litigation, inquiry, suit, action,
investigation or proceeding (whether judicial, arbitral, administrative or
other) (“Proceeding”) pending or, to the knowledge of the Company, threatened,
against or affecting the Company, or any of its properties, assets or businesses
which if adversely determined could reasonably be expected to have a Material
Adverse Effect on the Company, or challenging the validity or propriety of the
Transaction Agreements or any of the transactions contemplated thereby, nor is
there any Order of any Governmental Entity or arbitrator, or any settlement or
stipulation with any Person, outstanding or imminent against the Company.

 

(j)                                     Taxes.  Except as set forth in
Schedule 3.1(j), the Company has filed all tax returns required to be filed by
it and has paid all Taxes required to be paid (whether or not shown to be due on
such tax returns).  All such tax returns are true and complete.

 

(k)                                  Contracts.  The Company has delivered to
the Purchaser true and complete copies of all material Contracts to which the
Company is a party or by which any of its properties, assets or businesses are
bound and all material Contracts or term sheets currently under negotiation with
any other Person.  Schedule 3.1(k)(i) sets forth a true and complete list of all
material Contracts to which the Company is a party or by which any of its
properties, assets or businesses are bound and all material Contracts or term
sheets currently under negotiation with any other Person.  Attached as
Section 3.1(k)(ii) of the Disclosure Schedule are correct, accurate and complete
copies of the form agreements presently used by Company with respect to the
Company’s business.  Each material Contract to which the Company is a party is
valid and in full force and effect, and is enforceable by the Company in
accordance with its terms.

 

(l)                                     Property.  The properties and assets
owned or leased by the Company constitute all properties (whether real or
personal or tangible or intangible) and assets necessary for the Company to
conduct its business as it is presently being conducted.  The Company has good
and marketable title to all of the properties and assets owned by the Company
and has a valid leasehold interest in all properties or assets leased by the
Company, in each case, free and clear of all Encumbrances of any nature
whatsoever except statutory Encumbrances securing payments not yet due, and
Encumbrances as do not adversely affect the use of properties or assets subject
thereto or affected thereby or otherwise adversely impair business operations at
such properties.

 

(m)                               Intellectual Property.  (i) The Company owns
or possesses licenses or rights to use all of the Intellectual Property
necessary for the conduct and operation of the Company’s business as presently
conducted and operated, free and clear of any Encumbrances.

 

18

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(ii)                                  None of the Intellectual Property,
products, services or written material used in the Company’s business or sold or
provided by the Company contains any libelous or obscene material.  Neither the
Intellectual Property of the Company nor the conduct of the Company’s business
as presently conducted by the Company infringes upon any Intellectual Property
rights of any other Person, provided that, no representation or warranty is made
as to the infringement or the noninfringement of any patent rights.

 

(iii)                               Schedule 3.1(m)(iii) contains a true and
complete list of all of the currently registered United States and foreign
trademarks, service marks, trade names and domain names (with registrar) owned
by the Company and a list of the registrations or pending applications for
registration thereof.  There is no pending or, to the Company’s knowledge,
threatened opposition, interference or cancellation proceeding before any court
or registration authority in any jurisdiction against the registrations listed
in Schedule 3.1(m)(iii).

 

(iv)                              Schedule 3.1(m)(iv) contains a true and
complete list of all of the currently issued and registered United States and
foreign patents and pending applications owned by the Company.  The patents
listed, if any, in Schedule 3.1(m)(iv) are valid and subsisting, in full force
and effect, and have not been cancelled, expired or abandoned.  There is no
pending or, to the Company’s knowledge, threatened opposition, interference or
cancellation proceeding before any court or registration authority in any
jurisdiction against the patents and patent applications listed in
Schedule 3.1(m)(iv).

 

(v)                                 Schedule 3.1(m)(v) contains a true and
complete list of all Contracts under which Intellectual Property used in the
Company’s business and (A) owned by the Company is licensed, or rights
thereunder are granted, to any Person or (B) owned by any other Person, other
than “shrink-wrap” and similar widely available commercial end-user licenses, is
licensed, or rights thereunder are granted, to the Company.  The Company is not
in default under any such Contracts and the Company has not received notice of
any default thereunder by the Company.  All such Contracts are valid and binding
on the parties thereto and are in full force and effect, and the Company is not,
to Company’s knowledge, in breach of any provision thereof or in default in any
respect under the terms thereof.

 

(vi)                              No claim of trade name, trade secret,
trademark, copyright, patent or other Intellectual Property infringement has
been asserted or threatened against the Company.  To the best of the Company’s
knowledge, no Person is infringing any Intellectual Property owned by the
Company and no such claims are pending or threatened against a third party by
the Company.

 

(vii)                           The Company takes, and has taken, reasonable
measures to protect the confidentiality of its trade secrets, know-how or other
confidential information relating to the Company’s business as currently
operated.  No trade secret, know-how or other confidential information has been
disclosed or authorized to be disclosed to any Person, including any employee,
agent, contractor or other entity, other than pursuant to a non-disclosure
agreement or other confidential obligation that adequately protects Company’s
proprietary interests in and to such trade secrets.

 

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(viii)                        Schedule 3.1(m)(viii) contains a true and complete
list of all Software relating to the Company’s business which is owned,
licensed, leased or otherwise used by the Company in connection with the
operation of the Company’s business.  Each item of Software listed in
Schedule 3.1(m)(viii) is (A) owned by the Company, (B) currently in the public
domain or otherwise available to the Company without the license, lease or
consent of any Person, or (C) used under rights granted to the Company pursuant
to a Contract with another Person, which Contract is disclosed in
Schedule 3.1(m)(v).  With respect to the Software set forth in
Schedule 3.1(m)(viii) which the Company purports to own, such Software was
either (1) developed by employees of the Company within the scope of their
employment, (2) developed by independent contractors who have assigned their
rights to the Company pursuant to a Contract, (3) developed by independent
contractors as work made for hire, or (4) acquired or purchased from one or more
Persons pursuant to a written Contract.

 

(n)                                 Absence of Changes.  Since the date of the
most recent Company Financial Statements provided to the Purchaser, there has
not been any Material Adverse Effect on the Company.  Since the date of the most
recent Company Financial Statements provided to the Purchaser, the Company has
conducted its business in the ordinary course consistent with the past practices
of the Company.

 

(o)                                 Certain Fees.  No fees or commissions will
be payable by the Company to any broker, financial advisor, consultant, finder,
placement agent, investment banker, bank or other Person, with respect to the
Transaction Agreements or any transactions contemplated thereby.

 

(p)                                 Costs.  The Company shall bear its own costs
and expenses, including attorney fees and disbursements, in preparing,
negotiating, entering or performing under any of the Transaction Agreements.

 

SECTION 3.2.  Representations and Warranties of the Selling Stockholders.  Each
Selling Stockholder severally hereby makes the following representations and
warranties to the Purchaser and each other Selling Stockholder:

 

(a)                                  Ownership of Option Shares.  Such Selling
Stockholder has, and, upon delivery of the Option Shares set forth opposite such
Selling Stockholder’s name on Appendix A by such Selling Stockholder to the
Purchaser pursuant to the terms of this Agreement, the Purchaser will acquire,
good and valid title to such Option Shares free and clear of any Encumbrances. 
Except for this Agreement, there are no options, warrants, calls, rights,
commitments or agreements of any character to which such Selling Stockholder is
a party or by which such Selling Stockholder is bound relating to the issued or
unissued capital stock or Voting Debt of the Company, or obligating such Selling
Stockholder to transfer, deliver or sell any shares of capital stock or other
equity interest or any Voting Debt, or any securities convertible or
exchangeable for any capital stock or other equity interest or any Voting Debt,
of the Company or obligating such Selling Stockholder to issue, grant, extend or
enter into any such option, warrant, call, right, commitment or agreement. 
There are no

 

20

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outstanding contractual obligations of such Selling Stockholder to repurchase,
redeem or otherwise acquire any shares of capital stock of the Company.

 

(b)                                 Authorization; Enforcement.  Such Selling
Stockholder has all requisite legal capacity, power and authority to enter into
the Transaction Agreements to which such Selling Stockholder is a party and to
consummate the transactions contemplated thereby, including the sale of the
Option Shares.  The Transaction Agreements to which such Selling Stockholder is
a party have been duly executed and delivered by such Selling Stockholder and
constitute valid and binding obligations of such Selling Stockholder,
enforceable against the Selling Stockholder in accordance with their terms,
except as may be limited by bankruptcy, insolvency or other similar laws
affecting the rights and remedies of creditors generally, and subject to general
principles of equity, whether applied by a court of law or equity.

 

(c)                                  No Conflicts; No Consents.  (i) The
execution and delivery of the Transaction Agreements to which such Selling
Stockholder is a party do not, and the consummation of the transactions
contemplated thereby and the compliance with the terms thereof will not, (A)
result in any Violation of any Contract to which such Selling Stockholder is a
party or by which any of its properties or assets are bound, (B) result in any
Violation of any Permit, Order or Legal Requirement applicable to such Selling
Stockholder or its properties or assets or (C) result in the creation or
imposition of any Encumbrance on any properties or assets of such Selling
Stockholder.

 

(ii)                                  No consent, waiver, approval, order or
authorization of, or registration, declaration or filing with, or notice to, any
Person is required in connection with the execution and delivery of the
Transaction Agreements by such Selling Stockholder, or the consummation of the
transactions contemplated thereby or their compliance with the terms thereof,
including the sale of the Option Shares.

 

(d)                                 Certain Fees.  No fees or commissions will
be payable by such Selling Stockholder to any broker, financial advisor,
consultant, finder, placement agent, investment banker, bank or other Person
with respect to the Transactions Agreements or any transactions contemplated
thereby, including the sale of the Option Shares.

 

(e)                                  Costs.  Each Selling Stockholder shall bear
its own costs and expenses, including attorney fees and disbursements, in
preparing, negotiating, entering or performing under any of the Transaction
Agreements.

 

SECTION 3.3.  Representations and Warranties of the Purchaser.  The Purchaser
hereby makes the following representations and warranties to each of the Company
and each Selling Stockholder:

 

(a)                                  Organization; Qualification and Corporate
Power.  The Purchaser is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware, with the requisite
corporate power and authority to own, lease, operate and use its properties and
assets and to carry on its business as currently conducted.  The Purchaser is

 

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duly licensed or qualified to do business and is in good standing as a foreign
corporation or other entity in each jurisdiction in which the nature of the
business conducted or property owned by it makes such qualification necessary,
other than in such jurisdictions where the failure to be so licensed or
qualified would not, either individually or in the aggregate, have a Material
Adverse Effect on the Purchaser.

 

(b)                                 Authorization; Enforcement.  The Purchaser
has all requisite corporate power and authority to enter into the Transaction
Agreements to which it is a party and to consummate the transactions
contemplated thereby.  The execution and delivery of the Transaction Agreements
to which the Purchaser is a party and the consummation of the transactions
contemplated thereby have been duly authorized by all necessary corporate action
on the part of the Purchaser.  The Transaction Agreements to which the Purchaser
is a party have been duly executed and delivered by the Purchaser and constitute
valid and binding obligations of the Purchaser, enforceable against it in
accordance with their terms, except as may be limited by bankruptcy, insolvency
or other similar laws affecting the rights and remedies of creditors generally,
and subject to general principles of equity, whether applied by a court of law
or equity.

 

(c)                                  No Conflicts.  The execution and delivery
of the Transaction Agreements to which the Purchaser is a party do not, and the
consummation of the transactions contemplated thereby and the compliance with
the terms thereof will not, (i) result in a Violation of any provision of the
certificate of incorporation or by-laws of the Purchaser, (ii) result in any
Violation of any Contract to which the Purchaser is a party or by which any of
its properties, assets or businesses are bound or (iii) result in any Violation
of any Permit, Order or Legal Requirement applicable to the Purchaser or its
properties, assets or business or (iv) result in the creation or imposition of
any Encumbrance on any properties or assets of the Purchaser, except in the case
of clauses (ii), (iii) and (iv), Violations which, individually or in the
aggregate, would not have a Material Adverse Effect on the Purchaser.

 

(d)                                 No Consents.  No consent, waiver, approval,
order or authorization of, or registration, declaration or filing with, or
notice to, any Person is required in connection with the execution and delivery
of the Transaction Agreements by the Purchaser, or the consummation of the
transactions contemplated thereby or the compliance with the terms thereof.

 

(e)                                  Investment.  The Purchaser is an
“accredited investor” within the meaning of Rule 501 under the Securities Act,
and is acquiring the Purchased Shares (and the Option Shares assuming the
exercise of the Option) pursuant to this Agreement for its own account for
investment and not with a view to or for resale in connection with any
“distribution” thereof within the meaning of the Securities Act.

 

(f)                                    Costs.  The Purchaser shall bear its own
costs and expenses, including attorney fees and disbursements, in preparing,
negotiating, entering or performing under any of the Transaction Agreements.

 

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ARTICLE FOUR

 

GOVERNANCE

 

SECTION 4.1.  Board Composition.  The business of the Company shall be managed
by the board of directors.  Each of Hemant Sharma, Thomas George and the
Purchaser shall be entitled, so long as such Stockholder continues to hold a
Minimum Interest, to nominate one of the members of the board of directors.  If
any other Person becomes a Stockholder that holds a Minimum Interest, such
Stockholder shall also be entitled to nominate one of the members of the board
of directors.  Each of the Stockholders agrees to vote his/her/its Company
Common Stock and cause the Company to appoint any such nominee to the board of
directors.  If any Stockholder ceases to hold a Minimum Interest, such
Stockholder shall no longer be entitled to nominate a member of the board of
directors, and shall cause its nominee to resign from the board of directors;
provided that, if the Option is exercised, then subsequent to the exercise of
the Option, so long as the Company shall continue its existence as a separate
legal entity, Hemant Sharma and Thomas George shall have the right, together, to
nominate only one member to the board of directors of the Company until the
Final Payment Date.  Notwithstanding this Section 4.1, the number of directors
may be greater than the number of Stockholders that hold a Minimum Interest.

 

SECTION 4.2.  Board Action.  Subject to the provisions of Section 4.3, until the
Option Closing Date, the following actions shall be taken by the Company only
after the unanimous approval of the board of directors of the Company, or by the
approval of Stockholders that beneficially own an aggregate of least 90% of the
issued and outstanding shares of Company Common Stock if such issue is in the
power of the Stockholders in accordance with applicable Legal Requirements:

 

(a)                                  the amendment of the certificate of
incorporation or by-laws of the Company;

 

(b)                                 a change in the nature of the business of
the Company or the entering into a new business by the Company;

 

(c)                                  the issuance, redemption or repurchase of
any capital stock of the Company;

 

(d)                                 the undertaking of any merger, consolidation
or joint venture, or the acquisition of the capital stock or other equity
interests of, or all or substantially all of the assets of, another Person;

 

(e)                                  the creation of any subsidiaries of the
Company;

 

(f)                                    the appointment or discharge of any
employees of the Company and the approval of compensation of any employees of
the Company including bonuses, stock options, profit sharing or retirement
benefits; provided that, (i) approval of any recommendations made by Hemant
Sharma or Thomas George with respect to the foregoing shall not be unreasonably
withheld, and (ii) no such approval will be required with respect to

 

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a base salary of $110,000 for, and any benefits currently received by and
specified in Schedule 3.1(k)(i), each of Hemant Sharma and Thomas George;

 

(g)                                 adjusting the size of the board of directors
of the Company;

 

(h)                                 the dissolution, liquidation or cessation of
business activities of the Company;

 

(i)                                     the entering into, modification or
termination of one or more Contracts with a term of one year or more or
involving a payment or obligation of (i) $25,000 or more on an individual basis
or (ii) $250,000 or more in respect of Contracts not unanimously approved by the
board of directors in the aggregate in any twelve month period, except where
such entering into, modification or termination is reflected in the Company’s
budget, attached hereto as Exhibit E (the “Budget”);

 

(j)                                     the entering into any transaction with
an affiliate of the Company or any Stockholder other than the Transaction
Agreements and the transactions contemplated therein;

 

(k)                                  the sale, purchase, transfer, hypothecation
or lease of one or more assets having a value of (i) $25,000 or more on an
individual basis or (ii) $250,000 or more in respect of sales, purchases,
transfers, hypothecations or leases not unanimously approved by the board of
directors in the aggregate in any twelve month period, except where such sale,
purchase, transfer, hypothecation or lease is reflected in the Budget;

 

(l)                                     the incurrence of any indebtedness
(which shall not include accounts payable in the ordinary course of business) by
the Company in excess of $25,000 in the aggregate in any twelve month period,
except if such amount of indebtedness is provided for in the Budget;

 

(m)                               the investment of funds of the Company other
than in Permitted Investments;

 

(n)                                 the making by the Company of any loan or
advance to any Person that results in total outstanding loans and advances given
by the Company to exceed $25,000 at any time;

 

(o)                                 the guaranty of any obligation or debt of
any Person;

 

(p)                                 the making of one or more capital
expenditures of (i) $25,000 or more on an individual basis or (ii) $250,000 or
more in respect of capital expenditures not unanimously approved by the board of
directors in the aggregate in any twelve month period, or any capital
expenditure not in the ordinary course of business, except where such capital
expenditure is included in the Budget;

 

(q)                                 the declaration or payment of dividends or
distributions upon the capital stock of the Company;

 

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(r)                                    the approval or modification of any
accounting policies, or the appointment or removal of independent auditors of
the Company;

 

(s)                                  any amendments to the Budget;

 

(t)                                    the handling or resolution of any
Proceeding pending, threatened against or affecting the Company or any of its
properties, assets or businesses; provided that, to the extent the sole relief
sought pursuant to such Proceeding is monetary, such Proceeding involves a claim
of $100,000 or more;

 

(u)                                 enter into any license agreements to license
the System, other than license agreements specified in Schedule 4.2(u), on which
license agreements shall be, except as otherwise specified in Schedule 4.2(u),
on terms and conditions consistent with the Company’s ordinary business
practices and in form and substance substantially similar to the Company’s
current form of license agreement attached hereto as Exhibit F; and

 

(v)                                 enter into any commitment (contingent or
otherwise) to do any of the foregoing;

 

provided that, (i) any actions to be taken with respect to a breach by the
Purchaser of any of the Transaction Agreements shall not require the approval of
the director nominated by the Purchaser; (ii) only the approval of the director
nominated by the Purchaser shall be required for the appointment of independent
auditors by the Purchaser to audit the Company to the extent the costs of such
independent auditor are bourne by the Purchaser; and (iii) only the approval of
the director nominated by the Purchaser will be required to approve any
accounting policies that are consistent with GAAP or to modify any accounting
policies in order for such policies to become consistent with GAAP.

 

SECTION 4.3.  Cessation of Rights.  Notwithstanding anything herein to the
contrary, Section 4.2 other than Section 4.2(h), 4.2(r) and clauses (ii) and
(iii) of the proviso to Section 4.2 shall no longer be effective if (a) the
Purchaser is found by final judgment by a court of competent jurisdiction (not
subject to further appeal) that the Purchaser has materially breached this
Agreement or any of the Transaction Agreements; provided that, (i)
Section 4.2(b) shall continue to apply with respect to the entry by the Company
into a business that is unrelated to the Company’s business as currently
conducted, (ii) Section 4.2(c) shall continue to apply with respect to the
issuance of capital stock if such issuance is not for cash or has not been
offered to existing Stockholders, and (iii) Section 4.2(e) shall continue to
apply with respect to the creation of any subsidiary that is not wholly owned,
or (b) the Purchaser does not exercise the Option by the Expiration Date or the
Option is terminated.

 

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ARTICLE FIVE

 

COVENANTS

 

SECTION 5.1.  Transfers.  During the Restricted Transfer Period, no Stockholder
shall (a) offer, sell, transfer, agree to sell or transfer, sell any option or
contract to purchase, purchase any option or contract to sell, grant any option,
right or warrant to purchase, assign, pledge, hypothecate or create or permit to
exist any Encumbrance on, or otherwise transfer or dispose of (including the
deposit of any such shares of Company Common Stock into a voting trust or
similar arrangement), directly or indirectly, any shares of Company Common Stock
or any securities convertible into or exercisable or exchangeable therefore, or
any interest therein or (b) enter into any swap or other arrangement that
transfers to another Person, in whole or in part, any of the economic
consequences of owning such Company Common Stock (any transactions described in
clause (a) or (b) being referred to herein as a “Transfer”), except (i) in the
case of Transfers of the Option Shares in accordance with the terms and subject
to the conditions of Section 2.4 above or (ii) with the prior written consent of
each other Stockholder.  After the Restricted Transfer Period, any Stockholder
may Transfer all or part of its Company Common Stock subject to Sections 5.2.

 

SECTION 5.2.  Right of First Refusal; Tag Along Rights.  (a) In the event that
any Stockholder (a “Transferring Stockholder”) proposes to Transfer all or part
of their Company Common Stock (the “Transfer Shares”) after the Restricted
Transfer Period, such Transferring Stockholder shall notify the Company and each
Stockholder that holds a Minimum Interest at least 60 days prior to the date of
such proposed Transfer in writing of (i) its bona fide intention to Transfer the
Transfer Shares, (ii) the number of Transfer Shares to be Transferred, (iii) the
price, which must be payable entirely in immediately available U.S. dollars, and
other terms pursuant to which such Transferring Stockholder proposes to Transfer
the Transfer Shares, (iv) the proposed date of Transfer and (v) the identity of
the proposed purchaser of the Transfer Shares (“Transferee”) (the “Transfer
Notice”).

 

(b)  The Company shall notify the Transferring Stockholder and each Stockholder
that holds a Minimum Interest, within ten days after receipt of such Transfer
Notice, in writing whether it elects to purchase from the Transferring
Shareholder the Transfer Shares and the Tag Along Shares, if any.  The Company,
if it elects, shall have the right to purchase from the Transferring Shareholder
all, but not less than all, of the Transfer Shares, and from the Purchaser all,
but not less than all, of the Tag Along Shares, if the Purchaser elects to
exercise its rights pursuant to Section 5.2(d) below, at the same price and on
the same terms as provided in the Transfer Notice.

 

(c)  If the Company does not elect to exercise its rights to purchase the
Transfer Shares and Tag Along Shares, if any, each Stockholder that holds a
Minimum Interest shall notify the Company, the Transferring Stockholder and each
Stockholder that holds a Minimum Interest, within 15 days after receipt of such
Transfer Notice, in writing whether it elects to purchase from the Transferring
Stockholder its pro rata portion of the Transfer Shares and from the Purchaser
its pro rata portion of the Tag Along Shares, if any.

 

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Such Stockholder, if it elects, shall have the right to purchase from the
Transferring Shareholder its pro rata portion of the Transfer Shares, and from
the Purchaser its pro rata portion of the Tag Along Shares, if the Purchaser
elects to exercise its rights pursuant to Section 5.2(d) below, at the same
price and on the same terms as provided in the Transfer Notice.  The number of
shares to be purchased by each such Stockholder electing to purchase shall be
equal to (i) the number of shares of Company Common Stock owned by such
Stockholder electing to purchase multiplied by (ii) the number of Transfer
Shares and Tag Along Shares, if any, to be Transferred divided by (iii) the
aggregate number of shares of Company Common Stock owned by each such
Stockholder electing to purchase.  If neither the Company nor one or more
Stockholders that holds a Minimum Interest has elected to purchase all of the
Transfer Shares and Tag Along Shares, if any, within such 15 day period, the
Transferring Stockholder shall have the right, subject to Section 5.2(d) below,
within 60 days from the expiration of such 15 day period to Transfer the
Transfer Shares on the terms and conditions specified by the Transferring
Stockholder in the Transfer Notice free of the restrictions imposed by Sections
5.2(b) and (c).

 

(d)  In the event that the Transferring Stockholder is either Hemant Sharma or
Thomas George, the Purchaser shall notify the Company, the Transferring
Stockholder and each Stockholder that holds a Minimum Interest, within 15 days
after the receipt of such Transfer Notice, in writing whether it elects to
participate in such Transfer by selling a portion of the Purchaser’s Company
Common Stock.  The Purchaser, if it elects, shall have the right to sell to the
Transferee, or, if the Company or one or more Stockholders that holds a Minimum
Interest exercises its rights pursuant to Section 5.2(b) or (c) above, as the
case may be, to the Company or such Stockholders, as the case may be, at the
same price and on the same terms as the Transferring Stockholder, an amount of
Company Common Stock equal to the number of shares of Company Common Stock owned
by the Purchaser multiplied by the number of Transfer Shares divided by the
aggregate number of shares of Company Common Stock owned by any Stockholder that
has been granted tag along rights by Hemant Sharma and Thomas George (the “Tag
Along Shares”).  If the Purchaser does not elect to participate in such Transfer
of Company Common Stock within such 15 day period, the Transferring Stockholder
shall have the right, subject to Sections 5.2(b) and (c) above, within 60 days
from the expiration of such 15 day period, to Transfer the Transfer Shares on
the terms and conditions specified by the Transferring Stockholder in the
Transfer Notice free of the restrictions imposed by this Section 5.2(d).  In no
event after the Purchaser has elected to exercise its right to Transfer its
Company Common Stock pursuant to this Section 5.2(d) shall the Transferring
Stockholder Transfer the Transfer Shares to any Person without the Transfer by
the Purchaser of its Company Common Stock to such Person.

 

SECTION 5.3.  Validity of Transfer.  Any Transfer by a Stockholder that does not
comply with the provisions of this Agreement shall be null and void.  The
Stockholders shall cause the Company not to, and Company shall not, Transfer on
its books any shares of Company Common Stock that have been transferred in
violation of any of the provisions set forth in this Agreement or treat as owner
of such Company Common Stock, or accord the right to vote or pay dividends to,
any transferee to whom such Company Common Stock shall have been so
transferred.  The Stockholders shall cause the Company to, and the Company
shall, register on each stock certificate representing Company Common Stock that

 

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such Company Common Stock is subject to the restrictions contained in this
Agreement.  No Transfer of Company Common Stock by a Stockholder to any Person
other than any Person already a party to this Agreement shall be effective
unless the transferee of such Company Common Stock executes a counterpart of
this Agreement and thereby becomes a party thereto.

 

SECTION 5.4.  By-laws.  The Stockholders shall cause the Company to, and the
Company shall, adopt the amended and restated by-laws of the Company in the form
attached as Exhibit G to this Agreement.

 

SECTION 5.5.  Spartan License Agreement.   The Stockholders shall cause the
Company to, and the Company shall, assign all right, title and interest that the
Company now has or that shall hereafter arise in and to any amounts due to the
Company pursuant to Sections 3.3 and 3.4 of the Spartan License Agreement, all
proceeds thereof to Hemant Sharma and Thomas George net of any tax liability to
the Company, if any.

 

SECTION 5.6.  Purchaser Reporting Obligations.   (a) So long as any payment
(whether in cash or stock) to any of the Selling Stockholders is outstanding
under this Agreement, Purchaser shall furnish to each of the Company, Hemant
Sharma and Thomas George periodic statements (the “Gross Revenue Statement”)
setting forth in reasonably sufficient detail Gross Revenue accrued during the
preceding period to ITG Group in respect of trades executed via the System.  The
Gross Revenue Statement shall set forth, by name of the entity that executed any
trade, any and all of the commissions, fees or other remuneration accrued to ITG
Group in respect of the trades executed via the System, and all of the
deductions or discounts granted or proposed to be granted, together with the
following (i) with respect to any soft dollar credits to ITG Group, the terms
under which such soft dollar services were provided, and (ii) with respect to
any discounts and deductions, the nature, applicable period and terms of such
discounts and deductions.  The Gross Revenue Statement shall be furnished as
follows:

 

(A)                              From the date hereof, within 17 Business Days
after the end of each Fiscal Month, an unaudited Gross Revenue Statement;

 

(B)                                From the date hereof, within 30 Business Days
after the end of each Fiscal Quarter, an unaudited Gross Revenue Statement.  The
quarterly Gross Revenue Statement shall set forth, in addition to all other
details, comments as to whether any discounts or deductions were not in the
ordinary course of business;

 

(C)                                As of the Option Exercise Date, an unaudited
Gross Revenue Statement, setting forth all of the details included in the
quarterly Gross Revenue Statement; and

 

(D)                               From the date hereof, from time to time, such
further information regarding Gross Revenue, including copies of any Contracts
between any entity of the ITG Group and its customers that could reasonably be
expected to have an impact on Gross Revenues, as the Company, Hemant Sharma or
Thomas George may reasonably request.

 

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The Purchaser shall provide to each of Hemant Sharma or Thomas George reasonable
access during normal business hours, upon reasonable notice to the Company, to
the Gross Revenue Statements and all records pertaining to the calculation of
Gross Revenue; provided that, such request may only be made two times in any
calendar year.

 

(b)                                 From the Option Exercise Date until one year
after the Option Exercise Date, Purchaser shall furnish to the Sellers’
Representative prompt notice of any Change of Control.

 

SECTION 5.7.  Company Reporting Obligations.  The Company shall (i) use
commercially reasonable efforts to provide to the Purchaser in a reasonably
timely manner on a monthly basis, monthly financial information consisting of a
balance sheet of the Company as of the month end, together with statements of
operation and statements of cash flows as of the month end and (ii) provide on a
quarterly basis the Company officer certification in the form attached hereto as
Exhibit H.

 

SECTION 5.8.  No Solicitation.  The Purchaser agrees that from the date hereof
and until (a) if the Option is exercised, the Option Closing Date or (b) if the
Option is not exercised, two years after the Expiration Date, that the ITG Group
shall not directly or indirectly employ, solicit, induce, enter into any
agreement with, or attempt to influence any individual who is or was an employee
or software consultant of the Company to terminate his or her employment
relationship with the Company or to be employed by the ITG Group or interfere in
any other way with the employment, or other relationship of any employee or
software consultant of the Company.  Each of the Company and the Selling
Stockholders agrees that if the Option is not exercised, for two years after the
Expiration Date, the Company and each of Hemant Sharma and Thomas George shall
not directly or indirectly employ, solicit, induce, enter into any agreement
with, or attempt to influence any individual who is an employee or software
consultant of the ITG Group or interfere in any other way with the employment or
other relationship of any employee or software consultant of the ITG Group;
provided that, in the case of Hemant Sharma and Thomas George, such restriction
shall only apply to employees or software consultants that Hemant Sharma or
Thomas George had contact with in connection with the transactions contemplated
under this Agreement.

 

SECTION 5.9.  System Marketing.  In consideration of the exclusive license
granted to the Purchaser and its Affiliates under the License Agreement and
other rights and privileges granted to the Purchaser and its Affiliates under
the Transaction Agreements, the Purchaser shall at all times from the date
hereof until one year from the Option Exercise Date (or the Expiration Date if
the Option is not exercised) use all commercially reasonable efforts to market
the System including marketing the System to ITG Group customers.

 

SECTION 5.10.  US Trading Corporation License Agreement.  The Company shall
terminate the Software Site License Agreement dated as of April 8, 2001 between
US Trading Corporation and the Company within 30 days of the Closing Date.

 

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ARTICLE SIX

 

TERMINATION OF OBLIGATIONS; SURVIVAL

 

SECTION 6.1.  Termination.  This Agreement may be terminated: (a) by any Selling
Stockholder that holds a Minimum Interest, in the event of a material breach or
default in the performance by the Purchaser of any representation, warranty,
covenant or agreement set forth in this Agreement, which breach or default has
not been, or cannot be, cured within 15 days of written notice of such breach or
default, describing such breach or default, by any such Selling Stockholder to
the other parties hereto, (b) by the Purchaser so long as it holds a Minimum
Interest, in the event of a material breach or default in the performance by a
Selling Stockholder that holds a Minimum Interest or the Company of any
representation, warranty, covenant or agreement set forth in this Agreement,
which breach or default has not been, or cannot be, cured within 15 days of
written notice of such breach of default, describing such breach or default, is
given by the Purchaser to the other parties hereto, or (c) by mutual consent of
the Stockholders that hold a Minimum Interest.

 

SECTION 6.2.  Effect of Termination.  In the event of termination of this
Agreement pursuant to Section 6.1, this Agreement shall thereafter have no
effect, and no party shall have any liability to the other parties in respect
hereof, except that (a) the obligations of the parties under Section 6.2,
Article Seven, Article Eight and Section 9.7, shall survive and (b) nothing
herein contained shall relieve any party from liability for any breach of any
representation, warranty or agreement hereunder that occurred prior to such
termination.

 

ARTICLE SEVEN

 

CONFIDENTIALITY

 

SECTION 7.1.  CONFIDENTIAL INFORMATION.  (A)  “CONFIDENTIAL INFORMATION” SHALL
MEAN ALL INFORMATION THAT IS FURNISHED BY ANY PARTY HERETO (THE “DISCLOSING
PARTY”) TO ANY OTHER PARTY HERETO (THE “RECEIVING PARTY”) PURSUANT TO THIS
AGREEMENT, WHETHER WRITTEN OR ORAL AND IN WHATEVER FORM OR MEDIUM IT IS
PROVIDED, AND SHALL SPECIFICALLY INCLUDE (I) THE TRANSACTION AGREEMENTS, (II)
ALL DATA, RECORDS, ORAL DISCUSSIONS AND INFORMATION EXCHANGED BETWEEN THE
PARTIES HERETO IN CONNECTION WITH THE COMPANY, AND (III) ALL INFORMATION
GENERATED BY EACH PARTY HERETO OR ITS REPRESENTATIVES THAT ANALYZES, SUMMARIZES,
OR REPRODUCES THE FURNISHED INFORMATION.

 

(B)  THE FOLLOWING INFORMATION SHALL NOT BE DEEMED TO BE CONFIDENTIAL
INFORMATION, AND THE PROVISIONS OF THIS ARTICLE SHALL NOT APPLY TO: (I)
INFORMATION WHICH IS OR BECOMES GENERALLY AVAILABLE TO THE PUBLIC OTHER THAN AS
A RESULT OF A DISCLOSURE IN VIOLATION OF THIS AGREEMENT, (II) INFORMATION WHICH
WAS ALREADY KNOWN TO SUCH RECEIVING PARTY OR ITS REPRESENTATIVES PRIOR TO BEING
FURNISHED PURSUANT TO THIS AGREEMENT, (III) INFORMATION WHICH BECOMES AVAILABLE
TO SUCH RECEIVING PARTY OR ITS REPRESENTATIVE ON A NON-CONFIDENTIAL BASIS

 

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FROM A SOURCE OTHER THAN A DISCLOSING PARTY OR ITS REPRESENTATIVES IF SUCH
RECEIVING PARTY OR ITS REPRESENTATIVES HAD NO REASON TO BELIEVE THAT THE SOURCE
OF SUCH INFORMATION WAS SUBJECT TO ANY PROHIBITION AGAINST TRANSMITTING THE
INFORMATION TO SUCH RECEIVING PARTY OR ITS REPRESENTATIVE, AND (IV) INFORMATION
INDEPENDENTLY DEVELOPED BY SUCH RECEIVING PARTY OR ITS REPRESENTATIVE.

 

SECTION 7.2.  CONFIDENTIALITY OBLIGATIONS.  (A)  EACH RECEIVING PARTY SHALL NOT
DISCLOSE ANY CONFIDENTIAL INFORMATION TO ANY OTHER PERSON WITHOUT THE CONSENT OF
ALL OF THE STOCKHOLDERS HOLDING A MINIMUM INTEREST OTHER THAN TO: (I) SUCH
RECEIVING PARTY’S REPRESENTATIVES, THE OTHER PARTIES HERETO OR THEIR
REPRESENTATIVES, (II) AFTER THE RESTRICTED TRANSFER PERIOD, A PROSPECTIVE
TRANSFEREE OF ALL OR PART OF THE SHARES OF THE COMPANY COMMON STOCK HELD BY A
STOCKHOLDER, OR (III) A PERSON TO WHICH THE RECEIVING PARTY IS REQUIRED TO
DISCLOSE BY APPLICABLE LEGAL REQUIREMENTS.

 

(B)  IN CASE OF A DISCLOSURE OF CONFIDENTIAL INFORMATION TO A PERSON PERMITTED
BY SECTION 7.2(A)(II), THE RECEIVING PARTY DISCLOSING SUCH INFORMATION SHALL
ENSURE THAT SUCH THIRD PARTY HAS SIGNED AN AGREEMENT IN WRITING TO PROTECT THE
CONFIDENTIAL INFORMATION FROM FURTHER DISCLOSURE TO THE SAME EXTENT AS THE
PARTIES HERETO ARE OBLIGATED UNDER THIS ARTICLE.

 

SECTION 7.3.  NOTICE PRECEDING COMPELLED DISCLOSURE.  IF A PARTY HERETO OR ITS
REPRESENTATIVE REASONABLY BELIEVES IT IS REQUIRED BY APPLICABLE LEGAL
REQUIREMENTS TO DISCLOSE ANY CONFIDENTIAL INFORMATION, SUCH PARTY SHALL PROMPTLY
NOTIFY THE OTHER PARTIES HERETO OF SUCH REQUIREMENT AS SOON AS IT BECOMES AWARE
OF IT.

 

SECTION 7.4.  CONSULTATION AS TO ANNOUNCEMENTS.  NO PUBLIC ANNOUNCEMENT OR PRESS
RELEASE CONCERNING THE COMPANY OR THE TRANSACTION AGREEMENTS OR THE TRANSACTIONS
CONTEMPLATED THEREBY SHALL BE MADE BY ANY PARTY HERETO WITHOUT PRIOR
CONSULTATION WITH ALL STOCKHOLDERS HOLDING A MINIMUM INTEREST; PROVIDED THAT,
THIS SECTION 7.4 SHALL NOT PROHIBIT ANY PUBLIC ANNOUNCEMENT OR PRESS RELEASE
REQUIRED TO BE MADE PURSUANT TO APPLICABLE LEGAL REQUIREMENTS.

 

ARTICLE EIGHT

 

INDEMNIFICATION

 

SECTION 8.1.  Indemnity.  (a) (i) The Purchaser shall indemnify and hold
harmless the Company and each of the Selling Stockholders and their
Representatives (each, a “Stockholder Indemnitee”, and collectively, the
“Stockholder Indemnitees”) and (ii) (A) with respect to the representations and
warranties set forth in Section 3.1 above, and given on the date hereof, the
Company, and with respect to the representations and warranties set forth in
Section 3.1 above (as modified pursuant to Section 2.4(c)(B) above), and given
on the Option Closing Date, if any, the Selling Stockholders, jointly and
severally, and (B) with respect to the representations and warranties set forth
in Section 3.2 above and any covenant or agreement made by the Selling
Stockholders in this Agreement, each of the Selling

 

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Stockholders, severally, shall indemnify and hold harmless the Purchaser and its
Representatives (each, a “Purchaser Indemnitee”, and collectively, the
“Purchaser Indemnitees”, and together with the Stockholder Indemnitees, the
“Indemnitees”), in each case of (i) and (ii), against any losses, claims,
damages, liabilities or reasonable expenses (including reasonable attorneys
fees) (collectively, the “Losses”), joint or several, to which such Indemnitee
may become subject resulting from or arising out of any inaccuracy or
misrepresentation in, or breach of, any representation, warranty, covenant or
agreement made by such party pursuant to this Agreement; provided that, for the
purposes of this Section 8.1, the representations and warranties set forth in
the last sentence of Section 3.1(k) above shall be deemed not to contain any
materiality qualifiers.

 

(b)                                 If the Option is exercised, the Selling
Stockholders, jointly and severally, shall indemnify and hold harmless the
Purchaser and its Representatives (each of which shall also constitute a
“Purchaser Indemnitee”) against any Patent Infringement Losses.  Such
indemnification obligations shall cease one year after the date of the Option
Exercise Date other than in respect to claims for Patent Infringement Losses
made prior to such date.

 

(c)                                  If a New Escrow Agreement is entered into
pursuant to Section 8.6, the Selling Stockholders, jointly and severally, shall
indemnify and hold harmless the Purchaser and its Representatives (each of which
shall also constitute a “Purchaser Indemnitee”) against any Patent Infringement
Losses incurred on or subsequent to the date that is one year after the Option
Exercise Date and such indemnification obligations shall survive until all
escrowed funds are released pursuant to the New Escrow Agreement.

 

SECTION 8.2.  Claims for Indemnification.  Promptly after receipt by an
Indemnitee of notice of the commencement of any Proceeding, such Indemnitee
shall, if a claim in respect thereof is to be made against an indemnifying party
under Section 8.1 above, notify the indemnifying party in writing of the
commencement thereof and with reasonable particularity; but the omission so to
notify the indemnifying party shall not relieve it from any liability which it
may have to any Indemnitee otherwise unless, and solely to the extent, the
indemnifying party thereby is actually and materially prejudiced by such failure
to give notice.  In case any such Proceeding shall be brought against any
Indemnitee, it shall notify the indemnifying party of the commencement thereof,
the indemnifying party shall have, jointly with any other indemnifying party
similarly notified, the right to participate in the defense, compromise or
settlement thereof, including the selection of counsel.  Each of the Indemnitee
and the indemnifying party agrees to cooperate and work together in good faith
in the selection of counsel and to coordinate any defense, compromise or
settlement of any such Proceeding.  If the parties cannot agree upon the
selection of counsel, each party is entitled to, at its own expense, engage
counsel of its choice in connection with the defense, compromise or settlement
of any such Proceeding.  Notwithstanding anything to the contrary in this
Section 8.2, the Purchaser shall not settle any such Proceeding without the
consent of the Sellers’ Representative, which consent shall not be unreasonably
withheld, if and to the extent that 80% or more of the amount of any such
settlement is borne by the Selling Stockholders as an indemnifying party.

 

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SECTION 8.3.  Survival of Representations, Warranties and Covenants.  All of the
representations and warranties of any party hereto contained in this Agreement
and the liabilities and obligations of the parties with respect thereto shall
survive until (a) if the Option is exercised, for one year after the Option
Exercise Date, and (b) if the Option is not exercised, the Expiration Date.  All
of the covenants of any party hereto contained in this Agreement shall survive
until fully performed or fulfilled unless waived in writing by the party or
parties entitled to performance.  Any indemnification obligations pursuant to
Section 8.1(a) shall cease when the applicable representation, warranty or
covenant terminates other than in respect to claims for Losses made prior to
such date.

 

SECTION 8.4.  Limitation of Liability.  The indemnification obligations set
forth in this Article Eight shall apply only if a Closing occurs, and then only
after the aggregate amount of such obligations exceed $50,000, at which time the
indemnification obligations shall be effective as to all amounts exceeding
$50,000.  Notwithstanding anything contained herein to the contrary, the
indemnification obligation (a) of the Company provided for in Section 8.1(a),
shall not exceed with respect to any claims arising before the exercise or
expiration of the Option, whichever is earlier, $750,000, (b) of the Selling
Stockholders provided for in Section 8.1(a), shall not exceed with respect to
any claims arising after the Option Exercise Date if the Option is exercised, an
amount equal to the amounts held in escrow at such time pursuant to the Escrow
Agreement, (c) of the Selling Stockholders provided for in Section 8.1(b), shall
not exceed an amount equal to 50% of the amounts held in escrow at such time
pursuant to the Escrow Agreement and (d) of the Selling Stockholders provided
for in Section 8.1(c), shall not exceed an amount equal to the amounts held in
escrow at such time pursuant to the New Escrow Agreement; provided that, in the
case of clause (c) above, (A) such amount shall not exceed an amount equal to
50% of the Patent Infringement Losses; (B) such amounts shall not exceed 50% of
the aggregate of the Option Exercise Price and the Additional Option Payment
Amounts, if any, less $1,575,000, and (C) if the amount of Patent Infringement
Losses as a percentage of the aggregate Gross Revenues (calculated from the
Closing Date to the earlier of (i) the date on which such claim is resolved and
(ii) one year from the Option Exercise Date) is less than 3.5% of such Gross
Revenues, such amount shall not exceed $2,000,000; provided further, that in the
case of clauses (c) and (d) above, such amount shall not exceed $2,000,000 in
the case of the Patent Infringement Losses with respect to such patents set
forth in Schedule 8.4 hereto (“Scheduled Patents”).  Notwithstanding anything
contained herein to the contrary, the indemnification obligation of the
Purchaser provided for in Section 8.1(a), shall not exceed 1.5 times the Option
Exercise Price plus any Additional Option Payment Amounts previously paid or
otherwise due under this Agreement.

 

SECTION 8.5.  Sole Remedy.  The sole and exclusive remedy of an Indemnitee for
breaches of any of the representations and warranties under this Agreement or
for any Patent Infringement Losses is the indemnification in this Article 8. 
Any claims of the Purchaser for indemnification pursuant to Section 8.1(a),
8.1(b) and 8.1(c) other than with respect to any claims arising before the
exercise or the expiration of the Option shall be

 

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limited to the funds held in escrow pursuant to the Escrow Agreement and the New
Escrow Agreement, as the case may be.

 

SECTION 8.6.  New Escrow.  To the extent that any payments have been received by
the Purchaser from any indemnifying party with respect to any Patent
Infringement Losses pursuant to this Article 8 prior to the Final Payment Date
and the System continues to be used by the Purchaser, the indemnifying parties
and the Purchaser shall enter into a new escrow agreement (the “New Escrow
Agreement”).  The Purchaser shall deposit 7% of the Gross Revenues on a monthly
basis beginning with the first Fiscal Month after entering into the New Escrow
Agreement until the Purchaser has deposited an amount of funds equal to the
amount received by the Purchaser from any indemnifying party with respect to
Patent Infringement Losses under this Article 8.  The New Escrow Agreement shall
provide that an amount equal to 25% of the funds in the escrow account, from
time to time, shall be released on a semiannual basis to the Selling
Stockholders and the entire amount of funds in the escrow account shall be
released when the Purchaser shall have deposited an amount equal to the amount
received by the Purchaser by any indemnifying party with respect to Patent
Infringement Losses under this Article 8, except to the extent that there are
additional unresolved pending claims for Patent Infringement Losses.

 

SECTION 8.7.  Sellers’ Representative.  The Selling Stockholders hereby
irrevocably appoint Hemant Sharma as the sellers’ representative (the “Sellers’
Representative”) as their agent and attorney-in-fact to take all actions on
their behalf as contemplated by this Agreement, the Escrow Agreement and the New
Escrow Agreement, including, without limitation, to receive any and all payments
to be made by Purchaser hereunder.  The Purchaser shall be entitled to rely for
all purposes on Hemant Sharma’s authority to act as the Sellers’ Representative,
as herein contemplated.  In the event of the death or resignation of the
Sellers’ Representative, the Selling Stockholders (or their heirs, executors or
successors, as the case may be) shall promptly irrevocably appoint a successor
Sellers’ Representative and give the Purchaser written notice of such
appointment within one business day following such death or resignation.  Until
such time as the Purchaser is notified of the appointment of such successor
Sellers’ Representative, Hemant Sharma shall act in that capacity on behalf of
the Selling Stockholders and the Purchaser shall be entitled to rely for all
purposes on Hemant Sharma’s authority to act as the Sellers’ Representative, as
herein contemplated.  In the event Hemant Sharma shall be unable to act as the
Sellers’ Representative, Thomas George shall act in that capacity on behalf of
Selling Stockholders and the Purchaser shall be entitled to rely for all
purposes on Thomas George’s authority to act as the Stockholders Representative,
as herein contemplated.  Notwithstanding anything to the contrary herein, any
notices to be delivered to, or by, any Selling Stockholder, any payments to be
made to, or by, any Selling Stockholder and any other instruments or documents
to be executed or delivered to, or by, any Selling Stockholder may be delivered
or made to, or by, the Sellers’ Representative on behalf of any such Selling
Stockholder.

 

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ARTICLE NINE

 

GENERAL PROVISIONS

 

SECTION 9.1.  Notices.  All notices and other communications hereunder shall be
in writing and shall be deemed duly given (a) on the date of delivery if
delivered personally, or by telecopy upon confirmation of receipt, (b) on the
first business day following the date of dispatch if delivered by a nationally
recognized next-day courier service, or (c) on the third business day following
the date of mailing if delivered by registered or certified mail, return receipt
requested, postage prepaid.  All notices hereunder shall be delivered as set
forth below, or pursuant to such other instructions as may be designated in
writing by the party to receive such notice:

 

if to Purchaser, to:

 

Investment Technology Group, Inc.

380 Madison Avenue, 4th Floor

New York, New York 10017

Attention: General Counsel

Telephone: (212) 444-6327

Facsimile: (212) 444-6494

 

with a copy to:

 

Boies, Schiller and Flexner LLP

333 Main Street

Armonk, New York 10504

Attention: Robert W. Leung, Esq.

Telephone: (914) 749-8388

Facsimile: (914) 749-8300

 

if to the Company, to:

 

Radical Corporation

100 Quentin Roosevelt Blvd., Suite 203

Garden City, NY 11530

Telephone: (516) 832-1014

Facsimile: (516) 227-1268

 

with a copy to:

 

Lehman & Eilen LLP

50 Charles Lindbergh Blvd.

Uniondale, New York 11553

Attention: Hank Gracin, Esq.

Telephone: (516) 222-0888

Facsimile: (516) 222-0948

 

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if to a Selling Stockholder, to:

 

Sellers’ Representative

Hemant Sharma

76 South Bergen Place

Apt 4R

Freeport, NY 11520

Telephone: (516) 263-7784

 

with a copy to:

 

Lehman & Eilen LLP

50 Charles Lindbergh Blvd.

Uniondale, New York 11553

Attention: Hank Gracin, Esq.

Telephone: (516) 222-0888

Facsimile: (516) 222-0948

 

SECTION 9.2.  Interpretation.  When a reference is made in this Agreement to
Sections, Appendices or Schedules, such reference shall be to a Section of, or
Appendix or Schedule to, this Agreement unless otherwise indicated.  The table
of contents and headings contained in this Agreement are for reference purposes
only and shall not affect in any way the meaning or interpretation of this
Agreement.  Whenever the words “include,” “includes” or “including” are used in
this Agreement, they shall be deemed to be followed by the words “without
limitation.”  The phrases “the date of this Agreement,” “the date hereof” and
terms of similar import, unless the context otherwise requires, shall be deemed
to refer to June 11, 2003.  The phrases “known” or “knowledge” mean, with
respect to any party to this Agreement, the actual knowledge of any of such
Person or its current directors or current executive officers after reasonable
inquiry.  References to any Person shall include successors and assigns of such
Person.  Except as specifically set forth herein (including actions and
obligations of the Selling Stockholders in their individual capacities) or
otherwise provided by applicable law, nothing in this Agreement shall be deemed
to create or impose any personal liability of any kind on any director or
officer of the Company with respect to obligations of the Company.

 

SECTION 9.3.  Amendment.  This Agreement may be amended, modified or
supplemented only by an agreement in writing signed by each of the parties
hereto.

 

SECTION 9.4.  Waiver.  (a) No failure on the part of any Person to exercise any
power, right, privilege or remedy under this Agreement, and no delay on the part
of any Person in exercising any power, right, privilege or remedy under this
Agreement, shall operate as a waiver of such power, right, privilege or remedy;
and no single or partial exercise of any such power, right, privilege or remedy
shall preclude any other or further exercise thereof or of any other power,
right, privilege or remedy.

 

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(b)  No Person shall be deemed to have waived any claim arising out of this
Agreement, or any power, right, privilege or remedy under this Agreement, unless
the waiver of such claim, power, right, privilege or remedy is expressly set
forth in a written instrument duly executed and delivered on behalf of such
Person; and any such waiver shall not be applicable or have any effect except in
the specific instance in which it is given.

 

SECTION 9.5.  Counterparts; Effectiveness.  This Agreement may be executed in
any number of counterparts, each of which shall be considered an original with
the same effect as if the signatures were executed upon the same instrument. 
This Agreement shall become effective when each party hereto shall have received
a counterpart hereof signed by each other party hereto.

 

SECTION 9.6.  Entire Agreement; No Third Party Beneficiaries.  The Transaction
Agreements constitute the entire agreement of the parties hereto with respect to
the subject matter hereof and supersedes all prior agreements and
understandings, both written and oral, among the parties hereof relating to the
subject matter hereof (including without limitation, the Agreement of
Stockholders of the Company, dated January 29, 2001, among Hemant Sharma, Thomas
George, Astor Grenfel, Inc. and the Company), and there are no warranties,
representations or other agreements between or among any of the parties hereto
in connection with the subject matter hereof except as specifically set forth in
the Transaction Agreements.  This Agreement shall inure to the benefit of, and
be binding upon, only the parties hereto and their respective successors and
assigns, and shall not confer any rights or remedies on any other Person.

 

SECTION 9.7.  Governing Law; Consent to Jurisdiction.  This Agreement shall be
governed by, and construed in accordance with, the laws of the State of New
York.  Each of the parties hereto hereby irrevocably and unconditionally agree
that any legal action, suit or proceeding arising out of or relating to this
Agreement or any agreements or transactions contemplated hereby may be brought
in any federal or state court located in The Borough of Manhattan, The City of
New York, and hereby irrevocably and unconditionally expressly submits to the
personal jurisdiction and venue of such courts for the purposes thereof and
hereby irrevocably and unconditionally waives any claim (by way of motion, as a
defense or otherwise) of improper venue, that it is not subject personally to
the jurisdiction of such court, that such courts are an inconvenient forum or
that this Agreement or the subject matter may not be enforced in or by such
court.

 

SECTION 9.8.  Waiver of Jury Trial.  Each of the parties hereto hereby
irrevocably waives any and all right to trial by jury in any legal proceeding
arising out of or related to this Agreement or the transactions contemplated
hereby.

 

SECTION 9.9.  Severability.  Any term or provision of this Agreement which is
invalid or unenforceable in any jurisdiction shall, as to that jurisdiction, be
ineffective to the extent of such invalidity or unenforceability and shall not
render invalid or unenforceable the remaining terms and provisions of this
Agreement or affect the validity or enforceability of any of the terms or
provisions of this Agreement in any other jurisdiction.  If any provision

 

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of this Agreement is so broad as to be unenforceable, the provision shall be
interpreted to be only so broad as is enforceable.

 

SECTION 9.10.  Assignment.  Neither this Agreement nor any of the rights,
interests or obligations hereunder shall be assigned by any of the parties
hereto (whether by operation of law or otherwise) without the prior written
consent of the other parties, and any attempt to make any such assignment
without such consent shall be null and void.

 

SECTION 9.11.  Specific Performance.  The parties agree that irreparable damage
would occur in the event that any of the provisions of this Agreement were not
performed in accordance with their specific terms or were otherwise breached. 
It is accordingly agreed that the parties shall be entitled to an injunction or
injunctions to prevent breaches of this Agreement and to enforce specifically
the terms and provisions of this Agreement in any federal or state court located
in The Borough of Manhattan, The City of New York, this being in addition to any
other remedy to which they are entitled at law or in equity.

 

SECTION 9.12.  Time of Essence.  Time is of the essence of this Agreement.

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be signed
by their respective officers thereunto duly authorized, executed and delivered
as of June 11, 2003.

 

 

INVESTMENT TECHNOLOGY GROUP, INC.

 

By:

 

 

Name:

Title:

 

 

RADICAL CORPORATION

 

By:

 

 

Name:

Title:

 

 

HEMANT SHARMA

 

 

 

 

 

THOMAS GEORGE

 

 

 

 

 

KIMBERLY CARFERO

 

 

 

 

 

RAJIV JOHN

 

 

 

 

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TIM NICKDOW

 

 

 

 

 

ROBERT SCIARRA

 

 

 

 

 

MAHESH SINGHI

 

 

 

 

 

ANDREW KOVAL

 

 

 

 

 

HOSSEIN MAHDAVI

 

 

 

 

 

MULTI-COMMERCE USA

 

 

 

 

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Exhibit B

 

Selling Stockholder Shares

 

Selling Stockholder

 

Number of Option Shares

 

 

 

Hemant Sharma

 

20,000

 

Thomas George

 

20,000

 

Kimberly Carfero

 

225

 

Rajiv John

 

200

 

Tim Nickdow

 

135

 

Robert Sciarra

 

135

 

Mahesh Singhi

 

200

 

Andrew Koval

 

690

 

Hossein Mahdavi

 

215

 

Multi-Commerce USA

 

360

 

 

B-1

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Exhibit H

 

FORM OF OFFICER CERTIFICATE

 

Investment Technology Group, Inc.
Certification in Connection with CEO/CFO Certification

 

                    Report on Form            for the             period ended
              , 200  (the “Report”) of Investment Technology Group, Inc. (the
“Company”).

 

Name:
Title:

 

I certify that:

 

1.                                       I have read a draft of the Report
referred to above.

 

2.                                       To my knowledge, the information in the
Report relating to Radical Corporation, and the information relating to Radical
Corporation provided in connection with the preparation of the Report, do not
contain any untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements made in the Report regarding Radical
Corporation, in light of the circumstances under which such statements were
made, not misleading with respect to the period covered by the Report.

 

3.                                       To my knowledge, all financial
information relating to Radical Corporation provided in connection with the
preparation of the Report fairly presents, in all material respects, the
financial condition, results of operations and cash flows of Radical Corporation
as of, and for, the periods presented in the Report.

 

4.                                       Disclosure Controls and Procedures(1)

 

(a)               The disclosure controls and procedures (including internal
controls) for Radical Corporation, as they are designed and implemented, ensure
that material information relating to Radical Corporation is made known to me

 

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(1)                                  “Disclosure controls and procedures” are
controls and other procedures designed to ensure that all the information the
Company is required to disclose in its SEC filings, including required material
non-financial information, is recorded, processed, summarized and reported
within the time periods specified in SEC rules and forms.  Disclosure controls
and procedures include, without limitation, controls and procedures designed to
ensure that such information is accumulated and communicated to the Company’s
management, including its principal executive officer(s) and principal financial
officer(s), in a way that allows timely decisions regarding required disclosure.

 

H-1

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and to senior management of the Company, particularly during the period in which
the Report is being prepared.

 

(b)              I have evaluated the effectiveness of Radical Corporation’s
disclosure controls and procedures (including internal controls) as of a date
within 90 days prior to the date of the Report.

 

(c)               Disclosure in the Report regarding the Company’s disclosure
controls and procedures (including internal controls) and the effectiveness
thereof fairly presents Radical Corporation’s disclosure controls and procedures
(including internal controls) and the effectiveness thereof.

 

5.                                       Internal Controls

 

(a)               I am not aware of any deficiencies in the design or operation
of internal controls of Radical Corporation which could adversely affect the
Company’s ability to record, process, summarize and report financial data.

 

(b)              I am not aware of any fraud, whether or not material, that
involves management or other employees.

 

6.                                       Bring-Down of Representations:

 

To my knowledge, there have been no significant changes since my evaluation
referred to in 4(b) above in Radical Corporation’s disclosure controls and
procedures or internal controls or in any other factors that have significantly
affected or could significantly affect such disclosure controls and procedures
and/or internal controls subsequent to the date of their evaluation, including
any corrective actions with regard to deficiencies and weaknesses.

 

7.                                       If any information comes to my
attention between the date of this certification and the date of the filing of
the Report (on or about             , 200  ) which would cause me to change my
beliefs as set forth herein, I will promptly notify each of the Chief Executive
Officer and Chief Financial Officer of the Company of such information.

 

Date:

 

 

 

 

 

Signature

 

H-2

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