Exhibit 10.4


 


TRANSITION SERVICES AGREEMENT


 


dated as of September 29, 2008


 


between


 


LEHMAN BROTHERS HOLDINGS INC.


 


and


 


NOMURA HOLDINGS INC.


 

















 


TRANSITION
SERVICES AGREEMENT


 


This Transition Services Agreement, dated September 29,
2008 (this “Agreement”), is made by and between Nomura Holdings
Inc., a company incorporated in Japan (“Nomura”), and Lehman Brothers
Holdings Inc., a Delaware corporation (“LBHI”).


 


RECITALS


 


WHEREAS, the Provisional Liquidators, the Sellers and
Nomura have entered into an international asset purchase agreement concerning
the acquisition by Nomura of certain assets of the business of the Lehman
Brothers group in the Asia-Pacific region., dated as of September 29, 2008
(as may be amended from time to time, the “Nomura Purchase Agreement”);


 


WHEREAS,
it is contemplated by the Nomura Purchase Agreement that (a) Nomura shall
provide, or cause to be provided, to LBHI (and/or its Affiliates on the date
hereof including the IMD Entities, collectively hereinafter referred to as the “LBHI
Entities”) certain services, use of facilities and other assistance on a
transitional basis and in accordance with the terms and subject to the
conditions set forth herein and (b) LBHI shall provide, or cause to be
provided, to Nomura (and/or its Affiliates, collectively hereinafter referred
to as the “Nomura Entities”) certain services, use of facilities and
other assistance on a transitional basis and in accordance with the terms and
subject to the conditions set forth herein; and


 


WHEREAS,
the Nomura Purchase Agreement contemplates the execution and delivery of this
Agreement by Nomura and LBHI.


 


NOW, THEREFORE, in consideration of the foregoing and
the mutual agreements contained herein and for other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged, the
parties hereto hereby agree as follows:


 


ARTICLE 1



DEFINITIONS


 


Section 1.01           Certain Defined Terms.  Unless otherwise defined herein, any
capitalized term used herein shall have the same meaning as in the Nomura
Purchase Agreement.  The following
capitalized terms used in this Agreement shall have the meanings set forth
below:


 


“Affiliate” means,
with respect to any Person, any other Person that, directly or indirectly
through one or more intermediaries, controls, or is controlled by, or is under
common control with, such Person, and the term “control” (including the terms “controlled
by” and “under common control with”) means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of such Person, whether through ownership of voting securities,
control by a general partner, by contract or otherwise; provided that
such other Person shall no longer be deemed an Affiliate once such control
ceases, except to the extent such control ceases as a result of the appointment
of liquidators or provisional liquidators, in which case such other Person
shall (for the duration of the appointment of the liquidators or provisional
liquidators) continue to be deemed an Affiliate.


 


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“Bankruptcy Case” means Case No. 08-13555
of the Bankruptcy Court.


 


“Bankruptcy Court” means the United States
Bankruptcy Court for the Southern District of New York (Manhattan) .


 


“BarCap” means Barclays Capital Inc.


 


“BarCap Purchase Agreement” means that certain
Asset Purchase Agreement (as amended and supplemented), dated as of September 16,
2008, by and among LBHI, Lehman Brothers Inc., LB 745 LLC and BarCap.


 


“BarCap Services” means services that were
being provided (x) by a Subsidiary of LBHI that was acquired by BarCap or
one of its Affiliates pursuant to the BarCap Purchase Agreement or a vendor of
such Subsidiary, and (y) by the LBHI Entities or a vendor thereof through
the use of the assets acquired by or the employees transferred to BarCap or one
of its Affiliates pursuant to the BarCap Purchase Agreement, to the IMD
Business and any other businesses of the LBHI Entities prior to the closing of
the transactions contemplated by the BarCap Purchase Agreement that were not
acquired by BarCap thereunder.


 


“BarCap TSA” means that certain Transition
Services Agreement, dated as of September 20, 2008, by and between LBHI
and BarCap.


 


“Benchmark Period” means the twelve-month
period prior to the Completion.


 


“Business Day” means any day of the year on
which national banking institutions in New York are open to the public for
conducting business and are not required or authorized to close.


 


“Force Majeure”
means, with respect to a Person, an event beyond the control of such Person (or
any Person acting on its behalf), including acts of God, storms, floods, riots,
fires, sabotage, labor stoppage, civil commotion or civil unrest, interference
by civil or military authorities, acts of war (declared or undeclared) or armed
hostilities or other national or international calamity or one or more acts of
terrorism or failure of energy sources or of Internet or telecommunications
services.


 


“IMD Business” means the investment management
business of LBHI and Lehman Brothers Inc. and their subsidiaries.


 


“IMD Entities” means (i) the
entities that, on the date hereof, conduct the investment management business
of LBHI and its Affiliates and (ii) in each case solely to the extent
permitted under Section 9.10, their successors and assigns with
respect to such business.


 


“Information Systems” means computing,
telecommunications or other digital operating or processing systems or
environments, including computer programs, data, databases, computers, computer
libraries, communications equipment, networks and systems.  When referenced in connection with the
Services, Information Systems shall mean the Information Systems accessed
and/or used in connection with the Services.


 


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“Intellectual Property”
means, collectively, all intellectual property and other similar proprietary
rights in any jurisdiction, whether owned or held for use under license,
whether registered or unregistered, including without limitation such rights in
and to:   (i) patents and
applications therefor, including continuations, divisionals,
continuations-in-part, reissues, continuing patent applications,
reexaminations, and extensions thereof, any counterparts claiming priority
therefrom and patents issuing thereon (collectively, “Patents”) and
inventions, invention disclosures, discoveries and improvements, whether or not
patentable, (ii) all trademarks, service marks, trade names, service
names, brand names, all trade dress rights, logos, slogans, Internet domain
names and corporate names and general intangibles of a like nature, together
with the goodwill associated with any of the foregoing, and all applications,
registrations and renewals thereof and all common law rights thereto
(collectively, “Marks”), (iii) copyrights and registrations and
applications therefor and renewals and extensions thereof, and works of
authorship, databases and mask work rights, and all moral rights  (collectively, “Copyrights”), (iv) all
Software, Technology, trade secrets and market and other data, and rights to
limit the use or disclosure of any of the foregoing by any Person, and (v) all
claims, causes of action and defenses relating to the enforcement of any of the
foregoing.


 


“Law” means any federal, state, local or foreign
law, statute, code, ordinance, rule or regulation (including rules of
any self-regulatory organization).


 


“Prime Rate” means
the prime rate published in the Eastern Edition of The Wall Street Journal or a comparable newspaper if The Wall Street Journal shall
cease to publish the prime rate.


 


“Provider” means the
party hereto or its subsidiary or Affiliate providing a Service under this
Agreement.


 


“Recipient” means a
party hereto or its subsidiary or Affiliate to whom a Service is being provided
under this Agreement.


 


“Representative” of a
Person means any director, officer, employee, agent, consultant, accountant,
auditor, attorney or other representative of such Person.


 


“Software” means any and all (i) computer
programs, including any and all software implementations of algorithms, models
and methodologies and application programming interfaces, whether in source
code or object code, (ii) databases and compilations, including any and
all data and collections of data, whether machine readable or otherwise, (iii) descriptions,
flow-charts and other work product used to design, plan, organize and develop
any of the foregoing, screens, user interfaces, report formats, firmware,
development tools, templates, menus, buttons and icons, and (iv) all
software-related specifications documentation including user manuals and other
training documentation related to any of the foregoing.


 


“Subsidiary” means any Person of which a
majority of the outstanding voting securities or other voting equity interests
are owned, directly or indirectly, by a party.


 


“Technology” means,
collectively, all designs, formulae, algorithms, procedures, methods,
techniques, ideas, know-how, business and marketing information, research and
development, technical data, programs, subroutines, tools, materials,
specifications, processes, 


 


4

















 


inventions (whether patentable or unpatentable and
whether or not reduced to practice), apparatus, creations, improvements, works
of authorship and other similar materials, non-public or confidential
information, and all recordings, graphs, drawings, reports, analyses, and other
writings, and other tangible embodiments of the foregoing, in any form whether
or not specifically listed herein, and all related technology.


 


 “Termination Charges” shall mean any
portion of any fees or expenses payable to any unaffiliated, third-party
provider as a result of any early termination or reduction of a Service that
cannot reasonably be avoided by the Provider.


 


“Virus” shall mean any computer instructions (i) that
adversely affect the operation, security or integrity of a computing,
telecommunications or other digital operating or processing system or
environment, including without limitation, other programs, data, databases,
computer libraries and computer and communications equipment, by altering,
destroying, disrupting or inhibiting such operation, security or integrity; (ii) that
without functional purpose, self-replicate without manual intervention; and/or (iii) that
purport to perform a useful function but which actually perform either a
destructive or harmful function, or perform no useful function and utilize
substantial computer, telecommunications or memory resources.


 


ARTICLE 2



SERVICES AND TERMS


 


Section 2.01           Services; Scope.


 


(a)           Subject to the terms and conditions
set forth in this Agreement, (i) Nomura shall provide, or cause to be
provided, to the LBHI Entities those services (the “Nomura Services”)
that were being provided by LBHI Entities which are transferring assets to the
Purchasers and which employed the Transferred Employees  prior to the date of the Nomura Purchase
Agreement, or a vendor thereof, to the IMD Business and any other businesses of
the LBHI Entities receiving such services that were not acquired by Nomura
under the Nomura Purchase Agreement (each such business, a “Retained LBHI
Business”), and (ii) LBHI shall provide, or cause to be provided, to
the Nomura Entities those services that were being provided by an LBHI Entity
or a vendor thereof prior to the date of the Nomura Purchase Agreement to LBHI
Entities which are transferring assets to the Purchasers and which employed the
Transferred Employees  prior to the date
of the Nomura Purchase Agreement (the “Nomura-Acquired Business”) (the “LBHI
Services” and collectively with the Nomura Services, the “Services”).  For the avoidance of doubt, neither the LBHI
Services nor the Nomura Services shall include any of the BarCap Services.  The parties acknowledge and agree that any
BarCap Services of which Nomura will be the Recipient shall be provided by
virtue of an assignment of the BarCap TSA pursuant to Section 9.10
thereof, and any BarCap Services of which LBHI Entities will be the Recipient
shall be provided by virtue of the BarCap TSA. 
If, for any reason, Nomura is unable to provide any Nomura Service to
the LBHI Entities pursuant to the terms of this Agreement, Nomura shall provide
to the applicable LBHI Entity a substantially equivalent service (a “Nomura
Substitute Service”) in accordance with the terms of this Agreement, which
such service shall be considered a Nomura Service for purposes of this
Agreement.  The scope of each Nomura
Service shall be substantially the same as the scope of such services provided
by 


 


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the applicable LBHI Entity to the applicable Retained
LBHI Business in the ordinary course during the Benchmark Period (in each case,
to the extent such Nomura Service was provided by Transferred Employees), and
the use of each Nomura Service by an LBHI Entity shall include use by such LBHI
Entity’s contractors in substantially the same manner as used by such
contractors in the ordinary course, during the Benchmark Period.  If, for any reason, an LBHI Entity is unable
to provide any LBHI Service to the Nomura Entities pursuant to the terms of
this Agreement, LBHI shall provide to the applicable Nomura Entity a
substantially equivalent service (an “LBHI Substitute Service”) in
accordance with the terms of this Agreement, which such service shall be
considered an LBHI Service for purposes of this Agreement.  The scope of each LBHI Service shall be
substantially the same as the scope of such service provided by the applicable
Retained LBHI Business to the applicable LBHI Entity in the ordinary course
during the Benchmark Period, and the use of each LBHI Service by a Nomura
Entity shall include use by such Nomura Entity’s contractors in substantially
the same manner as used by such contractors in the ordinary course, during the
Benchmark Period.  All Services shall be
for the sole use and benefit of the respective Recipient, including any of such
Recipient’s customers or clients of the type who received the use and benefit
of the equivalent services in the ordinary course during the Benchmark Period; provided,
however, that the Recipient agrees that it shall not re-market or act as
a service provider with respect to any of the Services hereunder to a third
party.


 


(b)           Each Service shall include, and the
Service Charges reflect charges for, such maintenance, support, error
correction, updates and enhancements normally and customarily provided by (i) the
LBHI Entities which are transferring assets to the Purchasers and which
employed the Transferred Employees to the other LBHI Entities that received
such service prior to the date of the Nomura Purchase Agreement; and (ii) those
other LBHI Entities that provided such services prior to the date of the Nomura
Purchase Agreement to the LBHI Entities which are transferring assets to the
Purchasers and which employed the Transferred Employees.  Each Service shall include all functions,
responsibilities, activities and tasks, and the materials, documentation,
resources, rights and licenses to be used, granted or provided by the relevant
Provider that are not specifically described in this Agreement as a part of
such Service, but are incidental to, and would normally be considered an
inherent part of, or necessary subpart included within, such Service or are
otherwise necessary for such Provider to provide, or the Recipient to receive,
such Service.


 


(c)           Throughout the term of this
Agreement, (i) each Provider and each Recipient of any Service shall
cooperate with one another and use their good faith and commercially reasonable
efforts to effect the efficient, timely and seamless provision and receipt of
such Service and (ii) the Recipient shall use its good faith and
commercially reasonable efforts to transition away and wind down its use of the
Services.


 


(d)           This Agreement shall not assign any
rights to Technology or Intellectual Property between the parties hereto.


 


(e)           Notwithstanding
anything to the contrary herein, for the avoidance of doubt, Lehman Brothers
Holdings plc, Lehman Brothers Limited, LB UK RE Holdings Limited and Lehman
Brothers International (Europe) shall not be deemed LBHI Entities hereunder.


 


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Section 2.02           Conversion Services.


 


(a)           During the term of this Agreement,
the parties shall provide, or cause to be provided, the following information
and support to the other party, as applicable, which support shall be included
within the Services described herein or in the Schedules hereto:


 


(i)            current and reasonably available
historical data owned by the Provider and related to the Services and
predecessor services thereto as reasonably required by the relevant Recipient
in connection with the conduct of the Nomura-Acquired Business (in the case of
Nomura) or the Retained LBHI Business (in the case of the LBHI Entities) or for
litigation or regulatory purposes, in a manner and within a time period as
mutually agreed by the parties; and


 


(ii)           on commercially reasonable terms,
which will be added to the Service Charges, the services of the employees and
contractors of the relevant Provider whose assistance, expertise or presence is
necessary to assist the Recipient’s transition team in establishing a fully
functioning stand-alone environment (it being understood that the services of
employees and contractors pursuant to this clause (ii) are not intended to
be a substitute for the services of its own employees and third party
consultants and advisors to be engaged by the relevant Recipient in connection
with such transition or similar services, but instead to facilitate
coordination with such individuals).


 


Section 2.03           Transition Services Managers.


 


(a)           Nomura shall appoint an individual,
by giving written notice thereof to LBHI within three (3) Business Days
following the date hereof, to act as its initial services manager (the “Nomura
Services Manager”), who will be directly responsible for coordinating and
managing the delivery of the Nomura Services and have authority to act on
Nomura’s behalf with respect to matters relating to this Agreement.  The Nomura Services Manager will work with
the personnel of Nomura to periodically address issues and matters raised by
LBHI relating to this Agreement. 
Notwithstanding the requirements of Section 9.05, all
communications from LBHI to Nomura pursuant to this Agreement regarding routine
matters involving the Nomura Services shall be made through the Nomura Services
Manager, or such other individual as specified by the Nomura Services Manager
in writing and delivered to LBHI by email or facsimile transmission with
receipt confirmed.  Nomura shall
reasonably promptly notify LBHI of the appointment of a different Nomura
Services Manager, if necessary, in accordance with Section 9.05.


 


(b)           LBHI shall appoint an individual, by
giving written notice thereof to Nomura within three (3) Business Days
following the date hereof, to act as its initial services manager (the “LBHI
Services Manager”), who will be directly responsible for coordinating and
managing the delivery of the LBHI Services and have authority to act on LBHI’s
behalf with respect to matters relating to this Agreement.  The LBHI Services Manager will work with the
personnel of LBHI to periodically address issues and matters raised by Nomura
relating to this Agreement.  Notwithstanding
the requirements of Section 9.05, all communications from Nomura to
LBHI pursuant to this Agreement regarding routine matters involving the
Services shall be made through the LBHI Services Manager, or such other
individual as specified by the 


 


7

















 


LBHI Services Manager in writing and delivered to
Nomura by email or facsimile transmission with receipt confirmed.  LBHI shall reasonably promptly notify Nomura
of the appointment of a different LBHI Services Manager, if necessary, in
accordance with Section 9.05.


 


Section 2.04           Personnel; Authorized Signatories.  The Provider will have the right, in its sole
discretion, to (i) designate which personnel or third party service
providers it will assign to perform Services, and (ii) remove and replace
such personnel or third party service providers at any time.


 


Section 2.05           Performance and Receipt of
Services.  The following provisions
shall apply to the Services:


 


(a)           Security and Privacy.  Each Provider and Recipient shall at all
times comply with its own then in-force security guidelines and policies
applicable to the performance, access and/or use of the Services and
Information Systems.  Where a Provider or
Recipient receives access to the other party’s Information Systems, then it
shall also comply with such other party’s security guidelines and
policies.  The parties acknowledge that
historically the Services governed by this Agreement have been rendered within
a single group of related entities and a shared security environment, and that
in order for Services to be rendered among and between the Nomura Entities and
the LBHI Entities as unrelated entities additional systems, procedures,
guidelines and policies may need to be established to render the Services in
compliance with Law, regulation, and applicable privacy and security policies.  Each of the LBHI Entities and the Nomura
Entities shall use its reasonable efforts to establish such additional systems,
procedures, guidelines and policies in a manner that will not disrupt the
rendering of Services or the LBHI Retained Businesses or the Nomura-Acquired
Business, respectively.  Recipient shall
bear all of its own costs and expenses in connection with such an effort;
Provider’s costs and expenses in connection with such an effort will be
included in the Service Charges to the extent directly related to providing the
Services.


 


(b)           No Viruses.  Each of LBHI and Nomura shall take
commercially reasonable measures to ensure that no Viruses or similar items are
coded or introduced into the Services or Information Systems.  If a Virus is found to have been introduced
into the Services or Information Systems, the parties hereto shall use their
commercially reasonable efforts to cooperate and to diligently work together to
eliminate the effects of such Virus.


 


(c)           Reasonable Care.  Each Provider and Recipient shall exercise
reasonable care in providing and receiving the Services to (i) prevent
access to the Services or Information Systems by unauthorized Persons and (ii) not
damage, disrupt or interrupt the Services or Information Systems.


 


Section 2.06           Termination Services.  Each Provider shall reasonably cooperate with
the Recipient of each Service, upon request and on commercially reasonable
terms (which will be added to the Service Charges), to facilitate such
Recipient’s transition to provision of such services by a replacement provider
or by its own employees.


 


Section 2.07           Superseding Provisions.  Notwithstanding anything to the contrary
contained in this Agreement:


 


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(a)           no Provider shall be required
hereunder to take any action (including by providing any Services) that would
constitute, or that the Provider reasonably believes would constitute, (i) a
violation of applicable Law, including any requirement of any Governmental
Body, (ii) a breach of such Provider’s contractual obligations or (iii) any
other violation of a third party’s rights; provided that in each of the
foregoing circumstances the Provider shall use reasonable efforts to work
around the impediment and endeavor to provide Services in a manner that does
not violate Law, contractual obligations or third party rights;


 


(b)           no Provider shall be required
hereunder to fund the Services or otherwise provide financial support, benefits
or other consideration on the Recipient’s behalf to third parties, or to take
custody of, settle, clear or handle securities, in connection with the
Services, and the obligation to perform any Service involving funds shall be
subject to the Recipient having previously made such funds available to the Provider
specifically for such purpose;


 


(c)           any obligation to provide Services or
otherwise undertake activities hereunder shall be limited to the party’s use of
good faith and commercially reasonable efforts; and


 


(d)           the Provider shall not be responsible
for any failure to provide Services hereunder to the extent arising from (i) the
Recipient’s operations or systems or otherwise by the acts or omissions of the
Recipient or individuals acting on its behalf, (ii) a third party’s
failure to provide such Services or (iii) the failure of Recipient or its
Affiliates to provide Services to Provider.


 


ARTICLE 3



ADDITIONAL AGREEMENTS AND ARRANGEMENTS


 


Section 3.01           Computer-Based Resources.  Commencing on the Completion, and for ninety
(90) days thereafter, each party (the “Accessing Party”) shall continue
to have access to the Information Systems of the other party (the “Providing
Party”), to the extent such access to such Information Systems was
available to the Accessing Party (or, in the case of Nomura, was available to
the LBHI Entities which are transferring assets to the Purchasers and which
employed the Transferred Employees prior to the date of the Nomura Purchase
Agreement) immediately prior to the Completion and remains necessary for the
Accessing Party to operate its business; provided, that (a) the
Nomura Entities may take reasonable measures to restrict access by the LBHI
Entities to any systems or data unrelated to the Retained LBHI Business to
which the LBHI Entities are not entitled to access, (b) the LBHI Entities
may take reasonable measures to restrict access by the Nomura Entities, to any
systems or data unrelated to the Nomura-Acquired Business to which the Nomura
Entities are not entitled to access, and (c) such continued access shall
be subject to the Accessing Party complying with all reasonable security
measures implemented by the Providing Party as deemed necessary by such
Providing Party to protect its Information Systems.  Commencing no later than ten (10) Business
Days after the Completion, representatives of Nomura and LBHI with authority in
the area of Information Systems (the “IT Committee”) shall meet at such
reasonable time, place and manner as they may agree, to develop a plan for
migrating from the Information System infrastructure as deployed as of the
Completion, to a final Information Systems infrastructure satisfactory to both
Nomura and 


 


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LBHI (the “IT Migration Plan”).  The parties shall use reasonable efforts to
enter into an IT Migration Plan no later than one month after the Completion
and shall include, among other provisions, a time line for completing the
migration of Information Services and a final migration deadline after which
neither Nomura nor any LBHI Entity shall have access to all or any part of the
Information Systems of the other party, except to the extent reasonably
necessary for the receipt of the Services (subject to the accessing party
complying with all reasonable security measures implemented by the providing
party as deemed necessary by such providing party to protect its Information
Systems), or as otherwise agreed in a separate agreement.  When finalized in writing and executed by the
authorized representatives of Nomura and the LBHI Entities, the IT Migration
Plan shall be deemed to be incorporated into this Agreement as an amendment and
addition hereto.


 


Section 3.02           Intentionally left. blank


 


Section 3.03           Intentionally left blank.


 


Section 3.04           Access.  Nomura or LBHI, as the case may be, will
allow the relevant Provider and its Representatives reasonable access to the
facilities and personnel of the relevant Recipient, and shall provide such
other reasonable cooperation and assistance, at the Recipient’s cost, necessary
for the performance of the Services for the Provider to fulfill its obligations
under this Agreement.


 


Section 3.05           Schedules.  The parties acknowledge and agree that the
Services contemplated to be provided hereunder are not enumerated, defined or
described in detail.  For purposes of illustration,
the Services may include (or include aspects of) operational, financial,
corporate, human resources, information technology and other services.  The parties shall cooperate in good faith to
create Schedules to this Agreement, within thirty days following the
Completion, that will contain a specific list of certain of the Services to be
provided pursuant hereto, including, with respect to the IMD Business,
potential additional specificity on the pricing model.  For the avoidance of doubt, but subject to Section 3.07,
none of the Services shall require the relevant Provider to provide the legal
services of any attorney to the Recipient in connection with any such Service
(unless otherwise agreed in writing by the parties hereto).


 


Section 3.06           Intentionally left blank.


 


Section 3.07           Further Access.


 


(a)           For a period of two years after the
Completion, the Nomura Entities shall provide, or use reasonable efforts to
cause to be provided to, the LBHI Entities at no charge (other than Nomura’s
out-of-pocket costs and expenses including contractor fees) with reasonable
access to all individuals who were employees or contractors of the LBHI
Entities prior to the Completion (and are employees or contractors of the
Nomura Entities at the time of requested access), and who have material
knowledge about the Retained LBHI Businesses or liabilities that were excluded
pursuant to the Nomura Purchase Agreement, and Nomura shall use reasonable
efforts to provide such individuals’ cooperation therewith. As part of the foregoing,
for a period of ninety (90) days after Completion, (i) such employees
shall provide reasonably necessary assistance to the LBHI Entities in the
unwinding of the Retained LBHI Business and 


 


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(ii) such employees that are attorneys shall
provide reasonably necessary legal services in the unwinding of the Retained
LBHI Business (which legal services shall include but not be limited to legal
services with respect to regulatory matters), provided that such assistance in (i) and
(ii) shall be deemed Services as to which the Service Charges apply and in
all instances shall be subject to any confidentiality, professional or ethical
obligations or restrictions (including without limitation any potential conflicts).


 


(b)           For a period of two years after the
Completion, the LBHI Entities shall provide, or use reasonable efforts to cause
to be provided to, the Nomura Entities at no charge (other than LBHI’s
out-of-pocket costs and expenses including contractor fees) with reasonable
access to all individuals who were employees or contractors of the LBHI
Entities prior to the Completion (and are employees or contractors of the LBHI
Entities at the time of requested access), and who have material knowledge
about the Nomura-Acquired Business or the Services to be provided by the Nomura
Entities, and LBHI shall use reasonable efforts to provide such individuals’
cooperation therewith.


 


(c)           The parties recognize and understand
that there will be substantial efforts in the period following the Completion
in the integration of the Transferred Employees and the Transferred Assets into
Nomura’s operations and the operation of the Nomura-Acquired Business, and the
continuing efforts of LBHI to divest the remaining assets and wind down the
Retained LBHI Business while maintaining the continuity thereof.  As such, the parties will work together to
reasonably accommodate each other in such efforts while balancing Nomura’s
needs for integration and operation with LBHI’s needs for information and
support.


 


Section 3.08           Intentionally left blank.


 


Section 3.09           Notices.  If any of the LBHI Entities receive any
notices related to the Nomura-Acquired Business it shall promptly forward them
to Nomura and if any of the Nomura Entities receive any notices related to the
Retained LBHI Businesses it shall promptly forward them to LBHI.


 


Section 3.10           Intentionally left blank.


 


Section 3.11           Access to Books and Records.  (a) The Nomura Entities shall provide
the LBHI Entities reasonable access to books and records acquired as part of
the Transferred Assets that are related and material to the Retained LBHI
Business (to the extent such books and records are in a Nomura Entity’s
possession at the time of requested access); and (b) the LBHI Entities
shall provide  the Nomura Entities
reasonable access to books and records that are related and material to the
Nomura-Acquired Business (to the extent such books and records are in an LBHI
Entity’s possession at the time of requested access).


 


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ARTICLE
4



COSTS AND DISBURSEMENTS; PAYMENTS


 


Section 4.01           Costs and Disbursements; Payments.


 


(a)           Any
Service to be provided by any Provider hereunder shall be charged to the
Recipient thereof as follows (such charges, the “Service Charges”):


 


(i)            until
the date that is nine (9) months after the Completion, at a cost equal to
the Provider’s fully-loaded costs and expenses for providing such Service
(including in such fully-loaded costs and expenses (x) an allocation for
overhead costs to the extent directly related to providing the Services, (y) the
amount of the actual payments made by the Provider to third-party providers for
providing Services, and (z) associated overhead costs relating to the
Services provided by such third-party providers) (“Provider’s Cost”),
but without any markup for profit margin; and


 


(ii)           on
and after the date that is nine (9) months after the Completion (including
during any extension of the term of this Agreement), at a cost equal to
Provider’s Cost plus 15% of Provider’s Cost.


 


Service
Charges shall include value-added taxes and all other taxes payable in respect
of the provision of the Services other than taxes imposed on the net income of
the Provider.  If LBHI or Nomura (as
applicable) is required, by Law or to otherwise avoid legal penalties under
Law, to pay, directly or indirectly, to an Affiliate any transfer pricing
markup or equivalent cost in order to deliver a Service, then such transfer
pricing markup or cost shall be included in the relevant Service Charges, unless
such mark-up or cost is subsequently recoverable by LBHI or Nomura (as
applicable).


 


For
the avoidance of doubt, Service Charges shall not include any amounts owed by a
party (whether to third parties or Affiliates) prior to the Completion.


 


For
the avoidance of doubt, Service Charges may increase or decrease, including, as
a result of (i) an increase or decrease in the amount of such Services
being provided to the Recipient (as compared to the amount of the Services
underlying the determination of a Service Charge), (ii) an increase or
decrease in the rates or charges imposed by any third-party provider that is
providing goods or services used by the Provider in providing the Services (as
compared to the rates or charges underlying a Service Charge), (iii) an
increase or decrease in the payroll or benefits for any employees used by the
Provider in providing the Services, or (iv) any increase or decrease in
costs relating to any changes requested by the Recipient in the nature of the
Services provided (including relating to newly installed products or equipment
or any upgrades to existing products or equipment).


 


(b)           The
Provider shall deliver an invoice to the Recipient on a monthly basis (or, at
the option of the Provider, at such other frequency as is consistent with the
basis on which the Service Charges are determined and, if applicable, charged
to Affiliates of the Provider) in arrears for the Service Charges due to the
Provider under this Agreement.  The
Recipient shall pay the amount of such invoice by wire transfer or check to the
Provider within thirty (30) days 


 


12

















 


of the date of such invoice as instructed by the
Provider; provided that to the extent consistent with past practice with
respect to Services rendered outside the United States, payments may be made in
local currency.  If the Recipient fails
to pay such amount by such date, the Recipient shall be obligated to pay to the
Provider, in addition to the amount due, interest at an interest rate of 1-1/2%
per month over the Prime Rate, compounded monthly, accruing from the
date the payment was due through the date of actual payment.  As soon as practicable after receipt of any
reasonable written request by the Recipient, the Provider shall provide the
Recipient with data and documentation reasonably satisfactory to the Recipient
supporting the calculation of a particular Service Charge for the purpose of
verifying the accuracy of such calculation. 
If, after reviewing such data and documentation, the Recipient disputes
the Provider’s calculation of any amount due to the Provider, then the dispute
shall be resolved pursuant to Section 7.01.


 


Section 4.02           No Right to Set-Off.  The Recipient shall pay the full amount of
costs and disbursements incurred under this Agreement, and shall not set-off,
counterclaim or otherwise withhold any other amount owed to the Provider on
account of any obligation owed by the Provider to the Recipient.


 


ARTICLE
5



STANDARD FOR SERVICE; COMPLIANCE WITH LAWS


 


Section 5.01           Standard for Service.  Subject to the terms and conditions of this
Agreement, the Provider agrees to perform the Services such that the nature,
quality, standard of care and the service levels at which such Services are
performed are no less than the nature, quality, standard of care and service
levels at which the substantially same services were performed by or on behalf
of the Provider prior to the Completion in the ordinary course of business
during the Benchmark Period; provided, however, that notwithstanding
the foregoing, the Provider shall have no liability hereunder for any Losses
incurred by the Recipient except to the extent arising from Provider’s gross
negligence or willful misconduct (and in any case subject to the limitations
set forth in Article 6).


 


Section 5.02           Disclaimer
of Warranties.  Except as expressly set forth herein, the
parties hereto acknowledge and agree that the Services are provided as-is, that
the applicable Recipient assumes all risks and liabilities arising from or
relating to its use of and reliance upon the Services and each Provider makes
no representation or warranty with respect thereto.  EXCEPT AS EXPRESSLY SET FORTH HEREIN, THE
PROVIDERS HEREBY EXPRESSLY DISCLAIM ALL REPRESENTATIONS AND WARRANTIES
REGARDING THE SERVICES, WHETHER EXPRESS OR IMPLIED, INCLUDING ANY
REPRESENTATION OR WARRANTY IN REGARD TO QUALITY, PERFORMANCE, NONINFRINGEMENT,
COMMERCIAL UTILITY, MERCHANTABILITY OR FITNESS OF THE SERVICES FOR A PARTICULAR
PURPOSE.


 


13

















 


ARTICLE
6



INDEMNIFICATION; LIMITATION ON LIABILITY


 


Section 6.01           Indemnification of Each Provider by the
Relevant Recipient.  Subject to the
limitations set forth in this Article 6, each Recipient shall
indemnify and hold harmless each relevant Provider and its Affiliates and
Representatives (each, a “Provider Indemnified Party”) from and against
any and all loss, liability, claim, damage or expense (including legal fees and
expenses) (“Losses”) to the extent owed to third parties, and reimburse each
relevant Provider Indemnified Party for all expenses as they are incurred,
whether or not in connection with pending litigation and whether or not any
Provider Indemnified Party is a party, arising out of any claim by a third
party to the extent caused by, resulting from or in connection with any of the
Services rendered or to be rendered by or on behalf of such Provider pursuant
to this Agreement, the transactions contemplated by this Agreement or such
Provider’s actions or inactions in connection with any such Services or
transactions; provided that such Recipient shall not be responsible for
any Losses of such Provider Indemnified Party to the extent that such Loss is
caused by, results from, or arises out of or in connection with a Provider
Indemnified Party’s gross negligence or willful misconduct in connection with
any such Services or transactions, actions or inactions related thereto.


 


Section 6.02           Limited Liability of a Provider.  Notwithstanding Article 5 or
anything else to the contrary contained herein, no Provider Indemnified Party
shall have any liability in contract, tort or otherwise, for or in connection
with any Services rendered or to be rendered by any Provider Indemnified Party
pursuant to this Agreement, the transactions contemplated by this Agreement or
any Provider Indemnified Party’s actions or inactions in connection with any
such Services or transactions, to any Recipient Indemnified Party, except  to the extent that any such Recipient
Indemnified Party suffers a Loss that results from such Provider Indemnified
Party’s gross negligence or willful misconduct in connection with any such
Services or transactions, actions or inactions related thereto.


 


Section 6.03           Limited Liability of a Recipient.  Notwithstanding Article 5 or
anything else to the contrary contained herein, no Recipient shall have any
liability in contract, tort or otherwise, for or in connection with the
transactions contemplated by this Agreement or such Recipient’s actions or
inactions in connection with any Services or transactions, to any Provider,
except (a) to the extent that any such Provider suffers a Loss that
results from such Recipient’s gross negligence or willful misconduct in
connection with any such transactions, actions or inactions related thereto or (b) to
the extent owed pursuant to Recipient’s indemnification obligations in Section 6.01.


 


Section 6.04           Additional Limitation on Liability.


 


(a)           Notwithstanding
any other provision contained in this Agreement, no Provider Indemnified Party
shall be liable for any exemplary, special, indirect, punitive, incidental or
consequential losses, damages or expenses, including any damages due to
business interruption or loss of profits.


 


14

















 


(b)           Except
for the indemnification obligations set forth in Section 6.01, the
aggregate liability and indemnification of each of Nomura and LBHI (or their
respective assignees in accordance with Section 9.10) with respect
to this Agreement shall not exceed, in the aggregate, the aggregate amount of
Service Charges paid hereunder to Nomura or LBHI (or such respective
assignees), as the case may be.


 


Section 6.05           Liability for Payment Obligations.  Nothing in this Article 6 shall
be deemed to eliminate or limit, in any respect, a party’s express obligation
in this Agreement to pay or reimburse, as applicable, for (i) Termination
Charges, (ii) Service Charges for Services rendered in accordance with
this Agreement, (iii) amounts in respect of conversion services provided
pursuant to Section 2.02, or (iv) other costs and expenses to
the extent expressly provided herein.


 


Section 6.06           Obligations Several and Not Joint.  As between a Recipient and a permitted
third-party assignee of the Recipient, the obligations of each such party under
this Agreement shall be several and not joint.


 


Section 6.07           THE DISCLAIMER OF WARRANTY, LIMITATION OF
LIABILITY AND OVERALL ALLOCATION OF RISK BETWEEN THE PARTIES ARE FUNDAMENTAL
ELEMENTS OF THE BASIS OF THE BARGAIN BETWEEN THE PARTIES.  THE PROVIDER WOULD NOT BE ABLE OR WILLING TO
PROVIDE THE SERVICES WITHOUT THE PROTECTIONS PROVIDED TO PROVIDER PURSUANT TO
SUCH PROVISIONS.  IF ANY APPLICABLE COURT
HOLDS ANY DISCLAIMER, LIMITATION OF LIABILITY OR ALLOCATION OF RISK CONTAINED
IN THIS SECTION TO BE UNENFORCEABLE, THEN A PARTY’S LABILITY WILL BE
LIMITED TO THE FULLEST POSSIBLE EXTENT PERMITTED BY APPLICABLE LAW.


 


ARTICLE
7



DISPUTE RESOLUTION


 


Section 7.01           Dispute Resolution.


 


(a)           In
the event of any dispute, controversy or claim arising out of or relating to the
transactions contemplated by this Agreement, or the validity, interpretation,
breach or termination of any provision of this Agreement, or calculation or
allocation of the costs of any Service, including claims seeking redress or
asserting rights under any Law (each, a “Dispute”), the parties hereto
agree that the Nomura Services Manager and LBHI Services Manager (or such other
Persons as Nomura and LBHI may designate) shall negotiate in good faith in an
attempt to resolve such Dispute amicably. 
If such Dispute has not been resolved to the mutual satisfaction of
Nomura and LBHI within sixty (60) days after the initial notice of the Dispute
(or such longer period as such parties may agree), then, a senior executive on
behalf of Nomura and a senior executive on behalf of LBHI shall negotiate in
good faith in an attempt to resolve such Dispute amicably for an additional
twenty (20) days (or such longer period as such parties may agree).  If such Dispute has not been finally resolved
at the end of such twenty-day period, then either party may pursue remedies in
accordance with Section 9.11. 
Notwithstanding the foregoing, a 


 


15

















 


Provider shall have no obligation to comply with this Section 7.01(a) before
exercising any rights or remedies it may have under this Agreement.


 


(b)           In
any Dispute regarding the amount of a Service Charge, if after such Dispute is
finally adjudicated pursuant to the dispute resolution and/or judicial process
set forth in Section 7.01(a) or Section 9.11, it
is determined that the Service Charge that the Provider has invoiced the
Recipient, and that the Recipient has paid to the Provider, is greater or less
than the amount that the Service Charge should have been, then (i) if it
is determined that the Recipient has overpaid the Service Charge, the Provider
shall within five (5) Business Days after such determination reimburse the
Recipient an amount of cash equal to such overpayment, plus 1-1/2% per month
over the Prime Rate, compounded monthly, accruing from the date of payment by
the Recipient to the time of reimbursement by the Provider and (ii) if it
is determined that the Recipient has underpaid the Service Charge, the
Recipient shall within five (5) Business Days after such determination
reimburse the Provider an amount of cash equal to such underpayment, plus 

1-1/2% per month over the Prime Rate, compounded monthly, accruing from the
date such payment originally should have been made by the Recipient to the time
of reimbursement by the Recipient.


 


ARTICLE
8



TERMINATION


 


Section 8.01           Termination.


 


(a)           This
Agreement shall come into effect with respect to the Services in relation to a
particular LBHI Entity upon the completion of the sale of the transferred
assets of such LBHI Entity under the Nomura Purchase Agreement and shall
terminate as to any particular Service upon the earliest to occur of (i) the
first date on which the applicable party has no further need to have such
Service provided by the applicable Provider or (ii) the mutual written
agreement of the parties to terminate this Agreement in its entirety or (iii) as
further set out below.  All Services
shall terminate no later than the earliest of (x) eighteen (18) months
following the Completion and (y) twelve (12) months from the closing date
of the sale of the Retained LBHI Business or portion of the Nomura-Acquired
Business, as applicable, to which such Service relates or from which the
Service is provided and (z) such date as Recipient has developed an
alternative source of such Services; provided, that if there is no third
party vendor or service provider that can reasonably provide a comparable
Service, and the absence of such Service would cause a material adverse effect
on the value of the relevant underlying business operations or assets, then,
upon written notice from Recipient at least sixty (60) days prior to the twelve
month anniversary of the Completion, such services shall be extended until the
earliest of: (1) thirty (30) months following the Completion; (2) twenty-four
(24) months from the closing date of the sale of the Retained LBHI Business or
portion of the Nomura-Acquired Business, as applicable, to which such Service
relates or from which the Service is provided and (3) such date as
Recipient has developed an alternative source of such Services.  This Agreement shall terminate once the
provision of Services hereunder has terminated, and, for the avoidance of
doubt, this Agreement shall terminate at the end of the time periods set forth
above, provided that any provision of this Agreement which is expressly stated
to survive termination of this Agreement shall continue notwithstanding the
expiry of the Services.


 


16

















 


(b)           The
Retained LBHI Businesses will use reasonable efforts to alter their operations
to minimize or eliminate the need for Nomura Services (including by obtaining
replacement services from a third party provider) as promptly as reasonably
practicable as they wind down their operations or dispose of them to a third
party. In addition, (i) a Recipient may from time to time terminate this
Agreement with respect to any particular Service, in whole but not in part (1) for
any reason or no reason upon providing at least thirty (30) days prior written
notice to the Provider of such termination, subject to the obligation to pay
Termination Charges, as provided for under Section 8.02, (2) if
the Provider of such Service has failed to perform any of its material
obligations under this Agreement with respect to such Service, and such failure
shall continue to exist thirty (30) days after receipt by the Provider of
written notice of such failure from the Recipient, or (3) immediately upon
mutual written agreement of the parties hereto, and (ii) a Provider may
terminate this Agreement with respect to one or more Services, in whole but not
in part, at any time upon prior written notice to the Recipient if the
Recipient has failed to perform any of its material obligations under this
Agreement relating to such Service or Services, and such failure shall be
continued uncured for a period of thirty (30) days after receipt by the
Recipient of a written notice of such failure from the Provider.  In the event that the effective date of the
termination of any particular Service is a day other than at the end of a
billing period, the Service Charge associated with such Service shall be
pro-rated appropriately.


 


(c)           A
Recipient may from time to time request a reduction in part of the scope or
amount of any particular Service.  If
requested to do so by Recipient, the Provider agrees to discuss in good faith
appropriate reductions to the relevant Service Charges in light of all relevant
factors including the costs and benefits to the Provider of any such
reductions.  In the event that any
particular Service is reduced other than at the end of a billing period, the
Service Charge associated with such Service for the billing period in which
such Service is reduced shall be pro-rated appropriately. Without limiting Section 8.01(a),
the IMD Entities may request termination of any particular Service with respect
to them upon six (6) months’ prior written notice in which case such
Service will be terminated and charges for such Service will cease accruing at
the end of such six (6) month period.


 


(d)           The
Recipient may terminate this Agreement upon the occurrence of a Force Majeure
event pursuant to Section 8.04 below that materially disrupts the
provision of Services, and Provider’s failure to fully restore such Services
within 90 days, and the Provider’s further failure to fully restore such
Services 30 days after its receipt of written notice of Recipient’s intention
to so terminate pursuant to this Section 8.01(d) sent after
the expiration of the initial 90-day period.


 


(e)           The
parties agree to discuss in good faith implementing reasonable measures to
address situations that may arise after the date of this Agreement in which
Recipient requires an extension of the provision of one or more Services beyond
the term provided for herein or Provider requires relief from the provision of
one or more Services because such Services are unduly burdensome or
inconsistent with the strategic and operational objectives of Provider.


 


Section 8.02           Effect of Termination.  Upon termination of any particular Service
pursuant to this Agreement, the Provider of the terminated Service will have no
further obligation to provide the terminated Service, and the relevant
Recipient will have no obligation 


 


17

















 


to pay any future Service Charges relating to any such
Service; provided, however, that the Recipient shall remain
obligated to the relevant Provider for (i) the Service Charges owed and
payable in respect of Services provided prior to the effective date of termination
and (ii) any Termination Charges. 
Upon termination of any particular Service pursuant to this Agreement,
the relevant Provider shall reduce for the next billing period the amount of
the Service Charge for the category of Services in which the terminated Service
was included (such reduction to reflect the elimination of all costs incurred
in connection with the terminated service to the extent the same are not
required to provide other Services to the Recipient), and, upon request of the
Recipient, the Provider shall provide the Recipient with documentation and/or
information regarding the calculation of the amount of the reduction.


 


Section 8.03           Survival.  In connection with termination of any
Service, the provisions of this Agreement not relating solely to such
terminated Service shall survive any such termination, and in connection with a
termination of this Agreement, Article 1, Article 6
(including liability in respect of any indemnifiable Losses under this
Agreement arising or occurring on or prior to the date of termination), Article 7,
Article 8, Article 9, all confidentiality obligations
under this Agreement and liability for all due and unpaid Service Charges and
Termination Charges shall continue to survive indefinitely.


 


Section 8.04           Force Majeure.  No party hereto (nor any Person acting on its
behalf) shall have any liability or responsibility for failure to fulfill any
obligation (other than a payment obligation) under this Agreement so long as
and to the extent to which the fulfillment of such obligation is prevented,
frustrated, hindered or delayed as a consequence of circumstances of Force
Majeure; provided that (i) such party (or such Person) shall have
exercised commercially reasonable efforts to minimize the effect of Force
Majeure on its obligations and (ii) the nature, quality and standard of
care that the Provider shall provide in delivering a Service after a Force
Majeure shall be substantially the same 
as the nature, quality and standard of care that the Provider provides
to its Affiliates and its other business components with respect to such
Service.  In the event of an occurrence
of a Force Majeure, the party hereto whose performance is affected thereby
shall give notice of suspension as soon as reasonably practicable to the other
stating the date and extent of such suspension and the cause thereof, and such
party shall resume the performance of such obligations as soon as reasonably
practicable after the removal of the cause.


 


ARTICLE
9



GENERAL PROVISIONS


 


Section 9.01           Independent Contractors.  In providing the Services hereunder, the
Provider shall act solely as independent contractor and nothing in this
Agreement shall constitute or be construed to be or create a partnership, joint
venture, or principal/agent relationship between the Provider, on the one hand,
and the Recipient, on the other.  All
Persons employed by the Provider in the performance of its obligations under
this Agreement shall be the sole responsibility of the Provider.


 


Section 9.02           Subcontractors.  Any Provider may hire or engage one or more
subcontractors to perform any or all of its obligations under this Agreement; provided
that such 


 


18

















 


Provider shall in all cases remain responsible for all
its obligations under this Agreement. 
Under no circumstances shall any Recipient be responsible for making any
payments directly to any subcontractor engaged by a Provider.


 


Section 9.03           Books and Records.  All books, records and data maintained by a
Provider for a Recipient with respect to the provision of a Service to such
Recipient shall be the exclusive property of such Recipient.  The Recipient, at its sole cost and expense,
shall have the right to inspect, and make copies of, any such books, records
and data during regular business hours upon reasonable advance notice to the
Provider.  At the sole cost and expense
of the Recipient, upon termination of the provision of any Service, the
relevant books, records and data relating to such terminated Service shall be
delivered by the Provider to the Recipient in a mutually agreed upon format to
the address of the Recipient set forth in Section 9.05 or any other
mutually agreed upon location; provided, however, that the
Provider shall be entitled to retain one copy of all such books, records and
data relating to such terminated Service for archival purposes and for purposes
of responding to any dispute that may arise with respect thereto.


 


Section 9.04           Treatment of Confidential Information.


 


(a)           The
parties hereto shall not, and shall cause all other Persons providing Services
or having access to information of the other party that is known to such Person
as confidential or proprietary (“Confidential Information”) not to,
disclose to any other Person or use, except for purposes of this Agreement, any
Confidential Information of the other party; provided, however,
that each party may disclose Confidential Information of the other party, to
the extent permitted by applicable Law (i) to its Representatives on a
need-to-know basis in connection with the performance of such party’s
obligations under this Agreement, (ii) in any report, statement, testimony
or other submission required to be made to any Governmental Body having
jurisdiction over the disclosing party, or (iii) in order to comply with
applicable Law, or in response to any summons, subpoena or other legal process
or formal or informal investigative demand issued to the disclosing party in
the course of any litigation, investigation or administrative proceeding.  In the event that a party hereto becomes
legally compelled (based on advice of counsel) by deposition, interrogatory,
request for documents subpoena, civil investigative demand or similar judicial
or administrative process to disclose any Confidential Information of the other
party, such disclosing party shall provide the other party with prompt prior
written notice of such requirement, and, to the extent reasonably practicable,
cooperate with the other party (at such other party’s expense) to obtain a
protective order or similar remedy to cause such Confidential Information not
to be disclosed, including interposing all available objections thereto, such
as objections based on settlement privilege. 
In the event that such protective order or other similar remedy is not
obtained, the disclosing party shall furnish only that portion of the
Confidential Information that has been legally compelled, and shall exercise
its reasonable best efforts (at such other party’s expense) to obtain assurance
that confidential treatment will be accorded such Confidential Information.


 


(b)           Each
party hereto shall, and shall cause its Representatives to protect the
Confidential Information of the other parties by using the same degree of care
to prevent the unauthorized disclosure of such as the party uses to protect its
own confidential information of a like nature.


 


19

















 


(c)           Each
party shall comply with all applicable state, federal and foreign privacy and
data protection Laws that are or that may in the future be applicable to the
provision of the Services hereunder.


 


Section 9.05           Notices.  Except with respect to routine communications
by the Nomura Services Manager and LBHI Services Manager under Section 2.03,
all notices, requests, claims, demands and other communications under this
Agreement shall be in writing and shall be given or made (and shall be deemed
to have been duly given or made upon receipt) by delivery in person, by
overnight courier service, by facsimile with receipt confirmed (followed by
delivery of an original via overnight courier service) or by registered or
certified mail (postage prepaid, return receipt requested) to the respective
parties at the following addresses (or at such other address for a party as
shall be specified in a notice given in accordance with this Section 9.05):


 


	
  (a)

  	
  if
  to Nomura:

  
	
   

  	
   

  
	
   

  	
  Nomura Holdings Inc.

  
	
   

  	
  c/o Nomura International plc

  
	
   

  	
  Nomura House

  
	
   

  	
  1 St. Martin’s-le-Grand

  
	
   

  	
  London EC1A 4NP

  
	
   

  	
  Attention: General Counsel and Company Secretary

  
	
   

  	
   

  
	
   

  	
  Facsimile: (44 20) 7521 2121

  
	
   

  	
   

  
	
   

  	
  with a copy to:

  
	
   

  	
   

  
	
   

  	
  Freshfields Bruckhaus Deringer

  
	
   

  	
  11th Floor

  
	
   

  	
  Two Exchange Square

  
	
   

  	
  Hong Kong

  
	
   

  	
  Attention: Robert Ashworth

  
	
   

  	
  Facsimile: (852) 2810 6192

  
	
   

  	
   

  
	
  (b)

  	
  if
  to LBHI:

  
	
   

  	
   

  
	
   

  	
  Lehman Brothers
  Holdings Inc.

  
	
   

  	
  745 Seventh Avenue

  
	
   

  	
  New York, NY 10019

  
	
   

  	
  Attention: William B.
  Gordon

  
	
   

  	
  Facsimile: 646-758-4226

  



 


20

















 


	
   

  	
  with a copy to:

  
	
   

  	
   

  
	
   

  	
  Weil,
  Gotshal & Manges LLP

  
	
   

  	
  767 Fifth Avenue

  
	
   

  	
  New York, NY 10153

  
	
   

  	
  Attention: Jeffrey
  Osterman

  
	
   

  	
  Facsimile: (212)
  310-8007

  



 


Section 9.06           Regulatory Approval and Compliance.  Each party hereto shall be responsible for
its own compliance with any and all Laws applicable to its performance under
this Agreement; provided, however, that each of Nomura and LBHI
shall, subject to reimbursement of out-of-pocket expenses by the requesting
party, cooperate and provide one another with all reasonably requested
assistance (including the execution of documents and the provision of relevant
information) required by the requesting party to ensure compliance with all
applicable Laws in connection with any regulatory action, requirement, inquiry
or examination related to this Agreement or the Services.


 


Section 9.07           Further Assurances.  Each party hereto covenants and agrees that,
without any additional consideration, it shall execute and deliver any further
legal instruments and perform any acts that are or may become reasonably
necessary to effectuate this Agreement.


 


Section 9.08           Severability.  If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced under any Law or
as a matter of public policy, all other conditions and provisions of this
Agreement shall nevertheless remain in full force and effect so long as the
economic or legal substance of the transactions contemplated by this Agreement
is not affected in any manner materially adverse to any party hereto.  Upon such determination that any term or
other provision is invalid, illegal or incapable of being enforced, the parties
hereto shall negotiate in good faith to modify this Agreement so as to effect
the original intent of such parties as closely as possible in a mutually
acceptable manner in order that the transactions contemplated by this Agreement
can be consummated as originally contemplated to the greatest extent possible.


 


Section 9.09           Entire Agreement.  Except as otherwise expressly provided in
this Agreement, the Nomura Purchase Agreement and this Agreement constitute the
entire agreement of the parties hereto with respect to the subject matter of
this Agreement and supersede all prior agreements and undertakings, both
written and oral, between or on behalf of the parties hereto with respect to
the subject matter of this Agreement.


 


Section 9.10           Assignment; Third-Party Beneficiaries.


 


(a)           This
Agreement shall not be assigned or sublicensed by operation of Law or otherwise
without the prior written consent of the parties hereto; provided, however,
that, subject to Section 9.10(b):


 


(i)            the
LBHI Entities shall have a right to assign or sublicense their rights and
obligations hereunder, in whole or in part, (A) with respect to the IMD
Entities (as of the date hereof) to one or more related purchasers (in a single
transaction or a series of related 


 


21

















 


transactions) of (x) any or all of the IMD
Business or (y) any or all of the assets of, or entities that conduct, the
IMD Business, (B) with respect to any other acquirors of the Retained LBHI
Business, if the absence of such Service would cause a material adverse effect
on the value of the underlying business operations or assets, and (C) with
respect to any of their Affiliates, Subsidiaries or purchasers of their
business (including to any liquidators or provisional liquidators of any LBHI
Entities) solely for use by such Affiliate, Subsidiary or purchaser in
connection with the winding up of such business, and


 


(ii)           the
Nomura Entities may assign their rights and obligations hereunder, in whole or
in part, (A) with respect to any acquirors of the Nomura-Acquired
Business, if the absence of such Service would cause a material adverse effect
on the value of the underlying business operations or assets, and (B) to a
single purchaser (in a single transaction or a series of related transactions)
of (x) any or all of the Nomura-Acquired Business or (y) any or all
of the assets of, or entities that conduct, the Nomura-Acquired Business.


 


(b)           Notwithstanding
anything to the contrary, the total number of parties to which each of the LBHI
Entities, on one hand, and the Nomura Entities, on the other hand, may assign
their rights and obligations pursuant to Section 9.10(a) shall
not exceed six (i.e., up to six separate assignments for each party to this
Agreement); provided that the LBHI Entities shall have the right to assign
their rights and obligations hereunder up to two additional parties provided
that, notwithstanding Section 8.01(a), in the case of such two
additional parties, the Services pursuant to those assigned rights shall terminate
one (1) year after the Completion. 
With respect to the sale of the following businesses – the IMD Business;
the LBHI Entity private equity business; and the businesses conducted by the
LBHI Entities in each of India and Europe - if there is an assignment hereunder
to a single buyer of more than one of the foregoing businesses, then, solely
for the purposes of this Section 9.10(b), such assignment shall
count as separate assignment for each of such businesses.  For illustrative purposes, if there is an
assignment hereunder to a single buyer for the India and Europe businesses,
then it shall count as two assignments towards the total of six.  The parties agree to negotiate in good faith
if either party requests the right to make additional assignments hereunder to
a buyer of a part of such party’s business to which this Agreement relates if
the absence of such Service would cause a material adverse effect to the
underlying business operations or asset being sold.


 


(c)           Any
permitted assignee in accordance with this Section 9.10 shall be
required to execute a counterpart to this Agreement, agreeing to be bound by
the terms and conditions set forth herein. 
Further, permitted assignees hereunder shall not themselves be permitted
to assign any part of the rights or obligations assigned to them without the
prior written consent of the non-assigning party.  Each party shall require any assignee or
purchaser of any business or asset that had been providing (or had been used to
provide) Services hereunder, the absence of which would cause a material
adverse effect to the Recipient, to continue to provide Services to the
Recipient pursuant to the terms and conditions of this Agreement as a condition
to such assignment or purchase.  For the
avoidance of doubt, a change of control of an entity shall be deemed an
assignment hereunder.


 


(d)           Except
as provided in Article 6 with respect to Provider Indemnified
Parties, this Agreement is for the sole benefit of the parties hereto and their
permitted successors and assigns and nothing in this Agreement, express or
implied, is intended to or shall confer 


 


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upon any other Person any legal or equitable right,
benefit or remedy of any nature whatsoever, including any rights of employment
for any specified period, under or by reason of this Agreement.


 


Section 9.11           Governing Law; Submission to Jurisdiction.  (a) This Agreement (and any claims or
disputes arising out of or related hereto or to the transactions contemplated
hereby or to the inducement of any party to enter herein, whether for breach of
contract, tortious conduct or otherwise, and whether predicated on common law,
statute or otherwise) shall in all respects be governed by, and construed in
accordance with, the Laws of the State of New York, including all matters of
construction, validity and performance, in each case without reference to any
conflict of Law principles that might lead to the application of the Laws of
any other jurisdiction.


 


(b)           Without
limiting any party’s right to appeal any order of the Bankruptcy Court, (i) the
Bankruptcy Court shall retain exclusive jurisdiction to enforce the terms of
this Agreement and to decide any claims or disputes which may arise or result
from, or be connected with, this Agreement, any breach or default hereunder, or
the transactions contemplated hereby, and (ii) any and all proceedings
related to the foregoing shall be filed and maintained only in the Bankruptcy
Court, and the parties hereby consent to and submit to the jurisdiction and
venue of the Bankruptcy Court and shall receive notices at such locations as
indicated in Section 9.05 hereof; provided, however,
that if the Bankruptcy Case has closed, the parties agree to unconditionally
and irrevocably submit to the exclusive jurisdiction of the United States
District Court for the Southern District of New York sitting in New York County
or the Commercial Division, Civil Branch of the Supreme Court of the State of
New York sitting in New York County and any appellate court from any thereof,
for the resolution of any such claim or dispute.  The parties hereby irrevocably waive, to the
fullest extent permitted by applicable Law, any objection which they may now or
hereafter have to the laying of venue of any such dispute brought in such court
or any defense of inconvenient forum for the maintenance of such dispute.  Each of the parties hereto agrees that a
judgment in any such dispute may be enforced in other jurisdictions by suit on the
judgment or in any other manner provided by Law.


 


(c)           Each
of the parties hereto hereby consents to process being served by any party to
this Agreement in any suit, action or proceeding by delivery of a copy thereof
in accordance with the provisions of Section 9.05.


 


Section 9.12           Amendment.  No provision of this Agreement, including any
Schedule hereto, may be amended, supplemented or modified except by a written
instrument making specific reference hereto or thereto signed by all the
parties to this Agreement.  No waiver by
any party of any provision hereof shall be effective unless explicitly set
forth in writing and executed by the party so waiving.  The waiver by any party hereto of a breach of
any provision of this Agreement shall not operate or be construed as a waiver
of any other subsequent breach.


 


Section 9.13           Rules of Construction.  Interpretation of this Agreement shall be
governed by the following rules of construction (a) words in the
singular shall be held to include the plural and vice versa and words of one
gender shall be held to include the other gender as the context requires, (b) references
to the terms Article, Section, paragraph and Schedule are 


 


23

















 


references to the Articles, Sections, paragraphs and
Schedules of this Agreement unless otherwise specified, (c) the terms “hereof,”
“herein,” “hereby,” “hereto,” “hereunder” and derivative or similar words refer
to this entire Agreement, including the Schedules hereto, (d) references
to “$” shall mean U.S. dollars, (e) the word “including” and words of
similar import when used in this Agreement shall mean “including, without
limitation,” unless otherwise specified, (f) the word “or” shall not be
exclusive, (g) references to “written” or “in writing” include in
electronic form, (h) provisions shall apply, when appropriate, to
successive events and transactions, (i) the headings contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement, (j) Nomura and LBHI have each
participated in the negotiation and drafting of this Agreement and if an
ambiguity or question of interpretation should arise, this Agreement shall be
construed as if drafted jointly by the parties hereto and no presumption or
burden of proof shall arise favoring or burdening any such party by virtue of
the authorship of any of the provisions in any of this Agreement, (k) a
reference to any Person includes such Person’s successors and permitted
assigns, (l) any reference to “days” means calendar days unless Business
Days are expressly specified, and (m) when calculating the period of time
before which, within which or following which any act is to be done or step
taken pursuant to this Agreement, the date that is the reference date in
calculating such period shall be excluded, if the last day of such period is
not a Business Day, the period shall end on the next succeeding Business Day.


 


Section 9.14           Counterparts.  This Agreement may be executed in two or more
counterparts, and by each party in separate counterparts, each of which when
executed shall be deemed to be an original but all of which taken together
shall constitute one and the same agreement. 
Delivery of an executed counterpart of a signature page to this
Agreement by facsimile shall be as effective as delivery of a manually executed
counterpart of this Agreement.


 


Section 9.15           Waiver of Jury Trial.  EACH PARTY HERETO HEREBY WAIVES TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN RESPECT TO ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT
OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT. 
EACH SUCH PARTY (I) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER PARTIES WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE
FOREGOING WAIVER AND (II) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES
HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER TRANSACTION
AGREEMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN
THIS SECTION 9.15.


 


Section 9.16           Enforcement.  The parties agree that irreparable damage may
result, and that the parties may not have any adequate remedy at Law, if any of
the provisions of this Agreement were not performed in accordance with their
specific terms or were otherwise breached or threatened to be breached.  It is accordingly agreed that,
notwithstanding the penultimate sentence of Section 7.01(a), if
either party breaches its obligation to consummate the transactions
contemplated by this Agreement, the non-breaching party shall be entitled to
seek equitable relief, in addition to all other remedies available to the
parties at Law or in equity as a 


 


24

















 


remedy for any such breach or threatened breach.  Such equitable remedies may be sought in any
court referred to in Section 9.11(b).


 


Section 9.17           Non-Recourse.  No past, present or future director, officer,
employee, incorporator, member, partner, stockholder, Affiliate, agent,
attorney or representative of either Nomura or LBHI or their respective
Affiliates shall have any liability for any obligations or liabilities of
Nomura or LBHI, respectively, under this Agreement of or for any claim based
on, in respect of, or by reason of, the transactions contemplated hereby.


 


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


 


	
   

  	
  LEHMAN BROTHERS
  HOLDINGS INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ James P. Fogarty

  
	
   

  	
   

  	
  Name: James P. Fogarty

  
	
   

  	
   

  	
  Title: Executive Vice
  President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  NOMURA HOLDINGS INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Takumi Shibata

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  
	
   

  
	
  SIGNATURE PAGE TO

  
	
  TRANSITION SERVICES AGREEMENT

  



 


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