Document:

f20f0310ex4xxvi_djsp.htm

Exhibit 4.26

 

SECURITY AGREEMENT

1. THE SECURITY.  The undersigned, LAW OFFICES OF DAVID J. STERN, P.A., a Florida professional corporation (if more than one, collectively, the "Pledgor") hereby assigns and grants to DJS PROCESSING, LLC, a Delaware limited liability company (“DJS”), a security interest in the following described property now owned or hereafter acquired by the Pledgor ("Collateral") and authorizes DJS to file, with the appropriate authority, a UCC financing statement in the form attached hereto as Exhibit 1:

 

(a) All accounts, (including, without limitation, accounts receivables and work in process, but exclusive of any accounts receivable with respect to leases of equipment owned or leased by the Pledgor other than pursuant to the “Agreements” [as hereinafter defined]) and related contract rights, chattel paper, instruments, deposit accounts, letter of credit rights, payment intangibles, including all amounts due to the Pledgor from a factor; rights to payment of money from the Bank under any Swap Contract (as defined in Paragraph 2 below); and all returned or repossessed goods which, on sale or lease, resulted in an account or chattel paper.

 

(b) All general intangibles, including, but not limited to, (i) all patents, and all unpatented or unpatentable inventions; (ii) all trademarks, service marks, and trade names; (iii) all copyrights and literary rights; (iv) all computer software programs; (v) all mask works of semiconductor chip products; (vi) all trade secrets, proprietary information, customer lists, manufacturing, engineering and production plans, drawings, specifications, processes and systems; but only to the extent required to collect the accounts receivable and work in process.  The Collateral shall include all good will connected with or symbolized by any of such general intangibles; all contract rights, documents, applications, licenses, materials and other matters related to such general intangibles; all tangible property embodying or incorporating any such general intangibles; and all chattel paper and instruments relating to such general intangibles, but only to the extent required to collect the accounts receivable and work in process.

 

(c) All negotiable and nonnegotiable documents of title covering any Collateral.

 

(d) All substitutes or replacements for any Collateral, all cash or non-cash proceeds, product, rents and profits of any Collateral, all income, benefits and property receivable on account of the Collateral, all rights under warranties and insurance contracts, letters of credit, guaranties or other supporting obligations covering the Collateral, and any causes of action relating to the Collateral, and all proceeds (including insurance proceeds) from the sale, destruction, loss, or other disposition of any of the Collateral and sums due from a third party which has damaged or destroyed the Collateral or from that party’s insurer, whether due to judgment, settlement or other process.

 

(e) All books, data and records pertaining to any Collateral, whether in the form of a writing, photograph, microfilm or electronic media, including but not limited to any computer-readable memory and any computer hardware or software necessary to process such memory ("Books and Records")

 

  

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2. THE INDEBTEDNESS.  The Collateral secures all obligations to DJS under the following agreements, including any amendments, renewals or replacements thereof (collectively, the Agreements”):  (i) Facilities Sharing Agreement dated as of January 15, 2010; and (ii) Services Agreement dated as of January 15, 2010.  Each party obligated under such agreement is referred to as a “Debtor.”  All of the obligations secured under this Agreement are collectively referred to as the “Indebtedness.”

 

Pledgor acknowledges that the rights of DJS hereunder and under the UCC-1 Financing Statement filed in conjunction herewith, are all being collaterally assigned by DJS to Bank of America, N.A. (“BOA”) to secure a $15,000,000.00 credit facility from BOA to DAL Group, LLC (the “BOA Loan”).  Pledgor consents to that assignment and agrees as follows:  (a) not to amend any provision of the Agreements and/or this Security Agreement without the prior written consent of BOA, which consent shall not be unreasonably withheld if the result of such amendment would not adversely affect BOA, as determined in BOA’s sole discretion, acting reasonably; (b) not to declare a default under the Agreements without giving written notice to BOA and providing BOA the right (but not the obligation) to cure the default within a reasonable time; and (c) that BOA may succeed to the rights (but not the obligations) of DJS under the Agreements and this Security Agreement and Pledgor will recognize BOA as the successor to DJS notwithstanding anything in the Agreements to the contrary.  Notwithstanding the foregoing, the Agreements may be amended upon prior written notice to BOA, but without the consent of BOA if:  (i) the sole purpose of the amendment is to increase the rate to be paid by the Pledgor; or (ii) the sole purpose of the amendment is to decrease the rate to be paid by Pledgor by not more than 5% in the aggregate when aggregated with all decreases.

 

3. PLEDGOR'S COVENANTS.  The Pledgor represents, covenants and warrants that unless compliance is waived by DJS and BOA in writing:

 

(a) The Pledgor will properly preserve the Collateral; defend the Collateral against any adverse claims and demands; and keep accurate Books and Records.

 

(b) The Pledgor resides (if the Pledgor is an individual), or the Pledgor's chief executive office (if the Pledgor is not an individual) is located, in the state specified on the signature page hereof.  In addition, the Pledgor (if not an individual or other unregistered entity), is incorporated in or organized under the laws of the state specified on such signature page.  The Pledgor shall give DJS and BOA at least thirty (30) days notice before changing its residence or its chief executive office or state of incorporation or organization.  The Pledgor will notify DJS and BOA in writing prior to any change in the location of any Collateral, including the Books and Records.

 

(c) The Pledgor will notify DJS and BOA in writing prior to any change in the Pledgor's name, identity or business structure.

 

(d) The Pledgor has not granted and will not grant any security interest in any of the Collateral except:  (i) to DJS; and (ii) to a lender with the consent of BOA (as determined in the sole discretion of BOA) in accordance with the terms set forth in Section 8.26 of the Loan Agreement between BOA and DAL Group, LLC dated even date herewith, and will keep the Collateral free of all liens, claims, security interests and encumbrances of any kind or nature except the security interest of DJS, as assigned to BOA and except as provided in Section 5(g) of this Security Agreement.

 

  

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(e) The Pledgor will promptly notify DJS and BOA in writing of any event which affects the value of the Collateral, the ability of the Pledgor or DJS to dispose of the Collateral, or the rights and remedies of DJS in relation thereto, including, but not limited to, the levy of any legal process against any Collateral and the adoption of any marketing order, arrangement or procedure affecting the Collateral, whether governmental or otherwise.

 

(f) The Pledgor shall pay all costs necessary to preserve, defend, enforce and collect the Collateral, including but not limited to taxes, assessments, insurance premiums, repairs, rent, storage costs and expenses of sales, and any costs to perfect DJS’s security interest (collectively, the “Collateral Costs”).  Without waiving the Pledgor's default for failure to make any such payment, DJS or BOA at their respective option may pay any such Collateral Costs, and discharge encumbrances on the Collateral, and such Collateral Costs payments shall be a part of the Indebtedness and bear interest at the rate set out in the Indebtedness.  The Pledgor agrees to reimburse DJS on demand for any Collateral Costs so incurred.

 

(g) Until DJS and/or BOA exercise their respective rights to make collection, the Pledgor will diligently collect all Collateral.

 

(h) If any Collateral is or becomes the subject of any registration certificate, certificate of deposit or negotiable document of title, including any warehouse receipt or bill of lading, the Pledgor shall immediately deliver such document to DJS or, if BOA has exercised its collateral assignment to BOA, together with any necessary endorsements.

 

(i) Except in the ordinary course of business, the Pledgor will not sell, lease, agree to sell or lease, or otherwise dispose of any Collateral except with the prior written consent of DJS and BOA.

 

(j) The Pledgor will maintain and keep in force all risk insurance covering the Collateral against fire, theft, liability and extended coverages (including without limitation windstorm coverage and hurricane coverage as applicable), to the extent that any Collateral is of a type which can be so insured.  Such insurance shall be in form, amounts, coverages and basis reasonably acceptable to DJS and BOA, shall require losses to be paid on a replacement cost basis, shall be issued by insurance companies acceptable to DJS and BOA and include a loss payable endorsement in favor of DJS and BOA in a form acceptable to DJS and BOA.  Upon the request of DJS and BOA, the Pledgor will deliver to DJS and BOA a copy of each insurance policy, or, if permitted by DJS and BOA, a certificate of insurance listing all insurance in force.

 

(k) The Pledgor will not attach any Collateral to any real property or fixture in a manner which might cause such Collateral to become a part thereof unless the Pledgor first obtains the written consent of any owner, holder of any lien on the real property or fixture, or other person having an interest in such property to the removal by DJS or BOA of the Collateral from such real property or fixture.  Such written consent shall be in form and substance acceptable to DJS and BOA and shall provide that DJS or BOA has no liability to such owner, holder of any lien, or any other person.

 

(l) Following a default under either of the Agreements and/or this Security Agreement, the Pledgor shall not withdraw funds from any deposit account which is part of the Collateral without the prior written consent of DJS's and, for so long as the BOA Loan remains outstanding or BOA has any funding obligation thereunder, BOA’s prior written consent.  Following such a default, the Pledgor agrees that, upon maturity of any deposit account with a maturity date, such deposit account shall be renewed at the institution’s then prevailing rate of interest for successive ninety (90) day periods (or such other time period as may be agreed by DJS, BOA and the Pledgor).

 

  

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4. ADDITIONAL OPTIONAL REQUIREMENTS.  The Pledgor agrees that DJS and/or BOA may at its option at any time except as expressly provided below, whether or not the Pledgor is in default:

 

(a) Require the Pledgor to deliver to DJS and BOA (i) copies of or extracts from the Books and Records, and (ii) information on any contracts or other matters affecting the Collateral.

 

(b) Examine the Collateral, including the Books and Records, and make copies of or extracts from the Books and Records, and for such purposes enter at any reasonable time upon the property where any Collateral or any Books and Records are located.

 

(c) Require the Pledgor to deliver to DJS and, for so long as the BOA Loan remains outstanding or BOA has any funding obligation thereunder, BOA any instruments, chattel paper or letters of credit which are part of the Collateral, and to assign to DJS and BOA the proceeds of any such letters of credit.

 

(d) Notify any account debtors, any buyers of the Collateral, or any other persons of DJS's and, for so long as the BOA Loan remains outstanding or BOA has any funding obligation thereunder, BOA’s interest in the Collateral, but only following a Default hereunder.

 

5. DEFAULTS.  Any one or more of the following shall be a default hereunder (each a “Default”):

 

(a) Any Indebtedness is not paid when due, or any default occurs under any agreement relating to the Indebtedness, after giving effect to any applicable grace or cure periods.

 

(b) The Pledgor breaches any term, provision, warranty or representation under this Security Agreement, or under any other obligation of the Pledgor to DJS under the Agreements, and such breach remains uncured after any applicable cure period.

 

(c) Subject to an the Intercreditor Agreement to the extent consented to in writing by BOA pursuant to Section 8.26 of the Loan Agreement, DJS fails to have an enforceable first lien on or security interest in the Collateral.

 

(d) Any custodian, receiver or trustee is appointed to take possession, custody or control of all or a substantial portion of the property of the Pledgor or of any guarantor or other party obligated under any Indebtedness.

 

(e) The Pledgor or any guarantor or other party obligated under any Indebtedness becomes insolvent, or is generally not paying or admits in writing its inability to pay its debts as they become due, fails in business, makes a general assignment for the benefit of creditors, dies, or commences any case, proceeding or other action under any bankruptcy or other law for the relief of, or relating to, debtors.

 

  

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(f) Any case, proceeding or other action is commenced against the Pledgor or any guarantor or other party obligated under any Indebtedness under any bankruptcy or other law for the relief of, or relating to, debtors that is not dismissed within 60 days from the date of filing.

 

(g) Any involuntary lien of any kind or character attaches to any Collateral, except for liens for:  (i) taxes not yet due or which are due and are being contested in good faith by appropriate proceedings and amounts escrowed to the reasonable satisfaction of BOA; (ii) landlord liens for real property leases to the extent subordinated to the interest of DJS and BOA in form and substance reasonably satisfactory to BOA; (iii) liens in favor of the lessor arising from equipment leases with respect to such equipment only; or (iv) statutory liens excluding liens arising from the failure of the Pledgor to timely pay monies when such monies are due and payable.

 

(h) The Pledgor has given DJS any false or misleading information or representations.

 

6. REMEDIES AFTER DEFAULT.  Upon the occurrence of any Default, DJS and/or, for so long as the BOA Loan remains outstanding or BOA has any funding obligation thereunder, BOA may do any one or more of the following, to the extent permitted by law:

 

(a) Declare any Indebtedness immediately due and payable, without notice or demand.

 

(b) Enforce the security interest given hereunder pursuant to the Uniform Commercial Code and any other applicable law.

 

(c) Enforce the security interest of DJS in any deposit account of the Pledgor maintained with BOA by applying such account to the Indebtedness.

 

(d) Require the Pledgor to obtain DJS's and BOA’s prior written consent to any sale, lease, agreement to sell or lease, or other disposition of any Collateral consisting of inventory.

 

(e) Require the Pledgor to segregate all collections and proceeds of the Collateral so that they are capable of identification and deliver daily such collections and proceeds to DJS and BOA in kind.

 

(f) Require the Pledgor to direct all account debtors to forward all payments and proceeds of the Collateral to a post office box under BOA's exclusive control.

 

(g) Require the Pledgor to assemble the Collateral, including the Books and Records, and make them available to DJS and to BOA at a place designated by DJS.

 

(h) Enter upon the property where any Collateral, including any Books and Records, are located and take possession of such Collateral and such Books and Records, and use such property (including any buildings and facilities) and any of the Pledgor's equipment, if DJS or if BOA deems such use necessary or advisable in order to take possession of, hold, preserve, process, assemble, prepare for sale or lease, market for sale or lease, sell or lease, or otherwise dispose of, any Collateral.

 

  

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(i) Demand and collect any payments on and proceeds of the Collateral.  In connection therewith the Pledgor irrevocably authorizes DJS or BOA to endorse or sign the Pledgor's name on all checks, drafts, collections, receipts and other documents, and to take possession of and open the mail addressed to the Pledgor and remove therefrom any payments and proceeds of the Collateral.

 

(j) Grant extensions and compromise or settle claims with respect to the Collateral for less than face value, all without prior notice to the Pledgor.

 

(k) Have a receiver appointed by any court of competent jurisdiction to take possession of the Collateral.  The Pledgor hereby consents to the appointment of such a receiver and agrees not to oppose any such appointment.

 

(l) Take such measures as DJS or as BOA may deem necessary or advisable to take possession of, hold, preserve, process, assemble, insure, prepare for sale or lease, market for sale or lease, sell or lease, or otherwise dispose of, any Collateral, and the Pledgor hereby irrevocably constitutes and appoints DJS and BOA as the Pledgor's attorney-in-fact to perform all acts and execute all documents in connection therewith.

 

(m) Without notice or demand to the Pledgor, set off and apply against any and all of the Indebtedness any and all deposits (general or special, time or demand, provisional or final) and any other indebtedness, at any time held or owing by BOA or any of BOA's agents or affiliates to or for the credit of the account of the Pledgor or any guarantor or endorser of the Pledgor's Indebtedness.

 

(n) Exercise any other remedies available to DJS and/or BOA at law or in equity.

 

7. PLEDGOR NOT A DEBTOR.  If any Pledgor is not a Debtor under some or all of the Indebtedness:

 

(a) The Pledgor authorizes BOA, from time to time, without affecting the Pledgor's obligations under this Agreement, to enter into an agreement with DAL Group, LLC (the “Debtor”) to change the interest rate on or renew the Indebtedness; accelerate, extend, compromise, or otherwise change the repayment terms or any other terms of the Indebtedness; receive and hold, exchange, enforce, waive, fail to perfect, substitute, or release Collateral, including collateral not originally covered by this Agreement; sell or apply any Collateral in any order; or release or substitute any borrower, guarantor or endorser of the Indebtedness, or other person.

 

(b) The Pledgor waives any defense by reason of any Debtor's or any other person's defense, disability, or release from liability.  DJS and BOA can exercise its rights against the Collateral even if any Debtor or any other person no longer is liable on the Indebtedness because of a statute of limitations or for other reasons.

 

(c) The Pledgor agrees that it is solely responsible for keeping itself informed as to the financial condition of the Debtors and of all circumstances which bear upon the risk of nonpayment.  The Pledgor waives any right it may have to require DJS or BOA to disclose to the Pledgor any information which DJS or BOA may now or hereafter acquire concerning the financial condition of the Debtors.

 

  

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(d) The Pledgor waives all rights to notices of default or nonperformance by the Debtors.  The Pledgor further waives all rights to notices of the existence or the creation of new indebtedness by any Debtor and all rights to any other notices to any party liable on any of the Indebtedness.

 

(e) The Pledgor represents and warrants to DJS and BOA that it will derive benefit, directly and indirectly, from the collective administration and availability of credit under the Indebtedness.  The Pledgor agrees that neither BOA nor DJS will be required to inquire as to the disposition by any Debtor of funds disbursed by BOA.

 

(f) Until all obligations to DJS under the Indebtedness have been paid in full and any commitments of DJS or facilities provided by DJS with respect to the Indebtedness have been terminated, the Pledgor waives any right of subrogation, reimbursement, indemnification and contribution (contractual, statutory or otherwise), including without limitation, any claim or right of subrogation under the Bankruptcy Code (Title 11, United States Code) or any successor statute, which the Pledgor may now or hereafter have against any Debtor with respect to the Indebtedness.  The Pledgor waives any right to enforce any remedy which DJS or BOA now has or may hereafter have against any Debtor, and waives any benefit of, and any right to participate in, any security now or hereafter held by DJS or BOA.

 

(g) The Pledgor waives any right to require DJS or BOA to proceed against any Debtor or any other person; proceed against or exhaust any security; or pursue any other remedy.  Further, the Pledgor consents to the taking of, or failure to take, any action which might in any manner or to any extent vary the risks of the Pledgor under this Agreement or which, but for this provision, might operate as a discharge of the Pledgor.

 

(h) In the event any amount paid to DJS or BOA on any Indebtedness or any interest in property transferred to DJS or BOA as payment on any Indebtedness is subsequently recovered from DJS or BOA in or as a result of any bankruptcy, insolvency or fraudulent conveyance proceeding, the Pledgor shall be liable to DJS and BOA for the amounts so recovered up to the fair market value of the Collateral whether or not the Collateral has been released or the security interest terminated.  In the event the Collateral has been released or the security interest terminated, the fair market value of the Collateral shall be determined, at DJS's or BOA’s option, as of the date the Collateral was released, the security interest terminated, or said amounts were recovered.

 

8. DISPUTE RESOLUTION PROVISION.  This paragraph, including the subparagraphs below, is referred to as the “Dispute Resolution Provision.”  This Dispute Resolution Provision is a material inducement for the parties entering into this agreement.

 

(a) This Dispute Resolution Provision concerns the resolution of any controversies or claims between the parties, whether arising in contract, tort or by statute, including but not limited to controversies or claims that arise out of or relate to: (i) this agreement (including any renewals, extensions or modifications); or (ii) any document related to this agreement (collectively a "Claim").  For the purposes of this Dispute Resolution Provision only, the term “parties” shall include any parent corporation, subsidiary or affiliate of DJS involved in the servicing, management or administration of any obligation described or evidenced by this agreement.

 

  

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(b) At the request of any party to this agreement, any Claim shall be resolved by binding arbitration in accordance with the Federal Arbitration Act (Title 9, U.S. Code) (the "Act").  The Act will apply even though this agreement provides that it is governed by the law of a specified state.

 

(c) Arbitration proceedings will be determined in accordance with the Act, the then-current rules and procedures for the arbitration of financial services disputes of the American Arbitration Association or any successor thereof ("AAA"), and the terms of this Dispute Resolution Provision.  In the event of any inconsistency, the terms of this Dispute Resolution Provision shall control.  If AAA is unwilling or unable to (i) serve as the provider of arbitration or (ii) enforce any provision of this arbitration clause, BOA may designate another arbitration organization with similar procedures to serve as the provider of arbitration.

 

(d) The arbitration shall be administered by AAA and conducted, unless otherwise required by law, in any U.S. state where real or tangible personal property collateral for this credit is located or if there is no such collateral, in the state specified in the governing law section of this agreement.  All Claims shall be determined by one arbitrator; however, if Claims exceed Five Million Dollars ($5,000,000), upon the request of any party, the Claims shall be decided by three arbitrators.  All arbitration hearings shall commence within ninety (90) days of the demand for arbitration and close within ninety (90) days of commencement and the award of the arbitrator(s) shall be issued within thirty (30) days of the close of the hearing.  However, the arbitrator(s), upon a showing of good cause, may extend the commencement of the hearing for up to an additional sixty (60) days.  The arbitrator(s) shall provide a concise written statement of reasons for the award.  The arbitration award may be submitted to any court having jurisdiction to be confirmed and have judgment entered and enforced.

 

(e) The arbitrator(s) will give effect to statutes of limitation in determining any Claim and may dismiss the arbitration on the basis that the Claim is barred. For purposes of the application of any statutes of limitation, the service on AAA under applicable AAA rules of a notice of Claim is the equivalent of the filing of a lawsuit.  Any dispute concerning this arbitration provision or whether a Claim is arbitrable shall be determined by the arbitrator(s), except as set forth at subparagraph (h) of this Dispute Resolution Provision.  The arbitrator(s) shall have the power to award legal fees pursuant to the terms of this agreement.

 

(f) This paragraph does not limit the right of any party to: (i) exercise self-help remedies, such as but not limited to, setoff; (ii) initiate judicial or non-judicial foreclosure against any real or personal property collateral; (iii) exercise any judicial or power of sale rights, or (iv) act in a court of law to obtain an interim remedy, such as but not limited to, injunctive relief, writ of possession or appointment of a receiver, or additional or supplementary remedies.

 

(g) The filing of a court action is not intended to constitute a waiver of the right of any party, including the suing party, thereafter to require submittal of the Claim to arbitration.

 

  

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(h) Any arbitration or trial by a judge of any Claim will take place on an individual basis without resort to any form of class or representative action (the “Class Action Waiver”).  Regardless of anything else in this Dispute Resolution Provision, the validity and effect of the Class Action Waiver may be determined only by a court and not by an arbitrator.  The parties to this Agreement acknowledge that the Class Action Waiver is material and essential to the arbitration of any disputes between the parties and is nonseverable from the agreement to arbitrate Claims. If the Class Action Waiver is limited, voided or found unenforceable, then the parties’ agreement to arbitrate shall be null and void with respect to such proceeding, subject to the right to appeal the limitation or invalidation of the Class Action Waiver.  The Parties acknowledge and agree that under no circumstances will a class action be arbitrated.

 

(i) By agreeing to binding arbitration, the parties irrevocably and voluntarily waive any right they may have to a trial by jury in respect of any Claim.  Furthermore, without intending in any way to limit this agreement to arbitrate, to the extent any Claim is not arbitrated, the parties irrevocably and voluntarily waive any right they may have to a trial by jury in respect of such Claim.  This waiver of jury trial shall remain in effect even if the Class Action Waiver is limited, voided or found unenforceable.  WHETHER THE CLAIM IS DECIDED BY ARBITRATION OR BY TRIAL BY A JUDGE, THE PARTIES AGREE AND UNDERSTAND THAT THE EFFECT OF THIS AGREEMENT IS THAT THEY ARE GIVING UP THE RIGHT TO TRIAL BY JURY TO THE EXTENT PERMITTED BY LAW.

 

9. MISCELLANEOUS.

 

(a) Any waiver, express or implied, of any provision hereunder and any delay or failure by DJS or BOA to enforce any provision shall not preclude DJS or BOA from enforcing any such provision thereafter.

 

(b) The Pledgor shall, at the request of DJS or of BOA, execute such other agreements, documents, instruments, or financing statements in connection with this Agreement as DJS or BOA may reasonably deem necessary.

 

(c) All notes, security agreements, subordination agreements and other documents executed by the Pledgor or furnished to DJS or BOA in connection with this Agreement must be in form and substance satisfactory to DJS and BOA, respectively.

 

(d) This Agreement shall be governed by and construed in accordance with the laws of the State of Florida.  To the extent that DJS or BOA has greater rights or remedies under federal law, whether as a national bank or otherwise, this paragraph shall not be deemed to deprive DJS or BOA of such rights and remedies as may be available under federal law.  Jurisdiction and venue for any action or proceeding to enforce this Agreement shall be the forum appropriate for such action or proceeding against the Debtor, to which jurisdiction the Pledgor irrevocably submits and to which venue the Pledgor waives to the fullest extent permitted by law any defense asserting an inconvenient forum in connection therewith.

 

(e) All rights and remedies herein provided are cumulative and not exclusive of any rights or remedies otherwise provided by law.  Any single or partial exercise of any right or remedy shall not preclude the further exercise thereof or the exercise of any other right or remedy.

 

(f) All terms not defined herein are used as set forth in the Uniform Commercial Code.

 

  

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(g) In the event of any action by DJS or BOA to enforce this Agreement or to protect the security interest of DJS or BOA in the Collateral, or to take possession of, hold, preserve, process, assemble, insure, prepare for sale or lease, market for sale or lease, sell or lease, or otherwise dispose of, any Collateral, the Pledgor agrees to pay immediately the costs and expenses thereof, together with reasonable attorneys’ fees and allocated costs for in-house legal services to the extent permitted by law.

 

(h) In the event DJS or BOA seeks to take possession of any or all of the Collateral by judicial process, the Pledgor hereby irrevocably waives any bonds and any surety or security relating thereto that may be required by applicable law as an incident to such possession, and waives any demand for possession prior to the commencement of any such suit or action.

 

(i) This Agreement shall constitute a continuing agreement, applying to all future as well as existing transactions, whether or not of the character contemplated at the date of this Agreement, and if all transactions between DJS and the Pledgor shall be closed at any time, shall be equally applicable to any new transactions thereafter.

 

(j) DJS's rights hereunder shall inure to the benefit of its successors and assigns including BOA.  In the event of any assignment or transfer by DJS of any of the Indebtedness or the Collateral, DJS thereafter shall be fully discharged from any responsibility with respect to the Collateral so assigned or transferred, but DJS shall retain all rights and powers hereby given with respect to any of the Indebtedness or the Collateral not so assigned or transferred.  All representations, warranties and agreements of the Pledgor if more than one are joint and several and all shall be binding upon the personal representatives, heirs, successors and assigns of the Pledgor.

 

(k) Upon written request, BOA agrees to terminate its rights hereunder when the Loan Agreement between BOA and DAL Group, LLC is terminated and all amounts outstanding thereunder have been paid in full and BOA has no further funding obligations thereunder.

 

 

(SIGNATURE PAGES FOLLOW)

 

  

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10. FINAL AGREEMENT.  BY SIGNING THIS DOCUMENT EACH PARTY REPRESENTS AND AGREES THAT:  (A) THIS DOCUMENT REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES WITH RESPECT TO THE SUBJECT MATTER HEREOF, (B) THIS DOCUMENT SUPERSEDES ANY COMMITMENT LETTER, TERM SHEET, OR OTHER WRITTEN OUTLINE OF TERMS AND CONDITIONS RELATING TO THE SUBJECT MATTER HEREOF, UNLESS SUCH COMMITMENT LETTER, TERM SHEET, OR OTHER WRITTEN OUTLINE OF TERMS AND CONDITIONS EXPRESSLY PROVIDES TO THE CONTRARY, (C) THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES, AND (D) THIS DOCUMENT MAY NOT BE CONTRADICTED BY EVIDENCE OF ANY PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OR UNDERSTANDINGS OF THE PARTIES.

Dated:         ,     .

DJS PROCESSING, LLC, a Delaware

limited liability company

By:                                                                

Print Name:                                                               

Title:                                                               

Address for Notices:

 

                                                                       

                                                                      

                                                                       

 

  

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LAW OFFICES OF DAVID J. STERN, P.A., 

a Florida professional corporation

 

By:                                                                

Print Name:                                                               

Title:                                                             

\

Pledgor's Location (principal residence,

if the Pledgor is an individual;

chief executive office, if

the Pledgor is not an individual):

__________________________

Street Address

__________________________

City           State         Zip

Pledgor’s state of incorporation

or organization (if Pledgor is a corporation, partnership,

limited liability company or other registered entity):  Florida

Mailing Address (if different from above):

__________________________

Street Address

__________________________

City           State         Zip

 

12f8k042010ex10i_fund.htm

    Exhibit 10.1

     

    
 

    SECURITIES
PURCHASE AND RESTRUCTURING AGREEMENT

     

    THIS SECURITIES PURCHASE AND
RESTRUCTURING AGREEMENT (this “Agreement”) is made and
entered into as of the 26th day
of March 2010, by and among WESTON CAPITAL MANAGEMENT,
LLC, a Delaware limited liability company (the “Company”); FUND.COM, INC., a Delaware
corporation (“FNDM” or
the “Purchaser”); PBC-WESTON HOLDINGS, LLC, a
Delaware limited liability company (“PBC”); ALBERT HALLAC, an individual
(“A. Hallac”); and the
other Persons who are parties signatory hereto (together with PBC and A. Hallac,
each a “Member,” and
together, the “Members”).  The
Company, FNDM and the Members are sometimes individually referred to herein as a
“Party” and collectively
as the “Parties.”

    

    RECITALS:

    

    This
Agreement is being entered into with reference to the following:

    

    A. As a
limited liability company, the equity of the Company is expressed in and
evidenced by membership interests in the Company (the “Membership
Interests”).

     

    B. Pursuant
to the Interest Purchase and Contribution Agreement, dated June 5, 2006, among
the Company, PBC and A. Hallac, PBC purchased 2,500 of the issued and
outstanding Membership Interests (the “PBC Member Interests”),
representing 25% of the Existing Members Interests (as hereinafter defined)
outstanding as of the date thereof and hereof.

     

    C. A.
Hallac, together with Mitzi Hallac Liotta, Joanna Hallac, Jeffrey Hallac and
Russell Hallac, all members of the family of A. Hallac (collectively, the “Hallac Family”), own 7,300 of
the Existing Members Interests in the Company (representing 73% of the Existing
Members Interests outstanding as of the date hereof) and Victor Elmaleh, a
natural person (“Elmaleh” and together with the
Hallac Family, collectively, the “Hallac Members”), owns 200 of
the Existing Members Interests in the Company, representing 2% of the membership
interests outstanding as of the date hereof (the Existing Members
Interests in the Company held by the Hallac Family and Elmaleh, collectively the
“Existing Hallac
Interests”).

     

    D.  On
October 1, 2006, the Members entered into that certain Fourth Amended and
Restated Operating Agreement of the Company (the “Fourth Operating Agreement”),
which governed the capital, management and operation of the Company prior to the
date hereof.

     

    E. On or
about October 1, 2006, the Company entered into the Amended and Restated Weston
Capital Management, LLC 2003 Company Value Appreciation Plan (the “Incentive Plan”), pursuant to
which the Company issued Appreciation Units (as defined in the Incentive Plan)
to certain employees of the Company (the “Existing Appreciation
Units”).

     

    
      
         

      

      
        1

        
          

        

      

      
         

      

    

     

    F. The
Company and the Hallac Family have executed a transfer agreement (the “Transfer Agreement”), pursuant
to which immediately prior to the Closing (as defined below), the Company shall
spin-off and distribute 100% of the membership interests of its broker-dealer
Subsidiary, Weston Financial
Services, LLC, a Delaware limited liability company (the “Broker Subsidiary”), to PBC
and the Hallac Family by transferring to each of PBC and the Hallac Family such
amount of membership interests of the Broker Subsidiary as are set forth
opposite each applicable Member’s name in column (6) of the Schedule of Members
(the “Spin-Off
Transaction”).

     

    G. FNDM
desires to:

     

    (a)           acquire
from all of the Members, an aggregate of One Hundred Percent (100%) of the
Membership Interests, including:
(i) the PBC Member Interests from PBC, and (ii) the Existing Hallac Interests
from the Hallac Members (collectively, the “Purchased Members
Interests”);

     

    (b)           in
addition to its purchase of 100% of the Purchased Members Interests, make an
additional cash capital contribution to the Company in the aggregate amount of
Eight Hundred Thousand Dollars ($800,000), in exchange for the “Additional Purchased Membership
Interest” (as hereinafter defined) in the Company; and

     

    (c)           subject
to the Side Letter Agreement (as hereinafter defined), acquire the right and
option, following the satisfaction of applicable regulatory approvals, to
purchase 100% of the membership interests of the Broker Subsidiary.

     

    H. The
Company and the Hallac Members shall have approved, authorized and executed the
Amended and Restated Fifth Operating Agreement of the Company in the form
attached hereto as Exhibit
A and made a part hereof (the “Fifth Operating Agreement”);
which Fifth Operating Agreement shall amend and restate the Fourth Operating
Agreement in its entirety and which shall provide for, among other things, the
irrevocable conversion of all Membership Interests into Membership Interests
that are identical in all respects to the Existing Hallac
Interests.

     

    I. Subject
to the satisfaction of the terms and conditions set forth herein, at the Closing
each Existing Member shall acknowledge and agree that, concurrently with the
effectiveness of the Fifth Operating Agreement on the Closing Date (as defined
below), the following transactions shall occur simultaneously (the “Transactions"):

     

    (a)           Each
Hallac Member, Purchaser and the Company shall execute and deliver the Fifth
Operating Agreement to each of the Parties,

     

    (b)           PBC
shall sell and FNDM shall purchase the “Purchased PBC Interests” (as
hereinafter defined) in exchange for the “PBC Consideration” (as
hereinafter defined),

     

    (c)           The
Company shall issue and sell and FNDM shall purchase from the Company the "Additional Purchased Membership
Interests” for the “Company Purchase Price” (as
those terms are hereinafter defined), and

     

    (d)           Upon
the terms and subject to the conditions hereinafter set forth, on the Closing
Date, FNDM shall consummate the Hallac Purchase.

     

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

     

    J.           Each
Hallac Member, Purchaser and the Company shall execute and deliver the Fifth
Operating Agreement.

     

    K.          Upon
the terms and subject to the conditions hereinafter set forth, on the Closing
Date, FNDM shall consummate the Hallac Purchase and (subject to mutual agreement
of FNDM and Elmaleh) the Elmaleh Purchase.

     

    L.           The
Company will obtain after Closing the written consent of the holders of the
Existing Appreciation Units (the “Incentive Plan Consent”) to
the termination of the Incentive Plan effective upon the consummation of the
Restructuring Transactions.

     

    NOW, THEREFORE, in
consideration of, and premised upon, the various representations, warranties,
covenants and other agreements and undertakings of the parties hereto contained
in this Agreement, and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:

     

    
      1.    
THE RESTRUCTURING, PURCHASE
AND LOAN TRANSACTIONS.

    

     

    1.1           Spin-Off.  Immediately
prior to the Closing, the Company shall distribute to PBC and the Hallac Family
the Membership Interests of the Broker Subsidiary as set forth opposite each
applicable Member’s name in column (6) of the Schedule of Members annexed hereto
and consummate the Spin-Off Transaction in accordance with the terms hereof and
the Transfer Agreement.  The Company and PBC hereby agree that the PBC
Broker Subsidiary Interests to be issued to PBC in the Spin-Off Transaction
shall be uncertificated membership interests in the Broker
Subsidiary.

     

    1.2           Restructuring
Transactions.  Subject to satisfaction (or waiver) of the
conditions set forth in Articles 4 and 5 below, immediately following the
consummation of the Spin-Off Transaction, upon the Closing (as defined below),
the applicable Parties shall execute and deliver the Fifth Operating Agreement
and the other Transactions contemplated by this Article I shall be
consummated.

     

    1.3           The PBC
Purchase.

     

    (a)           On
the Closing Date, the Purchaser shall purchase, and PBC shall sell, transfer and
assign (collectively, “Transfer”) to the Purchaser,
the PBC Member Interests; which PBC Member Interests shall represent all, and
not less than all, of the Membership Interests in the Company owned by PBC as at
the Closing (the “Purchased PBC
Interests”).

     

    (b)           In
consideration for its Transfer of the Purchased PBC Interests, on the Closing
Date, the Purchaser shall pay and deliver to PBC, the following consideration
(the “PBC
Consideration”):

     

    (i)           the
sum of Two Million Five Hundred Thousand Dollars ($2,500,000), payable in cash
or by wire transfer of immediately available funds to one or more bank accounts
designated by PBC prior to the Closing Date (the “PBC Cash Consideration”);
and

     

    
      
         

      

      
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    (ii)           FNDM
shall issue to PBC a warrant, in substantially the form attached hereto as Exhibit
B (the “Warrant”), entitling the
holders to acquire that number “Warrant Shares” as shall be
determined by dividing (A) One Million Five Hundred Thousand Dollars
($1,500,000), by (B) the “Warrant VWAP” as of the “Six Month Anniversary Date”
(as those terms are defined in the Warrant).

     

    1.4           The Additional Purchased
Membership Interests.

     

    (a)           On
the Closing Date, the Company shall issue and sell to FNDM, and FNDM shall
purchase from the Company, membership interests in the Company that shall
represent, in the aggregate, Nine and One-Tenths Percent (9.1%) of all issued
and outstanding Membership Interests in the Company (the “Additional Purchased Membership
Interests”).

     

    (b)           In
consideration for its issuance of the Additional Purchased Membership Interests,
on the Closing Date, the Purchaser shall pay to the Company the sum of Eight
Hundred Thousand Dollars ($800,000) (the “Company Purchase Price”),
which Company Purchase Price shall be payable by wire transfer of immediately
available funds to a bank account designated by the Company prior to the Closing
Date.

     

    1.5           The Hallac
Purchase.

     

    (a)           On
the Closing Date, each of the Hallac Members shall Transfer to FNDM and FNDM
shall purchase from each of the Hallac Members (collectively, the “Hallac Purchase”), One Hundred
Percent (100%) of all Existing Members Interests owned by each of the Hallac
Members as at the Closing Date, which Existing Members Interests are represented
by such percentage of the Membership Interests as set forth opposite each such
Hallac Member’s name in column (3) of the Schedule of Members.  The
Existing Members Interests to be delivered by the Hallac Members and purchased
by FNDM shall represent, in the aggregate, Seventy-Five Percent (75.0%) of all
Membership Interests in the Company on the Closing Date, before
giving effect to (i) the purchase by FNDM of the Purchased PBC Interests
pursuant to Section
1.3 above, and (ii) the purchase by FNDM of the Additional Purchased
Membership Interests pursuant to Section 1.4
above.

     

    (b)           In
consideration for the Hallac Purchase, on the Closing Date the Purchaser shall
pay and deliver to A. Hallac and the other Hallac Members a minimum of Five
Million Five Hundred Thousand Dollars ($5,500,000) of consideration (the “Hallac Members
Consideration”), which shall be payable as follows:

     

    (i)           
the sum of Five Hundred Dollars ($500,000), payable to A. Hallac in cash or by
wire transfer of immediately available funds to a bank account designated by A.
Hallac prior to the Closing Date (the “A. Hallac Cash
Consideration”);

     

    (ii)           the
delivery to A. Hallac, on behalf of himself and all other Hallac Members (A.
Hallac, on behalf of himself and all other Hallac Members, the “Hallac Members
Representative”) of FNDM’s 4% Senior Secured Promissory Note in the
initial stated principal amount of Five Million ($5,000,000) Dollars (the “Reset Note”).  Each
of the Hallac Members or any subsequent holder(s) of such Reset Note shall own a
beneficial interest in the proceeds thereof equal to the percentage of their
respective “Percentage Interests” as set forth opposite each such Hallac
Member's name in column (3) of the Schedule of Members (the “Percentage
Interests”).  Such Reset Note shall be in the form of Exhibit
C annexed hereto and made a part hereof; and

     

    (iii)           Notwithstanding
the purchase by FNDM of all of the Existing Hallac Interests, for so long as any principal amount of
the Reset Note shall be outstanding, in the event that the Company makes
any distributions to FNDM in respect of its Membership Interests, the Company
shall, simultaneously with any such distributions to FNDM, make a payment to the
Hallac Members such that the payment to the Hallac Members shall represent 50.9%
of the aggregate amount of all such distributions made in respect of Membership
Interests.

     

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

     

    1.6           Collateral for Payment of
Note.  Payment of the Reset Note, and compliance by FNDM of all
of the terms and conditions therein, shall be secured by a pledge of the Pledged
Collateral (as that term is defined in the Pledge Agreement), pursuant to the
pledge agreement in the form of Exhibit
D annexed hereto and made a part hereof (the “Pledge
Agreement”)

     

    1.7           Termination of Incentive
Plan.  In accordance with the terms and conditions of the
Incentive Plan Consent, after the Closing (i) the Incentive Plan shall be
terminated and all outstanding Appreciations Units issued pursuant to the
Incentive Plan shall be cancelled and (ii) the Company shall mail or deliver by
check to the holders of vested Appreciation Units the cash redemption amount set
forth opposite such holder’s names in Schedule I to the Incentive Plan
Consent.

     

    1.8           Existing Member Consent and
Waiver.  Each of the Members hereby authorizes and approves the
Spin-Off Transaction and the transactions contemplated by this Agreement in all
respects.  Each of the Members do hereby, effective as of the Closing
Date, further waives any rights that any such Member has or may have had with
respect to the Membership Interests pursuant to the Fourth Operating Agreement,
including, without limitation, (i) any preemptive rights of such Member pursuant
to Section 7.3 of the Operating Agreement, (ii) any restrictions on transfer set
forth in Section 7.4 of the Fourth Operating Agreement, (iii) any rights of
first refusal of such Member pursuant to Section 7.5 of the Fourth Operating
Agreement, (iv) any co-sale rights of such Member pursuant to Section 7.6 of the
Fourth Operating Agreement, and (v) any objections to the Approved Sale (as
defined in the Fourth Operating Agreement) or dissenters, appraisal or similar
rights of such Member pursuant to Section 7.8 of the Fourth Operating
Agreement.

     

    1.9           Closing
Date.  Subject to notification of satisfaction (or waiver) of
the conditions to the Closing set forth in Sections 4 and 5 below, the closing
of the transactions contemplated by this Agreement (the “Closing”) shall take place at
10:00 a.m. New York City time, on a date (the “Closing Date”) that shall be
not later than five (5) Business Days following the date of execution of this
Agreement, or such other time and date as is mutually agreed to by the Company
and the Members.  The Closing shall occur on the Closing Date remotely
via the exchange of documents and signature pages.

     

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

     

    1.10   Payments and
Deliveries.   On the Closing Date:

     

    (a)           FNDM
shall pay by wire transfer of U.S. dollars and immediately available funds (i)
to PBC, the PBC Cash Consideration, (ii) to the Company, the Company Purchase
Price, and (iii) to A. Hallac, the A. Hallac Cash Consideration;

     

    (b)           FNDM
shall execute and deliver to each of the Hallac Members, the Reset
Note;

     

    (c)           FNDM
shall issue to PBC, the Warrant;

     

    (d)           The
Company shall deliver to the “Collateral Agent” (as that term is defined in the
Pledge Agreement) for the benefit of the Hallac Members, in accordance with the
terms and conditions of the Pledge Agreement, a certificate of Membership
Interests evidencing an aggregate of Fifty and Nine-Tenths Percent (50.9%) of
the Membership Interests in the Company (the “Pledged
Certificate”);

     

    (e)           FNDM
and each of the Hallac Members shall execute and deliver a counterpart of the
Pledge Agreement;

     

    (f)           A.
Hallac, Jeffrey Hallac, Keith Wellner and Marcel Herbst shall execute and
deliver a three (3) year employment agreement with the Company in the form
annexed hereto as Exhibits
E-1 through Exhibit
E-4;

     

    (g)           The
Company, A. Hallac (on behalf of the Hallac Group) and FNDM shall execute and
deliver a counterpart of the Fifth Operating Agreement; and

     

    (h)           A.
Hallac, the Company, FNDM and PBC shall execute and deliver a counterpart of the
Side Letter Agreement.

     

    
      1.11   Required Broker Approvals;
Broker Call.

    

     

    (a)           From
and after the Closing Date, the Company hereby agrees to use its reasonable best
efforts to obtain the approval of any applicable Governmental Authority or SRO
(as defined below) to the transfer of the PBC Broker Subsidiary Interests to
FNDM as soon as commercially practicable following the Closing Date (the “Required Broker
Approvals”).  The Company shall promptly deliver written notice
to PBC and FNDM upon obtaining the Required Broker Approvals.

     

    (b)           Subject
to the terms of the Side Letter Agreement, at any time following the Company’s
obtaining the Required Broker Approvals, FNDM shall have the right and option,
but not the obligation (the “Broker Call”), exercisable by
delivery of written notice to the Company and PBC (the “Broker Call Notice”), to cause
PBC to sell the PBC Broker Subsidiary Interests to FNDM for $1,000 (the “Broker Call Purchase
Price”).  The closing of the Broker Call shall occur no earlier
than the fifth (5th)
Business Day and no later than the tenth (10th)
Business Day following the Company’s receipt of the Broker Call Notice (the
“Broker Call
Closing”).  At the Broker Call Closing, (i) FNDM shall wire a
cash amount equal to the Broker Call Purchase Price to PBC in U.S. dollars and
immediately available funds in accordance with the wire instructions of PBC
previously delivered to FNDM or its designee, and (ii) the Company shall cause
the Broker Subsidiary to affect the transfer of the PBC Broker Subsidiary
Interests from PBC to FNDM or its designee on the books and records of the
Broker Subsidiary.  If requested by FNDM in the Broker Call Notice,
the Broker Subsidiary shall issue a certificate evidencing such transferred
membership interests.

     

    1.12           Certificated
Interests.  From and after the Closing, all Membership
Interests of the Company shall be evidenced by membership interest certificates
of the Company and, for all purposes, shall be deemed to be certificated
interests.

     

    1.13           Defined Terms Used in This
Agreement.  In addition to the terms defined above and
elsewhere in this Agreement, the following terms used in this Agreement shall be
construed to have the meanings set forth or referenced below.

     

    “Advisory Subsidiaries” means
the collective reference to Weston Capital Asset Management LLC, Weston Capital
Advisors UK, Weston-Atlas Advisers LTD., Weston-Partners Advisers LTD., and
Weston Capital Asset Management LTD. that are Subsidiaries of
Weston.

     

    “Affiliate” means, with respect
to any specified Person, any other Person who or which, directly or indirectly,
controls, is controlled by, or is under common control with such specified
Person, including, without limitation, any existing or former partner, officer,
director, manager or member of such Person and any venture capital or hedge fund
now or hereafter existing that is controlled by or under common control with one
or more general partners or managing members of, or shares the same management
company with, such Person.

     

    “Applicable Law” means any
foreign, federal, state or local law (statutory, common or otherwise),
constitution, treaty, convention, ordinance, code, rule, regulation, order,
injunction, judgment, decree, ruling or other similar requirement enacted,
adopted, promulgated or applied by a Governmental Authority, as amended unless
expressly specified otherwise.

     

    “Business Day” means any day
other than Saturday, Sunday or other day on which commercial banks in the City
of New York are authorized or required by law to remain closed.

     

    “Company Group” means the
collective reference to the Company, the Advisory Subsidiaries, the Investment
Funds and the Broker Subsidiary.

    

    “Company Material Adverse
Effect” means a material adverse effect on the business, assets
(including intangible assets), liabilities, financial condition, property, or
results of operations of the Company Group, when taken as a combined whole;
provided, however, that any event, condition, change, occurrence or development
of a state of circumstances that (A) arises out of general political, economic
or market conditions or general changes or developments in the financial markets
generally, (B) results from or is caused by acts of terrorism or war (whether or
not declared) or natural disasters occurring after the date hereof, (C) (C)
arises out of, result from or relate to the transactions contemplated by this
Agreement or the announcement or performance thereof, (D) results from changes
in any applicable accounting regulations or principles or the interpretations
thereof, (E) results from any action or delay of failure to act by any
Governmental Authority, (F) results from any material acts or omissions of any
Member or (G) results from any change in Applicable Laws, shall not be deemed a
Company Material Adverse Effect.

     

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

     

    “Existing Members Interests”
means the issued and outstanding Membership Interests issued to the
Members.

     

    “Fund Class A Common Stock”
means the shares of Class A common stock, $0.001 par value per share, of
FNDM.

     

    “Fund Material Adverse Effect”
means a material adverse effect on the business, assets (including intangible
assets), liabilities, financial condition, property, or results of operations of
FNDM and its Subsidiaries, when taken as a consolidated whole; provided,
however, that any event, condition, change, occurrence or development of a state
of circumstances that that occurs following the Closing Date which (A) arises
out of general political, economic or market conditions or general changes or
developments in the financial markets generally, (B) results from or is caused
by acts of terrorism or war (whether or not declared) or natural disasters
occurring after the date hereof, (C) results from changes in any applicable
accounting regulations or principles or the interpretations thereof, (D) results
from any material acts or omissions of any Member (other than FNDM) or (E)
results from any change in Applicable Laws, shall not be deemed a Fund Material
Adverse Effect.

     

    “Governmental Authority” means
any transnational, domestic or foreign federal, state or local, governmental
authority, department, court, agency or official, including any political
subdivision thereof.

     

    “Investment Funds” means the
collective reference to Wimbledon HDN Fund L.P., Wimbledon Fund L.P., Weston
Capital Partners Fund II LLC, Wimbledon HDN Fund QP L.P., Wimbledon Fund SPC,
Wimbledon Financing Master Fund Ltd., and Wimbledon Real Estate Financing Master
Fund Ltd., all private investment funds sponsored directly or indirectly through
the Advisory Subsidiaries.

     

     “Knowledge”, including the
phrase “to the Company’s
knowledge,” means the actual knowledge of A. Hallac, Jeffrey Hallac and
Keith Wellner.

     

    “Made Available” means made all
written and electronic information and data available for review by the Members
and their representatives in true and complete form during the period that
commenced October 16, 2009 through and including the Closing, and true complete
copies of which information and data shall be archived and maintained by the
Company until the third anniversary of the Closing.

     

    “Note Shares” means the Fund
Class A Common Stock issuable upon conversion of the Reset Note.

     

     “Person” means any individual,
corporation, partnership, trust, limited liability company, association or other
entity.

     

     “Securities” means the
collective reference to the Membership Interests, the Warrant, the Warrant
Shares, the Reset Note and the Note Shares.

     

    
      
         

      

      
        7

        
          

        

      

      
         

      

    

     

    “Side Letter Agreement” means
that certain letter agreement, dated as of the date hereof by and among PBC, the
Company, A. Hallac, and FNDM.

     

    “SRO” means any self-regulatory
organization with authority over the Broker Subsidiary or its business,
including, without limitation, FINRA.

     

    “Subsidiary” means, when used
with reference to any Person, any corporation, partnership, limited liability
company, joint venture, stock company or other entity of which such Person
(either acting alone or together with its other Subsidiaries), directly or
indirectly, owns or has the power to vote or to exercise a controlling influence
with respect to 50% of more of the capital stock or other voting interests, the
holders of which are entitled to vote for the election of a majority of the
board of directors or any similar governing body of such corporation,
partnership, limited liability company, joint venture, stock company or other
entity.

     

    “Warrant Shares” shall mean the
shares of Fund Class A Common Stock issuable upon exercise of the
Warrant.

     

    
      2.   REPRESENTATIONS AND
WARRANTIES

    

     

    (a) Company
Representations.  The Company hereby represents and warrants to
each Member that, except as set forth on the Disclosure Schedule attached hereto
as Schedule I
(the “Disclosure
Schedule”), which exceptions shall be deemed to be part of the
representations and warranties made hereunder, the following representations are
true and complete as of the date hereof and as of the Closing
Date.  The Disclosure Schedule shall be arranged in sections
corresponding to the numbered and lettered sections and subsections contained in
this Section
2(a), and the disclosures in any section or subsection of the Disclosure
Schedule shall qualify other sections and subsections in this Section 2(a) only to
the extent it is readily apparent from a reading of the disclosure that such
disclosure is applicable to such other sections and subsections.

     

    (i) Capitalization.

     

    (1) The
authorized capital of the Company consists, immediately prior to the Closing of
10,000 Membership Interests, which includes 7,500 Membership Interests entitled
to a common return and 2,500 Membership Interests entitled to a preferred
return, in each case, as set forth on Schedule A to the
Fourth Operating Agreement.  All of the outstanding Membership
Interests have been duly authorized and were validly issued in compliance with
all applicable federal and state securities laws.  The Company has
issued vested Appreciation Units and unvested Appreciation Units pursuant to the
Incentive Plan. On or before the Closing Date, or as soon thereafter as is
practicable, all such Appreciation Units shall be cancelled and rendered null
and void, and any obligations to the participants thereunder shall be the sole
responsibility of the Hallac Group.

     

    (2) The
Existing Hallac Interests represent 75% of all Membership Interests as at
the date hereof and immediately prior to the Closing; and the PBC Member
Interests represent 25% of all Membership Interests as at the date hereof and
immediately prior to the Closing.

     

    
      
         

      

      
        8

        
          

        

      

      
         

      

    

     

    (3) The
Schedule of Members annexed hereto sets forth the pro forma capitalization of
the Company immediately following the Closing and after giving effect to the
transactions contemplated hereby including the number of Percentage Interests of
the Company outstanding following the Spin-Off Transaction and the
Transactions.

     

    (4) Except as
contemplated herein or in the Fifth Operating Agreement, there are no
outstanding options, warrants, rights (including conversion or preemptive rights
and rights of first refusal or similar rights) or agreements, orally or in
writing, to purchase or acquire from the Company any Membership Interests or
other ownership interest in the Company.

     

    (ii) Organization and
Qualification.  Each member of the Company Group is a Person
duly organized, validly existing and in good standing under the laws of its
state or country of formation, as set forth in the Disclosure Schedule, and has
all requisite power and authority to carry on its business as presently
conducted and as proposed to be conducted.  Each member of the Company
Group is duly qualified to transact business and is in good standing in each
jurisdiction specified on the Disclosure Schedule.  The Company has
not failed to qualify to transact business in any jurisdiction in which the
failure to so qualify would have a Company Material Adverse Effect.

     

    (iii) Authorization; Enforcement;
Validity.  All action required to be taken by the Board (as
defined in the Fourth Operating Agreement) and the Members, including obtaining
all properly authorized consents, in order to authorize the Company (A) to enter
into this Agreement and each of the other agreements entered into by the parties
hereto in connection with the transactions contemplated by this Agreement
(collectively, the “Transaction
Documents”), (B) to consummate the Spin-Off Transaction and the
Transactions, has been taken or will be taken prior to the
Closing.  All action on the part of the officers of the Company
necessary for the execution and delivery of the Transaction Documents, the
performance of all obligations of the Company under the Transaction Documents to
be performed as of the Closing, and the consummation of the Spin-Off Transaction
and the Transactions, has been taken or will be taken prior to the
Closing.  Each of the Transaction Documents and the Fifth Operating
Agreement, when executed and delivered by the Company, shall constitute, valid
and legally binding obligations of the Company, enforceable against the Company
in accordance with their respective terms except (A) as limited by
applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent
conveyance, or other laws of general application relating to or affecting the
enforcement of creditors’ rights generally, or (B) as limited by laws
relating to the availability of specific performance, injunctive relief, or
other equitable remedies (such exceptions in clauses (A) and (B), the “Enforceability
Exceptions”).

     

    (iv) Valid Issuance of
Securities.  The Additional Purchased Membership Interest, when
issued and delivered in accordance with the terms and for the consideration set
forth in this Agreement, will be validly issued and free of restrictions on
transfer other than restrictions on transfer under this Agreement and the Fifth
Operating Agreement, Applicable Law and Liens (as defined below) created by or
imposed by FNDM.  Assuming the accuracy of the representations of FNDM
in Section 2(c)
and subject to the filings described in Section 2(a)(vii),
the Additional Purchased Membership Interest will be issued in compliance with
all Applicable Laws.

     

    
      
         

      

      
        9

        
          

        

      

      
         

      

    

     

    (v) Compliance With Other
Instruments.  Except as set forth in the Disclosure Schedule,
no member of the Company Group is in material violation of or material default
under (A) as to the Company, any provisions of the Fourth Operating
Agreement, and as to other members of the Company Group their respective
organizational documents, (B) any instrument, judgment, order, writ or
decree, (C) any note, indenture or mortgage, or (D) any lease,
agreement, contract or purchase order to which it is a party or by which it is
bound, or, to the Company’s Knowledge, of any provision of any Applicable Law,
the default or violation of any one or more of the preceding clauses (A) through
(D) would have a Company Material Adverse Effect.  The execution,
delivery and performance of the Transaction Documents, and the consummation of
the transactions contemplated hereby and thereby, will not result in any such
violation or be in conflict with or constitute, with or without the passage of
time and giving of notice, either (y) a material default under any such
provision, instrument, judgment, order, writ, decree, contract or agreement
binding upon the Company and to the Company’s Knowledge, other members of the
Company Group, or to which the Company and to the Company’s Knowledge, other
members of the Company Group are subject, or (z) an event which results in
the creation of any lien, charge or encumbrance of any kind or description
(collectively, “Lien”)
upon any material assets of the Company Group, or any member thereof, or the
suspension, revocation, forfeiture, or nonrenewal of any material permit or
license applicable to the Company Group, individually or as a combined
whole.

     

    (vi) No
Conflicts.  Except as set forth in the Disclosure Schedule, the
execution, delivery and performance of the Transaction Documents and the Fifth
Operating Agreement by the Company and the consummation by the Company of the
transactions contemplated hereby and thereby will not (A) result in a violation
of the Fourth Operating Agreement or (B) conflict with, or constitute a
material default (or an event which with notice or lapse of time or both would
become a material default) under, or give to others any rights of termination,
amendment, acceleration or cancellation of, any agreement, indenture or
instrument to which the Company, or to the Company’s Knowledge, any other member
of the Company Group, is a party, or (C) result in a material violation of any
law, rule, regulation, order, judgment or decree (including federal and state
securities laws and regulations) applicable to the Company or the Company Group,
or by which any property or asset of the Company or the Company Group is bound
or affected.

     

    (vii) Consents.  Assuming
the accuracy of the representations made by the Members in Sections 2(b)
and 2(d) of
this Agreement, no consent, approval, order or authorization of, or
registration, qualification, designation, declaration or filing with, any
Governmental Authority is required on the part of the Company in connection with
the consummation of the transactions contemplated by this Agreement and the
other Transaction Documents, except for filings pursuant to Regulation D of the
Securities Act of 1933, as amended (the “Securities Act”), and
applicable state securities laws, which have been made or will be made in a
timely manner.  All consents, authorizations, orders, filings and
registrations which the Company is required to obtain pursuant to the preceding
sentence have been obtained or effected or will be obtained or effected on or
prior to the Closing Date, and the Company is unaware of any facts or
circumstances which might prevent the Company from obtaining or effecting any of
the registration, application or filings pursuant to the preceding
sentence.

     

    (viii) Absence of
Litigation.  Except as set forth in the Disclosure Schedule,
there is no material claim, action, suit, proceeding, arbitration, complaint,
charge or investigation pending or, to the Company’s Knowledge, currently
threatened (A) against the Company, any other member of the Company Group,
or any officer or director of the Company, (B) that questions the validity
of the Transaction Documents and the Fifth Operating Agreement or the right of
the Company to enter into this Agreement or to otherwise consummate the
transactions contemplated by the Transaction Documents and the Fifth Operating
Agreement, or (C) that would reasonably be expected to have, either
individually or in the aggregate, a Company Material Adverse
Effect.

     

    
      
         

      

      
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    (ix) Information Made
Available.  The Company has Made Available to a representative
designated by FNDM all electronic and written business and financial information
and data concerning the Advisory Subsidiaries, the Investment Funds, and the
Broker Subsidiary, including, without limitation, all (A) all assets under
management by the Advisory Subsidiaries, (B) all investments made by the
Investment Funds, and (C) other information and data that has been requested by
FNDM.

     

    (x) No
Brokers.  The Company is not a party to or in any way obligated
to make any payment relating to, any contract or outstanding claim for the
payment of any broker’s or finder’s fee in connection with the origin,
negotiation, execution or performance of this Agreement or the transactions
contemplated hereby hereunder

     

    (b) Hallac Member
Representations.  Each Hallac Member hereby represents and
warrants to the Company and each other Hallac Member, severally and not jointly,
as of the date hereof and as of the Closing Date:

     

    (i) Authorization.  Such
Hallac Member has full power and authority to enter into the Transaction
Documents to which it is a party and to consummate the transactions contemplated
hereby.  Each of the Transaction Documents to which it is a party
constitutes a valid and legally binding obligation of such Hallac Member,
enforceable in accordance with their terms, except as limited by the
Enforceability Exceptions.

     

    (ii) Disclosure of
Information.  Such Hallac Member has had an opportunity to
discuss the Company’s business, management, financial affairs and the terms and
conditions of the transactions contemplated hereby with the Company’s management
and has had an opportunity to review the Company’s facilities.  The
foregoing, however, does not limit or modify the representations and warranties
of the Company contained in Section 2(a) or
the right of such Hallac Members to rely thereon.

     

    (iii) Purchased Members
Interests.  Such Hallac Member, to the extent such Hallac
Member is selling Purchased Members Interests hereunder, is the sole record and
beneficial owner of the Purchased Members Interests to be sold by it pursuant to
this Agreement and owns such shares free from all taxes, Liens and claims of
every kind and description.  Except as set forth in the Fourth
Operating Agreement, there are no outstanding rights, options, subscriptions or
other agreements or commitments obligating such Hallac Member to sell or
transfer any of its Purchased Members Interests and the Purchased Members
Interests are not subject to any lock-up or other restriction on their transfer
or on the ability of such Hallac Member to sell or transfer the applicable
Purchased Members Interests.

     

    (iv) Restricted
Securities.  Such Hallac Member understands that the Securities
have not been and will not be registered under the Securities Act by reason of a
specific exemption from the registration provisions of the Securities Act which
depends upon, among other things, the bona fide nature of the investment intent
and the accuracy of such Hallac Member’s representations as expressed
herein.  Such Hallac Member understands that the Securities are
“restricted securities” under applicable U.S. federal and state securities laws
and that, pursuant to these laws, such Hallac Member must hold the Securities
indefinitely unless they are registered with the Securities and Exchange
Commission and qualified by state authorities, or an exemption from such
registration and qualification requirements is available.  Such Hallac
Member acknowledges that neither the Company nor, with respect to the Warrant
and the Warrant Shares, FNDM, has any obligation to register or qualify the
Securities, or any securities into which the Securities may be converted,
exchanged or exercised, for resale except as set forth in the Fifth Operating
Agreement.  Such Hallac Member further acknowledges that if an
exemption from registration or qualification is available, it may be conditioned
on various requirements, including, but not limited to, the time and manner of
sale, the holding period for the Securities, and on requirements relating to the
Company or, with respect to the Warrant and the Warrant Shares, FNDM, which are
outside of such Hallac Member’s control, and which the Company or, with respect
to the Warrant and the Warrant Shares, FNDM, is under no obligation and may not
be able to satisfy.

     

    
      
         

      

      
        11

        
          

        

      

      
         

      

    

     

    (v) No Public
Market.  Such Hallac Member understands that no public market
now exists for the Warrant, and that neither the Company nor, with respect to
the Warrant, FNDM, has made no assurances that a public market will ever exist
for the Securities (other than the Warrant Shares and the Note
Shares).

     

    (vi) Legends.  Such
Hallac Member understands that the Percentage Interests and any Securities
issued in respect of or in exchange or upon conversion for the Percentage
Interests may bear one or all of the following legends:

     

    (1) “THE
SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AND HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN
CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF.  NO INTEREST IN
THESE SECURITIES MAY BE SOLD, DISTRIBUTED, ASSIGNED, OFFERED, PLEDGED, OR
OTHERWISE TRANSFERRED UNLESS (A) THERE IS AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT COVERING ANY SUCH TRANSACTION INVOLVING THESE
SECURITIES, (B) THE COMPANY RECEIVES AN OPINION OF LEGAL COUNSEL IN A FORM
REASONABLY SATISFACTORY TO THE COMPANY STATING THAT SUCH TRANSACTION IS EXEMPT
FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OR (C) THE COMPANY
OTHERWISE SATISFIES ITSELF THAT SUCH TRANSACTION IS EXEMPT FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT.”

     

    (2) Any
legend required by the securities laws of any state to the extent such laws are
applicable to the Securities represented by the certificate so
legended.

     

    
      
         

      

      
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    The
legends set forth above shall be removed and the Company (with respect to any
Percentage Interests, or Securities issued in respect of or in exchange or upon
conversion thereof) shall issue a certificate without such legend to the holder
of the Percentage Interests upon which it is stamped or issue to such holder by
electronic delivery at the applicable balance account at The Depository Trust
Company (“DTC”), if,
unless otherwise required by state securities laws, (i) such Percentage
Interests or Securities issued in respect of or in exchange or upon conversion
thereof are registered for resale under the Securities Act, (ii) in connection
with a sale, assignment or other transfer, such holder provides the Company or
FNDM, as applicable, with an opinion of counsel reasonably satisfactory to the
Company or FNDM, as applicable, in a generally acceptable form, to the effect
that such sale, assignment or transfer of the Percentage Interests or Securities
issued in respect of or in exchange or upon conversion thereof may be made
without registration under the applicable requirements of the Securities Act and
that such legend is no longer required, or (iii) such holder provides the
Company or FNDM, as applicable, with reasonable assurance that the Percentage
Interests or Securities issued in respect of or in exchange or upon conversion
thereof can be sold, assigned or transferred pursuant to Rule 144 or Rule 144A
of the Securities Act (or a successor rule thereto).  The Company or
FNDM, as applicable, shall be responsible for the fees of its transfer agent and
all DTC fees associated with such issuance.

     

    (c) FNDM
Representations.  FNDM hereby represents and warrants to the
Company and each Member that, except as set forth on the disclosure schedule
attached hereto as Schedule II (the
“Fund Disclosure
Schedule”), which exceptions shall be deemed to be part of the
representations and warranties made hereunder, the following representations are
true and complete as of the date hereof and as of the Closing
Date.  The Fund Disclosure Schedule shall be arranged in sections
corresponding to the numbered and lettered sections and subsections contained in
this Section
2(c), and the disclosures in any section or subsection of the Fund
Disclosure Schedule shall qualify other sections and subsections in this Section 2(c) only to
the extent it is readily apparent from a reading of the disclosure that such
disclosure is applicable to such other sections and subsections.

     

    (i) SEC Documents; Financial
Statements.  Except as disclosed in the Fund Disclosure
Schedule, during the two (2) years prior to the date hereof, FNDM has timely
filed all reports, schedules, forms, statements and other documents required to
be filed by it with the Securities and Exchange Commission (the “SEC”) pursuant to the
reporting requirements of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”) (all of
the foregoing filed prior to the date hereof and all exhibits included therein
and financial statements, notes and schedules thereto and documents incorporated
by reference therein being hereinafter referred to as the “SEC
Documents”).  FNDM has delivered to PBC and the Hallac Members
or their respective representatives true, correct and complete copies of the SEC
Documents not available on the EDGAR system.  As of their respective
dates, the SEC Documents complied in all material respects with the requirements
of the Exchange Act and the rules and regulations of the SEC promulgated
thereunder applicable to the SEC Documents, and none of the SEC Documents, at
the time they were filed with the SEC, contained any untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.  As of their
respective dates, the financial statements of FNDM included in the SEC Documents
complied as to form in all material respects with applicable accounting
requirements and the published rules and regulations of the SEC with respect
thereto.  Such financial statements have been prepared in accordance
with generally accepted accounting principles, consistently applied, during the
periods involved (except (i) as may be otherwise indicated in such financial
statements or the notes thereto, or (ii) in the case of unaudited interim
statements, to the extent they may exclude footnotes or may be condensed or
summary statements) and fairly present in all material respects the financial
position of FNDM as of the dates thereof and the results of its operations and
cash flows for the periods then ended (subject, in the case of unaudited
statements, to normal year-end audit adjustments).

     

    
      
         

      

      
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    (ii) Equity
Capitalization.  As of the date hereof, the authorized, issued
and outstanding share of capital stock of FNDM is set forth on the Fund
Disclosure Schedule.  Except as set forth in the Fund Disclosure
Schedule (i) no shares are reserved for issuance pursuant to FNDM’s stock option
and purchase plans and no shares are reserved for issuance pursuant to
securities (other than the Warrant and as may be required under the Reset Note)
exercisable or exchangeable for, or convertible into, shares of Fund Common
Stock and (ii) all of such outstanding shares have been, or upon issuance will
be, validly issued and are fully paid and nonassessable.  Except as
specified on the Fund Disclosure Schedule: (i) none of FNDM’s capital stock is
subject to preemptive rights or any other similar rights or any liens or
encumbrances suffered or permitted by FNDM; (ii) there are no outstanding
options, warrants, scrip, rights to subscribe to, calls or commitments of any
character whatsoever relating to, or securities or rights convertible into, or
exercisable or exchangeable for, any capital stock of FNDM or any of its
Subsidiaries, or contracts, commitments, understandings or arrangements by which
FNDM or any of its Subsidiaries is or may become bound to issue additional
capital stock of FNDM or any of its Subsidiaries or options, warrants, scrip,
rights to subscribe to, calls or commitments of any character whatsoever
relating to, or securities or rights convertible into, or exercisable or
exchangeable for, any capital stock of FNDM or any of its Subsidiaries; (iii)
there are no outstanding debt securities, notes, credit agreements, credit
facilities or other agreements, documents or instruments evidencing indebtedness
of FNDM or any of its Subsidiaries or by which FNDM or any of its Subsidiaries
is or may become bound; (iv) there are no financing statements securing
obligations in any material amounts, either singly or in the aggregate, filed in
connection with FNDM or any of its Subsidiaries; (v) there are no agreements or
arrangements under which FNDM or any of its Subsidiaries is obligated to
register the sale of any of their securities under the Securities Act; (vi)
there are no outstanding securities or instruments of FNDM or any of its
Subsidiaries which contain any redemption or similar provisions, and there are
no contracts, commitments, understandings or arrangements by which FNDM or any
of its Subsidiaries is or may become bound to redeem a security of FNDM or any
of its Subsidiaries; (vii) there are no securities or instruments containing
anti-dilution or similar provisions that will be triggered by the issuance of
the Warrant or the Warrant Shares; (viii) FNDM does not have any stock
appreciation rights or “phantom stock” plans or agreements or any similar plan
or agreement; and (ix) FNDM and its Subsidiaries have no liabilities or
obligations required to be disclosed in the SEC Documents but not so disclosed
in the SEC Documents, other than those incurred in the ordinary course of FNDM’s
or its Subsidiaries’ respective businesses and which, individually or in the
aggregate, do not or would not have a Fund Material Adverse
Effect.  FNDM has furnished to PBC and the Hallac Members true,
correct and complete copies of FNDM’s Certificate of Incorporation, as amended
and as in effect on the date hereof (the “Certificate of
Incorporation”), and FNDM’s Bylaws, as amended and as in effect on the
date hereof (the “Bylaws”), and the terms of all
securities convertible into, or exercisable or exchangeable for, shares of Fund
Common Stock and the material rights of the holders thereof in respect
thereto.

     

    (iii) Organization, Qualification
and Authorization.  FNDM is a corporation company duly
organized, validly existing and in good standing under the laws of the State of
Delaware and has all requisite corporate power and authority to carry on its
business as presently conducted and as proposed to be conducted.  FNDM
has not failed to qualify to transact business in any jurisdiction in which the
failure to so qualify would have a Fund Material Adverse Effect.  FNDM
has full power and authority to enter into the Transaction Documents to which it
is a party and the Fifth Operating Agreement and to consummate the transactions
contemplated hereby.  Each of the Transaction Documents to which it is
a party the Fifth Operating Agreement constitutes a valid and legally binding
obligation of FNDM, enforceable in accordance with their terms, except as
limited by the Enforceability Exceptions.

     

    
      
         

      

      
        14

        
          

        

      

      
         

      

    

     

    (iv) Issuance of
Securities.  The Securities are duly authorized and, upon
issuance in accordance with the terms hereof, shall be validly issued and free
from all taxes, liens and charges with respect to the issue
thereof.  Upon exercise in accordance with the Warrant or conversion
in connection with the Reset Note, each of the Warrant Shares and the Note
Shares will be validly issued, fully paid and non-assessable and free from all
preemptive or similar rights, taxes, liens and charges with respect to the issue
thereof, with the holders being entitled to all rights accorded to a holder of
Fund Class A Common Stock.  Subject to the accuracy of the
representations of the Hallac Members set forth in Section 2(b) above, the offer
and issuance by FNDM of the Note is exempt from registration under the
Securities Act.  Subject to the accuracy of the representations of PBC
set forth in Section 2(d) below, the offer and issuance by FNDM of the Warrant
is exempt from registration under the Securities Act and applicable state
securities laws.

     

    (v) Compliance With Other
Instruments.  Except as set forth in the Fund Disclosure
Schedule, FNDM is not in violation of or default under (A) any provisions
of its Certificate of Incorporation or Bylaws, (B) any instrument,
judgment, order, writ or decree, (C) any note, indenture or mortgage, or
(D) any lease, agreement, contract or purchase order to which it is a party
or by which it is bound, or, to its knowledge, of any provision of any
Applicable Law; the violation of or default under any of which would have a Fund
Material Adverse Effect.  The execution, delivery and performance of
the Transaction Documents, and the consummation of the transactions contemplated
hereby and thereby, will not result in any such violation or be in conflict with
or constitute, with or without the passage of time and giving of notice, either
(y) a default under any such provision, instrument, judgment, order, writ,
decree, contract or agreement or (z) an event which results in the creation
of any Lien, upon any material assets of FNDM or the suspension, revocation,
forfeiture, or nonrenewal of any material permit or license applicable to
FNDM.

     

    (vi) No
Conflicts.  The execution, delivery and performance of the
Transaction Documents by FNDM and the consummation by FNDM of the transactions
contemplated hereby and thereby will not (A) result in a violation of its
Certificate of Incorporation or Bylaws or (B) conflict with, or constitute
a default (or an event which with notice or lapse of time or both would become a
default) under, or give to others any rights of termination, amendment,
acceleration or cancellation of, any agreement, indenture or instrument to which
FNDM is a party, or (C) result in a violation of any law, rule, regulation,
order, judgment or decree (including federal and state securities laws and
regulations) applicable to FNDM or by which any property or asset of FNDM is
bound or affected.

     

    (vii) Consents.  Assuming
the accuracy of the representations made by the Hallac Members and PBC in Sections 2(b) and
2(d),
respectively, of this Agreement, no consent, approval, order or authorization
of, or registration, qualification, designation, declaration or filing with, any
Governmental Authority is required on the part of FNDM in connection with the
consummation of the transactions contemplated by this Agreement and the other
Transaction Documents, except for filings pursuant to Regulation D of the
Securities Act, and applicable state securities laws, which have been made or
will be made in a timely manner.  All consents, authorizations,
orders, filings and registrations which FNDM is required to obtain pursuant to
the preceding sentence have been obtained or effected or will be obtained or
effected on or prior to the Closing Date, and FNDM and is unaware of any facts
or circumstances which might prevent FNDM from obtaining or effecting any of the
registration, application or filings pursuant to the preceding
sentence.

     

    
      
         

      

      
        15

        
          

        

      

      
         

      

    

     

    (viii) Absence of
Litigation.  Except as set forth in the Fund Disclosure
Schedule, there is no claim, action, suit, proceeding, arbitration, complaint,
charge or investigation pending or, to FNDM’s knowledge, currently threatened
(A) against FNDM or any officer or director of FNDM, (B) that
questions the validity of the Transaction Documents or the right of FNDM to
enter into this Agreement or to otherwise consummate the transactions
contemplated by the Transaction Documents; or (C) that would reasonably be
expected to have, either individually or in the aggregate, a Fund Material
Adverse Effect.

     

    (ix) No
Brokers.  FNDM is not a party to or in any way obligated to
make any payment relating to, any contract or outstanding claim for the payment
of any broker’s or finder’s fee in connection with the origin, negotiation,
execution or performance of this Agreement or the transactions contemplated
hereby hereunder.

     

    (x) Sarbanes-Oxley
Act.  FNDM is in compliance in all material respects with all
applicable requirements of the Sarbanes-Oxley Act of 2002 that are effective as
of the date hereof, and any and all applicable rules and regulations promulgated
by the SEC thereunder that are effective as of the date hereof, except where
such noncompliance would not have, individually or in the aggregate, a Fund
Material Adverse Effect.

     

    (d) PBC
Representations.  PBC hereby represents and warrants to the
FNDM as of the date hereof and as of the Closing Date:

     

    (i) Authorization.  PBC
has full power and authority to enter into the Transaction Documents to which it
is a party and to consummate the transactions contemplated
hereby.  Each of the Transaction Documents to which it is a party
constitutes a valid and legally binding obligation of PBC, enforceable in
accordance with their terms, except as limited by the Enforceability
Exceptions.

     

    
      
         

      

      
        16

        
          

        

      

      
         

      

    

     

    (ii) Disclosure of
Information.  PBC has had an opportunity to discuss the
Company’s business, management, financial affairs and the terms and conditions
of the transactions contemplated hereby with the Company’s management and has
had an opportunity to review the Company’s facilities.  The foregoing,
however, does not limit or modify the representations and warranties of the
Company contained in Section 2(a) or
the right of PBC to rely thereon.

     

    (iii) Purchased Members
Interests.  PBC is the sole record and beneficial owner of the
PBC Member Interests to be sold by it pursuant to this Agreement and owns such
interests free from all taxes, Liens and claims of every kind and
description.  Except as set forth in the Fourth Operating Agreement,
there are no outstanding rights, options, subscriptions or other agreements or
commitments obligating PBC to sell or transfer any of the PBC Member Interests
and the PBC Member Interests are not subject to any lock-up or other restriction
on their transfer or on the ability of PBC to sell or transfer the PBC Member
Interests.

     

    (iv) Restricted
Securities.  PBC understands that the Warrant has not been
registered under the Securities Act by reason of a specific exemption from the
registration provisions of the Securities Act which depends upon, among other
things, the bona fide nature of the investment intent and the accuracy of PBC’s
representations as expressed herein.  PBC understands that the Warrant
is a “restricted security” under applicable U.S. federal and state securities
laws and that, pursuant to these laws, PBC must hold the Warrant indefinitely
unless it is registered with the SEC and qualified by state authorities, or an
exemption from such registration and qualification requirements is
available.  PBC acknowledges that FNDM does not have any obligation to
register or qualify the Warrant, for resale except as set forth in the
Warrant.  PBC further acknowledges that if an exemption from
registration or qualification is available, it may be conditioned on various
requirements, including, but not limited to, the time and manner of sale, the
holding period for the Warrant, and on requirements relating to FNDM with
respect to the Warrant, which are outside of PBC’s control, and which FNDM, with
respect to the Warrant, is under no obligation and may not be able to
satisfy.

     

    (v) Legends.  PBC
understands that the Warrant may bear one or all of the following
legends:

     

    (1) “THE
SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AND HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN
CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF.  NO INTEREST IN
THESE SECURITIES MAY BE SOLD, DISTRIBUTED, ASSIGNED, OFFERED, PLEDGED, OR
OTHERWISE TRANSFERRED UNLESS (A) THERE IS AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT COVERING ANY SUCH TRANSACTION INVOLVING THESE
SECURITIES, (B) FNDM RECEIVES AN OPINION OF LEGAL COUNSEL IN A FORM
REASONABLY SATISFACTORY TO FNDM STATING THAT SUCH TRANSACTION IS EXEMPT FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OR (C) FNDM OTHERWISE
SATISFIES ITSELF THAT SUCH TRANSACTION IS EXEMPT FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT.”

     

    
      
         

      

      
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    (2) Any
legend required by the securities laws of any state to the extent such laws are
applicable to the Securities represented by the certificate so
legended.

     

    The
legends set forth above shall be removed and FNDM (with respect to any Warrant)
shall issue a certificate without such legend to the holder of the Securities
(other than the Warrant Shares) upon which it is stamped or issue to such holder
by electronic delivery at the applicable balance account at DTC, if, unless
otherwise required by state securities laws, (i) such Securities (other than the
Warrant Shares) are registered for resale under the Securities Act, (ii) in
connection with a sale, assignment or other transfer, such holder provides FNDM,
with an opinion of counsel reasonably satisfactory to FNDM, in a generally
acceptable form, to the effect that such sale, assignment or transfer of the
Securities (other than the Warrant Shares) may be made without registration
under the applicable requirements of the Securities Act and that such legend is
no longer required, or (iii) such holder provides FNDM with reasonable assurance
that the Securities (other than the Warrant Shares) can be sold, assigned or
transferred pursuant to Rule 144 or Rule 144A of the Securities Act (or a
successor rule thereto).  FNDM shall be responsible for the fees of
its transfer agent and all DTC fees associated with such issuance.

     

    3.   COVENANTS OF THE
PARTIES.

     

    The following covenants and agreements
are hereby made by the Party or Parties indicated below in this Section
3.

     

    (a) FNDM Financial
Information.  FNDM agrees to send the following to the holder
of the Warrant and the Reset Note (i) unless the following are filed with the
SEC through EDGAR and are available to the public through the EDGAR system,
within one (1) Business Day after the filing thereof with the SEC, a copy of its
Annual Report on Form 10-K, any interim reports or any consolidated balance
sheets, income statements, stockholders’ equity statements and/or cash flow
statements for any period other than annual, any Current Reports on Form 8-K and
any registration statements (other than on Form S-8) or amendments filed
pursuant to the Securities Act, (ii) on the same day as the release thereof,
facsimile or e-mailed copies of all press releases issued by FNDM or any of its
Subsidiaries, and (iii) copies of any notices and other information made
available or given to the stockholders of FNDM generally, contemporaneously with
the making available or giving thereof to the stockholders.

     

    (b) Company Group Financial
Information.   The Company agrees to provide to FNDM (i)
within 30 days following the end of each month, copies of all monthly financial
statements (statements of operations and statement of cash flows) prepared by or
available to the Company and all monthly financial reports provided to the
Company by each other member of the Company Group, (ii) within three (3)
Business Days of receipt by the Company, copies of all notices of redemption of
Members in the Investment Funds or written claims or demands asserted by any
Members or account beneficiaries against any Advisory Subsidiary of Investment
Fund, (iii) within 35 days following the end of each fiscal quarter, unaudited
balance sheet, statement of operations and statement of cash flows of the
Company, the Advisory Subsidiaries and the Broker Subsidiary Group, all of which
shall have been reviewed by an independent auditing firm which is certified by
the Public Company Accounting Oversight Board (“PCAOB”),
and (iv) within 75 days following the end of each fiscal year, audited balance
sheet, statement of operations and statement of cash flows of the Company, the
Advisory Subsidiaries and the Broker Subsidiary Group, all of which shall have
been audited in accordance with generally accepted accounting principles by an
independent auditing firm which is certified by the PCAOB.

     

    
      
         

      

      
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    (c) Listing.  So
long as any Warrant or the Reset Note remains outstanding, or any Warrant Shares
or Note Shares are beneficially owned by PBC or any of the Hallac Members,
respectively, FNDM shall promptly secure the listing of all of the Warrant
Shares and Note Shares upon each national securities exchange and automated
quotation system, if any, upon which the Fund Class A Common Stock is then
listed (subject to official notice of issuance) (the principal nation securities
exchange or automated quotation system in which the Fund Class A Common Stock is
then listed, the "Principal
Market") and shall maintain such listing of all Warrant Shares and Note
Shares from time to time issuable under the terms of the Transaction
Documents.  So long as the Warrant or the Reset Note remains
outstanding, or any Warrant Shares or Notes Shares are beneficially owned by any
of PBC or the Hallac Members, respectively, FNDM shall maintain the Fund Class A
Common Stock's authorization for quotation on the Principal
Market.  So long as the Warrant or the Reset Note, remains
outstanding, or any Warrant Shares or any Note Shares are beneficially owned by
PBC or the Hallac Members, respectively, neither FNDM nor any of its
Subsidiaries shall take any action which would be reasonably expected to result
in the delisting or suspension of the Fund Class A Common Stock on the Principal
Market.  FNDM shall pay all fees and expenses in connection with
satisfying its obligations under this Section 3(c).

     

    (d) Disclosure of Transactions
and Other Material Information.  On or before 8:30 a.m., New
York Time, on the
Third Business Day following the date of this Agreement, FNDM shall file a
Current Report on Form 8-K describing the terms of the transactions contemplated
by the Transaction Documents in the form required by the 1934 Act and attaching
the material Transaction Documents (including, without limitation, this
Agreement and the form of Warrant and Reset Note as exhibits to such filing
(including all attachments, the "8-K Filing").  From
and after the filing of the 8-K Filing with the SEC, no holder of Warrant or the
Reset Note shall be in possession of any material, nonpublic information
received from FNDM, any of its Subsidiaries or any of their respective officers,
directors, employees or agents, that is not disclosed in the 8-K
Filing.  FNDM shall not, and shall cause each of its Subsidiaries and
its and each of their respective officers, directors, employees and agents, not
to, provide any holder of Warrant with any material, nonpublic information
regarding FNDM or any of its Subsidiaries from and after the filing of the 8-K
Filing with the SEC without the express written consent of such holder of
Warrant.  In the event of a breach of the foregoing covenant by FNDM,
any of its Subsidiaries, or any of their respective officers, directors,
employees and agents, in addition to any other remedy provided herein or in the
Transaction Documents, a holder of Warrant shall have the right to make a public
disclosure, in the form of a press release, public advertisement or otherwise,
of such material, nonpublic information without the prior approval by FNDM, its
Subsidiaries, or any of their respective officers, directors, employees or
agents.  No holder of Warrant shall have any liability to FNDM, its
Subsidiaries, or any of its or their respective officers, directors, employees,
stockholders or agents for any such disclosure.  Subject to the
foregoing, neither FNDM, its Subsidiaries nor any holder of Warrant shall issue
any press releases or any other public statements with respect to the
transactions contemplated hereby; provided, however, that FNDM
shall be entitled, without the prior approval of any holder of Warrant, to make
any press release or other public disclosure with respect to such transactions
(i) in substantial conformity with the 8-K Filing and contemporaneously
therewith and (ii) as is required by applicable law and regulations (provided
that in the case of clause (i) each holder of Warrant shall be consulted by FNDM
in connection with any such press release or other public disclosure prior to
its release).

     

    (e) Reservation of
Shares.  So long as any holder of Warrant or the Reset Note
directly or indirectly owns any Securities, FNDM shall take all action necessary
to at all times have authorized, and reserved for the purpose of issuance, no
less than 100% of the number of shares of Fund Class A Common Stock issuable
upon exercise of the Warrant or upon conversion of the Reset Note then
outstanding (without taking into account any limitations exercise of the Warrant
set forth in the Warrant).

     

    
      
         

      

      
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    (f) Register.  FNDM
shall maintain at its principal executive offices (or such other office or
agency of FNDM as it may designate by notice to each holder of Warrant), a
register for the Warrant in which FNDM shall record the name and address of the
Person in whose name the Warrant have been issued (including the name and
address of each transferee), the Warrant Shares issuable upon exercise of the
Warrant, held by such Person.  FNDM shall keep the register open and
available at all times during business hours for inspection of any holder of
Warrant or its legal representatives.

     

    (g) Transfer Agent
Instructions.

     

    (i) FNDM
shall issue irrevocable instructions to its transfer agent, and any subsequent
transfer agent, to issue certificates or credit shares to the applicable balance
accounts at DTC, registered in the name of each holder of the Warrant or Reset
Note or their respective nominee(s), for the number of Warrant Shares or Note
Shares issuable upon exercise of the Warrant or conversion of the Reset Note, as
the case may be, as specified from time to time by each holder of Warrant to
FNDM upon exercise of the Warrant or as specified by each holder of the Reset
Note to FNDM upon conversion of the Reset Note, as the case may be.

     

    (ii) If FNDM
shall fail for any reason (or for no reason) to issue to a Warrant holder or a
holder of the Reset Note unlegended certificates or credit such holder's balance
account with DTC for the number of shares of Fund Class A Common Stock to which
such holder is entitled within three (3) Trading Days of receipt of documents
necessary for the removal of legend set forth in Section 2(b)(vi) above (the
"Deadline Date"), then,
in addition to all other remedies available to any such holder, if on or after
such Trading Day, the holder purchases (in an open market transaction or
otherwise) shares of Fund Class A Common Stock to deliver in satisfaction of a
sale by the holder of shares of Fund Class A Common Stock that the holder
anticipated receiving from FNDM (a "Buy-In"), then FNDM shall,
within three (3) Trading Days after the holder's request and in the holder's
discretion, either (i) pay cash to the holder in an amount equal to the holder's
total purchase price (including brokerage commissions, if any) for the shares of
Fund Class A Common Stock so purchased (the "Buy-In Price"), at which
point FNDM's obligation to deliver such certificate (and to issue such shares of
Fund Class A Common Stock) shall terminate, or (ii) promptly honor its
obligation to deliver to the holder a certificate or certificates representing
such shares of Fund Class A Common Stock and pay cash to the holder in an amount
equal to the excess (if any) of the Buy-In Price over the product of (A) such
number of shares of Fund Class A Common Stock, times (B) the closing price of
the Fund Class A Common Stock on the Deadline Date.

     

    (iii) FNDM
acknowledges that a breach by it of its obligations under this Section 3(g) will
cause irreparable harm to a holder of the Warrant or the Reset
Note.  Accordingly, FNDM acknowledges that the remedy at law for a
breach of its obligations under this Section 3(g) will be inadequate and agrees,
in the event of a breach or threatened breach by FNDM of the provisions of this
Section 3(g), that a holder of the Securities shall be entitled, in addition to
all other available remedies, to an order and/or injunction restraining any
breach and requiring immediate issuance and transfer, without the necessity of
showing economic loss and without any bond or other security being
required.

     

    
      
         

      

      
        20

        
          

        

      

      
         

      

    

     

    (h) Fifth Operating
Agreement.   None of the Members nor the Company shall
amend, restate, modify or in any other respect make any changes to the Fifth
Operating Agreement, without in each case, the prior written consent of the FNDM
Designees (as defined in Section 3(i)
below) on the Board of Managers of the Company.

     

    (i) Board of
Managers.   For so long as any Principal Amount of the
Reset Note shall be outstanding, any members of the Board of Managers designated
by FNDM (the “FNDM
Designees”) shall be reasonably acceptable to A. Hallac.  The remaining members of the
Board of Managers shall be persons acceptable to the Hallac Members (the “Hallac
Designees”).  Following Closing Date, the initial members of
the Company Board of Managers shall be five (5) Persons, consisting of (A) A.
Hallac, (B) Keith Wellner, (C) Joseph J. Bianco, (D) Gregory Webster and (E)
Michael Hlavsa.  Messrs. A. Hallac and Keith Wellner are Hallac
Designees and Messrs. Bianco, Webster and Hlavsa are the FNDM
Designees.

     

    4.   CONDITIONS TO THE COMPANY’S
AND MEMBERS’ OBLIGATIONS AT THE CLOSING.

     

    The
obligations of each Member to consummate the transactions contemplated hereby to
occur at the Closing are subject to the fulfillment to the satisfaction of the
Members, on or before the Closing, of each of the following conditions, unless
otherwise waived by the Members in their sole discretion:

     

    (a) Transaction
Documents. FNDM shall have executed each of the Transaction Documents and
the Fifth Operating Agreement to which it is a party and delivered the same to
the applicable Member and the Company, as applicable.

     

    (b) Closing Payments and
Deliveries. The Closing payments and deliveries of the executed
Transaction Documents, the Fifth Operating Agreement, and the certificates and
instruments contemplated by this Agreement shall have been duly made, executed
and delivered by FNDM in a manner reasonably acceptable to the Hallac Members,
PBC and their respective legal counsel.

     

    (c) Representations and
Warranties.  The representations and warranties of the FNDM
contained in Section 2(c)
shall be true and correct in all material respects as of the Closing, except
that any such representations and warranties shall be true and correct in all
respects where such representation and warranty is qualified with respect to
materiality.

     

    
      
         

      

      
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    (d) Performance.  FNDM
shall have performed and complied with all covenants, agreements, obligations
and conditions contained in this Agreement that are required to be performed or
complied with by FNDM on or before the Closing.

     

    (e) Qualifications.  All
authorizations, approvals or permits, if any, of any Governmental Authority or
regulatory body of the United States or of any state that are required in
connection with the FNDM’s lawful issuance of the Note and the Warrant pursuant
to this Agreement shall be obtained and effective as of the
Closing.

     

    (f) FNDM Proceedings and
Documents.  All corporate and other proceedings of FNDM in
connection with the transactions contemplated at the Closing and all documents
incident thereto shall be reasonably satisfactory in form and substance to such
Member, and such Member (or its counsel) shall have received all such
counterpart original and certified or other copies of such documents as
requested.

     

    (g) FNDM Secretary’s
Certificate.  FNDM shall have delivered to each Member a
certificate, executed by the Secretary of FNDM and dated as of the Closing Date,
as to (i) the resolutions consistent with Section 2(b)(iii) as
adopted by the FNDM’s Board of Directors in a form reasonably acceptable to such
Member, (ii) the Certificate of Incorporation as in effect at the Closing, (iii)
the Bylaws as in effect at the Closing and (iv) the incumbency of the officers
of FNDM who executed the Transaction Documents, the Fifth Operating Agreement
and the Warrant.

     

    (h) FNDM Capitalization
Certificate.  FNDM shall have delivered to each Member a
certificate executed by the Chief Executive Officer or Chief Financial Officer
of FNDM certifying as to the (i) aggregate amount of outstanding indebtedness
for borrowed money and (ii) number of shares of FNDM Series A Preferred Stock,
FNDM Class A Common Stock and FNDM Class B Common Stock outstanding as of a date
within five days of the Closing Date.  In lieu of such Capitalization
Certificate, FNDM may include such information in the FNDM Disclosure Schedule
referenced in Section 2(c)(ii) of this Agreement.

     

    (i) Fund Common Stock and
Principal Market.  The Fund Common Stock (I) shall be
designated for quotation or listed on the Principal Market and (II) shall not
have been suspended, as of the Closing Date, by the SEC or the Principal Market
from trading on the Principal Market nor shall suspension by the SEC or the
Principal Market have been threatened, as of the Closing Date.

     

    (j) Spin-Off
Transaction.  The Company shall have consummated the Spin-Off
Transaction prior to the Closing.

     

    
      
         

      

      
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      5.    CONDITIONS OF FNDM’S
OBLIGATIONS AT THE CLOSING.

    

     

    The
obligations of FNDM to consummate the transactions contemplated hereby to occur
at the Closing are subject to the fulfillment, on or before the Closing, of each
of the following conditions, unless otherwise waived:

     

    (a) Transaction
Documents.  Each Member and the Company shall have executed
each of the Transaction Documents to which it is a party and the Fifth Operating
Agreement, as applicable, and delivered the same to the Company.

     

    (b) Closing Deliveries.
The Closing deliveries of the executed Transaction Documents, the Fifth
Operating Agreement and the certificates and instruments contemplated by this
Agreement shall have been duly made, executed and delivered by the Company and
each Member in a manner reasonably acceptable to FNDM and its legal
counsel.

     

    (c) Representations and
Warranties.  The representations and warranties of the Company
and the Members contained in Sections 2(a),
2(b) and 2(d) shall be true
and correct in all material respects as of the Closing, except that any such
representations and warranties shall be true and correct in all respects where
such representation and warranty is qualified with respect to
materiality.

     

    (d) Performance.  The
Company and each of the Members shall have performed and complied with all
covenants, agreements, obligations and conditions contained in this Agreement
that are required to be performed or complied with by the Company and such
Member(s) on or before the Closing.

     

    (e) Qualifications.  All
authorizations, approvals or permits, if any, of any Governmental Authority or
regulatory body of the United States or of any state that are required in
connection with the Company’s lawful issuance of its Securities and consummation
of the transactions contemplated by this Agreement and the other Transaction
Documents shall be obtained and effective as of the Closing.

     

    (f) Proceedings and
Documents.  All corporate and other proceedings of the Company
and each of the Members in connection with the transactions contemplated at the
Closing and all documents incident thereto shall be reasonably satisfactory in
form and substance to FNDM (or its counsel) shall have received all such
counterpart original and certified or other copies of such documents as
requested.

     

    (g) Company Secretary’s
Certificate.  FNDM shall have received from the Company a
certificate, executed by the Secretary of the Company and dated as of the
Closing Date, as to (i) the resolutions consistent with Section 2(a)(iii) as
adopted by the Board of Managers of the Company in a form reasonably acceptable
to FNDM, (ii) the Fifth Amended and Restated Operating Agreement, and (iii) the
incumbency of the officers of the Company who executed this Agreement, the other
Transaction Documents, and the Fifth Operating Agreement.

     

    (h) PBC Officer’s
Certificate.  FNDM shall have received from PBC a certificate,
executed by an officer of PBC and dated as of the Closing Date, as to (i) the
resolutions consistent with Section 2(d)(iii) as
adopted by the Board of Managers of PBC in a form reasonably acceptable to FNDM
and (ii) the incumbency of the officers of PBC who executed this Agreement and
the other Transaction Documents.

     

    
      
         

      

      
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    6.   MISCELLANEOUS.

     

    (a) Survival.  Unless
otherwise expressly set forth to the contrary in this Agreement, all of the
representations, warranties and covenants of the Company, FNDM and the Members
contained in or made pursuant to this Agreement and all of their respective
obligations to be performed under the terms hereof at, prior to, or after the
Closing shall survive the execution and delivery of this Agreement and the
Closing hereof.  The rights of the Parties to enforce the
representations, warranties and covenants hereunder shall in no way be affected
by any investigation or knowledge of the subject matter thereof made by or on
behalf of the applicable Party.

     

    (b) Successors and
Assigns.  This Agreement shall be binding upon and inure to the
benefit of the Parties and their respective successors and assigns, including
any purchasers of the Securities.  Notwithstanding the foregoing, the
Company may not assign or otherwise transfer this Agreement without the prior
written consent of FNDM and the Members holding at least a majority of the
Existing Members Interests, except in connection with an assignment in whole to
a successor to all or substantially all of the assets and business of the
Company.  The rights of each Member under this Agreement may be
assigned without the prior written consent of the Company, subject to Applicable
Law; provided, however, that (y) the Company is, within a reasonable time
after such transfer, furnished with written notice of the name and address of
such transferee and the Securities with respect to which such rights are
transferred and (z) such transferee agrees in writing to be bound by and subject
to the terms and conditions of this Agreement and the Transaction
Documents.

     

    (c) Governing
Law.  This Agreement shall be governed by and construed in
accordance with the laws of the State of New York, without regard to its
conflicts of laws.

     

    (d) Counterparts; Electronic
Transmission.  This Agreement may be executed and delivered in
two or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.  This
Agreement, and any permitted amendments hereto, to the extent signed and
delivered by means of a facsimile machine or by e-mail, shall be treated in all
manner and respects as an original contract 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, each other
party hereto or thereto shall re-execute original forms thereof and deliver them
to all other parties.  No Party hereto shall raise the use of a
facsimile machine or e-mail to deliver a signature or the fact that any
signature was transmitted or communicated through the use of facsimile machine
or by e-mail as a defense to the formation of a contract and each party forever
waives any such defense.

     

    (e) Titles and Subtitles;
Interpretation.  The titles and subtitles used in this
Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.

     

    
      
         

      

      
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    (f) Notices.  All
notices and other communications given or made pursuant to this Agreement shall
be in writing and shall be deemed effectively given:  (a) upon
personal delivery to the party to be notified; (b) when sent by confirmed
electronic mail or facsimile if sent during normal business hours of the
recipient, and, if not so confirmed, then on the next business day;
(c) five (5) days after having been sent by registered or certified mail,
return receipt requested, postage prepaid; or (d) one (1) Business Day
after deposit with a nationally recognized overnight courier, specifying next
business day delivery, with written verification of receipt.  All
communications shall be sent to the respective parties at their address as set
forth in column (2) of the Schedule of Members with a copy (which shall not
constitute notice) to their respective legal representatives, if any, as set
forth in column (8) of the Schedule of Members, or to such e-mail address,
facsimile number or address as subsequently modified by written notice given in
accordance with this Section 6(f).  The
addresses and facsimile numbers for communications to the Company shall
be:

     

    Weston
Capital Management, LLC

    One North
Clematis

    Suite
510

    West Palm
Beach, FL 33401

    Facsimile:
______________

    Telephone:
_____________

    Attention:
Keith D. Wellner

    

    

    with a
copy to:

    

    Zukerman
Gore Brandeis & Crossman, LLP

    875 Third
Ave

    28th
Floor

    New York,
NY 10022

    Attention:  Clifford
A. Brandeis

    Telephone:  (212)
223-6700

    Facsimile:  (212)
223-6433

    

    (g) No Finder’s
Fees.  Each party represents that it neither is nor will be
obligated for any finder’s fee or commission in connection with the transactions
contemplated by this Agreement.  The Company agrees to indemnify and
hold harmless each Member from any liability for any commission or compensation
in the nature of a finder’s or broker’s fee arising out of this transaction (and
the costs and expenses of defending against such liability or asserted
liability) for which the Company or any of its officers, employees or
representatives is responsible.

     

    (h) Fees and
Expenses.  The Company, the Members, and FNDM shall each pay
their own respective fees and expenses incurred in drafting, negotiating,
executing and performing this Agreement.

     

    
      
         

      

      
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    (i) Amendments and
Waivers.  Any term of this Agreement may be amended, terminated
or waived only with the written consent of the Company, FNDM and Members holding
at least a majority of the Existing Members Interests.  Any amendment
or waiver effected in accordance with this Section 6(i)
shall be binding upon the Members and each transferee of the Securities (or the
securities issuable upon conversion, exchange or exercise thereof), each future
holder of all such securities, and the Company.

     

    (j) Severability.  If
any provision of this Agreement is prohibited by law or otherwise determined to
be invalid or unenforceable by a court of competent jurisdiction, the provision
that would otherwise be prohibited, invalid or unenforceable shall be deemed
amended to apply to the broadest extent that it would be valid and enforceable,
and the invalidity or unenforceability of such provision shall not affect the
validity of the remaining provisions of this Agreement so long as this Agreement
as so modified continues to express, without material change, the original
intentions of the parties as to the subject matter hereof and the prohibited
nature, invalidity or unenforceability of the provision(s) in question does not
substantially impair the respective expectations or reciprocal obligations of
the parties or the practical realization of the benefits that would otherwise be
conferred upon the parties.  The parties will endeavor in good faith
negotiations to replace the prohibited, invalid or unenforceable provision(s)
with a valid provision(s), the effect of which comes as close as possible to
that of the prohibited, invalid or unenforceable provision(s).

     

    (k) Delays or
Omissions.  No delay or omission to exercise any right, power
or remedy accruing to any party under this Agreement, upon any breach or default
of any other party under this Agreement, shall impair any such right, power or
remedy of such non-breaching or non-defaulting party nor shall it be construed
to be a waiver of any such breach or default, or an acquiescence therein, or of
or in any similar breach or default thereafter occurring; nor shall any waiver
of any single breach or default be deemed a waiver of any other breach or
default theretofore or thereafter occurring.  Any waiver, permit,
consent or approval of any kind or character on the part of any party of any
breach or default under this Agreement, or any waiver on the part of any party
of any provisions or conditions of this Agreement, must be in writing and shall
be effective only to the extent specifically set forth in such
writing.  All remedies, either under this Agreement or by law or
otherwise afforded to any party, shall be cumulative and not
alternative.

     

    (l) Entire
Agreement.  This Agreement (including the Exhibits and the
Disclosure Schedule hereto) and the other Transaction Documents constitute the
full and entire understanding and agreement among the parties with respect to
the subject matter hereof, and any other written or oral agreement relating to
the subject matter hereof existing among the parties are expressly
canceled.

     

    (m) Jurisdiction; Dispute
Resolution.  The parties (i) hereby irrevocably and
unconditionally submit to the jurisdiction of the state courts of New York and
to the jurisdiction of the United States District Court for the Southern
District of New York for the purpose of any suit, action or other proceeding
arising out of or based upon this Agreement, (ii) agree not to commence any
suit, action or other proceeding arising out of or based upon this Agreement
except in the state courts of New York or the United States District Court for
the Southern District of New York, and (iii) hereby waive, and agree not to
assert, by way of motion, as a defense, or otherwise, in any such suit, action
or proceeding, any claim that it is not subject personally to the jurisdiction
of the above-named courts, that its property is exempt or immune from attachment
or execution, that the suit, action or proceeding is brought in an inconvenient
forum, that the venue of the suit, action or proceeding is improper or that this
Agreement or the subject matter hereof may not be enforced in or by such
court.

     

    
      
         

      

      
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    (n) Indemnification.

     

    (i) In
addition to any other rights or remedies to which Hallac Members may be entitled
under this Agreement, the Company agrees to and will indemnify and hold harmless
each Hallac Member and such Hallac Member’s respective successors, assigns,
officers, directors, managers, partners, and members (individually and
collectively, a “Hallac
Member Indemnified
Party”) from and against any and all losses, claims, actions, damages,
costs, and expenses (including, without limitation, costs of investigation and
defense, and reasonable attorneys’ fees and expenses) that the Hallac Member
Indemnified Party may become subject to, arising out of or resulting from any
misrepresentation, breach of representation, warranty, covenant or agreement on
the part of the Company or its agents under this Agreement, or from any
misrepresentation in, omission from, or breach of, any certificate or other
instrument furnished or to be furnished to Hallac Members pursuant to this
Agreement.

     

    (ii) In
addition to any other rights or remedies to which Hallac Members may be entitled
under this Agreement, each Hallac Member (the “Indemnifying Party”) agrees to
and will indemnify and hold harmless each other Hallac Member and the Company
and such other Hallac Member’s and the Company’s respective successors, assigns,
officers, directors, managers, partners, and members (individually and
collectively, an “Other Hallac
Indemnified Party”) from and against any and all losses, claims, actions,
damages, costs, and expenses (including, without limitation, costs of
investigation and defense, and reasonable attorneys’ fees and expenses) that the
Other Hallac Indemnified Party may become subject to, arising out of or
resulting from any misrepresentation, breach of representation, warranty,
covenant or agreement on the part of the Indemnifying Party or its agents under
this Agreement, or from any misrepresentation in, omission from, or breach of,
any certificate or other instrument furnished or to be furnished to Hallac
Members pursuant to this Agreement.

     

    (iii) In
addition to any other rights or remedies to which FNDM may be entitled under
this Agreement, PBC agrees to and will indemnify and hold harmless FNDM and each
of its successors, assigns, officers, directors, managers, partners, and members
(individually and collectively, an “FNDM Indemnified Party”) from
and against any and all losses, claims, actions, damages, costs, and expenses
(including, without limitation, costs of investigation and defense, and
reasonable attorneys’ fees and expenses) that the FNDM Indemnified Party may
become subject to, arising out of or resulting from any misrepresentation,
breach of representation, warranty, covenant or agreement on the part of PBC or
its agents under this Agreement, or from any misrepresentation in, omission
from, or breach of, any certificate or other instrument furnished or to be
furnished to FNDM pursuant to this Agreement.

     

    (iv) In
addition to any other rights or remedies to which PBC may be entitled under this
Agreement, FNDM agrees to and will indemnify and hold harmless PBC and each of
its successors, assigns, officers, directors, managers, partners, and members
(individually and collectively, a “PBC Indemnified Party”) from
and against any and all losses, claims, actions, damages, costs, and expenses
(including, without limitation, costs of investigation and defense, and
reasonable attorneys’ fees and expenses) that the PBC Indemnified Party may
become subject to, arising out of or resulting from any misrepresentation,
breach of representation, warranty, covenant or agreement on the part of FNDM or
its agents under this Agreement, or from any misrepresentation in, omission
from, or breach of, any certificate or other instrument furnished or to be
furnished to PBC pursuant to this Agreement.

     

    (o) Publicity. The
Company and Purchaser shall consult with the Members in issuing any press
releases or otherwise making public statements or filings and other
communications with respect to the transactions contemplated hereby, and none of
the Parties shall issue any such press release or otherwise make any such public
statement, filing or other communication without the prior consultation with the
other Parties, except if such disclosure is required by law, in which case the
disclosing Party shall promptly provide the other Parties with prior notice of
such public statement, filing or other communication. Notwithstanding the
foregoing, neither the Company nor Purchaser shall publicly disclose the name of
any Member or include the name of any Member, without the prior written consent
of such Member in any other press release or public statement or filing, except
to the extent the Company and Purchaser have been advised by its counsel that
such disclosure is required by law, in which case the Company and Purchaser
shall provide such Member with prior notice of such disclosure.

     

    (p) No Third-Party
Beneficiaries.  This Agreement is intended for the benefit of
the parties hereto and their respective permitted successors and assigns, and is
not for the benefit of, nor may any provision hereof be enforced by, any other
Person.

     

    (q) Further
Assurances.  Each Party shall do and perform, or cause to be
done and performed, all such further acts and things, and shall execute and
deliver all such other agreements, certificates, instruments and documents, as
any other Party may reasonably request in order to carry out the intent and
accomplish the purposes of this Agreement and the consummation of the
transactions contemplated hereby.

     

    (r) No Strict
Construction.  The language used in this Agreement will be
deemed to be the language chosen by the parties to express their mutual intent,
and no rules of strict construction will be applied against any
party.

     

    (s) Termination.  In
the event that the Closing shall not have occurred with respect to a Member on
or before five (5) Business Days from the date hereof due to the Company’s or a
Member’s failure to satisfy the conditions set forth in Sections 4 and
Section 5 above
(and the non-breaching Party’s failure to waive such unsatisfied condition(s)),
the non-breaching Party shall have the option to terminate this Agreement with
respect to such breaching party at the close of business on such date without
liability of any Party to any other Party.

     

     [Signature
Page Follows]

    
      
         

      

      
        27

        
          

        

      

      
         

      

    

    

    IN WITNESS WHEREOF, the each
of the Parties has caused its respective signature page to this Restructuring
Agreement to be duly executed as of the date first written above.

     

     

    
      
        	 	
                COMPANY:

              	 
	 	 	 	 
	 	WESTON CAPITAL MANAGEMENT,
      LLC	 
	 	 	 	 
	
                Date:
      March 29, 2010

              	
                By:
      

              	/s/ Albert Hallac	 
	 	 	Name:
      Albert Hallac	 
	 	 	Title:    Manager
      and Member	 
	 	 	 	 

      

     

     

     

     

     

     

     

     

     

     

     

    
      [Signature
Page to Restructuring Agreement]

    

     

    
      
         

      

      
        28

        
          

        

      

      
         

    

    IN WITNESS WHEREOF, the each
of the Parties has caused its respective signature page to this Restructuring
Agreement to be duly executed as of the date first written above.

    

     

    
      	 	
              HALLAC
      MEMBERS:

            
	 	 
	 	 
	 	
              /s/
      Albert Hallac_____________________

            
	 	
              ALBERT
      HALLAC

            
	 	 
	 	/s/
      Mitzi Hallac Liotta_________________
	 	MITZI
      HALLAC LIOTTA
	 	 
	 	/s/
      Joanna Hallac_____________________
	 	JOANNA
      HALLAC
	 	 
	 	
              /s/
      Jeffrey Hallac_____________________

            
	 	
              JEFFREY
      HALLAC

            
	 	 
	 	
              /s/
      Russell Hallac_____________________

            
	 	
              RUSSELL
      HALLAC

            
	 	 
	 	
              /s/
      Victor Elmaleh_____________________

            
	 	
              VICTOR
      ELMALEH

            

    

     

     

     

    

    

    

    
      [Signature
Page to Restructuring Agreement]

       

      
        
           

        

        
          29

          
            

          

        

        
           

        

      

    

     

    IN WITNESS WHEREOF, the each
of the Parties has caused its respective signature page to this Restructuring
Agreement to be duly executed as of the date first written above.

    

     

     

    
      	 	 	 FNDM:
	 	 	 
	 	 	 FUND.COM,
  INC.
	 	 	 
	 	
              By:

            	
              /s/
      Gregory Webster_________________

            
	 	 	
              Name:  Gregory
      Webster

            
	 	 	
              Title:Chief
      Executive Officer

            
	 	 	 
	 	 	 

    

     

     

     

     

    

     

    

    

    

    
      [Signature
Page to Restructuring Agreement]

    

    

    
      
         

      

      
        30

        
          

        

      

      
         

      

    

     

     

    
      	 	 	
              PBC:

            
	 	 	 
	 	 	
              PBC-WESTON
      HOLDINGS, LLC

            
	 	 	 
	 	 	 
	 	
              By:

            	
              /s/
      Nathan S. Ward___________________

            
	 	 	
              Nathan
      S. Ward, Manager

            

    

     

     

     

     

     

    
 

    [Signature
Page to Restructuring Agreement]

     

    
      
         

      

      
        31

        
          

        

      

      
         

      

    

    Schedule
of Members

     

    
      	
              (1)

            	
              (2)

            	
              (3)

            	
              (4)

            	
              (5)

            	
              (6)

            	
              (7)

            	
              (8)

            
	
              
                 

                Buyer

              

            	
              
                 

                Address
      and Facsimile Number

              

            	
              
                 

                Aggregate
      Percentage Interests to be Sold or Purchased

              

            	
              
                 

                Aggregate

                Principal
      Amount of Reset Note Retained

              

            	
              
                 

                Percentage
      of

                Warrant
      and Warrant Shares

              

            	
              
                Broker
      Subsidiary

                Membership
      Interests Received in Spin Off

              

            	
              
                Purchase

                 Price

                Received

              

            	
              
                Legal
      Representative's

                Address
      and Facsimile Number

              

            
	
              PBC-Weston
      Holdings, LLC

            	
              505
      S. Flagler Drive

              Suite
      1400

              West
      Palm Beach, FL 33401

            	
              25%
      sold

            	
              N/A

            	
              100%

            	
              25%

            	
              $2,500,000

            	
              Greenberg
      Traurig 401 East Las Olas Blvd., Ste 2000

              Fort
      Lauderdale, FL 33301

               Attn:
      Bruce March

              Fax:
      (954) 765-1477

            
	
              FNDM,
      Inc.

               

            	
               14
      Wall Street

              20th
      floor

              New
      York, NY 10005

               

            	
              100%
      purchased

            	
              N/A

            	
              N/A

            	
              N/A

            	
              N/A

            	
              Hodgson
      Russ LLP, 1540 Broadway, New York, NY 10036, attn: Stephen A. Weiss, fax.
      (212) 751-0927

            
	
              Albert
      Hallac

            	
              27
      Pheasant Hill Road

              Westport,
      CT 06883

            	
              58%
      sold

            	
              77.33%

            	
              N/A

            	
              57.4%

            	 
      	
              See
      (*) below

            
	
              Mitzi
      Hallac Liotta

               

            	
              27
      Pheasant Hill Road

              Westport,
      CT 06883

            	
              3.75%
      sold

            	
              5%

            	
              N/A

            	
              3.9%

            	 
      	
              See
      (*) below

            
	
              Joanna
      Hallac

            	
              27
      Pheasant Hill Road

              Westport,
      CT 06883

            	
              3.75%
      sold

            	
              5%

            	
              N/A

            	
              3.9%

            	 
      	
              See
      (*) below

            
	
              Jeffrey
      Hallac

            	
              27
      Pheasant Hill Road

              Westport,
      CT 06883

            	
              3.75%
      sold

            	
              5%

            	
              N/A

            	
              3.9%

            	 
      	
              See
      (*) below

            
	
              Russell
      Hallac

            	
              27
      Pheasant Hill Road

              Westport,
      CT 06883

            	
              3.75%
      sold

            	
              5%

            	
              N/A

            	
              3.9%

            	 
      	
              See
      (*) below

            
	
              Victor
      Elmaleh

               

            	
              27
      Pheasant Hill Road

              Westport,
      CT 06883

               

            	
              2%
      sold

            	
              2.67%

            	
              N/A

            	
              2.0%

            	
              N/A

            	
              See
      (*) below

            
	
              TOTAL

            	 
      	 
      	 
      	 
      	 
      	 
      

    

     

     (*)           Counsel
to the Hallac Group is Zukerman Gore Brandeis and Crossman, 875 Third Avenue,
New York, New York 10022

                   
Attn: Clifford Brandeis, Esq.

    

    
      
         

      

      
        32

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