Exhibit 10.1


 


IMD PARENT LLC


 


October 21, 2008


 


Lehman Brothers Holdings Inc.

745 Seventh Avenue

New York, New York 10019


 


Ladies and Gentlemen:


 


Reference is made to that certain Amended and Restated Purchase
Agreement, dated as of October 3, 2008 (the “Purchase Agreement”),
by and between IMD Parent LLC, a Delaware limited liability company, Lehman
Brothers Holdings Inc., a Delaware corporation, and the entities listed on Schedule
I thereto.  Capitalized terms used,
but not otherwise defined herein, shall have the meanings ascribed to such
terms in the Purchase Agreement.


 


In connection with the entry of the Bid Procedures Order by the
Bankruptcy Court on October 21, 2008, the Purchaser and Seller have agreed
to make certain amendments to the Purchase Agreement.  Pursuant to Section 10.3 of the Purchase
Agreement, the Purchase Agreement is hereby amended as follows:


 


1.               Exhibit A
to the Purchase Agreement is hereby amended and restated in its entirety to be
the Bid Procedures Order attached as Exhibit A hereto.


 


2.               The
definition of “Audited Financial Statements” in Section 1.1 of the
Purchase Agreement is hereby amended and restated in its entirety to read as
follows:


 


“Audited Financial Statements” means the final audited statement
of the special purpose combined financial position and statement of operations
of the NB Business as of and for the two fiscal-quarter period ended May 31,
2008, prepared in accordance with GAAP on a full carve out basis with the
exception that such financial statements shall (i) be on a pre-tax income
basis and will not include the current and deferred provision for income taxes
and related tax assets or liabilities or any income tax-related footnote
disclosures, (ii) exclude any additional push-down of fixed asset balances
and depreciation and amortization, asset impairment charges and interest income
(not including the revenue associated with the margin debits) and expense
outside of amounts historically recorded within the NB Business Financial
Information, (iii) exclude any adjustments and disclosure relating to
stock-based compensation under SFAS 123R and (iv) be prepared on a
going-concern basis.


 


3.               The
definition of “Designation Notice” in Section 1.1 of the Purchase
Agreement is hereby amended and restated in its entirety to read as follows:


 


“Designation Notice” means a notice (as it may
be amended, modified or supplemented 


 


1

















 


by Purchaser from time to time prior to the Bid
Deadline (as defined in the Bid Procedures Order and as it may be extended from
time to time in accordance with the Bid Procedures Order)) delivered by
Purchaser to Parent designating any Seller or any member of the Company Group
as an entity that will sell, assign, convey and deliver to the Purchaser the
Purchased Assets, free and clear of all Liens and Claims pursuant to sections
363 and 365 of the Bankruptcy Code in a voluntary proceeding under the
Bankruptcy Code in connection with the transactions contemplated hereby, which
notice shall be delivered to Parent no later than the Bid Deadline (as it may
be extended from time to time in accordance with the Bid Procedures Order).”


 


4.               The
definition of “Reimbursement Amount” in Section 1.1 of the Purchase
Agreement is hereby amended and restated in its entirety to read as follows:


 


“Reimbursement Amount” means the reasonable, customary,
documented and actual out-of-pocket fees, costs and expenses of the Purchaser
and its Affiliates (including fees, costs and expenses of counsel and any other
professionals retained by the Purchaser or its Affiliates) in connection with
the transactions contemplated by this Agreement, the negotiation,
investigation, preparation, execution and delivery of this Agreement and any
related agreements, documents and pleadings, or the Bankruptcy Case, or any
other attempted acquisition of all or part of the Business, including any fees,
costs and expenses incurred in connection with litigation, contested matters,
adversary proceedings or negotiations necessitated by any proceedings relating
to the foregoing, which shall be paid as set forth in Section 3.5
hereof.”


 


5.               The
definition of “S&P Percentage” in Section 1.1 of the Purchase
Agreement is hereby amended and restated in its entirety to read as follows:


 


“S&P Percentage” means 100%, minus the higher of (i) 78.69% and (ii) the
average closing price of the S&P 500 Index for the three consecutive full
trading days immediately preceding the Closing Date divided by 1202.77,
expressed as a percentage.”


 


6.               The
definition of “Seller Termination Fee” in Section 1.1 of the Purchase
Agreement is hereby amended and restated in its entirety to read as follows:


 


“Seller Termination Fee” means $52,500,000.”


 


7.               Section 2.5(a) of
the Purchase Agreement is hereby amended and restated in its entirety to read
as follows:


 


“(a)         Concurrent with the
delivery of the Designation Notice (or if no Designation Notice is delivered,
at or prior to the Bid Deadline (as it may be extended from time to time in
accordance with the Bid Procedures Order)), the Purchaser shall have the right
upon notice (which notice may be amended, modified or supplemented by Purchaser
from time to time prior to the Bid Deadline (as it may be extended from time to
time in accordance with the Bid Procedures Order)) to Seller to designate any
Related 


 


2

















 


Contract as a Contract to be assumed and/or assigned
(as applicable) pursuant to this Section 2.5 (such Contracts, the “Purchased
Contracts”).  In the event that a
Debtor is a party to a Purchased Contract, Seller shall, or cause its
Subsidiaries to, assume and assign such Purchased Contract to Purchaser (or its
designee) pursuant to Section 365 of the Bankruptcy Code.  In the event that a Debtor is not a party to
a Purchased Contract, such Purchased Contract shall be assigned to the
Purchaser (or its designee); provided, however, that Seller’s
obligation to assign any Transferred Real Property Leases under this sentence
is subject to the Seller obtaining the Landlord Consents).  Purchaser shall use commercially reasonable
efforts to designate Related Contracts as Purchased Contracts before the Sale
Hearing.  Until a date that is five (5) days
before Closing, the Purchaser shall have the right, upon notice to the Seller,
to remove without penalty any Related Contract designated as a Purchased
Contract (other than a Transferred Real Property Lease) from the list of
Purchased Contracts, in which case such Related Contract shall become an
Excluded Contract.”


 


8.               Section 3.3(g) of
the Purchase Agreement is hereby amended and restated in its entirety to read
as follows:


 


“(g)         by Purchaser, upon
notice to Parent, if (i) following the entry of the Bid Procedures Order,
such Bid Procedures Order is stayed, reversed, amended or vacated or modified
without Purchaser’s prior written consent and such Bid Procedures Order ceases
to be reinstated after a period of five (5) Business Days during which
Purchaser will work in good faith with the Debtors in an attempt to have such
Bid Procedures Order entered in a manner reasonably acceptable to Purchaser and
the Debtors, (ii) (A) the Auction is not held on or prior to December 8,
2008 or (B) the Sale Order, in form and substance reasonably satisfactory
to Purchaser, has not been entered in the Bankruptcy Case of Parent and each
entity designated in the Designation Notice prior to December 24, 2008
(or, if later, the second Business Day following the date of the Sale Hearing
if Purchaser elects to seek an adjournment of the Sale Hearing pursuant to Section 7.25(g)(i)),
or if after such entry, such Sale Order is stayed, reversed, amended, vacated
or modified without Purchaser’s prior written consent and such Sale Order
ceases to be reinstated after a period of ten (10) Business Days during
which Purchaser will work in good faith with the Debtors in an attempt to have
such Sale Order reinstated in a manner reasonably acceptable to Purchaser and
the Debtors, (iii) any Bankruptcy Case that relates to any Purchased Asset
is involuntarily converted to a case under Chapter 7 of the Bankruptcy Code, a
trustee or examiner is appointed in any such Bankruptcy Case, any such
Bankruptcy Case is dismissed or (iv) Parent, Seller or any Affiliate of
Parent breaches Section 7.20(a), Section 7.25(f) or
Section 7.25(g);”


 


9.               Section 7.25(f) of
the Purchase Agreement is hereby amended and restated in its entirety to read
as follows:


 


“(f)          If
Purchaser is selected as the Successful Bidder, promptly following such
selection, but in no event later than two (2) Business Days thereafter,
any Seller designated in the Designation Notice shall, or cause the designated
Affiliate to, file a 


 


3

















 


voluntary Chapter 11 (or,
if so designated by the Purchaser with respect to an Affiliate that is not
eligible for Chapter 11, a voluntary Chapter 7) petition in the United States
Bankruptcy Court for the Southern District of New York, together with
appropriate supporting declarations, pleadings and notices, each in form and
substance reasonably satisfactory to the Purchaser; provided, however,
that with respect to any Seller that is a Broker-Dealer Subsidiary that is a
member of SIPC, Seller shall not be required to file a voluntary Chapter 11
case until such time as a new broker dealer has been established and the
brokerage accounts from such Broker-Dealer Subsidiary that is a member of SIPC
have been transferred to a new broker dealer; provided  further
that Seller shall use commercially reasonable efforts to promptly establish the
new broker-dealer and transfer such accounts on or prior to the date that is
two (2) Business Days following Purchaser’s selection as the Successful
Bidder.”


 


10.         Section 7.25(g) of
the Purchase Agreement is hereby amended and restated in its entirety to read
as follows:


 


“(g)         In the event that any
Seller or any member of the Company Group becomes subject to a proceeding under
the Bankruptcy Code (a “New Debtor”), such Seller and the Parent shall
file a joinder to the Sale Motion, seeking approval of the Sale Order with
respect to such Seller and the assumption of this Agreement by such Seller and
the scheduling of a hearing to consider approval of such motion on the same
date of the Sale Hearing; provided, however, if Purchaser is
selected as the Successful Bidder, upon the request of the Purchaser, the
Parent shall (i) seek an adjournment of the Sale Hearing to a date not
later than fifteen (15) days after commencement of the New Debtor’s proceeding
and (ii) provide notice, to the extent not already provided, to all known
persons who may have Claims against the New Debtor or its property of the Sale
Hearing.  Any such motion shall be filed
in the Bankruptcy Case of any entity designated in the Designation Notice no
later than the commencement date of any such proceeding and in the Bankruptcy
Case of any other Seller or member of the Company Group no later than one (1) Business
Day after the commencement of such proceeding.”


 


11.         Section 8.1(h) of
the Purchase Agreement is hereby amended to replace the reference therein to “1202.79”
with a reference to “1202.77.”


 


Except as amended hereby, all of the terms of the Purchase Agreement
shall remain in full force and effect and are hereby ratified in all
respects.  On and after the date of this
letter agreement, each reference in the Purchase Agreement to “this Agreement”,
“hereunder”, “hereof”, “herein” or words of like import, and each reference to
the Purchase Agreement in any other agreements, documents or instruments
executed and delivered pursuant to, in connection with or in relation to the
Purchase Agreement, shall mean and be a reference to the Purchase Agreement, as
amended by this letter agreement.


 


Purchaser and Seller each hereby represents and warrants to each other
that:  (a) such party has all
requisite power and authority to execute and deliver this letter agreement; (b) the
execution and delivery of this letter agreement by such party have been duly
authorized by 


 


4

















 


all requisite action on the part of such party; and (c) this letter
agreement has been duly and validly executed and delivered by such party
hereto.


 


THIS LETTER AGREEMENT, AND ALL CLAIMS OR CAUSES OF ACTION (WHETHER IN
CONTRACT OR TORT) THAT MAY BE BASED UPON, ARISE OUT OF OR RELATE TO THIS
LETTER AGREEMENT (INCLUDING ANY AMENDMENT, SUPPLEMENT OR WAIVER OF THIS LETTER
AGREEMENT), OR THE NEGOTIATION, EXECUTION OR PERFORMANCE OF THIS LETTER
AGREEMENT (INCLUDING ANY AMENDMENT, SUPPLEMENT OR WAIVER OF THIS LETTER
AGREEMENT) AND THE TRANSACTIONS CONTEMPLATED HEREBY, SHALL BE GOVERNED BY THE
INTERNAL LAWS OF THE STATE OF NEW YORK.


 


This letter agreement may be executed in multiple counterparts, each of
which will be deemed to be an original copy of this letter agreement and all of
which, when taken together, will be deemed to constitute one and the same
agreement.


 


[Remainder of page intentionally left blank.  Signature page follows.]


 


5

















 


If the foregoing is consistent with your understanding, please so
indicate by signing below and returning a copy of this letter to us.


 


	
   

  	
  Very
  truly yours,

  
	
   

  	
   

  
	
   

  	
  IMD
  PARENT LLC

  
	
   

  	
   

  
	
   

  	
  By:

  	
        /s/
  Allen Thorpe

  
	
   

  	
   

  	
  Name:

  	
  Allen
  Thorpe

  
	
   

  	
   

  	
  Title:

  	
  Co-President

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
        /s/
  Phil Loughlin

  
	
   

  	
  Name:

  	
  Phil
  Loughlin

  
	
   

  	
  Title:

  	
  Vice
  President

  



 


[Signature page to
Purchase Agreement Amendment]


 

















 


ACCEPTED
AND AGREED TO AS OF

THE DATE FIRST WRITTEN ABOVE:


 


LEHMAN
BROTHERS HOLDINGS INC.


 


 


	
  By:

  	
   

  	
  /s/ D. J. Coles

  	
   

  
	
  Name:

  	
  D. J. Coles

  
	
  Title:

  	
  Chief Financial Officer

  



 


[Signature page to
Purchase Agreement Amendment]


 

















 


ACCEPTED
AND AGREED TO AS OF

THE DATE FIRST WRITTEN ABOVE:


 


LB I
GROUP INC.


 


 


	
  By:

  	
   

  	
  /s/ James P. Fogarty

  	
   

  
	
  Name:

  	
  James P. Fogarty

  
	
  Title:

  	
  Authorized Signatory

  



 


[Signature page to
Purchase Agreement Amendment]


 

















 


ACCEPTED
AND AGREED TO AS OF

THE DATE FIRST WRITTEN ABOVE:


 


LEHMAN
ALI INC.


 


 


	
  By:

  	
   

  	
  /s/ D. J. Coles

  	
   

  
	
  Name:

  	
  D. J. Coles

  
	
  Title:

  	
  Chief Financial Officer

  



 


[Signature page to
Purchase Agreement Amendment]


 

















 


ACCEPTED
AND AGREED TO AS OF

THE DATE FIRST WRITTEN ABOVE:


 


LEHMAN
BROTHERS ASSET MANAGEMENT LLC


 


 


	
  By:

  	
   

  	
  /s/ Joseph Amato

  	
   

  
	
  Name:

  	
  Joseph Amato

  
	
  Title:

  	
  Managing Director

  



 


[Signature page to
Purchase Agreement Amendment]


 
















 


ACCEPTED
AND AGREED TO AS OF

THE DATE FIRST WRITTEN ABOVE:


 


LEHMAN
BROTHERS ASSET MANAGEMENT INC.


 


 


	
  By:

  	
   

  	
  /s/ D. J. Coles

  	
   

  
	
  Name:

  	
  D. J. Coles

  
	
  Title:

  	
  Chief Financial Officer

  



 


[Signature page to
Purchase Agreement Amendment]


 

















 


ACCEPTED
AND AGREED TO AS OF

THE DATE FIRST WRITTEN ABOVE:


 


LEHMAN
BROTHERS AIM HOLDINGS LLC


 


 


	
  By:

  	
   

  	
  /s/ D. J. Coles

  	
   

  
	
  Name:

  	
  D. J. Coles

  
	
  Title:

  	
  Chief Financial Officer

  



 


[Signature page to
Purchase Agreement Amendment]


 

















 


ACCEPTED
AND AGREED TO AS OF

THE DATE FIRST WRITTEN ABOVE:


 


LEHMAN
BROTHERS AIM HOLDINGS II LLC


 


 


	
  By:

  	
   

  	
  /s/ D. J. Coles

  	
   

  
	
  Name:

  	
  D. J. Coles

  
	
  Title:

  	
  Chief Financial Officer

  



 


[Signature page to
Purchase Agreement Amendment]


 

















 


ACCEPTED
AND AGREED TO AS OF

THE DATE FIRST WRITTEN ABOVE:


 


LEHMAN
BROTHERS AIM HOLDINGS III LLC


 


 


	
  By:

  	
   

  	
  /s/ D. J. Coles

  	
   

  
	
  Name:

  	
  D. J. Coles

  
	
  Title:

  	
  Chief Financial Officer

  



 


[Signature page to
Purchase Agreement Amendment]


 

















 


ACCEPTED
AND AGREED TO AS OF

THE DATE FIRST WRITTEN ABOVE:


 


NEUBERGER
BERMAN HOLDINGS LLC


 


 


	
  By:

  	
   

  	
  /s/ Joseph Amato

  	
   

  
	
  Name:

  	
  Joseph Amato

  
	
  Title:

  	
  Managing Director

  



 


[Signature page to
Purchase Agreement Amendment]


 

















 


ACCEPTED
AND AGREED TO AS OF

THE DATE FIRST WRITTEN ABOVE:


 


NEUBERGER
BERMAN ASSET MANAGEMENT, LLC


 


 


	
  By:

  	
   

  	
  /s/ Joseph Amato

  	
   

  
	
  Name:

  	
  Joseph Amato

  
	
  Title:

  	
  Managing Director

  



 


[Signature page to
Purchase Agreement Amendment]


 

















 


ACCEPTED
AND AGREED TO AS OF

THE DATE FIRST WRITTEN ABOVE:


 


NEUBERGER
BERMAN MANAGEMENT LLC


 


 


	
  By:

  	
   

  	
  /s/ Joseph Amato

  	
   

  
	
  Name:

  	
  Joseph Amato

  
	
  Title:

  	
  Managing Director

  



 


[Signature page to
Purchase Agreement Amendment]


 

















 


ACCEPTED
AND AGREED TO AS OF

THE DATE FIRST WRITTEN ABOVE:


 


NEUBERGER
BERMAN, LLC


 


 


	
  By:

  	
   

  	
  /s/ Joseph Amato

  	
   

  
	
  Name:

  	
  Joseph Amato

  
	
  Title:

  	
  Managing Director

  



 


[Signature page to
Purchase Agreement Amendment]


 
















 


ACCEPTED AND AGREED TO AS OF

THE DATE FIRST WRITTEN ABOVE:


 


LEHMAN BROTHERS CAYMAN GP LTD.


 


 


	
  By:

  	
   

  	
  /s/ D. J. Coles

  	
   

  
	
  Name:

  	
  D. J. Coles

  
	
  Title:

  	
  Chief Financial Officer

  



 


 


	
  By:

  	
   

  	
  /s/ James P. Fogarty

  	
   

  
	
  Name:

  	
  James P. Fogarty

  
	
  Title:

  	
  Authorized Signatory

  



 


[Signature page to
Purchase Agreement Amendment]


 

















 


ACCEPTED AND AGREED TO AS OF

THE DATE FIRST WRITTEN ABOVE:


 


LEHMAN BROTHERS OFFSHORE PARTNERS LTD.


 


 


	
  By:

  	
   

  	
  /s/ D. J. Coles

  	
   

  
	
  Name:

  	
  D. J. Coles

  
	
  Title:

  	
  Chief Financial Officer

  



 


 


	
  By:

  	
   

  	
  /s/ James P. Fogarty

  	
   

  
	
  Name:

  	
  James P. Fogarty

  
	
  Title:

  	
  Authorized Signatory

  



 


[Signature page to
Purchase Agreement Amendment]


 

















 


ACCEPTED AND AGREED TO AS OF

THE DATE FIRST WRITTEN ABOVE:


 


LEHMAN BROTHERS PRIVATE EQUITY ADVISERS LLC


 


 


	
  By:

  	
   

  	
  /s/ D. J. Coles

  	
   

  
	
  Name:

  	
  D. J. Coles

  
	
  Title:

  	
  Chief Financial Officer

  



 


[Signature page to
Purchase Agreement Amendment]


 

















 


ACCEPTED AND AGREED TO AS OF

THE DATE FIRST WRITTEN ABOVE:


 


LEHMAN BROTHERS PRIVATE FUND MANAGEMENT, LP


 


 


	
  By:

  	
   

  	
  /s/ Anthony D. Tutrone

  	
   

  
	
  Name:

  	
  Anthony D. Tutrone

  
	
  Title:

  	
  Managing Director

  



 


[Signature page to
Purchase Agreement Amendment]


 

















 


ACCEPTED AND AGREED TO AS OF

THE DATE FIRST WRITTEN ABOVE:


 


LEHMAN BROTHERS PRIVATE FUNDS INVESTMENT COMPANY GP,
LLC


 


 


	
  By:

  	
   

  	
  /s/ Anthony D. Tutrone

  	
   

  
	
  Name:

  	
  Anthony D. Tutrone

  
	
  Title:

  	
  Managing Director

  



 


[Signature page to
Purchase Agreement Amendment]


 

















 


ACCEPTED AND AGREED TO AS OF

THE DATE FIRST WRITTEN ABOVE:


 


LEHMAN BROTHERS PRIVATE FUNDS INVESTMENT COMPANY LP,
LLC


 


 


	
  By:

  	
   

  	
  /s/ Anthony D. Tutrone

  	
   

  
	
  Name:

  	
  Anthony D. Tutrone

  
	
  Title:

  	
  Managing Director

  



 


[Signature page to
Purchase Agreement Amendment]


 

















 


ACCEPTED AND AGREED TO AS OF

THE DATE FIRST WRITTEN ABOVE:


 


THE MAIN OFFICE MANAGEMENT COMPANY II, LP


 


 


	
  By:

  	
   

  	
  /s/ Anthony D. Tutrone

  	
   

  
	
  Name:

  	
  Anthony D. Tutrone

  
	
  Title:

  	
  Managing Director

  



 


[Signature page to
Purchase Agreement Amendment]


 

















 


ACCEPTED AND AGREED TO AS OF

THE DATE FIRST WRITTEN ABOVE:


 


LEHMAN BROTHERS UK HOLDINGS (DELAWARE) INC.


 


 


	
  By:

  	
   

  	
  /s/ D. J. Coles

  	
   

  
	
  Name:

  	
  D. J. Coles

  
	
  Title:

  	
  Chief Financial Officer

  



 


[Signature page to
Purchase Agreement Amendment]


 

















 


ACCEPTED AND AGREED TO AS OF

THE DATE FIRST WRITTEN ABOVE:


 


LEHMAN BROTHERS ASSET MANAGEMENT (IRELAND) LTD.


 


 


	
  By:

  	
   

  	
  /s/ D. J. Coles

  	
   

  
	
  Name:

  	
  D. J. Coles

  
	
  Title:

  	
  Chief Financial Officer

  



 


 


	
  By:

  	
   

  	
  /s/ James P. Fogarty

  	
   

  
	
  Name:

  	
  James P. Fogarty

  
	
  Title:

  	
  Authorized Signatory

  



 


[Signature page to
Purchase Agreement Amendment]


 

















 


EXHIBIT A


 


Bid Procedures Order


 

















 


UNITED
STATES BANKRUPTCY COURT


SOUTHERN
DISTRICT OF NEW YORK


 


	
   

  	
  x

  	
   

  
	
  In re:

  	
  :

  	
  Chapter 11

  
	
   

  	
  :

  	
   

  
	
  LEHMAN BROTHERS
  HOLDINGS INC., et al.

  	
  :

  	
  Case
  No. 08-13555 (JMP)

  
	
   

  	
  :

  	
   

  
	
  Debtors.

  	
  :

  	
  (Jointly
  Administered)

  
	
   

  	
  x

  	
   

  



 


ORDER (I) APPROVING THE BIDDING PROCEDURES,


(II) APPROVING THE SELLER TERMINATION FEE AND THE


REIMBURSEMENT AMOUNT, (III) APPROVING THE FORM AND
MANNER


OF SALE NOTICES AND (IV) SETTING THE AUCTION AND
SALE HEARING


DATE IN CONNECTION WITH THE SALE OF CERTAIN DEBTOR
ASSETS


 


(The
“Bid Procedures Order”)


 


Upon the motion, dated October 6,
2008 (the “Motion”),(1) of Lehman Brothers Holdings Inc. (the “Debtor”
and collectively with its affiliated debtors in the above-referenced chapter 11
cases, the “Debtors”), for orders pursuant to 11 U.S.C. §§ 105,
363, 364, 365 and 503 and Fed. R. Bankr. P. 2002, 6004, 6006 and 9014 (I) authorizing
and approving, among other things, (A) the bidding procedures set forth
herein and attached hereto as Exhibit A (the “Bidding Procedures”),
(B) the Seller Termination Fee and the Reimbursement Amount as set forth
in the Amended and Restated Purchase Agreement by and between IMD Parent LLC,
the Debtor and certain of its subsidiaries, dated as of October 3, 2008
(as it may be amended, the “Purchase Agreement”), (C) the form and
manner of sale notices in connection with the Auction and Sale Hearing (each as
defined below) and (D) a date for the Auction and Sale Hearing, and (II) (A) authorizing
and approving the sale and related transactions contemplated by the Purchase
Agreement (the “Transaction”) of the Debtors’ assets free and clear of
all liens, claims and 


 






(1) Capitalized terms used herein but not defined herein shall
have the meaning ascribed to such terms in the Motion or the Purchase
Agreement, as applicable.


 

















 


encumbrances, (B) authorizing and approving the assumption and
assignment of certain Purchased Contacts and Transferred Real Property Leases
(each as defined in the Purchase Agreement) to IMD Parent LLC (together with
any of its designees, the “Purchaser”) or the Successful Bidder(s) and
(C) granting related relief; and upon the Court’s consideration of the
Motion, the record of the hearing held on October 16, 2008 with respect to
the Motion (the “Hearing”), including the testimony and evidence
admitted at the Hearing and the objections filed and raised at the Hearing; and
upon all of the proceedings had before the Court; and after due deliberation
thereon, and sufficient cause appearing therefor,


 


IT IS HEREBY FOUND AND DETERMINED THAT:(2)


 


A.            The
Court has jurisdiction over this matter and over the property of the Debtors
and their respective bankruptcy estates pursuant to 28 U.S.C. §§ 157(a) and
1334.  This matter is a core proceeding
pursuant to 28 U.S.C. § 157(b)(2)(A), (N), and (O).  The statutory predicates for the relief
sought herein are 11 U.S.C. §§ 105, 363, 364, 365 and 503 and Fed. R. Bankr. P.
2002, 6004, 6006 and 9014.  Venue of this
case and the Motion is proper pursuant to 28 U.S.C. §§ 1408 and 1409.


 


B.            The
relief requested in the Motion is in the best interests of the Debtors, their
estates, their stakeholders, and other parties-in-interest.


 


C.            The
notice of the Motion and the Hearing given by the Sellers constitutes due and
sufficient notice thereof.


 


D.            The
Debtors have articulated good and sufficient reasons for the Court to (i) approve
the Bidding Procedures, (ii) approve the Seller Termination Fee and the
Reimbursement Amount, (iii) approve certain matters relating to competing
bids, (iv) approve


 






(2) Findings of fact shall be construed as conclusions of law and
conclusions of law shall be construed as findings of fact to the fullest extent
of the law.  See Fed. R. Bankr. P.
7052.


 


2

















 


the form and manner of notice of the Motion, the Sale Hearing, and the
assumption and/or assignment of the Purchased Contracts and Transferred Real
Property Leases and (v) set the date of the Auction and the Sale Hearing,
all as provided in the Motion or the Purchase Agreement and as modified by this
Order.


 


E.             The
Seller Termination Fee and the Reimbursement Amount shall be payable in
accordance with the terms, conditions, and limitations of the Purchase
Agreement or this Order.  The Seller
Termination Fee and the Reimbursement Amount (i) if triggered, shall be
deemed actual and necessary costs and expenses of preserving the Debtors’
estates, (ii) are of substantial benefit to the Sellers and the Debtors’
estates, (iii) are reasonable and appropriate, including in light of the
size and nature of the Transaction, the necessity to announce a sale
transaction for IMD, and the efforts that have been and will be expended by the
Purchaser, (iv) have been negotiated by the parties and their respective
advisors at arms’ length and in good faith and (v) are necessary to ensure
that the Purchaser will continue to pursue the Transaction.  Each of the Seller Termination Fee and the
Reimbursement Amount, individually and collectively, is a material inducement
for, and condition of, the Purchaser’s entry into the Purchase Agreement.  The Purchaser is unwilling to commit to
purchase the Purchased Assets under the terms of the Purchase Agreement unless
the Purchaser is assured of payment of the Seller Termination Fee and the
Reimbursement Amount.  Assurance to the
Purchaser of payment of the Seller Termination Fee and the Reimbursement Amount
promotes more competitive bidding. 
Further, because the Seller Termination Fee and the Reimbursement Amount
induced the Purchaser to submit a bid that will serve as a minimum or floor bid
for other bidders, the Purchaser has provided a benefit to the Debtors’ estates
by increasing the likelihood that the price at which the Purchased Assets are
sold will reflect their true worth. 
Finally, absent authorization of the Seller 


 


3

















 


Termination Fee and the Reimbursement Amount, the
Debtors may lose the opportunity to obtain the highest or otherwise best
available offer for the Purchased Assets.


 


F.             The
Bidding Procedures are reasonable and appropriate and represent the best method
for maximizing the realizable value of the Purchased Assets.


 


G.            The
Purchaser consents to the form and timing of the entry of this Order and shall
be estopped from terminating the Purchase Agreement pursuant to Section 3.3(g)(i) of
the Purchase Agreement on account of the form or timing of the entry of this
Order.


 


THEREFORE,
IT IS ORDERED, ADJUDGED, AND DECREED THAT:


 


1.             The
Motion is granted, as provided herein.


 


2.             All
objections filed in response to the Motion, to the extent not resolved as set
forth herein, are hereby overruled.


 


The Stalking Horse Bid


 


3.             The
Transaction contemplated by the Purchase Agreement is designated as the “Stalking
Horse Bid.”


 


Bidding Procedures


 


4.             The
bidding procedures, as set forth on Exhibit A attached hereto and
incorporated herein by reference (the “Bidding Procedures”), are hereby
approved and shall govern all proceedings relating to the Transaction.


 


5.             The
Sellers, after consultation with the Creditors’ Committee, (a) may
determine which Qualified Bid (as defined in the Bidding Procedures), if any,
is the highest or otherwise best offer and (b) may reject, at any time, any
bid (other than the Stalking Horse Bid, which is found and determined to be a
Qualified Bid) that is (i) inadequate and insufficient, (ii) not in
conformity with the requirements of the Bankruptcy Code, the Bidding Procedures
or the terms 


 


4

















 


and conditions of the Transaction or (iii) contrary to the best
interests of the Debtors, their estates and their constituencies, as determined
by the Debtors in their sole discretion.


 


6.             The
failure specifically to include or reference a particular provision of the
Bidding Procedures in this Order shall not diminish or impair the effectiveness
of such provision.  The Bidding
Procedures are hereby authorized and approved in their entirety as modified by
this Order.


 


Auction and Sale Hearing


 


7.             The
Auction shall be held on December 3,
2008  at the offices of Weil, Gotshal &
Manges LLP, 767 Fifth Avenue, New York, New York 10153 at 10:00 a.m.
(New York time).  The Court
shall hold a hearing on December 22,
2008 at  10:00 a.m.
(New York time) (the “Sale Hearing”)
in the United States Bankruptcy Court for the Southern District of New York,
One Bowling Green, New York, New York 10004, at which time the Court shall
consider the approval of the sale as set forth in the Motion, approve the
Successful Bidder(s), and confirm the results of the Auction, if any.  Objections to the Motion, if any, shall be
filed and served on each of the Notice Parties (defined below) no later than 4:00 p.m. (New York time) on December 17, 2008 (the
“Sale Objection Deadline”).


 


8.             The
failure of any person or entity to file and serve an objection to the Motion by
the Sale Objection Deadline shall be a bar to the assertion by such creditor,
contract counterparty or other party in interest in these chapter 11 cases, at
the Sale Hearing or thereafter, of any objection to the Motion, the Sale Order,
the Transaction, or the Debtors’ consummation and performance of the Purchase
Agreement and Ancillary Agreements (as defined in the Purchase Agreement)
(including, without limitation, the Debtors’ transfer of the  Purchased Assets, the Purchased Contracts and
the Transferred Real Property Leases, and assumption and sublease of the
Subleased Real Property Leases free and clear of liens, claims, and
encumbrances).


 


5
















 


9.             The Sale Hearing
may be adjourned by the Debtors from time to time without further notice to
creditors or parties-in-interest other than by announcement of the adjournment
in open court or an entry of a notice on the Court’s docket; provided, however,
that any such adjournment shall be without prejudice to Purchaser’s rights
under Section 3.3 of the Purchase Agreement.


 


Seller Termination Fee and Reimbursement Amount


 


10.           The Debtors are
authorized and directed to pay the Seller Termination Fee and the Reimbursement
Amount as provided under the Purchase Agreement without further order of the
Court.  Notwithstanding anything in the
Purchase Agreement to the contrary, the Seller Termination Fee shall be equal
to $52,500,000, and shall be paid in the manner provided in the Purchase
Agreement upon the occurrence of any of the conditions set forth in Sections
3.3 and 3.5 of the Purchase Agreement. 
In addition, the Debtors are authorized and directed to pay the
Reimbursement Amount after the occurrence of the conditions set forth in
Sections 3.3 and 3.5 of the Purchase Agreement, and no later than two (2) business
days after delivery to the Debtors of an invoice documenting such reasonable
and customary out-of-pocket expenses.


 


11.           The Debtors’
obligation to pay the Seller Termination Fee upon the occurrence of the
conditions set forth in Sections 3.3 and 3.5 of the Purchase Agreement and to
pay the Reimbursement Amount, as provided by the Purchase Agreement, shall be
joint and several with the other Sellers, shall survive termination of the
Purchase Agreement, shall constitute a superpriority administrative claim
against the Debtors pursuant to sections 105(a), 503( b) and 364(c)(1) of the Bankruptcy Code and shall be
senior to, and have priority over, all other claims against the Debtors; provided,
however, that the Debtors and the Sellers shall allocate (without
affecting the joint and several obligations of the Debtors and the Sellers to
the Purchaser of the Seller Termination Fee and the Reimbursement Amount) the
liability for any such amounts paid 


 


6

















 


in accordance with
the allocation of the Purchase Price.  Without limiting the foregoing,
in the event that the Seller Termination Fee or the Reimbursement Amount
is payable pursuant to Sections 3.3 and 3.5 of the Purchase Agreement and a
Competing Transaction is consummated prior to the payment of the Seller
Termination Fee or the Reimbursement Amount, the proceeds in an amount equal to
the unpaid portion of the Seller Termination Fee or the Reimbursement Amount
shall be remitted directly to the benefit of the Purchaser or held in trust for
the Purchaser and shall not become property of such Debtors’ estates until all
obligations under the Purchase Agreement are paid in full pursuant to this
Order and the Purchase Agreement.


 


Authorization


 


12.           The Debtors, after
consultation with the Creditors’ Committee, are authorized to take such actions
as contemplated by the Purchase Agreement prior to the Auction and the Sale
Hearing, including, without limitation, actions to notify creditors, customers,
regulators or other interested parties regarding the Transaction and to obtain
any necessary consents or approvals regarding the Transaction.  In addition, the Debtors are authorized to
amend the Purchase Agreement to conform to this Order and the agreements stated
on the record at the Hearing. 
Notwithstanding anything in the Purchase Agreement to the contrary, the
Debtors and the Sellers shall not be required to take any actions in response
to a Designation Notice prior to the completion of the Auction.


 


13.           Until the completion
of the Auction, the Sellers shall be authorized to (i) afford (or cause to
be afforded) to the Purchaser and any bidder that executes a Bidder Confidentiality
Agreement (as defined in the Bid Procedures) (a “Bidder”) and requests
such access, reasonable access to the books, records, financial records,
contracts, leases, other information or data, properties, leased properties and
personnel of each of the Sellers related to the Business (as defined in the
Purchase Agreement), including the Purchased Assets, and information related to



 


7

















 


each of the
foregoing, including, without limitation, information concerning accounts
receivable, operations, production, financial performance and capacity on a per
business basis; (ii) furnish (or cause to be furnished) to the Purchaser
and any Bidder that request such documents copies of all such books, records,
employment and human resource files, financial and accounting records,
contracts and leases and other existing documents, data and information as the
Purchaser and such Bidder may reasonably request; (ii) furnish (or cause
to be furnished) to the Purchaser or any Bidder reasonable access to personnel,
including management and portfolio managers, during normal business hours and
with advanced notice as may be reasonably requested by the Purchaser or Bidder;
and (iv) furnish (or cause to be furnished) reasonable access to any and
all executed (or otherwise finalized) agreements or term sheets or similar
executed or otherwise finalized documents between the Purchaser or any Bidder
and personnel, including management and portfolio managers; provided, however,
that in no event shall the Sellers be required to provide to any Bidder any
information or documents that are subject to attorney-client, work product or
similar privileges or protections; provided further, however,
that if the Debtors refuse to provide or furnish information or access to a
Bidder or refuse to enter into a Bidder Confidentiality Agreement with a party,
and the Creditors’ Committee requests that such information or access be
provided or a Bidder Confidentiality Agreement be entered into, then (i) the
Debtors may provide such information and access as the Creditors’ Committee
requests or (ii) the Debtors and the Creditors’ Committee shall promptly
seek a determination of the Court to resolve any outstanding conflicts.


 


Notice


 


14.           Notwithstanding anything
in the Purchase Agreement to the contrary, notice of (a) the Motion, (b) the
Auction, (c) Sale Hearing and (d) the proposed assumption and/or
assignment of the Purchased Contracts, Transferred Real Property Leases and
Subleased Real Property 


 


8

















 


Leases to the
Purchaser pursuant to the Purchase Agreement or to a Successful Bidder shall be
good and sufficient, and no other or further notice shall be required, if given
as follows:


 


(a)           Notice
of Sale Hearing:  Within five (5) days
after entry of the Bid Procedures Order, the Sellers (or their agents) shall:


 


1.                                       provide
notice, in substantially the form attached to this Order (the “Sale Notice”),
of the Transaction, this Order, the Motion, the Purchase Agreement and the
proposed Sale Order by email, mail, facsimile or overnight delivery service,
upon (i) the U.S. Trustee, (ii) counsel for the Purchaser, (iii) counsel for the Creditors’
Committee, (iv) to the extent possible, all entities known to have
asserted any lien, claim, interest or encumbrance in or upon LBHI, (v) the Office of the United States Attorney for the Southern District
of New York, (vi) the United States Department of Justice, (vii) the
Securities and Exchange Commission, (viii) the
Federal Reserve Bank of New York, (ix) the Securities Investor Protection
Corporation, (x) the Internal Revenue Service and applicable federal and state taxing authorities, (xi) the U.S.
Commodities Futures Trading Commission, (xii) the Pension Benefit Guaranty Corporation
and all regulatory authorities of the Debtors’ foreign pension plans, including
the U.K. Pension Regulator, (xiii) all persons, if any, who have filed
objections to the Motion, (xiv) all persons who have filed a notice of
appearance in the Debtors’ bankruptcy cases,
and (xv) all persons who Purchaser may reasonably request; provided, however,
that, in the event that any Seller or any member of the Company Group becomes
subject to a Bankruptcy Case prior to the Sale Hearing, such entity shall
provide a Sale Notice, to the extent not already provided and to the extent
possible, to all entities known to have asserted any lien, claim, interest or
encumbrance against the new debtor or its property; and


 


2.                                       cause
the Sale Notice to be published on http://chapter11.epiqsystems.com/lehman (the
“Website”).


 


(b)           Assumption,
Assignment and Cure Notice.  If the
Purchaser is selected as the Successful Bidder, within two (2) Business
Days after the conclusion of the Auction, the Debtors shall file with this
Court and serve on each counterparty to a Purchased Contract, Transferred Real
Property Lease or Subleased Real Property Lease by email, mail, facsimile or overnight delivery
service, a notice of assumption, assignment and cure substantially in
the form attached hereto as Exhibit C (the “Assumption,
Assignment and Cure Notice”) for any Purchased Contract, Transferred Real
Property Lease or Subleased Real Property Lease that has been designated, as of
the date of such notice, as a Purchased Contract, Transferred Real Property
Lease or Subleased Real Property Lease to be assumed and subleased or assumed
and assigned to the Purchaser at Closing (collectively, the “Designated
Contracts”).  The Assumption,
Assignment and Cure Notice shall inform parties of the Debtors’ calculation of
the cure amount (the “Cure Amount”) for each such Designated
Contract.  A list of the Designated
Contracts, including Cure Amounts with respect thereto, will be posted on the
Website and updated as modified.


 


9

















 


(c)           Any
counterparty to a Designated Contract shall file and serve on the Notice
Parties any objections to (i) the proposed assumption and sublease or
assumption and assignment to the Purchaser (and must state in its objection,
with specificity, the legal and factual basis of its objection) and (ii) if
applicable, the proposed Cure Amount (and must state in its objection, with
specificity, what Cure Amount is required with appropriate documentation in
support thereof), no later than 4:00 p.m. (New York
time) on December 17, 2008
(the “Contract Objection Deadline”).  If no objection is timely received, (x) the
counterparty to a Designated Contract shall be deemed to have consented to the
assumption and sublease or assumption and assignment of the Designated Contract
to the Purchaser and shall be forever barred from asserting any objection with
regard to such assumption or assignment, and (y) the Cure Amount set forth
in the Assumption, Assignment and Cure Notice shall be controlling, notwithstanding
anything to the contrary in any Designated Contract, or any other document, and
the counterparty to a Designated Contract shall be deemed to have consented to
the Cure Amount and shall be forever barred from asserting any other claims
related to such Designated Contract against the Debtors or the Purchaser, or
the property of any of them. 
Notwithstanding anything in this paragraph, this Order does not affect
the right of any counterparty that is a governmental entity to object to the
assignment of a Designated Contract on the basis that any necessary
governmental approvals have not been obtained or that any necessary
governmental procedures have not been followed.


 


(d)           Successful Bidder Other Than Purchaser.  If the Purchaser is not the Successful Bidder
at the Auction, the Debtors shall send an Assumption, Assignment and Cure
Notice to each non-Debtor party to a Purchased Contract  as soon as practical after the Auction.  In such a case, the Contract Objection
Deadline would be no earlier than ten days after the Assumption, Assignment and
Cure Notice is provided.


 


(e)           Notice
of Objections.  All objections shall
be filed with the Court and  be served so
as to be received by the following persons no later than the Sale Objection
Deadline or the Contract Objection Deadline, as applicable:  (i) the chambers of the Honorable James M. Peck, One Bowling
Green, New York, New York 10004, Courtroom 601; (ii) Weil Gotshal &
Manges, LLP, 767 Fifth Avenue, New York, New York 10153, (Attn: Lori R. Fife, Esq.,
and Garrett A. Fail, Esq.), attorneys for the Debtors; (iii) the
Office of the United States Trustee for the Southern District of New York, 33
Whitehall Street, 21st Floor, New York, New York 10004 (Attn: Andy
Velez-Rivera, Paul Schwartzberg, Brian Masumoto, Linda Riffkin, and Tracy Hope
Davis); (iv) Milbank, Tweed, Hadley & McCloy LLP, 1 Chase
Manhattan Plaza, New York, New York 10005, (Attn: Abhilash M. Raval, Esq.,
and Evan Fleck, Esq.), attorneys for the official committee of unsecured
creditors appointed in these cases; (v) the attorneys for any other
official committee(s) appointed in these chapter cases; (vi) Hughes
Hubbard & Reed LLP, One Battery Park Plaza, New York, NY 10004 (Attn:
James B. Kobak, David Wiltenburg, and Jeff Margolin), attorneys for James
Giddens as SIPA Trustee for Lehman Brothers Inc.; and (vii) Ropes &
Gray, LLP, 1211 Avenue of the Americas, New York, NY 10036 (Attn: Mark I. Bane, Esq.
and Steven T. Hoort, Esq.) and Cleary Gottlieb Steen & Hamilton
LLP, One Liberty Plaza, New York, NY 10006 (Attn: James L. Bromley, Esq.
and Sean A. O’Neal, Esq.), attorneys for the Purchaser (collectively, the “Notice
Parties”).


 


10

















 


15.           This Order shall be binding on each Debtor and
its successors, including, without limitation, any Seller that becomes subject
to a bankruptcy or insolvency proceeding following entry of this Order.  In the event that any Seller becomes subject
to any proceeding under the Bankruptcy Code or the Securities Investor
Protection Act following entry of this Order, such debtor or any successor
shall be authorized and directed to comply with the Bidding Procedures as set
forth herein to the maximum extent permitted by law.


 


16.           Subject
to certain restrictions and the provisions in the Bidder Confidentiality
Agreement, joint bids shall be allowed. 
Nothing herein shall prohibit any bids by management or employees of the
Debtors or Sellers; provided, however, that such bids comply with
the Bidding Procedures.  If the Creditors’
Committee requests that the Sellers waive or modify restrictions or provisions
in any Bidder Confidentiality Agreement with respect to joint bids and/or
information sharing between one or more bidders then (i) the Sellers may
agree to such waivers or modifications or (ii) the Sellers and the
Creditors’ Committee shall promptly seek a determination of the Court to
resolve any outstanding conflicts.


 


17.           This
Court shall retain jurisdiction to hear and determine all matters arising from
the implementation of this Order.


 


 


	
  Dated: New York,
  New York 

  	
   

  
	
                                       ,
  2008

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  THE HONORABLE JAMES M.
  PECK
  UNITED STATES BANKRUPTCY JUDGE

  



 


11
















 


Exhibit A


 

















 


BIDDING
PROCEDURES FOR THE SALE


OF


LEHMAN
BROTHERS HOLDINGS INC.


INVESTMENT
MANAGEMENT DIVISION


 


The Bidding Procedures
set forth herein govern the proposed sale by Lehman Brothers Holdings Inc. (the
“Debtor,” together with certain of its debtor affiliates, the “Debtors,”
and together with its selling affiliates, the “Sellers”) of the assets
owned, held, or used primarily in connection with the Sellers’ investment
management business,  including certain partnerships, limited liability
companies, and investment vehicles to which a Seller or its affiliate provides
investment advisory services or serves as the general partner, managing member,
or any similar capacity.


 


A more complete listing
of the assets available for sale is included in that certain Amended and
Restated Purchase Agreement, dated October 3, 2008 (as it may be amended,
the “Purchase Agreement” or the “Stalking Horse Bid”), among IMD
Parent LLC (the “Purchaser”) and the Sellers, a copy of which is
available on the internet at http://chapter11.epiqsystems.com/lehman or by
request to the Debtor’s noticing agent at 1-866-841-7868.


 


Any interested bidder should
contact Barry W. Ridings, Vice Chairman of US Investment Banking, Lazard Freres &
Co. LLC, 30 Rockefeller Plaza, New York, New York 10020, t: 212-632-6896, f:
212-332-1757).


 


The
Bidding Procedures set forth herein describe, among other things, the manner in
which bidders and bids become Qualified Bidders and Qualified Bids (each as
defined below), the receipt and negotiation of bids received, the conduct of
any subsequent Auction (as defined below), the ultimate selection of the
Successful Bidder(s) (as defined below), and Court approval thereof
(collectively, the “Bidding Process”).


 


Participation Requirements


 


Any
party who wishes to participate in the Bidding Process must submit a bid that
satisfies each of the requirements set forth herein.


 


Any party who wishes to conduct diligence in connection with the
Bidding Process must enter into a
confidentiality agreement (a “Bidder Confidentiality Agreement”), which
shall inure to the benefit of any purchaser of the Purchased Assets, and shall
be on terms that are not less favorable to the Sellers or more favorable to
such potential bidder than the terms of the Confidentiality Agreement (as
defined in the Purchase Agreement).


 


Bid Deadline


 


A party who desires to
make a bid must deliver the Required Bid Documents (as defined below) so as to
be received not later than 12 noon (New York time) on
December 1, 2008
(the “Bid Deadline”) to  Lazard
Freres & Co. LLC, 30 Rockefeller Plaza, New York, New York 10020,
Attention:  Barry W. Ridings, with copies
to (a) Sellers’ counsel: Weil, Gotshal & 


 

















 


Manges LLP, 767 Fifth Avenue, New York, New York
10153, Attention:  Lori R. Fife, Esq.
and Michael E. Lubowitz, Esq., and (b) counsel to the Creditors’
Committee: Milbank, Tweed, Hadley & McCloy LLP, 1 Chase Manhattan
Plaza, New York, New York 10005, Attention: 
Abhilash M. Raval, Esq., and Evan Fleck, Esq.  The Sellers may extend the Bid Deadline.  If the Sellers extend the Bid Deadline, the
Sellers will promptly notify all Qualified Bidders of such extension.


 


The Sellers will promptly
provide written notice to the Purchaser of any bids in addition to the Stalking
Horse Bid and shall provide copies of each such bid to the Purchaser.


Bid Requirements


 


All bids must include the
following (the “Required Bid Documents”):


 


(a)                                 a
letter stating that the bidder’s offer is irrevocable until the conclusion of
the Sale Hearing;


(b)                                a
duly authorized and executed purchase agreement, including the purchase price
for the Purchased Assets, together with all exhibits and schedules marked to
show those amendments and modifications to the Purchase Agreement (a “Marked
Agreement”) and the proposed Sale Order;


(c)                                 written
evidence of a firm commitment for financing, or other evidence of ability to
consummate the proposed transaction without financing, that is satisfactory to
the Sellers after consultation with the Creditors’ Committee; and


(d)                              a
list of any entities that would be required to commence bankruptcy cases to
accomplish the sale.


 


A bid will be considered
only if the bid:


 


(a)                                 identifies
the assets to be purchased and the contracts and leases to be assumed;


(b)                                is
not conditioned on obtaining financing or on the outcome of unperformed due
diligence or corporate, stockholder or internal approval;


(c)                                 provides
evidence, satisfactory to the Sellers, in their reasonable discretion (after
consultation with the Creditors’ Committee) of the bidder’s financial wherewithal
and operational ability to consummate the transaction; and


(d)                                is
received on or before the Bid Deadline.


 


A party who submits a bid
that includes all of the Required Bid Documents and that satisfies each of the
requirements set forth herein shall be a “Qualified Bidder” and such bid
will constitute a “Qualified Bid.” 
Notwithstanding the foregoing, the Purchaser shall be deemed a Qualified
Bidder and the Purchase Agreement shall be deemed a Qualified Bid for all
purposes in connection with the Bidding Process.


 


A Qualified Bid will be
valued based upon several factors including, without limitation, items such as
the net value and recovery to constituents provided by such bid after pre- and
post-closing adjustments, the amount and availability of distributions to
stakeholders, consideration for any Seller Termination Fee and the
Reimbursement Amount payable to the Purchaser under the Purchase Agreement, the
number of transactions that would be required to consummate the 


 


A-2

















 


bid, the number of counterparties to such
transactions, the amount of assets included or excluded from the bid, and the
likelihood and timing of consummating such transactions, each as determined by
the Sellers with the assistance of their financial and legal advisors.


 


Debtors will promptly
advise Purchaser orally and in writing of (a) any offer or proposal for a
Competing Transaction (as defined in the Stalking Horse Bid), (b) any
request for nonpublic information relating to the Purchased Assets or access to
the properties, books or records with respect to the Purchased Assets, other
than requests in the ordinary course of business and unrelated to an offer or
proposal relating to a Competing Transaction, or (c) any inquiry or request
for discussions or negotiations regarding an offer or proposal relating to a
Competing Transaction.


 


Auction


 


Sellers will conduct an
auction in accordance with these Bidding Procedures (the “Auction”) of
the Purchased Assets upon notice to all Qualified Bidders who have submitted
Qualified Bids at 10:00, a.m. (New York
time) on December 3, 2008, at the offices of Weil, Gotshal &
Manges LLP, 767 Fifth Avenue, New York, New York 10153.


 


(a)                                 Only
the Sellers, the Purchaser, any representative of the Creditors’ Committee, and
any Qualified Bidder which has submitted a Qualified Bid (and the legal and
financial advisers to each of the foregoing), will be entitled to attend the
Auction, and only the Purchaser and Qualified Bidders who have submitted a
Qualified Bid will be entitled to make any subsequent bids at the Auction.


(b)                                Prior
to the Auction, the Sellers will provide copies of the Qualified Bid or
combination of Qualified Bids which the Sellers believe is the highest or
otherwise best offer (the “Starting Bid”) to all Qualified Bidders which
have informed the Sellers of their intent to participate in the Auction.  In order for a Qualified Bid (other than the
Stalking Horse Bid) to be the Starting Bid, such Qualified Bid shall have a
value to the Sellers, either individually or, in conjunction with any other
Qualified Bid, greater than or equal to
net amount the Sellers would receive under the Purchase Agreement, plus
the amount of the Seller Termination Fee (as defined in the Purchase
Agreement), plus the amount of the Reimbursement Amount (as defined in
the Purchase Agreement and, for purposes of this provision, limited to the
reasonable and customary out-of-pocket fees and expenses as documented by
Purchaser and reasonably estimated by the Purchaser through the date of the
Auction), plus $25 million, as determined by the Sellers in their sole
discretion, after consultation with the Creditors’ Committee.


(c)                                 Purchaser
and other Qualified Bidders shall have the opportunity to modify the terms of
their offers prior to the beginning of the Auction.


(d)                                The
Sellers, after consultation with the Creditors Committee, may employ and
announce at the Auction additional procedural rules that are reasonable
under the circumstances (e.g., the amount of time allotted to make Subsequent
Bids) for conducting the Auction, provided that such rules are (i) not
inconsistent with the Bid Procedures Order, the Bankruptcy Code, or any order
of the Bankruptcy Court entered in connection herewith, and (ii) disclosed
to each Qualified Bidder.


 


A-3

















 


(e)                                 Bidding
at the Auction will begin with the Starting Bid and continue, in one or more
rounds of bidding, so long as during each round at least one subsequent bid is
submitted by a Qualified Bidder that (i) improves upon such Qualified
Bidder’s immediately prior Qualified Bid (a “Subsequent Bid”) and (ii) the
Sellers determine, after consultation with the Creditors Committee, that such
Subsequent Bid is (a) for the first round, a higher or otherwise better
offer than the Starting Bid, and (b) for subsequent rounds, a higher or
otherwise better offer than the Leading Bid (defined below).  The first minimum incremental bid at the
Auction shall have a purchase price of at least $5 million over the Starting
Bid, with any subsequent bid increases of bids to be made in minimum increments
of at least $5 million.  After the first
round of bidding and between each subsequent round of bidding, the Sellers
shall announce the bid (and the value of such bid) that it believes to be the
highest or otherwise better offer (the “Leading Bid”).  A round of bidding will conclude after each
participating Qualified Bidder has had the opportunity to submit a Subsequent
Bid with full knowledge and written confirmation of the Leading Bid.  For the purpose of evaluating the value of
the consideration provided by Subsequent Bids (including any Subsequent Bid by
the Purchaser), the Sellers will give effect to the Seller Termination Fee and
the Reimbursement Amount (for purposes of this provision, limited to the
reasonable and customary out-of-pocket fees and expenses as documented by
Purchaser and reasonably estimated by the Purchaser through the date of the
Auction) that may be payable to the Purchaser under the Purchase Agreement.  Any Subsequent Bid submitted by the Purchaser
shall be credited in full with the amount of the Seller Termination Fee and
such Reimbursement Amount.


(f)                                   If
Sellers do not receive any Qualified Bid other than the Purchaser’s Qualified
Bid at the conclusion of the Auction, Sellers shall seek approval of the
Purchase Agreement at the Sale Hearing.


 


Selection Of
Successful Bid


 


The Sellers reserve the
right, after consultation with the Creditors Committee, to (i) determine
in their reasonable discretion which bid is the highest or best (the “Successful
Bid(s)” and the bidder(s) making such bid(s), the “Successful
Bidder(s)”) and (ii) reject at any time prior to entry of a Court
order approving an offer, without liability, any offer, other than the Stalking
Horse Bid, that the Sellers in their reasonable discretion (after consultation
with the Creditors’ Committee) deem to be (x) inadequate or insufficient, (y) not
in conformity with the requirements of the Bankruptcy Code, the Bankruptcy
Rules, the Local Rules, the Bid Procedures Order, or procedures set forth
therein or herein, or (z) contrary to the best interests of the Sellers,
the Debtors, and their estates.


 


The Sellers will sell the
Purchased Assets for the highest or otherwise best Qualified Bid to the
Successful Bidder(s) upon the approval of such Qualified Bid by the Court
after the Sale Hearing.  The Sellers’
presentation of a particular Qualified Bid to the Court for approval does not
constitute the Sellers’ acceptance of the bid. 
The Sellers will be deemed to have accepted a bid only when the bid has
been approved by the Bankruptcy Court at the Sale Hearing.


 


A-4

















 


The Sale Hearing


 


The Sale Hearing will be
held before the Honorable Judge James M. Peck on  December 22, 2008 at 10:00 a.m. (New
York time) in the United States Bankruptcy Court for the Southern
District of New York, One Bowling Green, New York, New York 10004.  The Sale Hearing may be adjourned without
further notice by an announcement of the adjourned date at the Sale
Hearing.  If the Sellers do not receive
any Qualified Bids (other than the Qualified Bid of the Purchaser), the Sellers
will report the same to the Bankruptcy Court at the Sale Hearing and will
proceed with a sale of the Purchased Assets to the Purchaser following entry of
the Sale Order in accordance with the terms of the Purchase Agreement.  If the Sellers do receive additional
Qualified Bids, then, at the Sale Hearing, the Sellers will seek approval of
the Successful Bid(s), and, at the Sellers’ election, one or more next highest
or best Qualified Bid(s) (the “Alternate Bid(s),” and such
bidder(s), the “Alternate Bidder(s)”); provided, however, the Sellers
may only designate the Stalking Horse Bid as an Alternative Bid with the
express written consent of the Purchaser.


 


Following approval of the
Sale to the Successful Bidder(s), if the Successful Bidder(s) fail(s) to
consummate the sale because of (a) failure of a condition precedent beyond
the control of either the Sellers or the Successful Bidder(s) upon which
occurrence the Sellers have filed a notice with the Bankruptcy Court advising
of such failure or (b) a breach or failure to perform on the part of such
Successful Bidder(s) upon which occurrence the Sellers have filed a notice
with the Bankruptcy Court advising of such breach or failure to perform, then
the Alternate Bid(s) will be deemed to be the Successful Bid(s) and
the Sellers will be authorized, but not directed, to effectuate a sale to the
Alternate Bidder(s) subject to the terms of the Alternate Bid(s) of
such Alternate Bidder(s) without further order of the Bankruptcy Court.


 


A-5

















 


EXHIBIT B


 

















 


UNITED STATES BANKRUPTCY COURT

SOUTHERN DISTRICT OF NEW YORK


 


	
   

  	
  x

  	
   

  
	
  In re:

  	
  :

  	
  Chapter 11

  
	
   

  	
  :

  	
   

  
	
  LEHMAN BROTHERS
  HOLDINGS INC., et al.

  	
  :

  	
  Case
  No. 08-13555 (JMP)

  
	
   

  	
  :

  	
   

  
	
  Debtors.

  	
  :

  	
  (Jointly
  Administered)

  
	
   

  	
  x

  	
   

  



 


NOTICE OF SALE OF CERTAIN EQUITY INTERESTS AND ASSETS

RELATED TO LEHMAN BROTHERS’ INVESTMENT MANAGEMENT DIVISION


 


On September 29,
2008, Lehman Brothers Holdings Inc. (“LBHI”) and its affiliates listed
on Schedule I to the Agreement (as defined below) (collectively with LBHI, “Lehman”)
entered into a Purchase Agreement, (as amended, the “Agreement”) with
IMD Parent LLC (the “Purchaser”), under which Lehman has agreed to sell
to Purchaser (or subsidiaries of the Purchaser) certain assets, and Purchaser
has agreed to assume (or cause certain of its subsidiaries to assume) certain
liabilities, related to Lehman’s investment management business (the “Business”).  The Purchaser is jointly controlled by
private investment funds sponsored by Bain Capital Partners, LLC and Hellman &
Friedman, which have agreed to provide all of the funding required to close the
transaction.


 


A more complete listing of the assets available
for sale is included in the Agreement.


 


Because
LBHI, as a debtor-in-possession under chapter 11 of the Bankruptcy Code, is a
party to the Agreement, the Agreement must be approved by the United States
Bankruptcy Court for the Southern District of New York (the “Bankruptcy
Court”) in which LBHI’s above-captioned chapter 11 case is pending.  The sale is subject to higher or better
offers.  By order, dated October [     ],
2008 (the “Bid Procedures Order”), the Bankruptcy Court approved certain
“Bidding Procedures” that govern the sale of the Purchased Assets.


 


LBHI
has requested the Bankruptcy Court enter a “Sale Order,” which provides,
among other things, for the sale of assets free and clear of liens, claims,
encumbrances and other interests, to the extent permissible by law, and the
assumption by Purchaser of certain assumed liabilities of the Sellers.  A separate notice will be provided to
counterparties to executory contracts and unexpired leases with the Sellers.


 


Copies of the Agreement, the Bid Procedures Order,
the Bidding Procedures, and the proposed Sale Order are available upon request
to LBHI’s noticing agent at 1-866-841-7867 on the internet at
http://chapter11.epiqsystems.com/lehman (the “Website”).


 


ANY INTERESTED BIDDER SHOULD
CONTACT Barry W. Ridings, Vice Chairman of US Investment Banking, Lazard
Freres & Co. LLC, 30 Rockefeller Plaza, New York, New York 10020, t:
212-632-6896, f: 212-332-1757).


 

















 


PLEASE TAKE NOTE OF THE FOLLOWING IMPORTANT DEADLINES:


 


·                                         The deadline to submit a Qualified Bid (as defined in the Bidding
Procedures) is December 1, 2008 at 12:00 noon.  The failure to abide by the procedures and
deadlines set forth in the Bid Procedures Order and the Bidding Procedures may
result in the failure of the Bankruptcy Court to consider a competing bid.


 


·                                         An auction for the assets of the Purchased Assets has been scheduled
for December 3, 2008 at 10:00 a.m. (New York time).


 


·                                         The deadline to lodge an objection with the Bankruptcy Court to the
proposed sale is December 17, 2008] at 4:00 p.m. (New York time) (the
“Sale Objection Deadline”). 
Objections must be filed and served in accordance with the Bid
Procedures Order.


 


·                                         The Bankruptcy Court will conduct a hearing to consider the proposed
sale on December 22, 2008 at 10:00 a.m. (the “Sale Hearing”).


 


THE FAILURE OF ANY PERSON
OR ENTITY TO FILE AND SERVE AN OBJECTION BY THE SALE OBJECTION DEADLINE SHALL
BE A BAR TO THE ASSERTION BY SUCH PERSON OR ENTITY, AT THE SALE HEARING OR
THEREAFTER, OF ANY OBJECTION TO THE SALE MOTION, SALE ORDER, THE PROPOSED
TRANSACTION, OR THE DEBTORS’ CONSUMMATION AND PERFORMANCE OF THE PURCHASE
AGREEMENT AND ANCILLARY AGREEMENTS (INCLUDING, WITHOUT LIMITATION, THE DEBTORS’
TRANSFER OF THE  PURCHASED ASSETS, THE
PURCHASED CONTRACTS AND THE TRANSFERRED REAL PROPERTY LEASES, AND ASSUMPTION
AND SUBLEASE OF THE SUBLEASED REAL PROPERTY LEASES FREE AND CLEAR OF LIENS,
CLAIMS, ENCUMBRANCES AND OTHER INTERESTS) (ALL AS DEFINED IN THE PURCHASE
AGREEMENT).


 


	
  Dated:

  	
  October    ,
  2008

  
	
   

  	
  New York, New
  York

  



 


	
   

  	
   

  
	
   

  	
  Harvey R. Miller

  
	
   

  	
  Richard P. Krasnow

  
	
   

  	
  Lori R. Fife

  
	
   

  	
  Shai Y. Waisman

  
	
   

  	
  Jacqueline
  Marcus

  
	
   

  	
  WEIL,
  GOTSHAL & MANGES LLP

  
	
   

  	
  767 Fifth Avenue

  
	
   

  	
  New York, New
  York 10153

  
	
   

  	
  Telephone: (212)
  310-8000

  
	
   

  	
  Facsimile: (212)
  310-8007

  
	
   

  	
   

  
	
   

  	
  Attorneys
  for the Sellers

  



 

















 


Exhibit C


 

















 


UNITED STATES BANKRUPTCY COURT

SOUTHERN DISTRICT OF NEW YORK


 


	
   

  	
  x

  	
   

  
	
  In re:

  	
  :

  	
  Chapter
  11

  
	
   

  	
  :

  	
   

  
	
  LEHMAN
  BROTHERS HOLDINGS INC., et al.

  	
  :

  	
  Case No. 08-13555
  (JMP)

  
	
   

  	
  :

  	
   

  
	
  Debtors.

  	
  :

  	
  (Jointly
  Administered)

  
	
   

  	
  x

  	
   

  



 


NOTICE OF ASSUMPTION, ASSIGNMENT AND CURE AMOUNT

WITH RESPECT TO EXECUTORY CONTRACTS AND UNEXPIRED LEASES 

RELATED TO LEHMAN BROTHERS’ INVESTMENT MANAGEMENT DIVISION


 


On September 29,
2008, Lehman Brothers Holdings Inc. (“LBHI”) and its affiliates listed
on Schedule I to the Purchase Agreement (as defined below) (collectively with
LBHI, “Lehman”) entered into a Purchase Agreement (as amended, the “Agreement”)
with IMD Parent LLC (together with any of its designees, the “Purchaser”),
under which Lehman has agreed to sell to Purchaser (or subsidiaries of the
Purchaser) certain assets (as defined in the Agreement, the “Purchased
Assets”), and Purchaser has agreed to assume (or cause certain of its
subsidiaries to assume) certain liabilities, related to Lehman’s investment
management business.  IMD Parent LLC is
jointly controlled by private investment funds sponsored by Bain Capital
Partners, LLC and Hellman & Friedman, which have agreed to provide all
of the funding required to close the transaction.


 


On October 6, 2008, LBHI and its affiliated debtors in the
above-referenced chapter 11 cases (collectively, the “Debtors”) filed a
motion (the “Motion”) to (a) establish sales procedures, (b) approve
certain stalking horse bidder protections, and (c) approve the sale of the
Purchased Assets and the assumption and sublease or assumption and assignment
of certain contracts and leases relating thereto free and clear of all liens,
claims, encumbrances and other interests.


 


Pursuant to the Motion, the Debtors sought authorization to assume and
sublease or assume and assign certain executory contacts and unexpired leases
relating to the Purchased Assets upon consummation of the transaction
contemplated in the Agreement.  A list of the Purchased Contracts, Transferred Real Property Leases and
Subleased Real Property Leases (each as defined in the Agreement and
collectively, the “Designated Contracts”) is available on the internet
at http://chapter11.epiqsystems.com/lehman (the “Website”), or upon
request to LBHI’s noticing agent at 1-866-841-7868.  The Debtors and the Purchaser
reserve the right to remove any Designated Contracts prior to consummation of
the transaction contemplated in the Agreement.


 


You are receiving this Notice because you may be a party to a
Designated Contract (or represent a party to a Designated Contract).


 


The Debtors have determined the appropriate cure amount (the “Cure
Amount”) for each Designated Contract and have listed such Cure Amounts on
the Website.


 

















 


To the extent that a non-Debtor counterparty
objects to (i) the assumption and sublease or assumption and assignment to
the Purchaser of such party’s respective Designated Contract or (ii) the
Cure Amount, the non-Debtor counterparty must file and serve an objection in
accordance with the Bid Procedures Order, so as to be received by the parties
specified therein no later than December 17,
2008, 2008, at 4:00 p.m. (New York Time).


 


If an objection challenges a Cure Amount, the Debtors have requested
that they nonetheless be authorized to move forward to assume, assume and
sublease, or assume and assign the contract or lease that is the subject of a
Cure Amount objection, provided that the Cure Amount asserted by the objector
is held in reserve.  If the Debtors
receive an objection to a Cure Amount, the Debtors reserve the right to decide
to reject the contract or lease at issue if the Cure Amount is ultimately
determined by order of the Court to be higher than the Cure Amount set forth in
this Notice.


 


If no objection is timely received, (i) the
counterparty to a Designated Contract shall be deemed to have consented to the
assumption and sublease or assumption and assignment of the Designated Contract
to the Purchaser and shall be forever barred from asserting any objection with
regard to such assumption or assignment, and (ii) the Cure Amount set
forth on [Exhibit A / the
Website] shall be controlling, notwithstanding anything to the contrary
in any Designated Contract, or any other document, and the counterparty to a
Designated Contract shall be deemed to have consented to the Cure Amount and
shall be forever barred from asserting any other claims related to such
Designated Contract against the Debtors or the Purchaser, or the property of
any of them.


 


	
  Dated:  New York, New York

  	
   

  	
   

  
	
                                     ,
  2008

  	
   

  	
   

  



 


	
   

  	
   

  
	
   

  	
  Harvey R. Miller

  
	
   

  	
  Richard P. Krasnow

  
	
   

  	
  Lori R. Fife

  
	
   

  	
  Shai Y. Waisman

  
	
   

  	
  Jacqueline
  Marcus

  
	
   

  	
  WEIL,
  GOTSHAL & MANGES LLP

  
	
   

  	
  767 Fifth Avenue

  
	
   

  	
  New York, New
  York 10153

  
	
   

  	
  Telephone: (212)
  310-8000

  
	
   

  	
  Facsimile: (212)
  310-8007

  
	
   

  	
   

  
	
   

  	
  Attorneys for Debtors and 

  Debtors In Possession

  



 


3