Document:

Exhibit 10(xxii)

The Stanley Works 2006 Management Incentive Compensation Plan

	
                        1.
 	
                        Purpose. The purpose of The Stanley Works 2006 Management Incentive Plan is to reinforce corporate, organizational and business-development goals, to promote the achievement of year-to-year financial and other business objectives and to reward the performance of eligible employees in fulfilling their personal responsibilities.
 

	
                        2.
 	
                        Definitions. The following terms, as used herein, shall have the following meanings:
 

	
                         
 	
                        (a)
 	
                        “Affiliate” shall mean, with respect to the Company or any of its subsidiaries, any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with the Company.
 

	
                         
 	
                        (b)
 	
                        “Award” shall mean an incentive compensation award, granted pursuant to the Plan that is contingent upon the attainment of Performance Goals with respect to a Performance Period.
 

	
                         
 	
                        (c)
 	
                        “Beneficial Owner” shall have the meaning set forth in Rule 13d-3 under the Exchange Act.
 

	
                         
 	
                        (d)
 	
                        “Board” shall mean the Board of Directors of the Company.
 

	
                         
 	
                        (e)
 	
                        A “Change in Control” shall be deemed to have occurred if the event set forth in any one of the following paragraphs shall have occurred:
 

	
                         
 	
                        (1)
 	
                        any Person is or becomes the Beneficial Owner, directly or indirectly, of securities of the Company (not including in the securities beneficially owned by such Person any securities acquired directly from the Company or its Affiliates) representing 25% or more of the combined voting power of the Company’s then outstanding securities, excluding any Person who becomes such a Beneficial Owner in connection with a transaction described in clause (i) of paragraph (3) below; or 
 

	
                         
 	
                        (2)
 	
                        the following individuals cease for any reason to constitute a majority of the number of directors then serving: individuals who, on the date hereof, constitute the Board and any new director (other than a director whose initial assumption of office is in connection with an actual or threatened election contest, including but not limited to a consent solicitation, relating to the election of directors of the Company) whose appointment or election by the Board or nomination for election by the Company’s shareowners was approved or recommended by a vote of at least two-thirds (2/3) of the directors then still in office who either were directors on the date hereof or whose appointment, election or nomination for election was previously so approved or recommended; or
 

 

 

	
                         
 	
                        (3)
 	
                        there is consummated a merger or consolidation of the Company or any direct or indirect subsidiary of the Company with any other corporation or other entity, other than (i) a merger or consolidation which results in the voting securities of the Company outstanding immediately prior to such merger or consolidation continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity or any parent thereof) at least 50% of the combined voting power of the securities of the Company or such surviving entity or any parent thereof outstanding immediately after such merger or consolidation, or (ii) a merger or consolidation effected to implement a recapitalization of the Company (or similar transaction) in which no Person is or becomes the Beneficial Owner, directly or indirectly, of securities of the
Company (not including in the securities Beneficially Owned by such Person any securities acquired directly from the Company or its Affiliates) representing 25% or more of the combined voting power of the Company’s then outstanding securities; or
 

	
                         
 	
                        (4)
 	
                        the shareowners of the Company approve a plan of complete liquidation or dissolution of the Company or there is consummated an agreement for the sale or disposition by the Company of all or substantially all of the Company’s assets, other than a sale or disposition by the Company of all or substantially all of the Company’s assets to an entity, at least 50% of the combined voting power of the voting securities of which are owned by shareowners of the Company in substantially the same proportions as their ownership of the Company immediately prior to such sale.
 

	
                         
 	
                        (f)
 	
                        “Code” shall mean the Internal Revenue Code of 1986, as amended.
 

	
                         
 	
                        (g)
 	
                        “Committee” shall mean the Compensation and Organization Committee of the Board of Directors, the composition of which shall at all times consist solely of two or more “outside directors” within the meaning of section 162(m) of the Code.
 

	
                         
 	
                        (h)
 	
                        “Company” shall mean The Stanley Works and its successors.
 

	
                         
 	
                        (i)
 	
                        “Covered Employee” shall have the meaning set forth in Section 162(m)(3) of the Code.
 

	
                         
 	
                        (j)
 	
                        “Disability” shall have the meaning set forth in Section 22(e)(3) of the Code, or any successor provision.
 

	
                         
 	
                        (k)
 	
                        “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.
 

 

 

2

 

	
                         
 	
                        (l)
 	
                        “Participant” shall mean any employee of the Company or an Affiliate who is, pursuant to Section 4 of the Plan, selected to participate in the Plan.
 

	
                         
 	
                        (m)
 	
                        “Performance Goals” shall mean performance goals based on one or more of the following criteria, determined in accordance with generally accepted accounting principles, where applicable:  (i) pre-tax income or after-tax income; (ii) earnings including operating income, earnings before or after taxes, earnings before or after interest, depreciation, amortization, or extraordinary or special items; (iii) net income excluding amortization of intangible assets, depreciation and impairment of goodwill and intangible assets; (iv) operating income; (v) earnings or book value per share (basic or diluted); (vi) return on assets (gross or net), return on investment, return on capital, or return on equity; (vii) return on revenues; (viii) net tangible assets (working capital plus property, plants and equipment) or return on net tangible assets
(operating income divided by average net tangible assets) or working capital; (ix) operating cash flow (operating income plus or minus changes in working capital less capital expenditures); (x) cash flow, free cash flow, cash flow return on investment (discounted or otherwise), net cash provided by operations, or cash flow in excess of cost of capital; (xi) sales or sales growth; (xii) operating margin or profit margin; (xiii) share price or total shareholder return; (xiv) earnings from continuing operations; (xv) cost targets, reductions or savings, productivity or efficiencies; (xvi) economic value added; and (xvii) strategic business criteria, consisting of one or more objectives based on meeting specified market penetration or market share, geographic business expansion, customer satisfaction, employee satisfaction, human resources management, financial management, project management, supervision of litigation, information technology, or goals relating to divestitures, joint
ventures or similar transactions. Where applicable, the Performance Goals may be expressed in terms of attaining a specified level of the particular criterion or the attainment of a percentage increase or decrease in the particular criterion, and may be applied to one or more of the Company or a parent or subsidiary of the Company, or a division or strategic business unit of the Company, all as determined by the Committee. The Performance Goals may include a threshold level of performance below which no payment will be made (or no vesting will occur), levels of performance at which specified payments will be paid (or specified vesting will occur) and a maximum level of performance above which no additional payment will be made (or at which full vesting will occur).
 

Each of the foregoing Performance Goals shall be evaluated in accordance with generally accepted accounting principles, where applicable, and shall be subject to certification by the Committee.

	
                         
 	
                        (n)
 	
                        “Performance Period” shall mean, unless the Committee determines otherwise, a period of no longer than 12 months.
 

	
                         
 	
                        (o)
 	
                        “Person” shall have the meaning given in Section 3(a)(9) of the Exchange Act, as modified and used in Sections 13(d) and 14(d) thereof, except that such term shall not include (i) the Company or any of its subsidiaries, (ii) a trustee or other
 

 

 

3

 

fiduciary holding securities under an employee benefit plan of the Company or any of its Affiliates, (iii) an underwriter temporarily holding securities pursuant to an offering of such securities, or (iv) a corporation owned, directly or indirectly, by the shareowners of the Company in substantially the same proportions as their ownership of shares of the Company.

	
                         
 	
                        (p)
 	
                        “Plan” shall mean The Stanley Works 2006 Management Incentive Plan, as amended from time to time.
 

	
                         
 	
                        (q)
 	
                        “Retirement” shall mean a Participant’s termination of employment with the Company or an Affiliate thereof at or after attaining age 55 and completing ten years of service.
 

	
                        3.
 	
                        Administration. The Plan shall be administered by the Committee. The Committee shall have the authority in its sole discretion, subject to and not inconsistent with the express provisions of the Plan, to administer the Plan and to exercise all the powers and authorities either specifically granted to it under the Plan or necessary or advisable in the administration of the Plan, including, without limitation, the authority to grant Awards; to determine the persons to whom and the time or times at which Awards shall be granted; to determine the terms, conditions, restrictions and performance criteria, including Performance Goals, relating to any Award; to determine whether, to what extent, and under what circumstances an Award may be settled, cancelled, forfeited, or surrendered; to construe and interpret the
Plan and any Award; to prescribe, amend and rescind rules and regulations relating to the Plan; to determine the terms and provisions of Awards; and to make all other determinations deemed necessary or advisable for the administration of the Plan. The Committee shall have the authority to make equitable adjustments to the Performance Goals in recognition of unusual or non-recurring events affecting the Company or any parent or subsidiary of the Company or the financial statements of the Company or any parent or subsidiary of the Company, in response to changes in applicable laws or regulations or to account for items of gain, loss or expense determined to be extraordinary or unusual in nature or infrequent in occurrence or related to the disposal of a segment of a business or related to a change in accounting principles.
 

All decisions, determinations and interpretations of the Committee shall be final and binding on all persons, including the Company and the Participant (or any person claiming any rights under the Plan from or through any Participant).

Subject to Section 162(m) of the Code or as otherwise required for compliance with other applicable law, the Committee may delegate all or any part of its authority under the Plan to any officer or officers of the Company.

	
                        4.
 	
                        Eligibility. Awards may be granted to Participants in the sole discretion of the Committee. In determining the persons to whom Awards shall be granted and the Performance Goals relating to each Award, the Committee shall take into account such factors as the Committee shall deem relevant in connection with accomplishing the purposes of the Plan.
 

 

 

4

 

	
                        5.
 	
                        Terms of Awards. Awards granted pursuant to the Plan shall be communicated to Participants in such form as the Committee shall from time to time approve and the terms and conditions of such Awards shall be set forth therein.
 

	
                         
 	
                        (a)
 	
                        In General. On or prior to the earlier of the 90th day after the commencement of a Performance Period or the date on which 25% of a Performance Period has elapsed, the Committee shall specify in writing, by resolution of the Committee or other appropriate action, the Participants for such Performance Period and the Performance Goals applicable to each Award for each Participant with respect to such Performance Period. Unless otherwise provided by the Committee in connection with specified terminations of employment, payment in respect of Awards shall be made only if and to the extent the Performance Goals with respect to such Performance Period are attained.
 

	
                         
 	
                        (b)
 	
                        Special Provisions Regarding Awards. Notwithstanding anything to the contrary contained in this Section 5, in no event shall payment in respect of an Award granted for a Performance Period be made to a Participant who is or is reasonably expected to be a Covered Employee exceed the lesser of 300% of the Participant’s annual base salary on the date the Performance Period commences for any twelve month period or $5,000,000. The Committee may, in its sole discretion, increase (subject to the maximum amount set forth in this Section 5(b)) or decrease the amounts otherwise payable to Participants upon the achievement of Performance Goals under an Award; provided, however, that in no event may the Committee so increase the amount otherwise payable to a Covered Employee pursuant to an Award.
 

	
                         
 	
                        (c)
 	
                        Time and Form of Payment. Subject to Section 7(h), all payments in respect of Awards granted under this Plan shall be made in cash on the 45th day following the end of the Performance Period but in no event later than the 45th day following the fiscal year in which the Award vests.
 

	
                        6.
 	
                        Term. Subject to the approval of the Plan by the holders of a majority of the Common Stock represented and voting on the proposal at the annual meeting of Company’s shareholders to be held in 2006 (or any adjournment thereof), the Plan shall be effective as of January 1, 2006 and shall continue in effect until the tenth anniversary of the date of such shareholder approval, unless earlier terminated as provided below.
 

	
                        7.
 	
                        General Provisions.
 

	
                         
 	
                        (a)
 	
                        Compliance with Legal Requirements. The Plan and the granting and payment of Awards, and the other obligations of the Company under the Plan shall be subject to all applicable federal and state laws, rules and regulations, and to such approvals by any regulatory or governmental agency as may be required.
 

	
                         
 	
                        (b)
 	
                        Nontransferability. Awards shall not be transferable by a Participant except upon the Participant’s death following the end of the Performance Period but prior to the date payment is made, in which case the Award shall be transferable in accordance with any beneficiary designation made by the Participant in accordance with Section 7(l) below or, in the absence thereof, by will or the laws of descent and distribution.
 

 

 

5

 

	
                         
 	
                        (c)
 	
                        No Right To Continued Employment. Nothing in the Plan or in any Award granted pursuant hereto shall confer upon any Participant the right to continue in the employ of the Company or to be entitled to any remuneration or benefits not set forth in the Plan or to interfere with or limit in any way whatever rights otherwise exist of the Company to terminate such Participant’s employment or change such Participant’s remuneration.
 

	
                         
 	
                        (d)
 	
                        Withholding Taxes. Where a Participant or other person is entitled to receive a payment pursuant to an Award hereunder, the Company shall have the right either to deduct from the payment, or to require the Participant or such other person to pay to the Company prior to delivery of such payment, an amount sufficient to satisfy any federal, state, local or other withholding tax requirements related thereto.
 

	
                         
 	
                        (e)
 	
                        Amendment, Termination and Duration of the Plan. The Board or the Committee may at any time and from time to time alter, amend, suspend, or terminate the Plan in whole or in part; provided that, no amendment that requires shareholder approval in order for the Plan to continue to comply with Section 162(m) of the Code shall be effective unless the same shall be approved by the requisite vote of the shareholders of the Company. Notwithstanding the foregoing, no amendment (other than an amendment necessary to comply with Section 409A of the Code) shall affect adversely any of the rights of any Participant under any Award following the end of the Performance Period to which such Award relates, provided that the exercise of the Committee’s discretion pursuant to Section 5(b) to reduce the amount of an Award
shall not be deemed an amendment of the Plan.
 

	
                         
 	
                        (f)
 	
                        Participant Rights. No Participant shall have any claim to be granted any Award under the Plan, and there is no obligation for uniformity of treatment for Participants.
 

	
                         
 	
                        (g)
 	
                        Termination of Employment.
 

	
                         
 	
                        (i)
 	
                        Unless otherwise provided by the Committee, and except as set forth in subparagraph (ii) of this Section 7(g), a Participant must be actively employed by the Company or one of its Affiliates at the end of the Performance Period in order to be eligible to receive payment in respect of such Award.
 

	
                         
 	
                        (ii)
 	
                        Unless otherwise provided by the Committee, if a Participant’s employment is terminated as result of death, Disability or Retirement prior to the end of the Performance Period, the Participant’s Award shall be cancelled and in respect of his or her cancelled Award the Participant shall receive a pro rata portion of the Award as determined by the Committee and such Award shall be payable at the same time as Awards are paid to active Participants.
 

 

 

6

 

	
                         
 	
                        (h)
 	
                        Change in Control. Notwithstanding any provision in the Plan to the contrary, upon a Change in Control, unless otherwise determined by the Committee with respect to an Award at the time of its grant, each outstanding Award shall be cancelled and in respect of his or her cancelled Award a Participant shall receive a pro rata portion of the Award. Such portion shall be calculated by extrapolating the achievement of the applicable Performance Goal or Performance Goals during the Performance Period prior to the Change in Control to the end of the Performance Period and then multiplying this amount by a fraction, the numerator of which is the number of days completed in the Performance Period prior to the Change in Control and the denominator of which is the total number of days in the Performance Period. The pro
rata portion of the Award shall be paid in cash as soon as practicable following the Change in Control but in no event later than 15 days following such Change in Control. In addition, if any Award which a Participant earned under the Plan during any Performance Period which ended prior to the Change in Control has neither been paid to the Participant nor credited to such Participant under a deferred compensation plan maintained or sponsored by the Company or an Affiliate prior to the Change in Control, such Award shall be paid to the Participant as soon as practicable and in no event later than the March 1st following the year in respect of which the Award was earned. After a Change in Control, the Committee may not exercise the discretion referred to in Section 5(b) to decrease the amount payable in respect of any Award which is outstanding immediately prior to the occurrence of the Change in Control.
 

	
                         
 	
                        (i)
 	
                        Unfunded Status of Awards. The Plan is intended to constitute an “unfunded” plan for incentive and deferred compensation. With respect to any payments not yet made to a Participant pursuant to an Award, nothing contained in the Plan or any Award shall give any such Participant any rights that are greater than those of a general creditor of the Company.
 

	
                         
 	
                        (j)
 	
                        Governing Law. The Plan and all determinations made and actions taken pursuant hereto shall be governed by the laws of the State of Connecticut without giving effect to the conflict of laws principles thereof.
 

	
                         
 	
                        (k)
 	
                        Effective Date. The Plan shall take effect upon its adoption by the Board; provided, however, that the Plan shall be subject to the requisite approval of the shareholders of the Company in order to comply with Section 162(m) of the Code. In the absence of such approval, the Plan (and any Awards made pursuant to the Plan prior to the date of such approval) shall be null and void.
 

	
                         
 	
                        (l)
 	
                        Beneficiary. A Participant may file with the Committee a written designation of a beneficiary on such form as may be prescribed by the Committee and may, from time to time, amend or revoke such designation. If no designated beneficiary survives the Participant and an Award is payable to the Participant’s beneficiary pursuant to Section 7(b), the Participant’s estate shall be deemed to be the grantee’s beneficiary.
 

 

 

7

 

  	
                         
	(m)
	Interpretation. The Plan is designed and intended to comply, to the extent applicable, with Section 162(m) of the Code, and all provisions hereof shall be construed in a manner to so comply.

 

 

8exv10w1

 

EXHIBIT 10.1

      

ASSET PURCHASE AGREEMENT

by and among

WILFORD & GESKE, PROFESSIONAL ASSOCIATION,

a Minnesota professional corporation,

LAWRENCE A. WILFORD, and

JAMES A. GESKE

AND

AMERICAN PROCESSING COMPANY, LLC,

a Michigan limited liability company

February 22, 2008

      

 

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	PAGE	 
	ARTICLE I PURCHASE AND SALE OF ASSETS
	 	 	1	 
	 
	 	 	 	 
	1.1 Transfer of Assets
	 	 	1	 
	1.2 Assumption of Liabilities
	 	 	3	 
	1.3 Conveyance
	 	 	5	 
	 
	 	 	 	 
	ARTICLE II CONSIDERATION AND MANNER OF PAYMENT
	 	 	5	 
	 
	 	 	 	 
	2.1 Purchase Price
	 	 	5	 
	2.2 Contingent Payment
	 	 	5	 
	2.3 Purchase Price Allocation
	 	 	7	 
	2.4 Services Agreement
	 	 	8	 
	 
	 	 	 	 
	ARTICLE III REPRESENTATIONS AND WARRANTIES OF THE SELLER
	 	 	8	 
	 
	 	 	 	 
	3.1 Organization and Qualification of the Seller
	 	 	8	 
	3.2 Authorization
	 	 	8	 
	3.3 Subsidiaries
	 	 	8	 
	3.4 No Conflict
	 	 	8	 
	3.5 No Consent Required
	 	 	9	 
	3.6 Financial Statements
	 	 	9	 
	3.7 Absence of Undisclosed Liabilities
	 	 	9	 
	3.8 Personal Property
	 	 	10	 
	3.9 Compliance with Laws; Governmental Authorizations
	 	 	10	 
	3.10 Real Property
	 	 	11	 
	3.11 Contracts
	 	 	11	 
	3.12 Proprietary Rights
	 	 	12	 
	3.13 Employee Benefit Plans
	 	 	14	 
	3.14 Labor and Employment Matters
	 	 	15	 
	3.15 Workers Compensation
	 	 	16	 
	3.16 Employees
	 	 	16	 
	3.17 Books and Records
	 	 	16	 
	3.18 Affiliate Transactions
	 	 	16	 
	3.19 Insurance Policies
	 	 	17	 
	3.20 Taxes
	 	 	17	 
	3.21 Litigation
	 	 	18	 
	3.22 Environmental and Safety Requirements
	 	 	19	 
	3.23 Conduct of the Business
	 	 	20	 
	3.24 Absence of Questionable Payments
	 	 	21	 
	3.25 Government Contracts
	 	 	21	 
	3.26 Corporate Name; Business Locations
	 	 	21	 
	3.27 Major Clients
	 	 	22	 
	3.28 Brokers or Finders
	 	 	22	 
	3.29 Disclosure
	 	 	22	 
	 
	 	 	 	 
	ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE BUYER
	 	 	22	 
	 
	 	 	 	 
	4.1 Organization and Good Standing
	 	 	22	 

i

 

	 	 	 	 	 
	 	 	PAGE	 
	4.2 Authorization
	 	 	22	 
	4.3 No Conflict
	 	 	23	 
	4.4 No Consent Required
	 	 	23	 
	4.5 Brokers and Finders
	 	 	23	 
	 
	 	 	 	 
	ARTICLE V [SECTION LEFT INTENTIONALLY BLANK]
	 	 	23	 
	 
	 	 	 	 
	ARTICLE VI CLOSING
	 	 	23	 
	 
	 	 	 	 
	6.1 Closing
	 	 	23	 
	6.2 Deliveries by the Seller
	 	 	24	 
	6.3 Deliveries by Buyer
	 	 	25	 
	6.4 Concurrent Delivery
	 	 	26	 
	 
	 	 	 	 
	ARTICLE VII COVENANTS AFTER CLOSING
	 	 	26	 
	 
	 	 	 	 
	7.1 No Assignment in Certain Circumstances
	 	 	26	 
	7.2 The Seller’s Access to Information
	 	 	27	 
	7.3 The Buyer’s Access to Information
	 	 	27	 
	7.4 Retention of Records
	 	 	27	 
	7.5 Indemnification
	 	 	28	 
	7.6 Right of Set Off
	 	 	33	 
	7.7 Restrictive Covenants
	 	 	33	 
	7.8 Employment Matters
	 	 	35	 
	 
	 	 	 	 
	ARTICLE VIII MISCELLANEOUS
	 	 	36	 
	 
	 	 	 	 
	8.1 Notices, Consents, etc
	 	 	36	 
	8.2 Public Announcements
	 	 	37	 
	8.3 Severability
	 	 	37	 
	8.4 No Third Party Beneficiaries
	 	 	38	 
	8.5 Amendment and Waiver
	 	 	38	 
	8.6 Counterparts
	 	 	38	 
	8.7 Deliveries
	 	 	38	 
	8.8 Expenses
	 	 	38	 
	8.9 Headings
	 	 	39	 
	8.10 Governing Law; Waiver of Jury Trial
	 	 	39	 
	8.11 Assignment
	 	 	39	 
	8.12 Definitions
	 	 	40	 
	8.13 Entire Agreement
	 	 	45	 
	8.14 Third Parties
	 	 	45	 
	8.15 Interpretative Matters
	 	 	45	 
	8.16 Further Assurances
	 	 	46	 
	8.17 Guaranty of the Seller’s Obligations
	 	 	46	 

ii

 

DEFINED TERMS

	 	 	 	 	 
	 	 	Page	 
	Agreement
	 	 	1	 
	Assumed Contracts
	 	 	2	 
	Assumed Liabilities
	 	 	3	 
	Audited Pro Forma Financial Statements
	 	 	9	 
	Bill of Sale
	 	 	5	 
	Business
	 	 	1	 
	Buyer
	 	 	1	 
	Buyer Indemnified Party
	 	 	28	 
	CAN-SPAM Act
	 	 	13	 
	Claim Notice
	 	 	30	 
	COBRA
	 	 	15	 
	Commercial Software
	 	 	13	 
	Computer System
	 	 	14	 
	Confidential Information
	 	 	34	 
	Defense Counsel
	 	 	30	 
	Defense Notice
	 	 	30	 
	Direct Claim
	 	 	31	 
	Employee Benefit Plans
	 	 	14	 
	Employment Agreements
	 	 	25	 
	Environmental and Safety Requirements
	 	 	20	 
	Excluded Liabilities
	 	 	4	 
	Financial Statements
	 	 	9	 
	Geske
	 	 	1	 
	Hazardous Materials
	 	 	20	 
	Indemnified Party
	 	 	30	 
	Indemnifying Party
	 	 	30	 
	Insurance Policies
	 	 	17	 
	Liens
	 	 	1	 
	Listed Proprietary Rights
	 	 	12	 
	Losses
	 	 	28	 
	Most Recent Financial Statements
	 	 	9	 
	Plan Affiliate
	 	 	16	 
	Proprietary Rights Licenses
	 	 	13	 
	Purchase Price
	 	 	5	 
	Purchased Assets
	 	 	1	 
	Real Property Leases
	 	 	11	 
	Required Contract Consents
	 	 	11	 
	Restricted Parties
	 	 	33	 
	Restricted Party
	 	 	33	 
	Restricted Period
	 	 	33	 
	Seller
	 	 	1	 
	Seller Guaranty
	 	 	46	 
	Seller Indemnified Party
	 	 	29	 
	Seller License
	 	 	12	 
	Seller Owned Proprietary Rights
	 	 	12	 
	Sublease Agreement
	 	 	25	 
	Territory
	 	 	34	 
	Third Party Claim
	 	 	30	 
	Third Party Licenses
	 	 	12	 
	Third Party Marks
	 	 	13	 
	Third Party Proprietary Rights
	 	 	12	 
	Transferred Employees
	 	 	35	 
	WARN Act
	 	 	16	 
	Wilford
	 	 	1	 

iii

 

ASSET PURCHASE AGREEMENT

     THIS ASSET PURCHASE AGREEMENT (this “Agreement”), dated as of February 22, 2008, is by
and among Wilford & Geske, a Minnesota professional association (the “Seller”), Lawrence A.
Wilford, individually (“Wilford”), and James A. Geske, individually (“Geske”), and
American Processing Company, LLC, a Michigan limited liability company (the “Buyer”).
Certain capitalized terms used but not otherwise defined herein shall have the meanings ascribed
thereto in Section 8.12.

RECITALS

     A. In support of the Legal Services provided to its clients, the Seller has been providing
foreclosure, bankruptcy and eviction processing and related services to its clients (the
“Business”).

     B. The Seller desires to sell and assign to the Buyer, and the Buyer desires to purchase from
the Seller, all of the Purchased Assets (as hereinafter defined), upon the terms and conditions set
forth below.

     C. Wilford and Geske are all of the owners of the Seller.

AGREEMENT

     In consideration of the mutual covenants of the parties set forth in this Agreement and other
good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:

ARTICLE I

PURCHASE AND SALE OF ASSETS

     1.1 Transfer of Assets.

          (a) Purchased Assets. On the terms and subject to the conditions set forth in this
Agreement, at the Closing, the Seller shall sell, transfer and deliver to the Buyer, free and clear
of all liens, hypothecations, mortgages, charges, security interests, pledges and other
encumbrances and claims of any nature (“Liens”), and the Buyer shall purchase from the
Seller, all of the Seller’s right, title and interest in and to the following assets (collectively,
the “Purchased Assets”):

               (i) Movable/Tangible Personal Property. All equipment and machinery, furniture,
computer hardware and printers, office furniture and equipment of Seller listed on Schedule
1.1(a)(i);

               (ii) Intangible Assets. A fully-paid, perpetual, fully transferable (in whole or in
part) non-exclusive license (which license is created hereby and granted hereunder)
to use all “know how,” production methods and techniques of the Seller relating solely to the
Business (the “Intangible Assets”);

1

 

               (iii) Assumed Contracts. All rights and benefits that the Seller may have under the
Contracts used primarily in connection with the operation of, or related to, the Business, listed
on Schedule 1.1(a)(iii) (the “Assumed Contracts”);

               (iv) Assumed Proprietary Rights. A fully-paid, perpetual, fully transferable (in whole
or in part) non-exclusive limited license (which license is created hereby and granted hereunder)
of the Proprietary Rights used by the Seller primarily in connection with the operation of, or
related to, the Business and listed on Schedule 1.1(a)(iv) (the “Assumed Proprietary
Rights”) (the Buyer acknowledges and agrees that the Assumed Proprietary Rights shall not
include any assets described in Section 1.1(b) and that such license is limited solely to
the use by Buyer of the Assumed Proprietary Rights in connection with providing mortgage default
support services to Seller pursuant to the Services Agreement);

               (v) Records. All records and files (in all media) of the Seller used solely in
connection with the operation of the Purchased Assets and all employment records with respect to
the Transferred Employees;

               (vi) Claims. All causes of action, claims, warranties, guarantees, refunds (other
than Tax refunds), covenants, indemnities and the like, all rights of recovery and set off of every
kind and character of the Seller related solely to the Purchased Assets, except to the extent such
amounts reimburse the Seller for amounts it has paid for the repair or restoration of the Purchased
Assets prior to the Closing; and

               (vii) Goodwill. All goodwill associated with the Business and the Purchased Assets.

          (b) Excluded Assets. Notwithstanding the foregoing, all of Seller’s assets other than
the Purchased Assets are retained by the Seller and are expressly excluded from the purchase and
sale contemplated by this Agreement (collectively, the “Excluded Assets”), including, but
not limited to, the following:

               (i) Records. The Seller’s formal corporate records, including governing documents,
client files, minute books, stock books and other records having exclusively to do with the
corporate organization of the Seller and all of the Seller’s Tax Returns and all other records of
the Seller not included in the Purchased Assets;

               (ii) Securities. All of the capital stock of the Seller;

               (iii) Agreement Rights. The Seller’s rights pursuant to or under this Agreement and
the Transaction Documents;

               (iv) Receivables. All notes and accounts receivable of the Seller and all other
evidences of indebtedness of any Person held by the Seller, including all trade and other accounts
and moneys receivable and all rights of the Seller to reimbursement by Clients for
services provided to the Seller by third-party vendors and all other client costs advanced by
Seller (the “Accounts Receivable”);

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               (v) Cash and Marketable Securities. All cash, cash equivalents, bank accounts and
marketable securities of the Seller;

               (vi) Intangible Assets & Proprietary Rights. Subject to the licenses granted to the
Buyer pursuant to Sections 1.1(a)(ii) and (iv), the Seller’s right, title and interest in and to
its Intangible Assets and its Proprietary Rights. Subject to the conditions of this Agreement, the
Seller shall also retain all rights in all telephone numbers, tradenames, trademarks, domain names,
websites, and email addresses currently held by Seller;

               (vii) Employee Benefit Plans. Each Employee Benefit Plan and all moneys, rights and
other assets (including any insurance policy, annuity contract or trust) maintained under, pursuant
to, or in direct connection with, any Employee Benefit Plan, including the right to receive refunds
from any such plans;

               (viii) Tax Assets. Any Tax deposits, Tax refunds, or any prepaid Taxes of the Seller;

               (ix) Contracts not Assumed. All rights and benefits that the Seller may have in any
Contracts that are not Assumed Contracts;

               (x) Insurance. All Insurance Policies under which the Seller is the owner and/or
named insured;

               (xi) Deposits. The Seller’s deposits for utility and/or other services; for leases
and other such deposits; and

               (xii) Other Assets. All other assets of the Seller of whatever type or nature.

     1.2 Assumption of Liabilities.

          (a) Assumed Liabilities. On the terms and subject to the conditions set forth in this
Agreement, at the Closing the Buyer shall assume and agree to perform, pay and discharge when due
all liabilities and obligations of the Seller that arise in connection with events or conditions
that occur, and are to be performed, after the Effective Time under any Assumed Contract;
provided, however, that the Buyer shall not assume (A) any liabilities or
obligations arising out of any breach prior to the Effective Time by the Seller of any provision of
any Assumed Contract and (B) any penalties arising prior to the Effective Time (collectively, the
“Assumed Liabilities”). In addition, the parties agree that the Assumed Liabilities shall
include the liabilities of the Seller in connection with the accrued and unpaid vacation and sick
time of the Transferred Employees arising from periods prior to the Closing to the extent such
amounts are set forth on Schedule 1.2(a) hereto (such amount, the “Accrued
Amount”).

          (b) Excluded Liabilities. Notwithstanding any disclosures made to the Buyer or its
agents in the conduct of their due diligence investigations of the Seller, the Business and the
Purchased Assets and further notwithstanding any matters disclosed on any Schedules hereto, the
Buyer shall not assume any of the liabilities of the Seller other than the Assumed Liabilities.
The Buyer shall not be or become liable for any claims, demands, liabilities or obligations other

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than the Assumed Liabilities and the Buyer shall purchase the Purchased Assets free and clear of
all Liens. Without limiting the foregoing, the Buyer shall not at the Closing assume or agree to
perform, pay or discharge, and the Seller shall remain unconditionally liable for, all obligations,
liabilities and commitments, fixed or contingent, known or unknown, accrued or unaccrued, direct or
indirect, choate or inchoate, perfected or unperfected, liquidated or unliquidated, of the Seller
other than the Assumed Liabilities (such retained amount, the “Excluded Liabilities”),
including:

               (i) Liabilities, obligations and expenses relating to the current and former employees of the
Seller or the Seller’s employment thereof, including (A) severance, termination and other payments
and benefits (including post-retirement benefits), whether owing under any severance policy, any
union contract, any employment agreement or otherwise to any employees of the Seller; (B) worker’s
compensation claims; (C) stock option or other stock-based award or any profit sharing, stock
appreciation right or phantom equity award; and (D) payroll and employment Taxes;

               (ii) Liabilities or obligations for any Taxes imposed upon, or incurred by, either the Seller
or any of their respective Affiliates at any time;

               (iii) Liabilities or obligations of the Seller incurred in connection with violations of, or
pursuant to, occupational safety, wage, welfare, employee benefit, and/or Environmental and Safety
Requirements;

               (iv) Liabilities and obligations of the Seller or any of its Affiliates with respect to any
claims, grievances, lawsuits, arbitrations, administrative or other Proceedings arising out of an
occurrence or condition prior to the Effective Time or attributable to the operation of the
Business prior to the Effective Time;

               (v) Liabilities and obligations of the Seller or any of its Affiliates under any Insurance
Policies or Contracts that are not Assumed Contracts;

               (vi) Liabilities and obligations of the Seller with respect to any customer or client advances
and deposits;

               (vii) Liabilities and obligations of the Seller with respect to trade payables and accruals
(including employee wages and benefits);

               (viii) Liabilities, obligations and expenses of the Seller with respect to the transaction
contemplated hereby, including liabilities, obligations and expenses with respect to the Seller’s
legal counsel, accountants, and any broker or finder;

               (ix) Liabilities for Indebtedness of the Seller;

               (x) Liabilities and obligations of the Seller or any of its Affiliates under or in connection
with any Proceedings or Orders;

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               (xi) Liabilities and obligations of the Seller or any of its Affiliates under, pursuant to or
in connection with, any Employee Benefit Plan, including any liabilities and obligations for
continuation coverage required by COBRA; and

               (xii) Liabilities and obligations arising out of or related to the Excluded Assets.

          (c) The Seller shall pay in full, when due, all of the Seller’s liabilities and obligations
other than the Assumed Liabilities.

     1.3 Conveyance. At the Closing, the Seller shall execute and deliver a Bill of Sale,
Assignment and Assumption Agreement, in the form attached hereto as Exhibit 1.3 (a
“Bill of Sale”) pursuant to which the Seller shall convey to the Buyer the Purchased Assets
and the Buyer shall assume the liabilities of the Seller included in the Assumed Liabilities.

ARTICLE II

CONSIDERATION AND MANNER OF PAYMENT

     2.1 Purchase Price. The aggregate purchase price (the “Purchase Price”) to be
paid by the Buyer to the Seller or its designee for the Purchased Assets, and the rights and
benefits conferred hereunder, shall be (a) $13,500,000 less (b) the Accrued Amount
plus (c) the amount of the Assumed Liabilities. The Purchase Price shall be payable as
follows:

          (a) At the Closing, the Buyer shall deliver to the Seller, by wire transfer of immediately
available funds to an account or accounts previously designated by the Seller in writing, an
aggregate amount equal to $13,500,000 minus the Accrued Amount.

          (b) At the Closing, the Buyer shall assume the Assumed Liabilities by delivering to the Seller
the Bill of Sale duly executed by the Buyer.

     2.2 Contingent Payment. The Purchase Price may be increased as follows:

          (a) Contingent Payment. If Adjusted 2008 EBITDA with respect to the Business (as
conducted by the Buyer) equals or exceeds the Adjusted 2008 EBITDA Target, then the Seller shall be
entitled to an additional payment from the Buyer in an amount equal to the Target Contingent
Payment. If there is an Adjusted 2008 EBITDA Shortfall but the Adjusted 2008 EBITDA Shortfall is
less than the Adjusted 2008 EBITDA Target by an amount not in excess of $400,000, then the Seller
shall be entitled to an additional payment from the Buyer in an amount equal to (i) the Target
Contingent Payment minus (ii) a dollar amount equal to the product of the Adjusted 2008 EBITDA
Shortfall multiplied by five (5). If there is an Adjusted
2008 EBITDA Shortfall which is equal to or in excess of $400,000, the Buyer shall not be
entitled to an additional payment. By way of example: if the Adjusted 2008 EBITDA Target is
$3,045,000 and the Adjusted 2008 EBITDA is (i) $3,045,000 or greater, then the full Target
Contingent Payment will be owed to the Seller, (ii) $2,800,000, then a payment of $775,000 will be
owed to the Seller, and (iii) $2,645,000 or less, then no payment will be owed to the Seller
pursuant to this Section. The parties hereto agree that, subject to the provisions of Section

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2.2(d), the Adjusted 2008 EBITDA shall be calculated in a manner consistent with the
methodology used in calculating the Adjusted EBITDA of the Business for the twelve (12) months
ended December 31, 2006.

          (b) Determination of Adjusted 2008 EBITDA. On or before the date that is forty-five
(45) days after the end of the Measurement Period, the Buyer shall compute and deliver in writing
to the Seller its calculation of the Adjusted 2008 EBITDA. During the forty-five (45) day period
commencing on the date the Adjusted 2008 EBITDA calculation is delivered to the Seller, the Buyer
shall give the Seller such access to the books and records of the Buyer and the Business
(including, but not limited to, copies of the work papers, schedules and other documents prepared
by the Buyer in connection with its calculation of the Adjusted 2008 EBITDA) as the Seller shall
reasonably request during normal business hours. On or before the forty-fifth day (45th) day
following the date of receipt by the Seller of the Adjusted 2008 EBITDA calculation, the Seller
shall deliver to the Buyer a written notice of objection (an “Adjusted EBITDA Objection
Notice”) or a written notice of acceptance (an “Adjusted EBITDA Acceptance Notice”)
with respect to the Adjusted 2008 EBITDA computed by the Buyer. If an Adjusted EBITDA Acceptance
Notice is delivered to the Sellers or if no Adjusted EBITDA Objection Notice is delivered to the
Sellers before the expiration of such forty-five (45) day period, the Adjusted 2008 EBITDA as
calculated by the Buyer shall be final and binding on the parties hereto. Any Adjusted EBITDA
Objection Notice shall describe in detail the basis for the objection to the calculation of the
Adjusted 2008 EBITDA, as well as the Seller’s calculation of the Adjusted 2008 EBITDA. If an
Adjusted EBITDA Objection Notice is timely delivered in accordance with this Section
2.2(b), the Seller and the Buyer shall consult with each other with respect to the objection
set forth therein. If the Seller and the Buyer are unable to reach a written agreement within
twenty (20) days following the date an Adjusted EBITDA Objection Notice has been timely received by
the Buyer, then all such matters as specified in the Adjusted EBITDA Objection Notice as to which
such written agreement has not been reached (the “Adjusted EBITDA Disputed Matters”) shall
be submitted to and reviewed by the Arbitrator, who shall serve as the arbitrator for disputes
under this Section. All issues with respect to Adjusted EBITDA Disputed Matters and any issue
related to the arbitration thereof, including any questions arising with respect to the procedures
described in this Section, shall be resolved by the Arbitrator, and the Arbitrator’s authority
shall be limited to resolving such issues. The Arbitrator shall have the power to compel testimony
and the production of documents reasonably necessary in any proceeding under this Section and the
parties shall make available to the Arbitrator all work papers and other information in their
possession or control relating to the Adjusted EBITDA Disputed Matters (excluding attorney-client
privileged materials and attorney work product). The Arbitrator shall use all reasonable efforts
to resolve all Adjusted EBITDA Disputed Matters within forty-five (45) Business Days after the date
that such matters are referred to the Arbitrator, and its decision with respect to all Adjusted
EBITDA Disputed Matters and any other matters under this Section shall be final and binding upon
the Buyer and the Seller. The computation of Adjusted 2008 EBITDA, as modified by resolution of the
Buyer and the
Seller or by the Arbitrator, as set forth in this Section, if applicable, shall be the
“Adjusted 2008 EBITDA” hereunder. Such binding determination by the Arbitrator shall be in the
form of an arbitration award and a judgment upon such award may be entered in a court of competent
jurisdiction. The fees and expenses of the Arbitrator incurred in connection with its review and
determination of any Adjusted EBITDA Disputed Matter and any other matters under this Section shall
be borne in the manner allocated by the Arbitrator based upon the Arbitrator’s

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determination as to
which side substantially prevails in the arbitration proceeding, which allocation shall be included
in the arbitration award.

          (c) Timing of Payment of Contingent Payments. If the Buyer is required to make a
payment to the Seller in accordance with this Section in an amount equal to the full Target
Contingent Payment, such payment shall be made as follows: the Buyer shall pay $1,000,000 to the
Seller on or before May 1, 2009 (or, if Adjusted 2008 EBITDA has not been finalized pursuant to
this Section prior to May 1, 2009, then no later than 15 days after Adjusted 2008 EBITDA has been
so finalized) and $1,000,000 on or before March 31, 2010. If the Buyer is required to make a
payment to the Seller in accordance with this Section in an amount less than the full Target
Contingent Payment, such payment shall be made as provided in the first sentence except that any
amount by which the payment to be made is less than the full Target Contingent Payment shall be
first subtracted from the payment to be made on or prior to March 31, 2010 and then from any
payment to be made on or prior to May 1, 2009 (or such later date described in the preceding
sentence). By way of example, if the payment owed pursuant to this Section is $1,225,000, then
$1,000,000 would be payable on or prior to May 1, 2009 or such later date described in the first
sentence of this subsection and $225,000 would be payable on or prior to March 31, 2010.

          (d) 2008 Budget. During the Measurement Period, as employees of the Buyer and
pursuant to their respective employment agreements, Wilford and Geske shall operate the Business.
The Parties have agreed on an operating budget for the Business for the period of the Closing Date
through the end of the Measurement Period, a copy of which is attached as Schedule 2.2(b)
(the “2008 Budget”). As a part of their employment with Buyer, Wilford and Geske shall
reasonably and in good faith manage the operations of the Business, including, without limitation,
hiring and firing employees and managing income and expenses within the 2008 Budget. The Parties
acknowledge and agree that Buyer ultimately controls the Business and its operations and expenses
and can make whatever decisions it desires about the operations of the Business within the
parameters of the Services Agreement; provided, however, aggregate expenses of the
Business in excess of what is detailed in the 2008 Budget (unless such are due to decisions by
Wilford and Geske in their capacities as employees of APC or with the prior agreement of Wilford
and Geske), shall not be included in calculating Adjusted 2008 EBITDA for purposes of determining
whether it equals or exceeds the Adjusted 2008 EBITDA Target.

     2.3 Purchase Price Allocation. The Purchase Price shall be allocated for all purposes
among the Purchased Assets (and all other items of consideration for federal income tax purposes,
including any adjustments thereto) in accordance with Schedule 2.3. The Buyer and the
Seller (a) agree to be bound, and to cause their respective Affiliates to be bound, by such
allocation, (b) shall act, and cause their respective Affiliates to act, in accordance with such
allocation in the preparation, filing and audit
of any Tax Return and for all other tax and accounting purposes, and (c) shall not take any
position or action inconsistent with such allocation. The Buyer and Seller shall each file, in
accordance with Section 1060 of the Code, an asset allocation statement on Form 8594 (which
conforms with such allocation) with its federal income tax return for the tax year in which the
Closing Date occurs, and shall contemporaneously provide the other party with a copy of the Form
8594 being filed.

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     2.4 Services Agreement. The Parties agree that, concurrently with the execution
hereof, they shall enter into a Services Agreement in the form attached hereto as Exhibit
6.2(j), with respect to the provision of mortgage default support services by the Buyer to the
Seller, on the terms and conditions therein. During the Measurement Period, in connection with the
provision of the services by Buyer to Seller pursuant to the Services Agreement, the Parties agree
that the applicable expenses related thereto shall be allocated between the Parties in accordance
with the methodology set forth on Exhibit 2.4. For periods after the Measurement Period,
the Parties agree that they will work together to establish the appropriate allocation of expenses
from time to time.

ARTICLE III

REPRESENTATIONS AND WARRANTIES OF THE SELLER

     As a material inducement to the Buyer to enter into this Agreement the Seller represents and
warrants to the Buyer as follows:

     3.1 Organization and Qualification of the Seller. The Seller is duly organized,
validly existing and in good standing under the laws of the State of Minnesota. The Seller has the
corporate power and authority to execute and deliver this Agreement and the other Transaction
Documents to be executed by it, to perform its obligations hereunder and thereunder and to
consummate the transactions contemplated hereby and thereby. The Seller is not qualified, and is
not required to be qualified, to do business as a foreign corporation in any other jurisdiction.
Complete and correct copies of the Organizational Documents of the Seller have previously been
delivered to the Buyer by the Seller.

     3.2 Authorization. The execution and delivery of this Agreement and the Transaction
Documents, and the performance by the Seller of its obligations hereunder and thereunder, have been
duly authorized by all necessary corporate action. This Agreement and the other Transaction
Documents to which the Seller is a party constitute the legal, valid and binding obligations of the
Seller enforceable against the Seller in accordance with their respective terms except as such
enforcement may be limited by applicable bankruptcy, insolvency, reorganization or other laws of
general application relating to or affecting the enforcement of creditors’ rights generally or
general principles of equity.

     3.3 Subsidiaries. The Seller has no Subsidiaries and does not own, directly or indirectly, any stock,
partnership interest, joint venture interest or other equity interest in any other Person.

     3.4 No Conflict. Except as set forth on Schedule 3.4, neither the execution
and delivery of this Agreement or any Transaction Document by the Seller nor the performance by the
Seller of the Transactions will, directly or indirectly:

          (a) contravene, conflict with, or result in (with or without notice or lapse of time) a
violation or breach of (i) any provision of the Organizational Documents of the Seller, (ii) any
resolution adopted by the board of directors or the stockholders of the Seller, or, to the

8

 

Seller’s
knowledge, (iii) any Legal Requirement, Governmental Authorization, Contract or Order related to
the Business or the Purchased Assets;

          (b) to the Seller’s knowledge, give any Person or Governmental Body the right (with or without
notice or lapse of time) to declare a default or exercise any remedy under, or to accelerate the
maturity or performance of, or to cancel, terminate, modify, withdraw or suspend any Contract,
Legal Requirement, Governmental Authorization or Order related to the Business or the Purchased
Assets; or

          (c) result in (with or without notice or lapse of time) the imposition or creation of any Lien
upon or with respect to any of the Purchased Assets.

     3.5 No Consent Required. Except as set forth on Schedule 3.5, no consent,
notification, approval, order or authorization of, or declaration, filing or registration with, any
Person or Governmental Body is required to be made or obtained by the Seller in connection with the
authorization, execution, delivery, performance or lawful completion of this Agreement, the
Transaction Documents or the Transactions.

     3.6 Financial Statements. Attached as Schedule 3.6 contains the following
financial statements of the Business prepared on a pro-forma historical basis: the audited balance
sheet as of December 31, 2005 and December 31, 2006 and the related statements of income and cash
flows for each of the fiscal years then ended (the “Audited Pro Forma Financial
Statements”). The audited balance sheet as of December 31, 2006 (such date is sometimes
referred to herein as the “Latest Balance Sheet Date”) is sometimes referred to herein as
the “Latest Balance Sheet”. Also attached as Schedule 3.6 is the unaudited balance sheet
of the Seller as of October 31, 2007 (the “Most Recent Financial Statements,” and together
with the Audited Pro Forma Financial Statements, the “Financial Statements”). The financial
information of Seller provided by Seller to Buyer in connection with the preparation of the pro
forma Financial Statements is consistent with the books and records of the Seller and fairly
reflects in all material respects the financial condition, results of operations and cash flows of
the Seller and the Financial Statements disclose all material liabilities, direct or contingent, of
the Seller as of the dates thereof. The books and records of the Seller are accurate and complete
in all material respects and fairly and accurately present and reflect in all material
respects all of the transactions described therein.

     3.7 Absence of Undisclosed Liabilities. The Seller does not have any debts,
liabilities or obligations of any nature materially affecting the Business or the Purchased Assets
(whether accrued or unaccrued, absolute or contingent, direct or indirect, known or unknown, choate
or inchoate, perfected or unperfected, liquidated or unliquidated, or otherwise, and whether due or
to become due) arising out of transactions entered into on or prior to the date hereof, or any
transaction, series of transactions, action or inaction occurring on or prior to the Effective
Time, or any state of facts or condition existing on or prior to the date hereof (regardless of
when such liability or obligation is asserted), except (a) as and to the extent clearly and
accurately reflected and accrued for or reserved against in the Latest Balance Sheet; (b) for
liabilities specifically delineated on Schedule 3.7; and (c) for liabilities and
obligations which have arisen in connection with the Business after the Lastest Balance Sheet Date
in the ordinary course of business consistent with past custom and practice.

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     3.8 Personal Property.

          (a) Title. Except as set forth on Schedule 3.8(a)(i), the Seller possesses
good and marketable, indefeasible title to, or the right to use, the Purchased Assets, free and
clear of all Liens. The Seller has the exclusive right to possess and convey, and upon the
consummation of the Transactions, the Seller will have conveyed, and the Buyer will be vested with,
good and marketable title and interest in and to, or the right to use to the same extent as the
Seller, the Purchased Assets, free and clear of all Liens. Except as set forth on Schedule
3.8(a)(ii), the Purchased Assets constitute all of the assets and properties used in connection
with the conduct of the Business and are all of the assets used by the Seller to conduct the
Business as presently conducted and as conducted in the previous twelve (12) months.

          (b) Condition and Location. The tangible assets that are part of the Purchased
Assets, taken as a whole, are in operating condition and repair (consistent with their age and
subject to normal wear and tear), are adequate and suitable for the purposes for which such
tangible personal property are presently used by the Seller in performing the Mortgage Default
Support Services (as defined in the Services Agreement). There is no material tangible asset or
material portion of the tangible assets which are part of the Purchased Assets that require any
material repair or replacement in order to be used by the Buyer following the Closing in
substantially the same manner as used by the Seller prior to the Closing. All Purchased Assets are
located at the Leased Real Property.

     3.9 Compliance with Laws; Governmental Authorizations.

          (a) Except as set forth on Schedule 3.9(a):

               (i) The Seller has complied in all material respects with, is in compliance in all material
respects with, and has operated the Business in compliance in all material respects with, all
applicable Legal Requirements that is or was applicable to the Seller, the Purchased Assets and the
conduct or operation by the Seller of the Business;

               (ii) no event has occurred or circumstance exists that may constitute or result in (with or
without notice or lapse of time) a material violation the Seller of, or a failure on the part of
the Seller to comply in any material respect with, any Legal Requirement applicable to the
Business; and

               (iii) the Seller has not received any written notice or other written communication from any
Governmental Body or any other Person regarding, and to Seller’s knowledge, there does not exist
any material violation of, or material failure to comply with, any Legal Requirement applicable to
the Business.

          (b) Other than an occupancy certificate with respect to the Leased Real Property and annual
filings made by the Seller with the State of Minnesota with respect to its status as a Minnesota
professional association (collectively, the “Seller Governmental Authorizations”), no other
Governmental Authorization is required to permit the Seller to lawfully conduct and operate the
Business in the manner in which it currently conducts and operates such business and to permit the
Seller to own and use the Purchased Assets in the manner in which it currently owns and uses the
Purchased Assets. Each Seller Governmental

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Authorization is valid and in full force and effect. All applications required to have been
filed for the renewal of the Seller Governmental Authorizations have been duly filed on a timely
basis with the appropriate Governmental Bodies, and all other filings required to have been made
with respect to such Seller Governmental Authorizations have been duly made on a timely basis with
the appropriate Governmental Bodies.

     3.10 Real Property.

          (a) The Seller does not own, nor does Seller have any option to purchase or sell, nor is
Seller obligated to purchase or sell, any real property.

          (b) Schedule 3.10 lists all real property leases to which the Seller is a party or by
which the Seller is bound as of the date hereof (the “Real Property Leases”). The Seller
is not in default of under the terms of any Real Property Lease nor, to the Seller’s knowledge, is
any other party to any Real Property Lease in default under the terms thereof; and each such Real
Property Lease is in full force and effect and is valid, binding and enforceable against the Seller
and each other party thereto in accordance with its terms. Accurate and complete copies of the
Real Property Leases have heretofore been delivered to the Buyer by the Seller.

     3.11 Contracts.

          (a) Schedule 1.1(a) contains a complete and accurate list, and the Seller has
delivered to the Buyer true and complete copies (or forms thereof, where form agreements are used;
provided that any and all material deviations or changes to the forms in any individual
case are described on Schedule 3.11(a)) of all material Assumed Contracts used or entered
into in connection with the operation of, or related to, the Business to which the Seller is a
party or bound. Except as set forth on Schedule 3.11(a), the Assumed Contracts constitute
all of the material Contracts used or entered into in connection with the operation of, or related
to, the Business.

          (b) Except as set forth on Schedule 3.11(b), all of the Assumed Contracts are in full
force and effect and are valid and enforceable in all respects in accordance with their terms
except as such enforceability may be limited by laws applicable to creditors rights and equitable
principles generally, and, to the Seller’s Knowledge, no event has occurred or circumstance exists
that would give any Person (including the Seller) the right (with or without notice or lapse of
time) to declare a default or exercise any remedy under, or to accelerate the maturity or
performance of, or to cancel, terminate or modify, any such Assumed Contract.

          (c) There are no pending renegotiations of any of the Assumed Contracts.

          (d) Schedule 3.11(d) sets forth all filings, consents and approvals (the “Required
Contract Consents”) necessary to validly assign and transfer all of the Assumed Contracts, and
no such Assumed Contract is subject to termination, modification or acceleration as a result of the
Transactions other than as disclosed on Schedule 3.11(d).

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     3.12 Proprietary Rights.

          (a) The Seller owns, or is licensed or otherwise possesses legally enforceable rights to use
all Assumed Proprietary Rights. Except as set forth on Schedule 3.12(a), each item of
Assumed Proprietary Rights will, immediately subsequent to the Closing hereunder, continue to be
owned or available for use by the Buyer on such terms as are identical to those pursuant to which
the Seller, immediately prior to the Closing, owns or has the right to use such item. The Seller
does not, directly or through the engagement of another Person to, distribute, sell, resell,
license or sublicense to others any software or other Proprietary Rights, whether such software or
Proprietary Rights are owned by the Seller or any third party.

          (b) Except as set forth on Exhibit 3.12(b) or with respect to Assumed Proprietary
Rights which are owned by third parties (“Third Party Proprietary Rights”), the Seller is
the sole and exclusive owner, with all right, title and interest in and to (free and clear of any
Liens), of the Assumed Proprietary Rights, and has sole and exclusive rights (and is not
contractually obligated to pay any compensation to any third party in respect thereof or in
connection with the use, distribution, licensing or other exploitation thereof or as a result of
the transactions contemplated by this Agreement) to the use and distribution therefor. All Assumed
Proprietary Rights owned by the Seller are herein referred to as “Seller Owned Proprietary
Rights”. No government funding or university or college facilities were used in the
development of Seller Owned Proprietary Rights. All Seller Owned Proprietary Rights has been
developed or created by employees of the Seller who developed or created such Seller Owned
Proprietary Rights acting within the scope of their employment with the Seller, or by independent
contractors or consultants under written Contracts which are listed on Schedule 3.12(b) and
pursuant to which Contracts all of their Proprietary Rights thereto have been assigned to the
Seller.

          (c) Schedule 3.12(c) sets forth a complete list of all of the following types of
Seller Owned Proprietary Rights: (i) patents and patent applications (including all reissuances,
continuations, continuations-in-part, revisions, extensions and reexaminations thereof); (ii)
trademark and service mark registrations, registration applications, and unregistered trademarks
and service marks; (iii) Internet domain name registrations; (iv) copyright registrations, renewals
and applications for registration of copyrights; (v) Software and material Third Party Software;
and (vi) trade names and corporate names (collectively, “Listed Proprietary Rights”)
(including the jurisdictions where such Listed Proprietary Rights are registered or where
applications have been filed, and all registration numbers). Except as set forth in Schedule
3.12(c), (A) all Listed Proprietary Rights are currently in the name of the Seller, and are in
full force and effect; (B) no Listed Proprietary Right that is the subject of an application or
registration has been canceled, abandoned, adjudicated invalid, or otherwise terminated; and (C)
all renewal and maintenance fees in respect of the Listed Proprietary Rights have been duly paid.

          (d) Schedule 3.12(d)(i) sets forth a complete list of all Contracts as to which the
Seller is a party and pursuant to which any other third party is authorized to use any of the
Seller Owned Proprietary Rights (“Seller License”). Schedule 3.12(d)(ii) sets
forth a complete list of all Contracts as to which the Seller is a party and pursuant to which the
Seller is licensed and/or otherwise authorized to use any Third Party Proprietary Rights
(“Third Party Licenses”), except for licenses of Commercial Software. The Seller has
licenses for all Commercial Software

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used in the Business, use of such Commercial Software is in accordance with such licenses and
Seller does not have any obligation to pay fees, royalties or other amounts at any time pursuant to
any such license, including by virtue of the Seller’s current usage thereof. Seller Licenses and
Third Party Licenses are herein collectively “Proprietary Rights Licenses.” For purposes
hereof, “Commercial Software” means packaged, commercially available software programs
generally available to the public pursuant to non-exclusive end-user licenses having a cumulative
cost or license fee to the Seller for all software and rights to use thereunder of less than
$20,000, or pursuant to which ongoing maintenance and/or support fees are less than $10,000. The
Seller is not in default in the performance, observance or fulfillment of any obligation, covenant
or condition contained in any Proprietary Rights License, and, to Seller’s knowledge, no other
party is in default in the performance, observance or fulfillment of any obligation, covenant or
condition contained in any Proprietary Rights License. The execution and delivery of this
Agreement and the consummation of the transactions contemplated hereby will not cause the Seller to
be in violation or default of such Proprietary Rights Licenses.

          (e) To the Seller’s knowledge, the Seller has not infringed, misappropriated or violated, and
is not infringing, misappropriating or violating, the Proprietary Rights of any third party. To
Seller’s knowledge, there is no unauthorized use, infringement or misappropriation of any of the
Seller Owned Proprietary Rights by any third party, including any employee or former employee of
the Seller. Except as set forth in Schedule 3.12(e), (i) the Seller has not received any
written notice, and has no knowledge of any facts, alleging or otherwise indicating, that the
conduct of the Business and/or the use of any of the Assumed Proprietary Rights has infringed,
misappropriated or otherwise violated, or is infringing, misappropriating or is otherwise
violating, the Proprietary Rights of any third party and (ii) to the Seller’s knowledge, there is
no pending or threatened complaint, action, suit, claim, Proceeding, other dispute or
investigation, asserting the invalidity, misuse or unenforceability of any Seller Owned Proprietary
Rights, contesting ownership of any Seller Owned Proprietary Rights, or otherwise challenging any
of the Seller’ rights in or use of the Seller Owned Proprietary Rights, and no valid grounds for
the same exist.

          (f) Except as set forth in Schedule 3.12(f), (i) the Seller has not used, authorized
the use of or purchased as keywords, is not using or authorizing the use or purchase of, and has
written agreements with any and all affiliate marketing services vendors engaged by the Seller not
to purchase as keywords or otherwise use, any trademarks, service marks, or trade names or any
other third party, or any terms confusingly similar thereto (“Third Party Marks”), in any
manner designed to: divert traffic from or to obscure a third party’s website; to disrupt the
experience of a visitor to the website of a third party; to elevate search engine rankings of the
Seller or the Business above those of any competitor of the Seller; or to infringe, tarnish, dilute
or otherwise violate such Third Party Marks; and (ii) the Seller has taken all reasonable measures
to comply with the Controlling the Assault of Non-Solicited Pornography and Marketing Act of 2003
(the “CAN-SPAM Act”), including complying with all disclosure requirements, and those
requirements relating to opt-out mechanisms and requests, in regard to all electronic mail messages
that qualify as “commercial electronic mail messages” within the meaning of the CAN-SPAM Act.

          (g) Except as set forth on Schedule 3.12(g), the Seller has made no oral or written
representations or warranties with respect to the products or services of the Business.

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          (h) The computer software, hardware, systems and databases used internally in the operation of
the Business (the “Computer System”) adequately meets the data processing needs of the
Business and operations of the Business as conducted by the Seller prior to the Effective Time. The
Seller has arranged for back-up data processing services adequate to meet its data processing needs
(with respect to the operation of the Business by the Seller prior to the Effective Time) in the
event the Computer System or any of its material components is rendered temporarily or permanently
inoperative as a result of a natural or other disaster. Except as set forth on Schedule
3.12(h), the Computer System performs substantially in accordance with the documentation
related thereto, and the Seller has not suffered any failures, errors or breakdowns in the Computer
System within the past twelve (12) months which have caused any substantial disruption or
interruption in the Business.

     3.13 Employee Benefit Plans.

          (a) Except as set forth on Schedule 3.13(a), the Seller has not maintained, sponsored,
adopted, made contributions to or obligated itself to make contributions to or to pay any benefits
or grant rights under or with respect to, any “Employee Pension Benefit Plan” (as defined in
Section 3(2) of ERISA), “Employee Welfare Benefit Plan” (as defined in Section 3(1) of ERISA),
“Multi-Employer Plan” (as defined in Section 3(37) of ERISA), pension plan, plan of deferred
compensation, medical plan, life insurance plan, long-term disability plan, dental plan or other
plan providing for the welfare of any of the employees or former employees or beneficiaries thereof
of the Seller, personnel policy (including vacation time, holiday pay, bonus programs, moving
expense reimbursement programs and sick leave), excess benefit plan, bonus or incentive plan
(including stock options, restricted stock, stock bonus and deferred bonus plans), salary reduction
agreement, change-of-control agreement, employment agreement, consulting agreement or any other
benefit, program or Contract, whether or not written or pursuant to a collective bargaining
agreement, which could give rise to or result in the Seller having any material debt, liability,
claim or obligation of any kind or nature, whether accrued, absolute, contingent, direct, indirect,
known or unknown, perfected or inchoate or otherwise and whether or not due or to become due
(collectively, “Employee Benefit Plans”). No Employee Benefit Plan that provides severance
benefits is subject to ERISA.

          (b) None of the Purchased Assets is subject to any lien under ERISA or the Code. The Seller
is not bound by any Contract, nor has any obligation or liability described in Section 4204 of
ERISA.

          (c) Each such Employee Benefit Plan that is intended to be qualified under Section 401(a) of
the Code has received a determination from the Internal Revenue Service that such Employee Benefit
Plan is so qualified, and nothing has occurred since the date of such determination that would
cause such determination letter to become materially unreliable. No Employee Benefit Plan is a
multi-employer plan or is subject to Section 302 or Title IV of ERISA or Section 412 of the Code.

          (d) Each of the Employee Benefit Plans and all related trusts, insurance contracts and funds
have been maintained, funded and administered in material compliance with their terms, and in
compliance with the applicable provisions of ERISA, the Code, and any other applicable Legal
Requirement. With respect to each such Employee Benefit Plan, all required

14

 

payments, premiums, contributions, distributions or reimbursements for all periods ending
prior to or as of the date hereof have been made or properly accrued.

          (e) None of the Seller or any other “disqualified person” (within the meaning of Section 4975
of the Code) or any “party in interest” (within the meaning of Section 3(14) of ERISA) has engaged
in any “prohibited transaction” (within the meaning of Section 4975 of the Code or Section 406 of
ERISA) with respect to any of such Employee Benefit Plans which could subject any such Employee
Benefit Plans, the Seller or any officer, director or employee of the Seller to a penalty or tax
under Section 502(i) of ERISA or Section 4975 of the Code.

          (f) Each such Employee Benefit Plan that is subject to the health care continuation
requirements of Part 6 of Subtitle B of Title I of ERISA or Section 4980B of the Code
(“COBRA”) has been administered in material compliance with such requirements. No Employee
Benefit Plan provides medical or life or other welfare benefits to any current or future retired or
terminated employee (or any dependent thereof) of the Seller other than as required pursuant to
COBRA or applicable state law.

          (g) With respect to each such Employee Benefit Plan, the Seller has provided the Buyer with
true, complete and correct copies of (to the extent applicable): (i) all documents pursuant to
which such Employee Benefit Plan is maintained, funded and administered (including the plan and
trust documents, any amendments thereto, the summary plan descriptions, and any insurance contracts
or service provider agreements); (ii) the three most recent annual reports (IRS Form 5500 series)
filed with the Internal Revenue Service (with applicable attachments); and (iii) the most recent
determination letter, if any, received from the Internal Revenue Service.

          (h) The Seller does not have any liability (or potential liability) with respect to any
“employee benefit plan” (as defined in Section 3(3) of ERISA) by reason of being treated as a
single employer under Section 414 of the Code or Section 4001(b) of ERISA with any trade, business
or entity other than the Seller.

     3.14 Labor and Employment Matters. Except as set forth on Schedule 3.14: (a)
the Seller is not a party to or bound by any collective bargaining agreement or other labor
Contract; (b) no labor organization or group of employees has filed any representation petition or
made any written demand for recognition; (c) no organizing or decertification efforts are underway
or, to the Seller’s knowledge, Threatened; (d) since September 1, 2003, no labor strike, work
stoppage, slowdown or other material labor dispute has occurred, and none is underway or, to the
Seller’s knowledge, Threatened; (e) there is no employment-related charge (including an unfair
labor practice charge), complaint, grievance, investigation, inquiry or obligation of any kind,
pending or, to the Seller’s knowledge, Threatened, in any forum, relating to an alleged violation
or breach by the Seller (or its officers or directors) of any Legal Requirement or Contract; (f) no
employee of the Seller has any agreement as to length of notice or severance payment required to
terminate his or her employment, other than such as results by law from the employment of an
employee without an agreement as to notice or severance; and (g) the Seller will not have any
material liability under any benefit or severance policy, practice, agreement, plan, or program
which exists or arises, or may be deemed to exist or arise, under any applicable Legal Requirements
or otherwise, as a result of the Transactions. With respect to the Transactions, any

15

 

notice required under any Legal Requirement or any collective bargaining agreement has been,
or prior to the Closing will be, given, and all bargaining obligations with any employee
representative have been, or prior to the Closing will be, satisfied. Within the past three (3)
years, the Seller has not implemented any plant closing or mass layoff of employees as those terms
are defined in the Worker Adjustment and Retraining Notification Act of 1988, as amended, and the
regulations issued thereunder, or any similar foreign, state or local law, regulation or ordinance
(“WARN Act”). Within ninety (90) days preceding the date hereof, no employee of the Seller
has suffered an “employment loss” with the Seller, as such term is defined in the WARN Act.

     3.15 Workers Compensation. Schedule 3.15 sets forth all expenses,
obligations, duties and liabilities relating to any claims by employees and former employees
(including dependents and spouses) of the Seller or any Person with whom the Seller constitutes all
or part of a controlled group (as defined in Section 414 of the Code) (“Plan Affiliate”)
(or predecessors) made since September 1, 2003 and the extent of any specific accrual on or reserve
therefor set forth on the Financial Statements for (a) costs, expenses and other liabilities under
any workers compensation laws, regulations, requirements or programs and (b) any other medical
costs and expenses. No claim, or to the Seller’s knowledge, injury, fact, event or condition
exists that would give rise to a material claim (individually or in the aggregate) by employees or
former employees (including dependents and spouses) of the Seller or any Plan Affiliate under any
workers compensation laws, regulations, requirements or programs or for any other medical costs and
expenses.

     3.16 Employees. Schedule 3.16 is a complete and correct list setting forth
(a) the names and current compensation rates and other compensation of all individuals presently
employed in the Business on a salaried basis, (b) the names and current compensation rates of all
individuals presently employed in the Business on an hourly or piecework basis and (c) the names
and total annual compensation for all independent contractors who render services on a regular or
seasonal basis to the Business. Except as set forth on Schedule 3.16, no Person listed
thereon has received any bonus or increase in compensation, nor has there been any “general
increase” in the compensation or rate of compensation payable to any such employees, since January
1, 2008 or since such date there has been no promise to the employees listed on Schedule
3.16, orally or in writing, of any bonus or increased compensation, whether or not legally
binding.

     3.17 Books and Records. The books of account, minute books, stock record books, and
other records of the Seller, all of which have been made available to the Buyer prior to the date
hereof, are complete and correct in all material respects and have been maintained in accordance
with reasonable business practices.

     3.18 Affiliate Transactions. Except as set forth on Schedule 3.18, no
officer, director, employee, stockholder, partner or Affiliate of the Seller or any entity in which
any such Person or individual is an officer, director or the owner of five percent (5%) or more of
the beneficial ownership interests, is a party to any Contract with the Seller related to the
Business, or has any interests in any property used by the Seller in connection with the operation
of the Business, or has any claim or right against the Seller. Each Affiliate Transaction was
effected on terms equivalent to those which would have been established in an arm’s-length
negotiation, except as

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disclosed on Schedule 3.18. Except as set forth on Schedule 3.18, neither the
Seller nor any of its Affiliates has any direct or indirect interest in any competitor of the
Business, except for passive ownership of less than one percent (1%) of the outstanding capital
stock of any competing business that is publicly traded on any recognized exchange or in the
over-the-counter market.

     3.19 Insurance Policies. Schedule 3.19 contains a complete and accurate list
of all insurance policies (including “self-insurance” programs) now maintained by the Seller (the
“Insurance Policies”) and all general liability policies maintained by the Seller during
the past three (3) years with respect to the Business or the Purchased Assets and all material
claims (other than claims made under group medical plans) now pending or made under any current or
prior insurance policies during such three (3)-year period. The Insurance Policies are in full
force and effect, the Seller is not in default under any Insurance Policy and no claim for coverage
under any Insurance Policy has been denied. The Seller has not received any notice of cancellation
or intent to cancel or increase or intent to increase premiums with respect to the Insurance
Policies.

     3.20 Taxes.

          (a) The Seller has filed all Tax Returns required to be filed (or extensions to file Tax
Returns have been timely filed) by the Seller. All such Tax Returns are true, correct, and
complete in all material respects. All Taxes owed by the Seller (whether or not shown as due on
any tax returns), which are payable prior to the date hereof, have been paid. The unpaid Taxes of
the Seller with respect to Seller’s Mortgage Default Support Services (i) did not as of the Latest
Balance Sheet Date, exceed the reserve for tax liability (rather than any reserve for deferred
Taxes established to reflect timing differences between book and tax income) set forth on the face
of the Financial Statements (rather than any notes thereto) and (ii) do not exceed that reserve as
adjusted for the passage of time through the date hereof.

          (b) The Seller has timely withheld and, if due, has timely remitted with respect to its
employees, foreign creditors, independent contractors or other third parties all Taxes required to
be withheld and/or, if due, remitted and all Forms W-2 and 1099 required with respect thereto have
been thoroughly completed and timely filed.

          (c) The Seller does not have any Tax deficiency outstanding, proposed, assessed, or, to the
Seller’s knowledge, Threatened by any Tax authority against the Seller. The Seller has not
executed or requested any waiver of any statute of limitations on or extending the period for the
assessment or collection of any Tax.

          (d) No audit or other examination of any Tax Return of the Seller is presently in progress or
pending, nor has the Seller been notified in writing of any request for such an audit or other
examination.

          (e) There is no investigation or other Proceeding pending or, to the Seller’s knowledge,
Threatened by any Tax authority for any jurisdiction where the Seller does not file Tax Returns
with respect to a given Tax that involves an assertion by such Tax authority that the Seller is or
may be subject to a given Tax in such jurisdiction.

17

 

          (f) There are no Liens for Taxes on the assets of the Seller other than Taxes not yet due and
payable.

          (g) The Seller is not a party to or bound by any Tax indemnity, Tax sharing or Tax allocation
agreements.

          (h) The Seller does not and never had a permanent establishment in any foreign country, as
defined in any applicable Tax treaty or convention between the United States and such foreign
country or nexus on a Taxable presence in a jurisdiction in which it does not file Tax Returns.

          (i) The Seller has never been a member of an Affiliated Group of Corporations within the
meaning of Sections 1504 of the Code or any similar state law.

          (j) The Seller does not have liability for Taxes of any other Person as a transferee or
successor by contract or otherwise.

          (k) The Seller made a valid election under Subchapter S of the Code (and the corresponding
provisions of applicable state and local law where the Seller files Tax Returns), to which all
Persons who were stockholders of the electing corporation on the date of such election gave their
consent and such election became effective on September 2, 2003. Such election has never been
terminated or revoked, intentionally or inadvertently, and is currently in effect.

     3.21 Litigation.

          (a) Except as set forth on Schedule 3.21, there is no pending Proceeding:

               (i) that has been commenced by or against the Seller in connection with the Business;

               (ii) that otherwise relates to or may affect the Business or any of the Purchased Assets; or

               (iii) that challenges, or that may have the effect of preventing, delaying, making illegal, or
otherwise interfering with, any of the Transactions.

Except as set forth on Schedule 3.21(a), to the Seller’s knowledge (A) no such Proceeding
has been Threatened and (B) no event has occurred or circumstance exists that may give rise to or
serve as a basis for the commencement of any such Proceeding. The Seller has delivered to the
Buyer copies of all pleadings, material correspondence, and other material documents relating to
each Proceeding listed on Schedule 3.21(a). The Proceedings listed on
Schedule 3.21(a) will not, either individually or in the aggregate, have a Material Adverse
Effect.

          (b) Except as set forth on Schedule 3.21(b):

               (i) there is no Order to which the Seller is subject in connection with, or related to, the
Business or any of the Purchased Assets is subject;

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               (ii) the Seller is not subject to any Order that relates to the Business or any of the
Purchased Assets; and

               (iii) no officer, director, agent or employee of the Seller is subject to any Order that
prohibits such officer, director, agent or employee from engaging in or continuing any conduct,
activity or practice relating to the Business.

          (c) Except as set forth on Schedule 3.21(c):

               (i) the Seller is, and at all times has been, in compliance with all of the terms and
requirements of each Order to which the Business or any of the Purchased Assets is or has been
subject;

               (ii) no event has occurred or circumstance exists that may constitute or result in (with or
without notice or lapse of time) a violation of or failure to comply with any term or requirement
of any Order to which the Business or any of the Purchased Assets is subject; and

               (iii) the Seller has not received any notice or other communication (whether oral or written)
from any Governmental Body or any other Person regarding any actual, alleged, possible, or
potential violation of, or failure to comply with, any term or requirement of any Order to which
the Business or any of the Purchased Assets is or has been subject.

     3.22 Environmental and Safety Requirements. Except as set forth on
Schedule 3.22:

          (a) The Seller has complied with and is now in material compliance with all applicable
Environmental and Safety Requirements, and the Seller possesses all required Governmental
Authorizations, and has filed all notices or applications, required thereby.

          (b) (b) (i) The Seller has never generated, transported, treated, stored, disposed of,
arranged for the disposal of, or otherwise handled, any Hazardous Materials at any site, location
or facility owned or operated or used by the Seller or at any offsite location, and (ii) to the
Seller’s knowledge, no Hazardous Materials are present on, in, under or emanating from the Leased
Real Property, and the Leased Real Property does not contain any Hazardous Materials except as, for
either clauses (i) or (ii) above, would not result in a condition in material violation of, or any
material liability under, any applicable Environmental and Safety Requirements. To the Seller’s
knowledge, there are no underground storage tanks on the Leased Real Property.

          (c) The Seller has not been subject to, nor has the Seller received any written notice of, any
private, administrative or judicial action, order, or investigation relating to any violation of
Environmental and Safety Requirements or the presence or alleged presence of Hazardous Materials
in, under, upon, or emanating from any real or immovable property now or previously owned or used
by the Seller or any offsite location, and to the Seller’s knowledge, there is no reasonable basis
in fact or law for any such notice or action. There are no pending or, to Seller’s knowledge,
Threatened actions, investigations, Orders or Proceedings from any

19

 

Governmental Body or any other entity regarding any matter relating to Environmental and
Safety Requirements.

          (d) To the Seller’s knowledge, no facts, events or conditions with respect to the past or
present operations or facilities of the Seller, the Purchased Assets or the Business exist which
would reasonably be expected to materially interfere with or prevent continued compliance with, or
would give rise to any material common law or statutory liability, or otherwise form the basis of
any Proceeding against or involving the Purchased Assets or the Business under any Environmental
and Safety Requirement based on any such fact, event or condition, including material liability for
cleanup costs, personal injury or property damage with respect to the Leased Real Property.

          (e) The Seller does not have, control or possess any engineering or environmental studies with
respect to the Seller, the Leased Real Property or the Business.

          (f) For purposes of this Agreement, “Environmental and Safety Requirements” means all
federal, state and local or municipal laws, rules, regulations, ordinances, orders, statutes and
requirements, and all common law, relating to public health and safety, worker health and safety,
pollution or protection of the environment. For purposes of this Agreement, “Hazardous
Materials” means (i) hazardous materials, hazardous substances, extremely hazardous substances
or hazardous wastes, as those terms are defined by the Comprehensive Environmental Response,
Compensation and Liability Act, 42 U.S.C. §9601 et seq., the Resource Conservation and Recovery
Act, 42 U.S.C. §6901 et seq., and any other Environmental and Safety Requirements; (ii) petroleum,
including crude oil or any fraction thereof which is liquid at standard conditions of temperature
and pressure (60 degrees Fahrenheit and 14.7 pounds per square inch absolute); (iii) any
radioactive material, including any source, special nuclear, or by-product material as defined in
42 U.S.C. §2011 et seq.; (iv) asbestos in any form or condition; and (v) any other material,
substance or waste to which liability or standards of conduct may be imposed under any
Environmental and Safety Requirements.

     3.23 Conduct of the Business. Except as set forth on Schedule 3.23, since the
Latest Balance Sheet Date, the Seller has conducted the Business only in the ordinary course of
business consistent with past custom and practice, and has incurred no liabilities other than in
the ordinary course of business consistent with past custom and practice and there has been no
Material Adverse Effect, and no contingency could reasonably be expected to result in or cause a
Material Adverse Effect. Without limitation of the foregoing and except as set forth on
Schedule 3.23, since January 1, 2008, the Seller has not:

          (a) accelerated or delayed the provision of services, in a manner inconsistent with past
practices;

          (b) sold, assigned or transferred any asset or property right, or mortgaged, pledged or
subjected such asset or property right to any Lien, charge or other restriction, except for Liens
for current property taxes not yet due and payable;

          (c) sold, assigned, transferred, abandoned or permitted to lapse any Governmental
Authorizations that are required for the operation of the Business, or related to

20

 

any of the Assumed Proprietary Rights or other intangible assets, or disclosed any material
proprietary confidential information to any Person, granted any license or sublicense of any rights
under or with respect to any Assumed Proprietary Rights or other intangible assets;

          (d) made or granted any increase in, or amended (except as may be required by law) or
terminated, any existing plan, program, policy or arrangement, including any Employee Benefit Plan
or arrangement or adopted any new Employee Benefit Plan or arrangement, or entered into, modified
or terminated any new collective bargaining agreement or multiemployer plan;

          (e) undertaken any employee layoffs that could implicate the WARN Act;

          (f) made any loans or advances to, or guarantees for the benefit of, or entered into any
transaction with any stockholder, partner, employee, officer or director of the Seller other than
regular salary and expense reimbursement payments;

          (g) suffered any extraordinary loss, damage, destruction or casualty loss to the Business or
waived any rights of value in excess of $50,000, whether or not covered by insurance and whether or
not in the ordinary course of business;

          (h) received written notification that any material customer or supplier will stop or
materially decrease in any respect the rate of business done with the Seller or the Business,
respectively;

          (i) entered into any other material transaction, other than in the ordinary course of business
consistent with past custom and practice; or

          (j) committed to any of the foregoing.

     3.24 Absence of Questionable Payments. The Seller has not, nor has any manager,
director, officer, shareholder, partner, agent, employee or other Person acting on behalf of the
Seller, (a) used any corporate or other funds for unlawful contributions, payments, gifts or
entertainment, or made any unlawful expenditures relating to political activity to government
officials or others or established or maintained any unlawful or unrecorded funds in violation of
Section 104 of the Foreign Corrupt Practices Act of 1977 (15 U.S.C. §79dd-2), as amended, or any
other applicable foreign, federal or state law, (b) accepted or received any unlawful
contributions, payments, expenditures or gifts, or (c) established or maintained any fund or asset
that has not been recorded in the books and records of the Seller.

     3.25 Government Contracts. Except as set forth on Schedule 3.25, the Seller
is not a party to, or bound by the provisions of, any Contract (including purchase orders, blanket
purchase orders and agreements and delivery orders) with the United States government or any
department, agency or instrumentality thereof or any Governmental Body.

     3.26 Corporate Name; Business Locations. During the past five (5) years, the Seller
has only been known as or used the corporate, fictitious and trade names set forth on
Schedule 3.26. Except as set forth on Schedule 3.26, the Seller has not been the
surviving corporation of a merger or consolidation nor has the Seller acquired all or substantially
all of the

21

 

assets of any Person. During the past five (5) years, the Seller has not had an office or
place of business other than as listed on Schedule 3.26.

     3.27 Major Clients. Schedule 3.27 sets forth the Major Clients of the Seller
along with the dollar value of the revenue from each such client for the twelve-month period ended
on December 31, 2007. In the twelve (12) months preceding the Closing Date, no Major Client of the
Seller has cancelled or otherwise terminated, or, to the Seller’s knowledge, Threatened to cancel
or otherwise terminate, its relationship with the Seller, or reduce, or, to the Seller’s knowledge,
Threatened to reduce, its business with the Seller. The Seller has not received any written notice
nor has knowledge that any Major Client intends to cancel or otherwise adversely modify its
relationship with the Seller as a result of the Transactions.

     3.28 Brokers or Finders. Neither the Seller nor any of its agents has incurred any
obligation or liability, contingent or otherwise, for brokerage or finders’ fees or agents’
commissions or other similar payment in connection with this Agreement or the Transaction Documents
or the Transactions.

     3.29 Disclosure. This Agreement, the Transaction Documents, and the Schedules hereto
do not contain any untrue statement of a material fact and do not omit to state a material fact
necessary in order to make the statements contained therein or herein not misleading in light of
the circumstances under which they were made. Except as otherwise disclosed in this Agreement or
the Schedules hereto, there is no fact known to the Seller relating to the Purchased Assets,
Assumed Liabilities, or the Business that has had, or could reasonably be expected to have, a
Material Adverse Effect.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF THE BUYER

     The Buyer hereby represents and warrants to the Seller as follows:

     4.1 Organization and Good Standing. The Buyer is a limited liability company duly
organized, existing and in good standing under the laws of the State of Michigan. The Buyer has the
power and authority to execute and deliver this Agreement and the other Transaction Documents to be
executed by it, to perform its obligations hereunder and thereunder and to consummate the
transactions contemplated hereby and thereby.

     4.2 Authorization. The execution and delivery of this Agreement and the Transaction
Documents, and the performance by the Buyer of its obligations hereunder and thereunder, have been
duly authorized by all necessary company action. This Agreement and the other Transaction
Documents to which the Buyer is a party constitute the legal, valid and binding obligations of the
Buyer enforceable against the Buyer in accordance with their respective terms except as such
enforceability may be limited by applicable bankruptcy, insolvency, reorganization or other laws of
general application relating to or affecting the enforcement of creditors’ rights generally or
general principles of equity.

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     4.3 No Conflict. Except as set forth in Schedule 4.3, neither the execution
and delivery of this Agreement or any Transaction Document by the Buyer nor the performance by the
Buyer of the Transactions will, directly or indirectly:

          (a) contravene, conflict with, or result in (with or without notice or lapse of time) a
violation or breach of (i) any provision of the Organizational Documents of the Buyer, (ii) any
resolution adopted by its manager or members, or (iii) any Legal Requirement, Governmental
Authorization, Contract or any Order to which the Buyer may be subject; or

          (b) give any Person or Governmental Body the right (with or without notice or lapse of time)
to declare a default or exercise any remedy under, or to accelerate the maturity or performance of,
or to cancel, terminate, modify, withdraw or suspend any Contract, Legal Requirement, Governmental
Authorization or Order applicable to the Buyer.

     4.4 No Consent Required. No consent, notification, approval, order or authorization
of, or declaration, filing or registration with, any Person or Governmental Body is required to be
made or obtained by the Buyer in connection with the authorization, execution, delivery,
performance or lawful completion of this Agreement, the Transaction Documents or the Transactions.

     4.5 Brokers and Finders. Neither the Seller nor its agents has incurred any
obligation or liability, contingent or otherwise, for brokerage or finders’ fees or agents’
commissions or other similar payment in connection with this Agreement or the Transaction Documents
or the transactions contemplated hereby and thereby.

ARTICLE V

[SECTION LEFT INTENTIONALLY BLANK]

ARTICLE VI

CLOSING

     6.1 Closing. Subject to the satisfaction of the conditions precedent set forth
herein, the Transactions shall be consummated at a closing (the “Closing”), which shall
commence at 10:00 a.m. Minneapolis time on February 22, 2008 (the “Closing Date”), the
Closing Date and shall be consummated by exchanging documents via email, facsimile and overnight
courier. The Closing shall be effective as of 12:01 a.m. Central Standard Time on the date
immediately following the Closing Date (the “Effective Time”).

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     6.2 Deliveries by the Seller. At the Closing, the Seller shall deliver to the Buyer
the following (or the same shall be waived in writing by the Buyer), all of which shall be deemed
to be delivered simultaneously:

          (a) Instruments of Conveyance. The Bill of Sale duly executed by the Seller and
instruments of conveyance for any Assumed Proprietary Rights reasonably requested by the Buyer in
form and substance satisfactory to the Buyer.

          (b) Opinion of Counsel. An opinion of counsel of the Seller, dated as of the Closing
Date, in the form of Exhibit 6.2(b) attached hereto, addressed to the Buyer and its equity
and debt financing sources.

          (c) Opinion of Minnesota Ethics Counsel. An opinion from Bassford Remele, a Minnesota
professional association, dated as of the Closing Date, addressed to the Buyer and its financing
sources, in form and substance reasonably acceptable to the Buyer, indicating that the operation of
the Business by the Buyer post-closing as presently contemplated does not violate any Minnesota law
relevant to the unauthorized practice of law or the sharing of fees from the Practice of Law with a
non-lawyer.

          (d) Organizational Documents. A certificate of the Secretary of the Seller certifying
(i) as to the incumbency and signatures of the officers of the Seller executing any documents being
delivered to the Buyer in connection with the transactions contemplated hereby, and (ii) that
attached to such certificate are true and correct copies of (A) the charter of the Seller and all
amendments thereto as in effect on the Closing Date and certified by the Secretary of State of the
Seller’s state of incorporation, (B) the Bylaws of the Seller as in effect on the Closing Date, and
(C) the resolutions of the Board of Directors of the Seller and the stockholders of the Seller
authorizing the execution and delivery of this Agreement and the Transaction Documents and the
consummation of the Transactions.

          (e) Required Consents. All (i) Required Governmental Consents in form and substance
reasonably satisfactory to the Buyer, (ii) Required Contract Consents in form and substance
reasonably satisfactory to the Buyer and (iii) other consents identified on Schedule 3.5 in
form and substance reasonably satisfactory to the Buyer.

          (f) Lien Searches and Release of Liens. Such Uniform Commercial Code lien search and
such other instruments dated on or after December 7, 2007 showing that there were no financing
statements, judgments, Taxes or other Liens outstanding against the Seller or any of the Purchased
Assets as of such date (except for such financing statements, judgments, Taxes or Liens that will
be removed prior to or on the Closing Date and for which the Seller has delivered to the Buyer
written evidence of such removal in form and substance reasonably satisfactory to the Buyer at the
Closing).

          (g) Good Standing Certificate. A good standing certificate for the Seller issued not
more than ten (10) days prior to the Closing Date by the Secretary of States of the Seller’s state
of incorporation and each jurisdiction in which the Seller is qualified to do business as a foreign
corporation.

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          (h) Possession of Purchased Assets. Legal and actual possession of the Purchased
Assets, together with any keys, combinations, alarm systems and related codes and other rights of
access required to take legal and actual possession of the Purchased Assets.

          (i) Employment Agreements. Employment Agreements between the Buyer and each of
Wilford and Geske, in the forms attached hereto as Exhibit 6.2(i)(i) and
6.2(i)(ii), respectively (collectively, the “Employment Agreements” ) duly executed
by Wilford and Geske, as applicable.

          (j) Services Agreement. The Services Agreement between the Buyer and the Seller in
the form attached hereto as Exhibit 6.2(j) duly executed by the Seller.

          (k) Sublease Agreement. The Sublease Agreement between the Buyer and the Seller in
the form attached hereto as Exhibit 6.2(k) (the “Sublease Agreement”) duly executed
by the Seller.

          (l) Landlord Estoppel. A landlord estoppel certificate, in form and substance
reasonably satisfactory to the Buyer and the Buyer’s lenders, executed by the lessor under the main
Real Property Lease which is the subject of the Sublease Agreement.

          (m) FIRPTA Affidavit. A non-foreign affidavit dated as of the Closing Date sworn
under penalty of perjury and in form and substance required under the Treasury Regulation pursuant
to Section 1445 of the Code stating that Seller is not a “Foreign Person” as defined in Section
1445 of the Code.

          (n) Other Documents. Such other documents as the Buyer may reasonably request with
respect to the Transactions.

     6.3 Deliveries by Buyer. At the Closing, the Buyer shall deliver to the Seller the
following (or the same shall be waived in writing by the Seller), all of which shall be deemed to
be delivered simultaneously:

          (a) Instruments of Assumption. The Bill of Sale duly executed by the Buyer.

          (b) Organizational Documents. A certificate of the Secretary of Buyer certifying (i)
as to the incumbency and signatures of the officers of such Buyer executing any documents being
delivered to the Buyer in connection with the transactions contemplated hereby, and (ii) that
attached to such certificate are true and correct copies of (i) the articles of organization of the
Buyer and all amendments thereto as in effect on the Closing Date and certified by the Secretary of
State of the Buyer’s state of organization, (ii) the limited liability company agreement of Buyer
and (iii) the resolutions of the Buyer authorizing the execution and delivery of this Agreement and
the Transaction Documents and the consummation of the transactions contemplated hereby and thereby.

          (c) Purchase Price. Payment of the Purchase Price in accordance with
Section 2.1.

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          (d) Employment Agreements. The Employment Agreements duly executed by the Buyer.

          (e) Services Agreement. The Services Agreement duly executed by the Buyer.

          (f) Sublease Agreement. The Sublease Agreement duly executed by the Buyer.

          (g) Good Standing Certificate. A good standing certificate for the Buyer issued not
more than ten (10) days prior to the Closing Date by the Secretary of State of the state of such
Buyer’s organization.

          (h) Other Documents. Such other documents as the Seller may reasonably request with
respect to the transactions contemplated by this Agreement.

     6.4 Concurrent Delivery. It shall be a condition of the Closing that all matters of
payment and the execution and delivery of documents by any party to the others pursuant to the
terms of this Agreement shall be concurrent requirements and that nothing will be complete at the
Closing until everything required to complete the Closing has been paid, executed and/or delivered,
as the case may be.

ARTICLE VII

COVENANTS AFTER CLOSING

     7.1 No Assignment in Certain Circumstances. Notwithstanding anything herein to the
contrary, this Agreement shall not constitute an agreement to sell, convey, assign, transfer or
deliver any interest in any instrument, commitment or other Contract or arrangement or Governmental
Authorization or any claim, right or benefit arising thereunder or resulting therefrom, if a sale,
conveyance, assignment, transfer or delivery or an attempt to make such a sale, conveyance,
assignment, transfer or delivery without the authorization, approval, consent or waiver of a third
party would constitute a breach or violation thereof or affect adversely the rights of the Seller
or the Buyer thereunder; and any sale, conveyance, assignment, transfer or delivery to the Buyer of
any interest under any such instrument, commitment or other Contract or arrangement or Governmental
Authorization that requires the authorization, approval, consent or waiver of a third party shall
be made subject to such authorization, approval, consent or waiver being obtained. In the event
that any such authorization, approval, consent or waiver is not obtained on or prior to the Closing
Date and the Buyer waives its right to delivery thereof under Section 6.2, the Seller shall
use its commercially reasonable efforts to obtain any such authorization, approval, consent or
waiver upon request by the Buyer (provided that in obtaining any such authorization,
approval, consent or waiver, the Seller shall not agree to any amendment, modification or
supplement of any such instrument,
commitment or other Contract or arrangement or Governmental Authorization), and the Seller
shall, to the greatest extent permitted by law and any such agreement or instrument, commitment or
other Contract or arrangement or Governmental Authorization (including by acting as an agent of
Buyer or its Affiliates), hold such instrument, commitment or other Contract or arrangement or

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Governmental Authorization or any claim, right or benefit arising thereunder or resulting therefrom
in trust for the benefit of the Buyer and its Affiliates or otherwise for the exclusive use and
benefit of the Buyer and its Affiliates such that the Buyer and its Affiliates receive the interest
of the Seller in the benefits therefrom until such time as such authorization, approval, consent or
waiver is obtained, all at no additional cost to the Buyer, but such instrument, commitment or
other Contract or arrangement or Governmental Authorization shall not be deemed to be included in
the Purchased Assets unless and until such authorization, approval, consent or waiver is obtained.
The Buyer shall perform, as a subcontractor or on a similar basis, the obligations under such
instrument, commitment or other Contract or arrangement or Governmental Authorization.

     7.2 The Seller’s Access to Information. After the Closing Date, the Buyer will give,
or cause to be given, to the Seller and its representatives, during normal business hours, such
reasonable access to the personnel, properties, titles, contracts, books, records, files and
documents included in the Purchased Assets and, at Seller’s expense, copies of titles, contracts,
books, records, files and documents included in the Purchased Assets, only as is necessary to allow
the Seller to obtain information in connection with the preparation and any audit of the Seller’s
Tax Returns and any claims, demands, other audits, suits, actions or Proceedings by or against the
Seller as the previous owner and operator of the Purchased Assets and the Business. The Buyer
agrees to cooperate reasonably with the Seller after the Effective Time, at the Seller’s expense,
with respect to any claims, demands, Tax or other audits, suits, actions and Proceedings by or
against the Seller as the previous owner and operator of the Purchased Assets and the Business,
other than Direct Claims.

     7.3 The Buyer’s Access to Information. After the Closing Date, the Seller will give
to the Buyer and its representatives, during normal business hours, such reasonable access to the
personnel, properties and documents of the Seller not included in the Purchased Assets and access
to and copies of titles, Contracts, books, records, files and documents not included in the
Purchased Assets as is necessary to allow the Buyer to obtain information in connection with the
preparation and any audit of the Buyer’s Tax Returns and any claims, demands, other audits, suits,
actions or Proceedings by or against the Buyer as the owner and operator of the Purchased Assets
and the Business. The Seller agrees to cooperate reasonably with the Buyer after the Effective
Time, at the Buyer’s expense, with respect to any claims, demands, Tax or other audits, suits,
actions and Proceedings by or against the Buyer as the owner and operator of the Purchased Assets
and the Business, other than Direct Claims.

     7.4 Retention of Records. The Buyer and the Seller shall retain all books, records and other data pertaining to Tax
matters for all open periods through the Effective Time. In particular, the Buyer and the Seller
shall retain all Tax Returns, schedules and work papers, and all material records and other
documents relating thereto with respect to the operation of the Business prior to the Effective
Time, until the expiration of the statute of limitations (including any extensions thereof) of the
respective Tax periods. The Seller agrees that it will retain for a period of time not less than
three (3) years after the Closing any books and records (including accounting records) relating to
the Business and not included in the Purchased Assets. At the Buyer’s request, the Seller will
make such books and records available to and otherwise cooperate with the Buyer and its
representatives so that an audit of the financial statements of the Business for periods prior to
the Closing can be performed in accordance with generally accepted

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auditing standards. Such
cooperation shall include causing management representation letters to be delivered to any
accounting firm retained by the Buyer in connection with such audit by each of Wilford and Geske
and any other current or former officers or employee of the Seller as shall be reasonably requested
by the Buyer or its representatives. The Seller hereby consents to the use and disclosure by the
Buyer or its Affiliates of such financial statements (or any portion thereof) in any securities
filings to be made by the Buyer or any of its Affiliates.

     7.5 Indemnification.

          (a) Indemnification by the Seller. From and after the Closing, the Seller agrees to
indemnify, defend and save the Buyer and its Affiliates, and each of their respective officers,
directors, employees, equity holders, attorneys, agents, Employee Benefit Plans and fiduciaries,
plan administrators or other parties dealing with such plans (each, a “Buyer Indemnified
Party”), harmless from and against, and to promptly pay to each Buyer Indemnified Party or
reimburse each Buyer Indemnified Party for, any and all liabilities (whether contingent, fixed or
unfixed, liquidated or unliquidated, or otherwise), obligations, deficiencies, demands, claims,
suits, actions, or causes of action, assessments, losses, diminution in value, costs, expenses,
interest, fines, penalties, damages or costs or expense of any and all investigations, Proceedings,
judgments, settlements and compromises (including reasonable fees and expenses of attorneys,
accountants and other experts) (individually and collectively, “Losses”) sustained or
incurred by any such Buyer Indemnified Party relating to, resulting from, or otherwise arising out
of any of the following:

               (i) any breach or inaccuracy of a representation or warranty made herein or in the Transaction
Documents by the Seller;

               (ii) any non-compliance with or breach by the Seller of any of the covenants or agreements
contained in this Agreement or the Transaction Documents to be performed by the Seller;

               (iii) any liability or obligation of the Seller or any assertion against a Buyer Indemnified
Party resulting from, arising out of or relating to any of the Excluded Liabilities or Excluded
Assets;

               (iv) the ownership, operation or conduct of the Business or the Purchased Assets on or prior
to the Effective Time;

               (v) all liabilities arising out of the transaction contemplated herein under any federal,
state or local “plant closing law” (including the WARN Act);

               (vi) all obligations to any current or former employees of the Seller, including accrued sick
pay, uninsured COBRA benefits incurred by the Seller and other similar amounts and benefits, and
with respect to current or former employees of the Seller, accrued vacation pay and severance and
termination pay and other similar amounts and benefits, in each case incurred prior to the
Effective Time;

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               (vii) any claim for payment of fees and/or expenses as a broker or finder in connection with
the origin, negotiation, execution or consummation of this Agreement based upon an agreement or
alleged agreement between claimant and the Seller or any of its Affiliates;

               (viii) any failure by the Seller to comply with any bulk sales or similar laws applicable to
the Transactions; and

               (ix) any liabilities for (a) Taxes imposed upon, or incurred by, the Seller at any time, (b)
Taxes imposed upon or incurred in connection with the operation of the Business during any period
(or portion of any period) ending on or before the Closing Date, and (c) any Taxes imposed on Buyer
as transferee under Section 6901 of the Code or any similar or comparable Legal Requirement.

          (b) Indemnification by the Buyer. From and after the Closing, the Buyer agrees to
indemnify, defend and save the Seller and its Affiliates, officers, directors, employees,
attorneys, equity holders, agents and fiduciaries (each, a “Seller Indemnified Party”)
harmless from and against, and to promptly pay to each Seller Indemnified Party or reimburse each
Seller Indemnified Party for, any and all Losses sustained or incurred by such Seller Indemnified
Party relating to, resulting from, or otherwise arising out of, any of the following:

               (i) any breach or inaccuracy of a representation or warranty made herein or in the Transaction
Documents by the Buyer;

               (ii) any non-compliance with or breach by the Buyer of any of the covenants or agreements
contained in this Agreement or the Transaction Documents to be performed by the Buyer;

               (iii) any claim for payment of fees and/or expenses as a broker or finder in connection with
the origin, negotiation, execution or consummation of this Agreement based upon any agreement or
alleged agreement between the claimant and the Buyer;

               (iv) any liability or obligation of the Buyer or any assertion against a Seller Indemnified
Party resulting from, arising out of or relating to any of the Purchased Assets and/or the Assumed
Liabilities for periods commencing after Closing;

               (v) all obligations to any employees of the Buyer, including Transferred Employees, incurred
after the Effective Time;

               (vi) ownership, operation or conduct of the Business after the Closing Date; and

               (vii) any liabilities for Taxes incurred by the Buyer with respect to: (a) Taxes imposed upon,
or incurred by, the Buyer at any time, or (b) Taxes imposed upon or incurred in connection with the
operation of Buyer’s Business during any period (or portion of any period) commencing on or after
the Closing Date.

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          (c) Indemnification Procedure for Third Party Claims.

               (i) In the event that subsequent to the Closing any Person entitled to indemnification under
this Agreement (an “Indemnified Party”) asserts a claim for indemnification or receives
notice of the assertion of any claim or of the commencement of any action or Proceeding by any
Person who is not a party to this Agreement or an Affiliate of a party to this Agreement (including
any Governmental Body) (a “Third Party Claim”) against such Indemnified Party, against
which a party to this Agreement is required to provide indemnification under this Agreement (an
“Indemnifying Party”), the Indemnified Party shall give written notice of such claim to the
Indemnifying Party within thirty (30) days after learning of such claim (the “Claim
Notice”). The Indemnifying Party shall have the right, upon written notice to the Indemnified
Party (the “Defense Notice”) within thirty (30) days after receipt from the Indemnified
Party of the Claim Notice, which Defense Notice shall specify the counsel the Indemnifying Party
will appoint to defend such claim (“Defense Counsel”), to conduct at its expense the
defense against such claim in its own name, or, if necessary, in the name of the Indemnified Party;
provided, however, that the Indemnified Party shall have the right to approve the
Defense Counsel, and in the event the Indemnifying Party and the Indemnified Party cannot agree
upon such counsel within ten (10) days after the Defense Notice is provided, then the Indemnifying
Party shall propose an alternate Defense Counsel, which shall be subject again to the Indemnified
Party’s approval and provided, further, that if such claim is covered by insurance
and the insurance policy governs the selection of counsel, the terms of the insurance policy shall
govern. If the Indemnifying Party delivers a Defense Notice, the delivery of such Defense Notice
shall constitute acceptance of responsibility for such claim or action and the Indemnifying Party
shall be fully responsible for all liabilities arising out of or relating to such claim or action
including the costs of the defense thereof. Notwithstanding the foregoing, the Indemnifying Party
shall not be entitled to assume control of a Third Party Claim and shall pay the reasonable fees
and expenses of counsel retained by the Indemnified Party if the Third Party Claim solely seeks
injunctive or other equitable relief or if the Indemnified Party determines that the Indemnified
Party’s interests in the Third Party Claim is or can reasonably be expected to be adverse to the
interests of the Indemnifying Party and provides written notice of such determination to the
Indemnifying Party.

               (ii) In the event that the Indemnifying Party shall fail to give the Defense Notice within the
time period described above, it shall be deemed to have elected not to conduct the defense of the
subject claim, and in such event the Indemnified Party shall have the
right to conduct such defense in good faith and to compromise and settle the claim in good
faith subject to the consent of the Indemnifying Party (which consent will not be unreasonably
withheld) and such Indemnifying Party will be liable for all costs, expenses, settlement amounts or
other Losses actually paid or incurred in connection therewith. If the Indemnifying Party is not
entitled to assume the defense of a Third Party Claim because of reasons set forth in the last
sentence of the preceding paragraph, the Indemnified Party may not settle the Third Party Claim
without the written consent of the Indemnifying Party, which consent shall not be unreasonably
withheld or delayed, if such settlement would lead to any liability or create any other obligation
of the Indemnifying Party.

               (iii) In the event that the Indemnifying Party does deliver a Defense Notice within the time
period described above and thereby elects to conduct the defense of the

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subject claim, the
Indemnifying Party shall diligently conduct such defense and the Indemnified Party will cooperate
with and make available to the Indemnifying Party such assistance and materials as it may
reasonably request, all at the expense of the Indemnifying Party, and the Indemnified Party shall
have the right at its expense to participate in the defense assisted by counsel of its own
choosing.

               (iv) The Indemnifying Party may enter into any settlement of any Third Party Claim;
provided, however, the Indemnifying Party may not enter into any settlement of any
Third Party Claim without the prior written consent of the Indemnified Party if pursuant to or as a
result of such settlement, (A) injunctive or other equitable relief would be imposed against the
Indemnified Party, or (B) such settlement would or could reasonably be expected to lead to any
liability or create any financial or other obligation on the part of the Indemnified Party.

          (d) Direct Claims. It is the intent of the parties hereto that all direct claims by
an Indemnified Party against a party hereto not arising out of Third Party Claims shall be subject
to and benefit from the terms of this Section 7.5. Any claim under this Section
7.5(d) by an Indemnified Party for indemnification other than indemnification against a Third
Party Claim (a “Direct Claim”) will be asserted by giving the Indemnifying Party reasonably
prompt written notice thereof, and the Indemnifying Party will have a period of thirty (30)
calendar days within which to satisfy such Direct Claims, except for injunctive or equitable
relief, which the Indemnified Party may pursue at any time. The Indemnifying Party shall only be
deemed to reject such claim if it sends notice thereof to the Indemnified Party within such thirty
(30) calendar day period, in which event the Indemnified Party will be free to pursue such remedies
as may be available to the Indemnified Party under this Section 7.5 or otherwise. If the
Indemnifying Party does not so respond within such thirty (30) calendar day period, the
Indemnifying Party will be deemed to have accepted such claim, in which event the Indemnifying
Party shall make payment to the Indemnified Party therefor pursuant to Section 7.5(h).

          (e) Failure to Give Timely Notice. A failure by an Indemnified Party to give timely,
complete or accurate notice as provided in Section 7.5(c) will not affect the rights or
obligations of any party hereunder except and only to the extent that, as a result of such failure,
any party entitled to receive such notice was prejudiced as a direct result of such failure to give
timely notice.

          (f) Survival of Representations and Warranties. All of the representations and
warranties set forth in this Agreement or in any of the other Transaction Documents shall survive
the execution and delivery of this Agreement and the consummation of the Transactions until they
expire and terminate on the date this eighteen (18) months after the Closing Date except that (i)
the representations and warranties contained in Section 3.2 (Authorization),
Section 3.8(a) (Title to Assets), and Section 4.2 (Authorization) shall survive
indefinitely and (ii) the representations and warranties contained in Section 3.13
(Employee Benefit Plans) and Section 3.20 (Taxes) shall survive until sixty (60) days
following the expiration of the applicable statute of limitations period or any extensions or
waivers thereof. It is agreed that in the event notice of any claim for indemnification under this
Agreement with respect to any inaccuracy or a breach of representation or warranty or with respect
to any other matter shall have been given within the applicable survival period, the claims and
rights to indemnification relating to such

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inaccuracies or breaches of representations and
warranties or other matters that are the subject of such indemnification claim shall survive until
such time as such claim is finally resolved.

          (g) Adjustment to Purchase Price. Any indemnification received under this
Section 7.5 shall be, to the extent permitted by law, an adjustment to the Purchase Price.

          (h) Payments. With respect to any claim of an Indemnified Party made in good faith or
portion thereof that is not being contested by the Indemnifying Party in good faith or upon the
resolution of a claim or portion thereof contested by the Indemnifying Party as provided in
Section 7.5(d), such payment shall be made by the Indemnifying Party (i) if the claim is
not being contested, not later than thirty (30) days after receipt by the Indemnifying Party of
written notice from the Indemnified Party stating the amount of the claim or (ii) if the claim is
contested pursuant to Section 7.5(d), five (5) days after the resolution of any claim
contested pursuant to Section 7.5(d). In addition, the Indemnifying Party shall reimburse
the Indemnified Party for any and all costs or expenses of any nature or kind whatsoever (including
all attorney’s fees) incurred in seeking to collect any payments under this Section 7.5(h).
Any payments required under this Section 7.5 that is not made when due shall bear interest
until paid in full at the Prime Rate of interest as published in The Wall Street Journal (changing
as and when such rate changes) plus four percent (4%) or, if less, the maximum rate permitted by
applicable usury laws. Interest on any such unpaid amount shall be compounded monthly, computed on
the basis of a 360-day year and shall be payable on demand.

          (i) Sole Remedies. The remedies provided by this Article VII, subject to the
limitations set forth herein, shall be the sole and exclusive remedies of the Buyer Indemnified
Parties for the recovery of Losses resulting from, relating to or arising out of
Section 7.5(a)(i) of this Agreement, absent fraud or intentional misconduct.

          (j) Insurance Proceeds. To the extent that a Buyer Indemnified Party suffers a claim
for which it is entitled to a recovery from the Seller, the Loss recoverable shall be reduced to
the extent that the Buyer or any Buyer Indemnified Party actually receives proceeds of insurance or
other recoveries or reimbursements from Third Parties that are directly related to the matter
giving rise to the claim, reduced by all costs of the Buyer Indemnified Parties incurred in
obtaining such payment.

          (k) Limitations on Seller’s Indemnification Liability. Notwithstanding the other
provisions of this Article VII:

               (i) the Buyer Indemnified Parties shall not be entitled to assert any Claims under
Section 7.5(a)(i) until such time that all Losses to the Buyer Indemnified Parties,
collectively (not including internal costs) arising from claims under Section 7.5(a)(i)
exceed $50,000 in the aggregate (the “Deductible”), in which case the Seller shall be
liable for all Losses (i.e., not just those in excess of the Deductible);

               (ii) the aggregate maximum liability for all indemnification by Seller under
Section 7.5(a)(i) shall not exceed $4,000,000 (the “Cap”), for all Claims made by
any Buyer Indemnified Party at any time after the date hereof; and

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               (iii) the Seller shall not be liable to indemnify any Buyer Indemnified Party or any other
Person pursuant to Section 7.5(a)(i) for any Claims unless Buyer notifies Seller in writing
of the claim for indemnification not later than the expiration of the representation and warranty
to which such Claim relates in accordance with Section 7.5(f) above.

          (l) Mitigation. Notwithstanding anything in Section 7.5 to the contrary, any
common law duty to mitigate any Losses for which indemnification is available under this Agreement
shall be binding on any Indemnified Party seeking indemnification hereunder. Each Party hereto
agrees that it shall use commercially reasonable efforts to cooperate with the other Party hereto
in connection with the defense of any Third Party Claims for indemnification hereunder, including
providing reasonable access, during regular business hours, to the records and employees of such
Party.

     7.6 Right of Set Off.

          (a) In addition to, and not in limitation of, the Buyer Indemnified Parties’ rights to
indemnity as set forth in this Article VII, the Buyer shall have the right to set off
against any and all monies otherwise to be paid or delivered to the Seller from and after the
Closing, including any and all amounts for which the Buyer is required to indemnify a Seller
Indemnified party pursuant to this Article VII. The exercise of such right of set off by
the Buyer in good faith will not constitute a breach of this or any other agreement between the
parties.

          (b) In addition to, and not in limitation of, the Seller Indemnified Parties’ rights to
indemnity as set forth in this Article VII, the Seller shall have the right to set off
against any and all monies otherwise to be paid or delivered to the Buyer from and after the
Closing, including any and all amounts for which the Seller is required to indemnify a Buyer
Indemnified party pursuant to this Article VII. The exercise of such right of set off by
the Seller in good faith will not constitute a breach of this or any other agreement between the
parties.

     7.7 Restrictive Covenants.

          (a) Acknowledgment. As an inducement to the Buyer to enter into this Agreement and
consummate the transactions contemplated hereby, each of the Seller, Wilford
and Geske (collectively, the “Restricted Parties”, and each individually a
“Restricted Party”) agree and acknowledge that it is necessary that each Restricted Party
undertake not to utilize such Restricted Party’s special knowledge of the Business and such
Restricted Party’s relationship with customers and suppliers to compete with the Buyer.

          (b) Non-Compete. The Restricted Parties hereby agree, jointly and severally, that so
long as the Buyer is not in breach of any of its material obligations set forth in this Agreement
and the Transaction Documents (as determined by a non-appealable order of any court of competent
jurisdiction or other Governmental Body) that for a period commencing on the Closing Date and
ending five (5) years from the Closing Date (the “Restricted Period”), each of them will
not, directly or indirectly, as agent, employee, consultant, distributor, representative, equity
holder, manager, partner or in any other capacity, own (other than through the passive ownership of
less than 1% of the publicly

33

 

traded shares of any Person), operate, manage, control, engage in,
invest in (other than through the passive ownership of less than 1% of the publicly traded shares
of any Person) or participate in any manner in, act as a consultant or advisor to, render services
for (alone or in association with any Person), or otherwise assist any Person that engages in or
owns, invests in, operates, manages or controls any venture or enterprise that directly or
indirectly engages or proposes to engage in any business competitive in any material respect with
any portion of the Business (as conducted by the Buyer in the State of Minnesota from time to time)
anywhere in the States of Minnesota, Illinois, Indiana, Kentucky, Michigan and Wisconsin(the
“Territory”). Notwithstanding the foregoing, the parties acknowledge that the non-compete
described in this Section 7.7(b) does not in any manner limit a Restricted Party from the
Practice of Law. Notwithstanding the foregoing, the parties acknowledge that the non-compete
described in this Section 7.7(b) does not in any manner limit any Restricted Party from the
Practice of Law or any Restricted Party’s ability to itself provide or perform Legal Services or
Mortgage Default Support Services to clients of the Seller or such Restricted Party.

          (c) Confidential Information. During the Restricted Period and thereafter, each
Restricted Party shall keep secret and retain in strictest confidence, and shall not, without the
prior written consent of the Buyer, furnish, make available or disclose to any third party or use
for the benefit of the Restricted Parties or any third party, any Confidential Information. As
used in this Section 7.7(c), “Confidential Information” shall mean any information
relating to this Agreement and the transactions contemplated hereby, the business or affairs of the
Buyer or the Business, and information relating to financial statements, customer identities,
potential customers, employees, suppliers, servicing methods, equipment, programs, strategies and
information, analyses, profit margins or other proprietary information used by the Restricted
Parties or the Buyer in connection with the Business; provided, however, that Confidential
Information does not include information relating to the Seller’s Clients and the services
performed by Seller for such Clients, whether before or after the Effective Time or which, at the
time of disclosure to such Restricted Party, had become a part of the public domain, through lawful
publication or communication by others; or which, after disclosure to such Restricted Party,
becomes a part of the public domain, through lawful publication or communication by others or
otherwise becomes generally known through no wrongful act on the part of any Restricted Parties.

          (d) Interference with Relationships. During the Restricted Period, and so long as the
Buyer is not in breach of any of its material obligations set forth in this Agreement and the
Transaction Documents (as determined by a non-appealable order of any court of competent
jurisdiction or other Governmental Body), no Restricted Party shall, without the prior written
consent of the Buyer, directly or indirectly, as agent, employee, consultant, distributor,
representative, stockholder, manager, partner or in any other capacity, employ or engage, or
recruit or solicit for employment or engagement, any person (i) who is employed or engaged by the
Buyer or any of its Affiliates (both before and after the Closing Date), (ii) who was employed or
engaged by the Buyer or any of its Affiliates within six (6) months of such contact, or (iii) who
was engaged in the Business during the six (6) months prior to the Closing Date, or otherwise seek
to influence or alter any such person’s relationship with the Buyer.

          (e) Buyer Non-Solicitation. During the term of the Services Agreement (including any
extensions or renewals thereof), and so long as the Seller is not in breach of any of its material
obligations set forth in this Agreement and the Transaction Documents (as determined by a
non-appealable order of any court of competent jurisdiction or other

34

 

Governmental Body) and for a
period of one (1) year following termination of the Services Agreement, the Buyer shall not, direct
or indirectly, whether alone or in connection with any other Person, hire, recruit or employ, or
solicit or otherwise seek to hire, recruit, or employ, any employee of the Seller (i) who is then
employed or engaged by the Seller or (ii) who was employed or engaged by the Seller within the six
(6) month period prior to such contact.

          (f) Blue-Pencil. If any court of competent jurisdiction shall at any time deem the
term of any particular restrictive covenant contained in this Section 7.7 too lengthy or
the Territory too extensive, the other provisions of this Section 7.7 shall nevertheless
stand, and the Restricted Period and/or the Territory shall be reduced to such duration or size as
such court shall determine to be permissible.

          (g) Remedies. Each of the Restricted Parties acknowledges and agrees that the
covenants set forth in this Section 7.7 are reasonable and necessary for the protection of
the Buyer’s business interests, that irreparable injury will result to the Buyer if the Restricted
Parties breach any of the terms of this Section 7.7, and that in the event of any
Restricted Party’s actual or Threatened breach of any of the provisions contained in this
Section 7.7, the Buyer will have no adequate remedy at law. Each of the Restricted Parties
accordingly agrees that in the event of any actual or Threatened breach by it of any of the
provisions contained in this Section 7.7, the Buyer shall be entitled to such injunctive
and other equitable relief, without the necessity of showing actual monetary damages and without
posting any bond or other security. Nothing contained herein shall be construed as prohibiting the
Buyer from pursuing any other remedies available to it for such breach or Threatened breach,
including the recovery of any damages.

     7.8 Employment Matters.

          (a) Transferred Employees. Effective at the Closing and except with respect to the
Persons listed on Schedule 7.8(a), the Buyer shall, or shall cause one of its Affiliates
to, offer employment to the employees of the Seller listed on the employee list previously
delivered
by the Seller to the Buyer (those of such employees accepting employment with the Buyer, the
“Transferred Employees”) upon terms to be determined in the sole discretion of the Buyer or
its Affiliates. Upon request by the Seller, the Buyer shall provide the Seller with the proposed
salary information at Closing for each Transferred Employee. In connection therewith, the Seller
shall use commercially reasonable efforts to encourage all of the Seller’s employees to accept
employment with the Buyer or its Affiliates, if employment is offered. For purposes of this
Section 7.8(a), an employee shall be deemed to have accepted employment with the Buyer or
an Affiliate thereof if such employee (i) appears at work on the second Business Day following the
Closing Date and (ii) has not given notice to the contrary to the Buyer or the Seller as of such
date. Notwithstanding the foregoing, nothing herein shall be deemed to require the Buyer or any of
its Affiliates to employ any Transferred Employee for any period of time after the Closing Date.

          (b) Severance Pay. The Seller agrees that it shall be solely responsible for any
notice of termination, termination pay, severance pay or any other costs, liabilities or
obligations due to any of its employees (including vacation pay, sick pay and any other accrued
paid time off), whether such employees are terminated by the Seller in connection with the
transactions contemplated by this Agreement or otherwise, on or prior to the Closing Date, whether
such

35

 

severance pay is due pursuant to statute, common law or written or oral agreements or
arrangements with such employee.

          (c) Employee Benefits.

               (i) The Buyer covenants and agrees to recognize the service by each Transferred Employee with
the Seller for purposes of eligibility and vesting (but not benefit accrual) under any employee
benefit plan offered by the Buyer to the Transferred Employees as of, or following, the Closing
Date.

               (ii) Assuming the continued qualified status of the Wilford & Geske 401(k) Retirement Plan,
the Buyer covenants and agrees that it shall allow individual rollovers of accounts from such plan
to the Dolan Media Company 401(k) Plan for all Transferred Employees; provided,
however, that (A) such rollovers shall only be allowed for pre-tax employee contributions
and employer contributions, and (B) such rollovers shall be completed by each Transferred Employee
following the reasonable procedures of the Buyer relating to rollovers.

               (iii) Notwithstanding anything to the contrary herein, the Seller shall remain responsible for
all employer group health plan continuation of coverage obligations arising under COBRA or
applicable state law with respect to all individuals who are or become “M&A Qualified
Beneficiaries” (as defined in Treas. Reg. §54.4980B-9) as a result of the consummation of the
Transactions.

               (iv) The Seller and the Buyer shall mutually cooperate and provide the other party with such
records, information, documentation and assistance as such party reasonably requests to carry out
the intent of this Section 7.8.

               (v) The Seller hereby agrees that it shall permit each of the Transferred Employees that is
currently a participant in the Seller’s Flex Spending Account Plan to remain a participant in such
plan until September 30, 2008. Within forty-five (45) days following such date, the Buyer will
compensate Seller for any additional amounts required to be paid by the Seller resulting from the
early termination of employment of any Transferred Employee prior to such date.

          (d) Accrued Raises. Promptly upon the determination of the amount of any raises in
the salaries or wages of the Transferred Employees for fiscal year 2008, the Seller shall remit to
the Buyer by check or wire transfer the amount equal to the retroactive increase in such salaries
or wages for the Transferred Employees for the period from January 1, 2008 through and including
the Closing Date.

ARTICLE VIII

MISCELLANEOUS

     8.1 Notices, Consents, etc. Any notices, consents or other communication required or
permitted to be sent or given hereunder by any of the parties shall in every case be in writing

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and
shall be deemed properly served if (a) delivered personally or (b) delivered by a recognized
overnight courier service, to the parties at the addresses as set forth below or at such other
addresses as may be furnished in writing.

	 	(a)	 	If to the Buyer:
	 
	 	 	 	c/o Dolan Media Company

1200 Baker Building

706 Second Avenue South

Minneapolis, Minnesota 55402

Attention: James P. Dolan
	 
	 	 	 	with a copy to (which shall not constitute notice):
	 
	 	 	 	Katten Muchin Rosenman LLP

525 West Monroe Street

Chicago, Illinois 60661-3693

Attention: Walter S. Weinberg, Esq.
	 
	 	(b)	 	If to the Seller:
	 
	 	 	 	c/o Wilford & Geske, Professional Association

7650 Currell Boulevard

Suite 300

Woodbury, Minnesota 55125

Attention: Lawrence A. Wilford and James A. Geske
	 
	 	 	 	with a copy to (which shall not constitute notice):
	 
	 	 	 	Moss & Barnett, A Professional Association

90 South Seventh Street, Suite 4800

Minneapolis, Minnesota 55402

Attention: Thomas J. Shroyer, Esq.

Date of delivery of such notice shall be (x) the date such notice is personally delivered or (y)
one (1) Business Day after the date of delivery to the overnight courier if sent by overnight
courier.

     8.2 Public Announcements. Prior to the Closing, none of the parties hereto shall
make, nor shall they permit their respective Affiliates to make, any public announcement or filing
with respect to the transactions provided for herein without the prior consent of the other parties
to this Agreement. The Seller and the Buyer shall mutually agree upon the timing, method and
content of the disclosure to the employees of the Seller of the transactions contemplated by this
Agreement.

     8.3 Severability. The unenforceability or invalidity of any provision of this
Agreement shall not affect the enforceability or validity of any other provision.

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     8.4 No Third Party Beneficiaries. Notwithstanding anything to the contrary in this
Agreement and the Transaction Documents and except with respect to any Persons entitled to
indemnification hereunder, nothing in this Agreement or in any of the Transaction Document, will
entitle any Person (other than a Party and his/its respective successors and assigns permitted
hereby) to any claim, cause of action, remedy or right of any kind.

     8.5 Amendment and Waiver. This Agreement may be amended, and any provision of this
Agreement may be waived; provided that any such amendment or waiver will be binding on the
Buyer only if such amendment or waiver is set forth in a writing executed by the Buyer;
provided, further that any such amendment or waiver will be binding upon the
Seller, Wilford and Geske only if such amendment or waiver is set forth in a writing executed by
the Seller. 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 breach.

     8.6 Counterparts. This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original but all of which together shall constitute one and the same
agreement and shall become effective when one or more counterparts have been signed by each of the
parties hereto and delivered to the other.

     8.7 Deliveries. This Agreement, the Transaction Documents and each other agreement or
instrument entered into in connection herewith or therewith or contemplated hereby or thereby, and
any amendments hereto or thereto, to the extent signed and delivered by means of a facsimile
machine or other electronic transmission (including e-mail of a “pdf”), shall be treated in all
manner and respects and for all purposes as an original agreement or instrument and shall be
considered to have the same binding legal effect as if it were the original signed version thereof
delivered in person. At the request of any party hereto or to any such agreement or instrument,
each other party hereto or thereto shall re-execute original forms thereof and deliver them to all
other parties, except that the failure of any party to comply with such a request shall not render
this Agreement invalid or unenforceable. No party hereto or to any such agreement or instrument
shall raise the use of a facsimile machine or other electronic transmission to deliver a signature
or the fact that any signature or agreement or instrument was transmitted or communicated through
the use of a facsimile machine or other electronic transmission as a defense to the formation or
enforceability of a contract and each such party forever waives any such defense.

     8.8 Expenses. Each of the parties shall pay all costs and expenses incurred or to be
incurred by it in negotiating and preparing this Agreement and in closing and carrying out the
transactions contemplated by this Agreement, including any finder’s fees or brokerage or other
commission arising by reason of any services rendered or alleged to have been rendered to such
party in connection with this Agreement or the Transactions; provided, however,
that all sales or transfer taxes relating to the sale of the Purchased Assets shall be paid by the
Buyer, and all fees and charges of any Governmental Body relating to the transfer of the Assumed
Proprietary Rights to the Buyer hereunder shall be borne by the Buyer. Notwithstanding anything in
this Agreement to the contrary, Buyer shall pay all state and local sales and use taxes (if any),
transfer taxes and documentary stamp taxes associated with the sale and conveyance of the Purchased
Assets pursuant to this Agreement.

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     8.9 Headings. The subject headings of Articles and Sections of this Agreement are
included for purposes of convenience of reference only and shall not affect the construction or
interpretation of any of its provisions.

     8.10 Governing Law; Waiver of Jury Trial.

          (a) THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED
IN ALL RESPECTS, INCLUDING VALIDITY, INTERPRETATION AND EFFECT, BY THE LAWS OF THE STATE OF
MINNESOTA, WITHOUT REGARD TO ITS RULES OF CONFLICTS OF LAW.

          (b) EACH PARTY HEREBY EXPRESSLY WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR
PROCEEDING TO ENFORCE OR DEFEND ANY RIGHT, POWER, OR REMEDY UNDER OR IN CONNECTION WITH THIS
AGREEMENT OR ANY OF THE CONTEMPLATED TRANSACTIONS HEREUNDER OR IN CONNECTION WITH ANY AMENDMENT,
INSTRUMENT, DOCUMENT, OR AGREEMENT DELIVERED OR WHICH MAY IN THE FUTURE BE DELIVERED IN CONNECTION
HEREWITH OR THEREWITH OR ARISING FROM ANY RELATIONSHIP EXISTING IN CONNECTION WITH THIS AGREEMENT
OR ANY TRANSACTION CONTEMPLATED BY THIS AGREEMENT, AND AGREE THAT ANY SUCH ACTION SHALL BE TRIED
BEFORE A COURT AND NOT BEFORE A JURY. THE TERMS AND PROVISIONS OF THIS SECTION 8.10 CONSTITUTE A
MATERIAL INDUCEMENT FOR THE PARTIES ENTERING INTO THIS AGREEMENT.

          (c) Consent to Jurisdiction and Service of Process. Any legal action, suit or
proceeding in equity or in law arising out of or relating to this Agreement and the transactions
contemplated hereby or thereby shall be instituted solely in any state or federal court in the
State of Minnesota and each party agrees not to assert, by way of motion, as a defense, or
otherwise, in any such action, suit or proceeding, any claim that such party is not subject
personally to the jurisdiction of such court, that its property is exempt or immune from
attachment, that the action, suit or proceeding is brought in an inconvenient forum, that the venue
of the action, suit or proceeding is improper, or that this Agreement may not be enforced in or by
such court. Each party further irrevocably submits to the jurisdiction of any such court in any
such action, suit or proceeding. Any and all service of process and any other notice in any such
action, suit or proceeding shall be effective against any party if given by registered or certified
mail, return receipt requested, or by any other means of mail which requires a signed receipt,
postage prepaid, mailed to such party as herein provided (or, if no such method is provided by
local law, by a recognized overnight delivery courier). Nothing herein contained shall be deemed
to affect the right of any Party to serve process in any manner permitted by law.

     8.11 Assignment. This Agreement will be binding upon and inure to the benefit of the
parties hereto and their respective successors and permitted assigns, but will not be assignable or
delegable by any party without the prior written consent of the other party, provided,
however, that the Buyer shall be allowed to assign its rights and benefits hereto to (a) an
Affiliate so long as the Affiliate assumes the Buyer’s obligations hereunder and Buyer remains
fully liable for all

39

 

of its obligations under this Agreement and the Transaction Documents and
(b) the lenders of the Buyer or any Affiliate of the Buyer as collateral for security purposes;
provided, further, in no event shall any such assignment relieve the Buyer of its obligations
hereunder. The Seller agrees
to provide any acknowledgment or consent required by any such lender in connection with any
assignment referenced in clause (b) above.

     8.12 Definitions. For purposes of this Agreement, the following terms have the
meaning set forth below:

     “Adjusted EBITDA” means, with respect to the Business for a specified period, the sum, without
duplication, of net income of the Business for the specified period after Taxes determined in a
manner consistent with the preparation of the Audited Pro Forma Financial Statements, as

(a) reduced by the amount of any (i) gains derived from any unusual and infrequent,
nonrecurring event that would be characterized as “extraordinary” under GAAP, (ii)
gains resulting from the sale or other disposition of assets not in the ordinary
course of business, and (iii) gains attributable to (A) adjustments relating to
prior periods or (B) acquisitions of businesses or lines of business consummated
subsequent to the Closing Date, all to the extent any of the foregoing items are
included in the determination of net income; and

(b) increased by the amount of any (i) interest expense, (ii) income taxes, (iii)
depreciation and amortization, (iv) losses derived from any unusual and infrequent,
nonrecurring event that would be characterized as “extraordinary” under GAAP, (v)
net losses resulting from the sale or other disposition of assets not in the
ordinary course of business, (vi) deductions or losses attributable to adjustments
relating to prior periods, (vii) costs attributable to acquisitions of businesses or
lines of business consummated subsequent to the Closing Date, and (viii) the salary
expense and benefit costs under the Wilford Employment Agreement and the Geske
Employment Agreement, all to the extent any of the foregoing items are deducted in
the determination of net income.

     “Adjusted 2008 EBITDA” means Adjusted EBITDA for the Measurement Period.

     “Adjusted 2008 EBITDA Shortfall” means the amount, if any, by which Adjusted 2008 EBITDA is
less than the Adjusted 2008 EBITDA Target.

     “Adjusted 2008 EBITDA Target” means $3,045,000.

     “Affiliate” means, with respect to any Person: (i) any other Person directly or indirectly
controlling, controlled by or under common control with the subject Person or (ii) any officer,
director, trustee, managing member or general partner of the subject Person, provided that,
for the purposes of this definition, “control” (including, with correlative meanings, the terms
“controlled by” and “under common control with”), as used with respect to any Person, shall mean
the possession, directly or indirectly, of the power to direct or cause the direction of the

40

 

management and policies of such Person, whether through the ownership of voting securities, by
Contract or otherwise.

     “Arbitrator” means Deloitte & Touche LLP.

     “Business Day” means any day other than a Saturday, Sunday or day on which commercial banks
are authorized or required by law to close in Minneapolis, Minnesota.

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

     “Contract” means any agreement, contract, license, lease, purchase order, obligation, promise,
or undertaking (whether written or oral and whether express or implied).

     “Documentation” means all existing and current user manuals, design specifications, system
flow charts, program flow charts, schematics, file layouts, report layouts, screen layouts, test
results, activity or tracking logs or reports, other logs, and other installation, instructional,
trouble shooting, customer service and training materials and all other existing documentation,
system and user materials in Seller’s possession and related to the Purchased Assets.

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

     “GAAP” means United States generally accepted accounting principles set forth in the opinions
and pronouncements of the Accounting Principles Board of the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial Accounting Standards Board (or any
successor authority) that are applicable as the date of determination, consistently applied in
accordance with past practices.

     “Governmental Authorization” means any approval, consent, license, permit, waiver, or other
authorization issued, granted, given, or otherwise made available by or under the authority of any
Governmental Body or pursuant to any Legal Requirement.

     “Governmental Body” means any:

          (a) foreign, federal, state, county, municipal, city, town village, district, or other
jurisdiction or government of any nature;

          (b) governmental or quasi-governmental authority of any nature (including any governmental
agency, branch, department, official, or other entity and any court or other tribunal); or

          (c) body exercising, or entitled or purporting to exercise, any administrative, executive,
judicial, legislative, police, regulatory, or taxing authority or power of any nature.

     “Income Tax” means Tax imposed by a Governmental Body with respect to or on income, including
any interest, penalty or addition thereto.

     “Indebtedness” of any Person means the principal of, premium, if any, unpaid interest on, and
other amounts owing in respect of, (a) indebtedness for borrowed money, (b)

41

 

indebtedness for
borrowed money guaranteed, directly or indirectly, in any manner by such Person, or in effect
guaranteed, directly or indirectly, in any manner by such Person through an agreement, contingent
or otherwise, to supply funds to, or in any other manner invest in, the
debtor, or to purchase indebtedness for borrowed money, or to purchase and pay for property if
not delivered or pay for services if not performed, primarily for the purpose of enabling the
debtor to make payment of the indebtedness for borrowed money or to assure the owners of the
indebtedness for borrowed money against loss, (c) all indebtedness for borrowed money secured by
any Lien upon property owned by such Person, even though such Person has not in any manner become
liable for the payment of such indebtedness, and (d) renewals, extensions and refunding of any such
indebtedness for borrowed money.

     “Legal Requirement” means any foreign, federal, state, local, municipal or other constitution,
ordinance, regulation, statute, rule or other law adopted, enacted, implemented, or promulgated by
or under the authority of any Governmental Body or by the eligible voters of any jurisdiction, and
any agreement, approval, consent, injunction, judgment, license, Order, or Permit by or with any
Governmental Body or to which the Seller is a party or by which the Seller or the Purchased Assets
are bound.

     “Legal Services” means the practice of law, including counseling or assisting others in
matters that require the use of legal discretion and profound legal knowledge, the giving of advice
or the rendering of any service requiring the use of legal skill or knowledge.

     “Major Clients” means the ten (10) largest clients of the Seller utilizing Seller’s mortgage
default support services prior to the Effective Time, as measured by the dollar amount of revenue
received by the Seller for the twelve-month period ending on December 31, 2007.

     “Material Adverse Effect” means any change or effect that (a) individually or when taken
together with all other changes or effects that have occurred during any relevant period of time
prior to the date of determination of the occurrence of such change or effect, has been, is or
could reasonably be expected to be materially adverse to the Business, the Purchased Assets or the
condition (financial or otherwise) or results of operations of the Seller considered as a whole, or
(b) materially adversely affects the ability of the Seller to perform its obligations under this
Agreement or the Transaction Documents or to consummate the transactions contemplated hereby or
thereby.

     “Measurement Period” means the twelve (12) month period ended March 31, 2009.

     “Order” means any award, injunction, judgment, order, ruling, subpoena, or verdict or other
decision entered, issued, made, or rendered by any court, administrative agency, or other
Governmental Body or by any arbitrator.

     “Organizational Documents” means (a) the articles or certificate of incorporation and the
bylaws of a corporation; (b) any charter or similar document adopted or filed in connection with
the creation, formation, or organization of a Person (e.g., a certificate of formation, articles of
organization or certificate of limited partnership), and any agreement governing such Person (e.g.,
a limited liability company agreement, operating agreement or partnership agreement); and (c) any
amendment to any of the foregoing.

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     “Person” means any individual, sole proprietorship, partnership, limited liability company,
joint venture, trust, unincorporated association, corporation, other entity or
government (whether federal, provincial, state, county, city or otherwise, including, but not
limited to, any instrumentality, division, agency or department thereof).

     “Practice of Law” means any activities that constitute providing Legal Services.

     “Proceeding” means any claim, suit, litigation, arbitration, hearing, audit, charge,
investigation, or other action (whether civil, criminal, administrative, investigative, or
informal) commenced, brought, conducted, or heard by or before, or otherwise involving, any
Governmental Body, arbitrator or mediator.

     “Proprietary Rights” of Seller means all intellectual property, confidential information, and
proprietary information of Seller relating solely to the Purchased Assets, including: (a) patents
and patent applications (including all reissuances, continuations, continuations-in-part,
revisions, extensions and reexaminations thereof) and patent disclosures and inventions (whether or
not patentable and whether or not reduced to practice); (b) trademarks, service marks, trade dress,
trade names, Internet domain names, assumed names and corporate names, together with the goodwill
of the business associated with and symbolized by such trademarks, service marks, trade dress,
trade names and corporate names, in each case whether or not registered; (c) published and
unpublished works of authorship, whether copyrightable or not, including all statutory and common
law copyrights associated therewith; (d) all registrations, applications, extensions and renewals
for any of the terms listed in clauses (b) and (c); (e) trade secrets; (f) websites; (g) all
computer programs and Software, including operating systems, applications, routines, interfaces,
all algorithms; (h) all Documentation related solely to the Purchased Assets, to the extent
available.

     “Securities Act” means the Securities Act of 1933, as amended.

     “Seller’s knowledge” or “to the knowledge of the Seller” means the knowledge that any of
Wilford or Geske actually has or that a reasonable business owner would have of the applicable
matter after due inquiry.

     “Software” means all software programs and applications developed by, on behalf of, at the
specific request or direction of, or owned by, the Seller and used or intended for use by the
Seller in the Business, including all enhancements, versions, releases and updates of such programs
and applications, and any other software products in development by the Seller.

     “Subsidiary” means, with respect to any Person, any corporation, limited liability company,
partnership, association or entity of which (i) if a corporation, a majority of the total voting
power of shares of stock entitled (without regard to the occurrence of any contingency) to vote in
the election of directors, managers, or trustees thereof is at the time owned or controlled,
directly or indirectly, by that Person or one or more of the other Subsidiaries of that Person or a
combination thereof, or (ii) if a limited liability company, partnership, association, or other
entity (other than a corporation), a majority of partnership or other similar ownership interest
thereof is at the time owned or controlled, directly or indirectly, by that Person or one or more
Subsidiaries of that Person or a combination thereof. For purposes hereof, a Person or Persons
shall be

43

 

deemed to have a majority ownership interest in a limited liability company, partnership,
association or other entity (other than a corporation) if such Person or Persons shall be allocated
a majority of limited liability company, partnership, association, or other entity gains or
losses or shall be or control any managing director or general partner of such limited liability
company, partnership, association, or other entity.

     “Target Contingent Payment” means $2,000,000.

     “Tax” means any and all foreign, federal, state or local taxes, assessments and other
governmental charges based on or measured by gross receipts, income, profits, sales, use and
occupation, and franchise, estimated, alternative minimum, add-on minimum, sales, use, real or
immovable property, personal or movable property, intangible property, social security, employment,
unemployment, payroll, deductions at source, employee or other withholding, including any interest,
penalties or additions to tax or additional amounts in respect of the foregoing; whether disputed
or not, and including any transferee or secondary liability in respect of any tax (whether by law,
contractual agreement, or otherwise) and any liability in respect of any tax as a result of being a
member of any affiliated, consolidated, combined, unitary, or similar group.

     “Tax Returns” means returns, declarations, reports, claims for refund, information returns or
other documents (including any related or supporting schedules, statements or information and any
amendment thereof) filed or required to be filed in connection with the determination, assessment
or collection of any Taxes of any party or the administration of any laws, regulations or
administrative requirements relating to any Taxes.

     “Third Party Software” means any off-the-shelf software program or any software utility, tool,
application or program, which was not developed at the specific request or direction of the Seller.

     A claim, Proceeding, dispute, action, or other matter will be deemed to have been “Threatened”
if any notice, demand or statement has been given or made in writing, or if any other event has
occurred or any other circumstances exist, that would lead a prudent Person to conclude that such a
claim, Proceeding, dispute, action, or other matter is likely to be asserted, commenced, taken, or
otherwise pursued in the future.

     “Transaction Documents” means each agreement, document, certificate and instrument being
delivered pursuant to this Agreement, including, but not limited to, the Services Agreement.

     “Transactions” shall mean the transactions contemplated by this Agreement and each of the
Transaction Documents.

     “Websites” means all series of interconnected pages on the World Wide Web, documents, files,
content, written materials, graphics and designs, formatted using HTML code or another web-based
code, located at, or otherwise intended to be accessible by Internet users with web browsers and
all content, information and other materials associated therewith, including (a) any computer
software, script, programming code, formatting code, data,

44

 

methodologies and processes used in the
operation thereof or otherwise related thereto; (b) all versions, works in process, updates, fixes,
enhancements, and releases thereof; (c) all mirror
sites associated with the foregoing; and (d) all copyrights, trademarks, trade secrets and
other Proprietary Rights, in any jurisdiction, inherent in the foregoing or appurtenant thereto.

     8.13 Entire Agreement. This Agreement, the Recitals and all the Schedules and
Exhibits attached to this Agreement (all of which shall be deemed incorporated in the Agreement and
made a part hereof) and the other Transaction Documents set forth the entire understanding of the
parties, and supersede and preempt all prior oral or written understandings and agreements with
respect to the subject matter hereof (including any term sheet and/or letter of intent), and shall
not be modified or affected by any offer, proposal, statement or representation, oral or written,
made by or for any party in connection with the negotiation of the terms hereof, and may be
modified only by instruments signed by all of the parties hereto. The Schedules shall be prepared
in a manner that is reasonably contemplated to provide the disclosures requested by the Buyer;
provided, however, the Buyer acknowledges and agrees that (i) the inclusion of any
information in the Schedules shall not be construed as an admission that such information is
material to the operations or financial condition of the Seller’s Mortgage Default Support Services
or the Purchased Assets; (ii) the disclosure of information included in the Schedules may be
over-inclusive, taking into consideration the materiality of the standard that may be contained in
the representation and warranty relating thereto; (iii) the fact that any item or items may be
disclosed on a particular Schedule shall not be deemed to establish a different standard of
materiality than the one set forth in the applicable representation or warranty; (iv) all
disclosures in the Schedules shall be deemed to refer solely to matters as they exist on the date
of the Agreement, unless a different date is specified in the applicable Schedule; and (v) to avoid
duplication and possible confusion, any disclosure made in any Schedule that applies or is relevant
to more than one numbered section of this Agreement shall be presumed to be disclosed without
repetition in each such other part of the Schedules provided that, as a condition of such presumed
incorporation, it is reasonably apparent based on the nature and description of such disclosure,
taken in the light most favorable to the Buyer, that such disclosure should apply to such other
disclosure(s) required or permitted hereunder.

     8.14 Third Parties. Nothing herein expressed or implied is intended or shall be
construed to confer upon or give to any Person, other than the parties to this Agreement and their
respective permitted successors and assigns and each Indemnified Party, any rights or remedies
under or by reason of this Agreement.

     8.15 Interpretative Matters. Unless the context otherwise requires, (a) all
references to Articles, Sections or Schedules are to Articles, Sections or Schedules in this
Agreement, (b) each accounting term not otherwise defined in this Agreement has the meaning
assigned to it in accordance with GAAP, (c) words in the singular or plural include the singular
and plural, pronouns stated in either the masculine, the feminine or neuter gender shall include
the masculine, feminine and neuter and (d) the term “including” shall mean, in all cases,
“including, but not limited to,” and shall mean by way of example and not by way of limitation.
The parties hereto have participated jointly in
the negotiation and drafting of this Agreement. If an ambiguity or questions of intent or
interpretation arises, this Agreement shall be construed as if drafted jointly by the parties, and
no presumption or burden of proof shall arise favoring any party by virtue of the authorship of any
of the provisions of this Agreement.

45

 

     8.16 Further Assurances. The Buyer and the Seller shall from time to time after the
Closing, at any other party’s reasonable request, execute and deliver or cause to be executed and
delivered such instruments of transfer, conveyance and assignment (in addition to those delivered
at the Closing), and take or cause to be taken such other action, as such any party may reasonably
require, to effect, consummate, confirm, or evidence the transactions contemplated hereby. The
Seller and the Buyer will also do such acts as are necessary to perform their covenants and
agreements herein.

     8.17 Guaranty of the Seller’s Obligations. During the two (2) year period following
the Closing, each of Wilford and Geske, as primary obligors, jointly and severally and not as
surety only, hereby irrevocably, unconditionally and continually guarantees to the Buyer (this
“Seller Guaranty”) the full and timely performance of the obligations of the Seller under
this Agreement, including, but not limited to, any payment obligation (the “Seller
Liabilities”); provided, however, in no event shall the aggregate amount that
Wilford and Geske, collectively, shall be required to pay to Buyer with respect to the Seller
Liabilities exceed the Cap. The Buyer agrees that, prior to any attempt to enforce the Seller
Liabilities against Wilford or Geske, the Buyer shall make a good faith effort, as determined by
the Buyer in its reasonable discretion, to attempt to enforce the obligations of the Seller
directly against the Seller. In addition, in connection with any attempt to enforce the Seller
Guaranty, to the extent reasonably practicable, in Buyer’s reasonable discretion, the Buyer shall
attempt to enforce the Seller Guaranty against both Wilford and Geske; provided, however, in no
event shall anything in this Section 8.17 be deemed in any way to limit the joint and
several nature of the obligations of both Wilford and Geske hereunder. This Seller Guaranty shall
continue in full force and effect until all the Seller Liabilities have been indefeasibly
satisfied. Each of Wilford and Geske shall not be discharged from liability hereunder as long as
any claim by the Buyer against the Seller relating to the Seller Liabilities remains outstanding.
Each of Wilford and Geske hereby expressly waives: (a) notice of the acceptance by the Buyer of
this Seller Guaranty, (b) notice of the existence or creation or non-payment of all or any of the
Seller Liabilities, (c) presentment, demand, notice of dishonor, protest, notice of protest and all
other notices whatsoever, either in respect of this Seller Guaranty or any or all of the Seller
Liabilities, (d) all diligence in collection or protection of, or realization upon, the Seller
Liabilities, any obligations hereunder, or any security or guaranty of any of the foregoing and (e)
any defenses not available to the Seller. Each of Wilford and Geske agrees that it shall not be
necessary for the Buyer or its successors and assigns to institute suit or exhaust their legal
remedies against the Seller in order to enforce this Seller Guaranty. Each of Wilford and Geske
agrees that this Seller Guaranty may be immediately enforced by the Buyer or its successors and
assigns upon the nonpayment when due of any amount due from the Seller to it or upon the
nonperformance by the Seller, Wilford or Geske of any of the Seller Liabilities. Each of Wilford
and Geske agrees that the Buyer may, from time to time, extend the time for performance or
otherwise modify, alter or change the terms of any Seller Liability and may
receive and accept notes, checks and other instruments for the payment of money made by the
Seller and extensions or renewals thereof without in any way releasing or discharging Wilford or
Geske from their respective obligations hereunder. This Seller Guaranty shall not be released,
extinguished, modified or any way affected by the failure on the part of the Buyer or its
successors and assigns to enforce all of the rights or remedies available to them. Each of Wilford
and Geske consents and agrees that the insolvency or bankruptcy of the Seller shall not relieve
either of Wilford or Geske of their obligations assumed hereunder. This Seller Guaranty shall
inure to the benefit of the Buyer and its successors and assigns. This Seller Guaranty shall be

46

 

binding upon Wilford and Geske and their respective heirs, successors and assigns. Neither Wilford
nor Geske shall make an assignment of their respective obligations hereunder without the prior
written consent of Buyer or its successors and assigns.

[Remainder of Page Intentionally Left Blank.

Signature Pages Follow.]

47

 

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

	 	 	 	 	 
	 	 	WILFORD & GESKE, PROFESSIONAL ASSOCIATION
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Lawrence A. Wilford
	 

	 	 	 	 
	 

	 	Name:
	 	Lawrence A. Wilford
	 

	 	Its:
	 	President
	 
	 	 	 	 
	 	 	/s/ Lawrence A. Wilford
	 	 	 
	 	 	LAWRENCE A. WILFORD, individually
	 
	 	 	 	 
	 	 	/s/ James A. Geske
	 	 	 
	 	 	JAMES A. GESKE, individually
	 
	 	 	 	 
	 	 	AMERICAN PROCESSING COMPANY, LLC
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Scott J. Pollei
	 

	 	 	 	 
	 

	 	Name:
	 	Scott J. Pollei
	 

	 	Its:
	 	Vice President

48

 

SCHEDULES

Schedule 1.1(a) – Permitted Liens

Schedule 1.1(a)(i) – Personal Property

Schedule 1.1(a)(ii) – Intangible Assets

Schedule 1.1(a)(iii) – Assumed Contracts

Schedule 1.2(a)- Accrued Vacation

Schedule 2.2(d) – 2008 Budget

Schedule 2.3 – Purchase Price Allocation

Schedule 3.1 – Jurisdictions

Schedule 3.4 – Conflicts

Schedule 3.5 – Consents

Schedule 3.6 – Financial Statements

Schedule 3.7 – Liabilities

Schedule 3.8(a)(i)- Personal Property

Schedule 3.8(a)(ii) -  Purchased Assets

Schedule 3.9(a) – Compliance with Laws

Schedule 3.10 – Real Property

Schedule 3.11(a) – Contracts

Schedule 3.11(b) – Enforceability of Contracts

Schedule 3.11(d) – Required Contract Consents

Schedule 3.12(a) – Assumed Proprietary Rights Exceptions

Schedule 3.12(b) – Independent Contractor Contracts

Schedule 3.12(c) – Seller Owned Proprietary Rights

Schedule 3.12(d)(i) – Seller Licenses

Schedule 3.12(d)(ii) – Third Party Licenses

Schedule 3.12(f) – Third-Party Marks

Schedule 3.12(g) - Warranties

Schedule 3.12(h)- Computer System

Schedule 3.13(a) – Employee Benefit Plans

Schedule 3.14 – Labor and Employment Matters

Schedule 3.15 – Workers Compensation

Schedule 3.16 – Employees

Schedule 3.18 – Affiliate Transactions

Schedule 3.19 – Insurance Policies

Schedule 3.21(a) – Litigation proceedings

Schedule 3.21(b) – Orders

Schedule 3.21(c) – Compliance with Orders

Schedule 3.22 – Environmental and Safety Requirements

Schedule 3.23 – Conduct of the Business

Schedule 3.25 – Government Contracts

Schedule 3.26 – Corporate Names/Business Locations

Schedule 3.27 – Major Clients

Schedule 4.3 – Buyer Conflicts

Schedule 4.4 - Capitalization

Schedule 7.8(a) – Excluded Employees

 

 

EXHIBITS

Exhibit 1.3 – Bill of Sale

Exhibit 2.4  -  Allocation Methodology

Exhibit 6.2(b) – Opinion of Counsel to the Seller

Exhibit 6.2(c) – Opinion of Minnesota Ethics Counsel

Exhibit 6.2(i)(i) – Wilford Employment Agreement

Exhibit 6.2(i)(ii) – Geske Employment Agreement

Exhibit 6.2(j) – Services Agreement

Exhibit 6.2(k) – Sublease Agreement

 

 

Exhibit 1.3

Bill of Sale

 

 

Exhibit 2.4

Allocation Methodology

 

 

Exhibit 6.2(b)

Opinion of Counsel to the Seller

 

 

Exhibit 6.2(j)(i)

Wilford Employment Agreement

 

 

Exhibit 6.2(j)(ii)

Geske Employment Agreement

 

 

Exhibit 6.2(k)

Services Agreement

 

 

Exhibit 6.2(l)

Sublease Agreement

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