Document
false0001398987000135500100013989872019-11-072019-11-070001398987rlgy:RealogyGroupLLCMember2019-11-072019-11-07

______________________________________________________________________________________________________
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
_______________________________
FORM 8-K
_______________________________
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): November 7, 2019 (November 6, 2019)
_______________________________
Realogy Holdings Corp.
(Exact Name of Registrant as Specified in its Charter)
Delaware
001-35674
20-8050955
(State or Other Jurisdiction of Incorporation)
(Commission File Number)
(IRS Employer Identification No.)
_______________________________
Realogy Group LLC
(Exact Name of Registrant as Specified in its Charter)
Delaware
333-148153
20-4381990
(State or Other Jurisdiction of Incorporation)
(Commission File Number)
(IRS Employer Identification No.)
_______________________________
175 Park Avenue
Madison, NJ 07940
(Address of principal executive offices) (Zip Code)
(973) 407-2000
(Registrant’s telephone number, including area code)
None
(Former name or former address if changed since last report)
_______________________________
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Realogy Holdings Corp.
Common Stock, par value $0.01 per share
RLGY
New York Stock Exchange
Realogy Group LLC
None
None
None
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company 
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. 
______________________________________________________________________________________________________




Item 1.01.
Entry into a Material Definitive Agreement.
.
Purchase and Sale Agreement
On November 6, 2019, Realogy Holdings Corp. (the “Company”) entered into a Purchase and Sale Agreement (the “Purchase Agreement”) with SIRVA Worldwide, Inc. (the “Buyer”), a subsidiary of SIRVA, Inc. Pursuant to the Purchase Agreement, the Company has agreed to sell its employee relocation services business (the “Business”) held by Cartus Corporation, an indirect subsidiary of the Company (“Cartus”), to the Buyer. Buyer is controlled by affiliates of Madison Dearborn Partners, LLC (the “Sponsor”). Subject to the terms and conditions of the Purchase Agreement, and following the completion of certain restructuring steps to separate from Cartus the affinity and broker-to-broker referral businesses that the Company will retain (the “Restructuring”), the Buyer will purchase all of the outstanding equity interests in Cartus for an aggregate purchase price of $400 million, consisting of $375 million in cash payable at the closing of the transaction (the “Closing”) and a $25 million deferred payment payable after the Closing, subject to certain adjustments set forth in the Purchase Agreement (collectively, the “Transaction”).
The Closing is subject to closing conditions, including (i) the expiration or termination of all waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act and the receipt of other required regulatory clearances, (ii) the absence of any preliminary or permanent injunction or other order restraining, prohibiting or otherwise making illegal the consummation of the Transaction, and the absence of any law prohibiting or making illegal the consummation of the Transaction, (iii) subject to certain materiality and other qualifications, the accuracy of the representations and warranties made by the Company and the Buyer under the Purchase Agreement, (iv) the performance in all material respects by each of the Company and the Buyer of its obligations under the Purchase Agreement, (v) in the case of the Buyer’s obligations to complete the Transaction, the absence of any Material Adverse Effect (as defined in the Purchase Agreement) with respect to the Business since the date of the Purchase Agreement and (vi) in the case of the Buyer’s obligations to complete the Transaction, the completion in all material respects of the Restructuring.
Each of the Company and the Buyer have the right to terminate the Purchase Agreement under certain circumstances, including, among others, (i) upon mutual consent, (ii) upon a material uncured breach by the other party to the Purchase Agreement, (iii) upon a final, non-appealable order of any governmental authority that permanently restrains, enjoins or otherwise prohibits the Transaction, (iv) if Buyer fails to consummate the Closing within three business days after receipt of irrevocable confirmation from the Company that all conditions to Closing have been satisfied and that if the Buyer’s Debt Financing and Equity Financing (as defined in the Purchase Agreement) are funded, then the Company will consummate the Closing or (v) if the Closing has not occurred by April 30, 2020 (the “Outside Date”); provided that either party may extend the Outside Date to November 6, 2020 if all conditions to Closing, except with respect to certain regulatory approvals, are satisfied.
The Purchase Agreement provides that the Buyer will be required to pay to the Company a $30,000,000 termination fee if the Purchase Agreement is terminated (i) by the Company or the Buyer, due to failure to complete the Transaction after the Outside Date (as extended pursuant to the Purchase Agreement); provided that all conditions to Closing, except with respect to certain regulatory approvals, have been satisfied, (ii) by the Company or the Buyer, due to a final, non-appealable order arising under antitrust laws that permanently restrains, enjoins or otherwise prohibits the Transaction or (iii) by the Company, due to a material uncured breach by the Buyer to the Purchase Agreement or due to Buyer’s failure to consummate the Closing within three business days after receipt of irrevocable confirmation that the Company is ready and willing to consummate the Closing. Certain affiliates of the Sponsor have guaranteed the payment of the termination fee to the Company, when due, under the Purchase Agreement.
The Company and the Buyer have agreed to indemnify each other for losses resulting from certain specified breaches of the Purchase Agreement and for certain other liabilities, subject to certain limitations.
The Purchase Agreement includes certain representations and warranties made by the Company and the Buyer to each other. The representations and warranties of each party have been made solely for the benefit of the other parties to the Purchase Agreement and may not be relied upon by any other person (except to the extent expressly provided by the terms of the Purchase Agreement). In addition, the representations and warranties (i) have been qualified by the disclosure letter that the Company delivered to the Buyer in connection with the execution of the Purchase Agreement, (ii) are subject to materiality standards set forth in, and established by, the Purchase Agreement, which may differ from materiality standards used in other contexts or by other persons and (iii) were made as of specific dates. Representations and warranties may be used for diligence purposes, to allocate risk among parties or to determine whether closing conditions have been satisfied or require waiver. Information regarding a party may also change after the date on which the representations and warranties were made. As a result, reference solely to the representations and warranties of a party outside the context of the disclosure letter, without reference to, or knowledge of, the qualifications or limitations set forth in the Purchase Agreement, should not necessarily be considered a statement of fact, current or prospective, about that party.



The Purchase Agreement is included with this filing only to provide investors with information regarding the terms of the Purchase Agreement, and not to provide investors with any other factual information regarding the Company, the Business or the Buyer.
The foregoing description of the Purchase Agreement and the Transaction does not purport to be complete and is qualified in its entirety by the Purchase Agreement, which is attached as Exhibit 2.1 to this Current Report on Form 8-K and incorporated herein by reference.
Item 7.01.Regulation FD Disclosure.
On November 7, 2019, the Company issued a press release in connection with the Transaction. A copy of the press release is attached as Exhibit 99.1 to this Current Report on Form 8-K and incorporated herein by reference.
Item 9.01.Financial Statements and Exhibits.
(d)Exhibits
Exhibit No.
Description
2.1Purchase and Sale Agreement, dated as of November 6, 2019, by and between SIRVA Worldwide, Inc. and Realogy Holdings Corp.*
99.1Press Release, dated November 7, 2019
104Cover Page Interactive Data File (embedded within the Inline XBRL document).

* Schedules and exhibits have been omitted pursuant to Section 601(b)(2) of Regulation S-K. The Company agrees to furnish supplementally a copy of any omitted schedule or exhibit to the SEC upon request.



SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
REALOGY HOLDINGS CORP.
By:/s/ Charlotte C. Simonelli
Charlotte C. Simonelli, Executive Vice President, Chief Financial Officer and Treasurer
Date: November 7, 2019


Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
REALOGY GROUP LLC
By:/s/ Charlotte C. Simonelli
Charlotte C. Simonelli, Executive Vice President, Chief Financial Officer and Treasurer
Date: November 7, 2019





EXHIBIT INDEX
Exhibit No.
Description
2.1
99.1
104Cover Page Interactive Data File (embedded within the Inline XBRL document).

Document
Exhibit 2.1


PURCHASE AND SALE AGREEMENT

by and between

REALOGY HOLDINGS CORP.

and

SIRVA WORLDWIDE, INC.

Dated as of November 6, 2019










Table of Contents
Page
Article I
DEFINITIONS
Section 1.1Definitions1
Section 1.2Interpretation17
Article II
PURCHASE AND SALE
Section 2.1Purchase and Sale20
Section 2.2Restructuring20
Section 2.3Closing.21
Section 2.4Closing Deliveries22
Article III
PAYMENT OF THE PURCHASE PRICE
Section 3.1Purchase Price23
Section 3.2Estimated Closing Date Payment Statement24
Section 3.3Withholding24
Section 3.4Taking of Necessary Actions; Further Actions24
Section 3.5Post-Closing Adjustment25
Article IV
REPRESENTATIONS AND WARRANTIES REGARDING THE ACQUIRED COMPANIES
Section 4.1Corporate Organization27
Section 4.2Authority27
Section 4.3No Conflict28
Section 4.4Litigation; Orders28
Section 4.5Capitalization28
Section 4.6Financial Statements29
Section 4.7Absence of Certain Changes29
Section 4.8Undisclosed Liabilities30
Section 4.9Taxes30
Section 4.10Material Contracts32
Section 4.11Customers and Suppliers35
Section 4.12Intellectual Property35
Section 4.13Real Property37
Section 4.14Employees38



Section 4.15Labor Matters38
Section 4.16Employee Benefit Plans39
Section 4.17Compliance with Laws41
Section 4.18Environmental Matters42
Section 4.19Insurance43
Section 4.20Title to and Sufficiency of Acquired Company Assets43
Section 4.21Affiliate Transactions44
Section 4.22Disclaimer44
Article V
REPRESENTATIONS AND WARRANTIES OF SELLER
Section 5.1Corporate Organization45
Section 5.2Authority45
Section 5.3Consents and Approvals; No Conflict45
Section 5.4Litigation; Orders46
Section 5.5Ownership46
Section 5.6Brokers46
Article VI
REPRESENTATIONS AND WARRANTIES OF BUYER
Section 6.1Corporate Organization46
Section 6.2Authority47
Section 6.3Consents and Approvals; No Conflict47
Section 6.4Litigation; Orders47
Section 6.5Investment Purpose47
Section 6.6Financial Capacity48
Section 6.7Solvency50
Section 6.8Brokers50
Section 6.9No Reliance50
Article VII
COVENANTS
Section 7.1Conduct of the Business51
Section 7.2Public Announcements54
Section 7.3Financing55
Section 7.4Financing Cooperation57
Section 7.5Directors and Officers Liability62
Section 7.6Regulatory and Other Authorizations63
Section 7.7Shared Contracts; Required Third Party Consents65
Section 7.8Shared Property66
Section 7.9Wrong Pockets66
ii



Section 7.10Further Assurances68
Section 7.11Restrictive Covenants68
Section 7.12Securitization Matters70
Section 7.13Affiliate Arrangements71
Section 7.14Seller Guarantees72
Section 7.15R&W Insurance Policy73
Section 7.16Confidentiality73
Section 7.17Access to Properties, Books and Records74
Section 7.18Insurance76
Section 7.19Mutual Release77
Section 7.20Required Cash Distributions78
Section 7.21Credit Support Obligations and Company Indebtedness79
Section 7.22Use of Cartus and Realogy Names and Trademarks80
Section 7.23Intellectual Property Chain of Title80
Section 7.24Resignations80
Section 7.25Separation Planning and Collaboration81
Article VIII
EMPLOYEE MATTERS
Section 8.1Employment81
Article IX
TAX MATTERS
Section 9.1Section 338 Tax Matters87
Section 9.2Tax Returns; Allocation of Taxes89
Section 9.3Tax Sharing Agreements and Powers of Attorney91
Section 9.4Cooperation on Tax Matters91
Section 9.5Tax Indemnification91
Section 9.6Treatment of the Restructuring93
Section 9.7Survival93
Section 9.8Satisfaction of Claims93
Section 9.9Treatment of Payments93
Section 9.10Conflict94
Article X
CONDITIONS TO CLOSING
Section 10.1Conditions to Obligations of Each Party94
Section 10.2Conditions to the Obligations of Buyer94
Section 10.3Conditions to the Obligations of Seller95
iii



Article XI
TERMINATION
Section 11.1Termination95
Section 11.2Effect of Termination97
Section 11.3Termination Fees97
Article XII
REMEDIES
Section 12.1Survival98
Section 12.2Indemnification by Seller99
Section 12.3Indemnification by Buyer100
Section 12.4Direct Claims100
Section 12.5Third Party Claims101
Section 12.6Limitations103
Section 12.7Exclusive Remedy103
Article XIII
MISCELLANEOUS
Section 13.1Fees and Expenses104
Section 13.2Notices104
Section 13.3Severability105
Section 13.4Assignment; Binding Effect105
Section 13.5Headings105
Section 13.6Waiver and Amendment105
Section 13.7Third Party Beneficiaries106
Section 13.8Specific Performance and Other Equitable Relief106
Section 13.9Choice of Law107
Section 13.10Consent to Jurisdiction108
Section 13.11Waiver of Jury Trial109
Section 13.12Counterparts; Electronic Signatures109
Section 13.13Entire Agreement109
Section 13.14Conflicts and Privilege109
Section 13.15Liability of Financing Sources110
Section 13.16Non-Recourse110

iv



Schedules and Exhibits
Exhibit A  Form of Limited Guaranty
Exhibit B  Form of R&W Insurance Policy
Exhibit C  Form of Transition Services Agreement
Exhibit D  Form of Danbury Sublease Agreement
Exhibit E  Form of Irving Sublease Agreement
Exhibit F  Form of FIRPTA Certificate
Exhibit G  Form of Deferred Payment Amount Agreement
Exhibit H  Agreed Communication Plans

v



Index of Defined Terms
2019 Audited Financial StatementsSection 7.4(c)
2019 BonusSection 8.1(k)(i)
2019 BonusesSection 8.1(k)(i)
2020 Pro Rata BonusSection 8.1(k)(ii)
Accounting PrinciplesSection 1.1
Acquired CompaniesSection 1.1
ActionSection 1.1
Additional Purchase PriceSection 3.5(d)
AffiliateSection 1.1
Affiliated ContractsSection 4.21(a)
Affiliated GroupSection 1.1
Affinity ProgramSection 1.1
Agreed Communications PlansSection 1.1
AgreementPreamble
AllocationSection 9.1(b)
Alternative FinancingSection 7.3(c)
Anti-Bribery LawsSection 1.1
Antitrust LawsSection 1.1
Assigned ContractsSection 7.13(c)
Balance SheetSection 4.6
Balance Sheet DateSection 4.6
BusinessSection 1.1
Business DaySection 1.1
Business EmployeesSection 4.14
Business Equity InterestsSection 4.5(a)
Business PlanSection 1.1
BuyerPreamble
Buyer 401(k) PlanSection 8.1(i)
Buyer Assumed Employee LiabilitiesSection 8.1(d)
Buyer Benefit PlanSection 8.1(c)
Buyer Confidential InformationSection 7.16(b)
Buyer Fundamental RepresentationsSection 1.1
Buyer Indemnified PersonSection 9.5(a)
Buyer Indemnified PersonsSection 9.5(a)
Buyer Released MattersSection 7.19(b)
Buyer Released PartySection 7.19(b)
Buyer Releasing PartySection 7.19(b)
Buyer’s FSASection 8.1(j)
Buyer-Filed Tax ReturnSection 9.2(a)(ii)
Calculation TimeSection 1.1
CartusRecitals
Cartus MarksSection 7.22
vi



ClaimsSection 7.19(a)
ClosingSection 2.3(a)
Closing CashSection 3.5(a)
Closing DateSection 2.3(a)
Closing Date PaymentSection 3.1
Closing IndebtednessSection 3.5(a)
Closing Net Securitization Asset AmountSection 3.5(a)
Closing Net Working CapitalSection 3.5(a)
Closing Transaction ExpensesSection 3.5(a)
CodeSection 1.1
Confidential InformationSection 1.1
Confidentiality AgreementSection 1.1
ConsentsSection 1.1
Continuation PeriodSection 8.1(b)
Continuing EmployeeSection 1.1
ContractSection 1.1
Covered PersonsSection 7.5(a)
Credit Support DocumentsSection 4.21(d)
Credit Support ObligationsSection 4.21(d)
DamagesSection 1.1
Danbury Government GrantSection 1.1
Danbury Sublease AgreementSection 7.8
Data Security RequirementsSection 1.1
Debt Commitment LetterSection 6.6(a)
Debt FinancingSection 6.6(a)
Debt Financing CommitmentsSection 6.6(a)
Debt Financing SourcesSection 1.1
Deferred Payment AmountSection 1.1
Deferred Payment Amount AgreementSection 1.1
Designated PremisesSection 7.8
Direct ClaimSection 12.4(a)
Disclosing PartySection 7.16(d)
Dispute NoticeSection 3.5(b)
Employee Benefit PlanSection 1.1
EncumbranceSection 1.1
Environmental LawSection 1.1
Equity FinancingSection 6.6(a)
Equity Financing CommitmentsSection 6.6(a)
Equity Financing SourcesSection 6.6(a)
ERISASection 1.1
ERISA AffiliatesSection 1.1
Estimated CashSection 3.2
Estimated Closing Date PaymentSection 3.2
Estimated Closing StatementSection 3.2
Estimated IndebtednessSection 3.2
vii



Estimated Net Securitization Asset AmountSection 3.2
Estimated Net Working CapitalSection 3.2
Estimated Transaction ExpensesSection 3.2
Excluded AssetsSection 1.1
Export-Import LawsSection 1.1
Final Closing Date PaymentSection 3.5(c)
FinancingSection 6.6(a)
Financing CommitmentsSection 6.6(a)
FIRPTA CertificateSection 2.4(b)(iv)
Foreign CashSection 7.20
Foreign PlanSection 1.1
FraudSection 1.1
GAAPSection 1.1
Government ContractSection 1.1
Governmental EntitySection 1.1
Governmental OfficialSection 1.1
GuarantorsRecitals
Hazardous MaterialsSection 1.1
Held AssetSection 7.9(a)(i)
HSR ActSection 1.1
Inactive EmployeeSection 8.1(a)
IndebtednessSection 1.1
Indemnification ClaimSection 12.5(a)
Indemnified TaxesSection 1.1
IndemnitorSection 1.1
Initial Purchase PriceSection 1.1
Insurance PoliciesSection 4.19
Intellectual PropertySection 1.1
IRSSection 1.1
Irving Sublease AgreementSection 7.8
Knowledge of SellerSection 1.1
Labor AgreementSection 4.15(a)
LawSection 1.1
Leased Real PropertiesSection 4.13(b)
LiabilitySection 1.1
Limited GuarantyRecitals
Marketing PeriodSection 1.1
Material Adverse EffectSection 1.1
Material ContractSection 4.10(a)
Net Securitization Asset AmountSection 1.1
Net Working CapitalSection 1.1
Non-Assignable AssetSection 2.2(c)
Non-Recourse PersonSection 13.16
viii



Notice of ClaimSection 12.4(a)
Noticed Pre-Closing ClaimSection 7.18
OFACSection 1.1
OfferSection 8.1(b)
Offer EmployeesSection 8.1(a)
Omitted AssetSection 7.9(a)(ii)
OrderSection 1.1
Organizational DocumentsSection 1.1
Other Party’s MarksSection 7.22
Outside DateSection 11.1(a)
Overdraft FacilitySection 1.1
PartiesPreamble
PartyPreamble
Payoff LetterSection 7.21(a)
Per Diem TaxesSection 9.5(b)(i)
PermitsSection 4.17(b)
Permitted EncumbranceSection 1.1
PersonSection 1.1
Post-Closing Tax PeriodSection 1.1
PRCSection 1.1
Pre-Closing ClaimsSection 7.18
Pre-Closing PoliciesSection 7.18
Pre-Closing Tax PeriodSection 1.1
Preliminary Closing StatementSection 3.5(a)
Project CatchSection 1.2(s)
Proposed AllocationSection 9.1(b)
Public Notice 7Section 1.1
Purchase PriceSection 1.1
R&W Insurance PolicySection 1.1
R&W InsurerSection 1.1
Real Property LeasesSection 4.13(b)
Realogy MarksSection 7.22
Receiving PartySection 7.16(d)
Replacement ContractSection 7.7(a)
RepresentativesSection 1.1
Required AmountSection 6.6(c)
Required Financial InformationSection 7.4(c)
Required Third Party ConsentsSection 7.7(b)
Restricted ActivitiesSection 7.11(d)
Restricted PeriodSection 7.11(c)
RestructuringSection 2.2(a)
Retained BusinessSection 1.1
Retained LiabilitiesSection 1.1
ix



Retention Pool AmountSection 1.1
Sanctioned CountrySection 1.1
Sanctioned PersonSection 1.1
Sanctions LawsSection 1.1
SECSection 1.1
Section 338 FormsSection 9.1(a)
Section 338(h)(10) ElectionsSection 9.1(a)
Section 338(h)(10) EntitiesSection 9.1(a)
Securities ActSection 1.1
Securitization Commitment LetterSection 6.6(a)
SellerPreamble
Seller 401(k) PlanSection 8.1(i)
Seller Confidential InformationSection 7.16(c)
Seller Disclosure LetterSection 1.1
Seller Fundamental RepresentationsSection 1.1
Seller GuaranteesSection 1.1
Seller Indemnified PersonSection 7.14
Seller Indemnified PersonsSection 7.14
Seller PlanSection 1.1
Seller Released MattersSection 7.19(a)
Seller Released PartySection 7.19(a)
Seller Releasing PartySection 7.19(a)
Seller’s FSASection 8.1(j)
Settlement AccountantSection 3.5(c)
Shared Contract RightsSection 7.7(a)
Shared ContractsSection 7.7(a)
SharesRecitals
Shortfall AmountSection 3.5(e)
Shortfall TransferSection 7.20
SkaddenSection 13.14
SoftwareSection 1.1
Straddle PeriodSection 1.1
Sublease AgreementsSection 7.8
SubsidiarySection 1.1
SystemsSection 1.1
Target Net Securitization Asset AmountSection 1.1
Target Net Working CapitalSection 1.1
TaxSection 1.1
Tax Filing PartySection 9.1(d)
Tax PeriodSection 1.1
Tax ProceedingSection 1.1
Tax ReturnSection 1.1
Taxing AuthoritySection 1.1
x



Terminating AgreementsSection 7.13(a)
Termination FeeSection 11.3(a)
Third PartySection 1.1
Third Party ClaimSection 12.5(a)
Trade Control LawsSection 4.17(c)
TransactionSection 1.1
Transaction DocumentsSection 1.1
Transaction ExpensesSection 1.1
Transfer TaxesSection 9.2(c)
Transition Services AgreementSection 1.1
Treasury RegulationsSection 1.1
U.K. DocumentsSection 1.1
U.S.Section 1.1
Unaudited Financial StatementsSection 4.6
WARN ActSection 1.1
Willful BreachSection 1.1

xi



PURCHASE AND SALE AGREEMENT
This PURCHASE AND SALE AGREEMENT, dated as of November 6, 2019 (this “Agreement”), is made and entered into by and between SIRVA Worldwide, Inc., a Delaware corporation (“Buyer”), and Realogy Holdings Corp., a Delaware corporation (“Seller” and, together with Buyer, collectively, the “Parties” and each individually, a “Party”).
RECITALS
WHEREAS, Seller is engaged in the Business (as hereinafter defined) through Cartus Corporation, a Delaware corporation (“Cartus”), and its Subsidiaries (as hereinafter defined);
WHEREAS, Seller desires to sell or cause to be sold to Buyer, and Buyer wishes to purchase from Seller, all of the issued and outstanding common shares, par value $0.01 per share, of Cartus (the “Shares”), after giving effect to the Restructuring (as hereinafter defined), in each case, on the terms and subject to the conditions set forth in this Agreement; and
WHEREAS, concurrently with the execution and delivery of this Agreement, and as a condition to the willingness of Seller to enter into this Agreement, (i) Madison Dearborn Capital Partners VII-A, L.P., Madison Dearborn Capital Partners VII-C, L.P. and Madison Dearborn Capital Partners VII Executive-A, L.P., each a Delaware limited partnership (collectively, the “Guarantors”), are entering into a backstop limited guaranty in favor of Seller, pursuant to which the Guarantors are guaranteeing their respective pro rata share of Buyer’s obligations under this Agreement to pay the Termination Fee in the event of default of such obligation by Buyer, substantially in the form attached hereto as Exhibit A (the “Limited Guaranty”); and (ii) Buyer has delivered copies of the Financing Commitments (as hereinafter defined) to Seller.
NOW, THEREFORE, in consideration of the premises, and the covenants, promises, representations and warranties set forth herein, and for other good and valuable consideration (the receipt and sufficiency of which are hereby acknowledged by the Parties), intending to be legally bound hereby, the Parties agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1 Definitions. For purposes of this Agreement, the following terms, when used in this Agreement, shall have the meanings assigned to them in this Section 1.1.
Accounting Principles” means GAAP applied consistently with the accounting principles, methods, policies, practices, procedures, classification and estimation methodologies that were used in preparing the Unaudited Financial Statements.
Acquired Companies” means each of the entities set forth on Section 4.5(a) of the Seller Disclosure Letter under the heading “Acquired Company.”



Action” means any action, audit, claim, litigation, complaint, investigation, audit, petition, suit, arbitration or other similar proceeding, whether civil, criminal, administrative, regulatory or otherwise, at law or in equity by or before any Governmental Entity.
Affiliate” of any Person means any Person that, directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, such first Person. A Person shall be deemed to control another Person if such first Person possesses, directly or indirectly, the power to direct, or cause the direction of, the management and policies of such other Person, whether through the ownership of voting securities, by Contract or otherwise. The Acquired Companies shall (i) be considered Affiliates of Seller until (but not after) the Closing and (ii) be considered Affiliates of Buyer after (but not at or prior to) the Closing.
Affiliated Group” means an affiliated group as defined in Section 1504 of the Code (or any analogous combined, consolidated, unitary or similar group under state, local or non-U.S. Law).
Affinity Program” means the business, as operated by Seller and its Subsidiaries as operated immediately prior to the Restructuring (including the Acquired Companies immediately prior to the Restructuring), of offering cash back or other financial benefits to individuals with respect to such individual’s purchasing or selling a home in the United States.
Agreed Communications Plans” means the communications plans attached hereto as Exhibit H.
Anti-Bribery Laws” means any U.S. and non-U.S. Laws with respect to the prevention of bribery or corruption (whether governmental or commercial), which apply to the Business, including Laws that prohibit the corrupt payment, offer, promise or authorization of the payment or transfer of anything of value, directly or indirectly, to any Governmental Official, commercial entity, or any other Person to obtain an improper business advantage, including the U.S. Foreign Corrupt Practices Act of 1977, as amended, and the U.K. Bribery Act of 2010, and all other applicable national or international Laws enacted to implement the OECD Convention on Combatting Bribery of Foreign Officials in International Business Transactions.
Antitrust Laws” means any applicable international, multinational, national, provincial, federal, state or local Law designed or intended to prohibit, restrict or regulate actions having the purpose or effect of monopolizing or restraining trade or lessening competition in any other country or jurisdiction, including the HSR Act, the Sherman Act, the Clayton Act, and the Federal Trade Commission Act, in each case, as amended, and other similar competition Laws of any jurisdiction.
Business” means the employee relocation services business, global talent mobility business, assignment management business, benefit coordination business, supplier management business and move management business (including for the United States Department of Defense) and other business incident to the employee relocation service business of, and other business of, or conducted through, the Acquired Companies as of or prior to the Closing Date, in each case as operated by Cartus and its subsidiaries immediately prior to the Closing and for the
2



past twelve (12) months; provided, however, that the Business does not include Seller’s Affinity Programs, broker-to-broker referral business and broker network management business. For purposes of the foregoing, “move management” means coordination of aspects of a relocating employee’s transportation of household goods to coordinate the preparation, transportation, and storage of household goods effects, including counseling on all aspects of the move process; household goods brokerage, freight forwarding; communication with the shipper; obtaining estimates and quotes; coordination of the referral of individual to a carrier; conveyance of authorizations and information to the carrier; coordinating automobile transportation, third party services related to the foregoing, loss coverage of the household goods shipments; supplier management related to household goods shipments; quality control related to household goods shipments; invoice review related to household goods shipments; and, assisting in dispute and claim resolution related to household goods shipments and, in the case of employer sponsored moves, move management also includes policy review and revision, benefits counseling, account management, pricing, audits, and exception management, in each case related to household goods shipments.
Business Day” means any day other than a Saturday, a Sunday or other day on which commercial banks in New York, New York are authorized or required by Law to close.
Business Plan” means each Employee Benefit Plan that is sponsored by an Acquired Company for the benefit of any Business Employee or any other service provider to the Business, or any of their beneficiaries and dependents.
Buyer Fundamental Representations” means the representations and warranties set forth in Section 6.1 (Corporate Organization), Section 6.2 (Authority) and Section 6.8 (Brokers).
Calculation Time” means 11:59 p.m. (Eastern Time) on the day that is immediately prior to the Closing Date.
Cash” means, as of the date and time of determination, the cash and cash equivalents of the Acquired Companies, including (without duplication) marketable securities, security deposits, short-term investments, all cash and cash equivalents held in bank and other depositary accounts and safe deposit boxes, demand accounts, certificates of deposit, time deposits and securities and brokerage accounts of the Acquired Companies, in each case calculated in accordance with the Accounting Principles; provided that Cash shall (i) be calculated net of uncleared checks and drafts issued by any of the Acquired Companies to the extent that the payables of the Acquired Companies with respect thereto have been reduced, (ii) include uncleared checks and drafts received or deposited for the account of any of the Acquired Companies that are not yet credited to the account of the Acquired Companies (but only to the extent the same are not included in the calculation of Net Working Capital), (iii) exclude (without duplication) security deposits (including real estate lease deposits) and amounts held in escrow on behalf of customers of the Acquired Companies, and (iv) exclude any cash and cash equivalents held in or in respect of securitization facilities of the Business. For purposes of calculating “Closing Cash” for purposes of the definition of Purchase Price and Final Closing Date Payment and calculating “Estimated Cash” for purposes of the definition of Estimated Closing Date Payment and Closing Date Payment, in each case prior to giving effect to the proviso to the immediately foregoing (x) Cash of the Acquired Companies organized under the laws of any jurisdiction outside the U.S. or a Subsidiary of an Acquired Company organized
3



under the laws of any jurisdiction outside the U.S.  shall be $8,000,000 in the aggregate and (y) Cash of the Acquired Companies organized under the laws of the United States (other than such an Acquired Company that is a Subsidiary of an Acquired Company organized outside the U.S.) shall be $0.
Code” means the U.S. Internal Revenue Code of 1986, as amended.
Confidential Information” means Buyer Confidential Information or Seller Confidential Information, as the case may be.
Confidentiality Agreement” means (i) the Confidentiality Agreement, dated September 15, 2019, between Seller and SIRVA, Inc., a Delaware corporation and (ii) the Clean Room Agreement, dated September 15, 2019, between Seller and SIRVA, Inc., a Delaware corporation.
Consents” means, without duplication, consents, approvals, exemptions, waivers, authorizations, applications, permits, clearances, compliances, orders, licenses, notices, designations, declarations, registrations and notifications of or with, or the expiration of any applicable waiting period imposed by, any Person, whether or not a Governmental Entity.
Continuing Employee” means each Business Employee (i) whose employment transfers to Buyer or its Affiliates by operation of law in connection with the Closing or (ii) who is an Offer Employee or an Inactive Employee and has accepted an offer of employment from and actually commences employment with Buyer or its Affiliates effective as of the Closing Date.
Contract” means any written or oral contract, agreement, commitment, franchise, indenture, lease or license or other legally binding obligation or arrangement.
Damages” means damages (of any kind or nature), losses, liabilities, penalties, fines, Taxes, claims, payments, interest, costs and expenses (including reasonable fees and expenses of attorneys, accountants and other professional advisors and all amounts incurred or paid in investigation, defense and/or settlement of any of the foregoing).
Danbury Government Grant” means the Promissory Note, dated as of June 30, 2014, by Cartus in favor of the State of Connecticut in the principal amount of $6,500,000 and the Assistance Agreement referenced therein.
Data Security Requirements” means (i) all applicable Laws, (ii) applicable provisions of Contracts to which any of the Acquired Companies is bound and industry standards to which any of the Acquired Companies is bound (including the Payment Card Industry Data Security Standard, if applicable), and (iii) each of the Acquired Companies’ own internal and external facing privacy policies; in each case of the foregoing clauses (i) through (iii), to the extent relating to (A) the collection, use, processing, storage, transfer, or disposal of personally identifiable information or other protected or sensitive personal data, (B) data privacy, data protection, information security, anti-spam, or unsolicited telephone calls or text messages, or (C) data breach notification.
4



Debt Financing Sources” means the financial institutions that have committed to provide or arrange or otherwise entered into agreements to provide or arrange the Debt Financing or other debt financings in connection with the Transaction, including the parties to the Debt Financing Commitments and any joinder agreements, credit agreements and the other definitive documents relating thereto, together with their respective Affiliates and their respective Affiliates’ former, current and future officers, directors, employees, agents and representatives and their respective successor and assigns.
Deferred Payment Amount” means $25,000,000.
Deferred Payment Amount Agreement” means the agreement substantially in the form of Exhibit G hereto.
Employee Benefit Plan” means each (i) “employee benefit plan” (within the meaning of Section 3(3) of ERISA, whether or not subject to ERISA), and each (ii) pension, separation, post-retirement or post-employment welfare, life, employment, severance, welfare, disability, deferred compensation, stock purchase, stock option, equity or equity-based, change-in-control, retention, fringe benefit, bonus, and incentive plan, program, policy arrangement or Contract.
Encumbrance” means any lien, encumbrance, security interest, pledge, mortgage, deed of trust, hypothecation, conditional sale, charge or similar restriction of any kind.
Environmental Law” means any Law or Order relating to pollution or the protection of the environment (including ambient air, surface water, ground water, land surface, subsurface strata, vapor or natural resources), or to human health or safety (to the extent relating to toxic, hazardous, dangerous or deleterious materials, substances or wastes), including any Law or Order relating to (i) emissions, discharges, releases or threatened releases of, or exposure to, Hazardous Materials, (ii) the manufacture, processing, distribution, use, treatment, generation, storage, containment (whether above ground or underground), disposal, transport or handling of Hazardous Materials or (iii) recordkeeping, notification, disclosure or any reporting requirements regarding or relating to Hazardous Materials.
ERISA” means the Employee Retirement Income Security Act of 1974, as amended.
ERISA Affiliates” means any Person that is or was at a relevant time considered a single employer with Seller or any of its Affiliates under Section 4001(b)(1) of ERISA or Section 414(b), (c), (m) or (o) of the Code.
Excluded Assets” means the assets, properties and rights of Seller and Subsidiaries, as of immediately prior to the Restructuring, set forth in Section 1.1(a) of the Seller Disclosure Letter.
Export-Import Laws” means all U.S. and non-U.S. Laws relating to export, re-export, transfer and import controls, including the Export Administration Regulations administered by the U.S. Department of Commerce, the International Traffic in Arms Regulations administered by the U.S. Department of State, customs and import Laws administered by U.S. Customs and Border Protection, the anti-boycott regulations administered by the U.S. Department of Commerce and the U.S. Department of the Treasury, and the EU Dual-Use Regulation.
5



Foreign Plan” means each Seller Plan that covers any Business Employee primarily based outside of the U.S. and that is subject to any Law other than U.S., federal, state or local Law (other than any plan or program that is maintained by a Governmental Entity to which Seller or any of its Affiliates contributes pursuant to applicable Law).
Fraud” means a false misrepresentation (including intentional omission) of material fact made by a Party with respect to its representations and warranties in this Agreement, with intent to deceive the other Party or to induce such Party to enter into this Agreement (i) with knowledge and belief that such representation or warranty is false or indifference to the truth of such representation or warranty, and (ii) causing such Party to suffer damage by reason of such reliance. It is understood and agreed by the Parties that Buyer is justifiably relying on the representations and warranties of Seller to execute and deliver this Agreement and to consummate the Transactions.
GAAP” means generally accepted accounting principles in the U.S.
Government Contract” means any Contract with or funded by or for the benefit of a Governmental Entity for the provision of goods, services, data or software by any Acquired Company (or with another Person and pursuant to which an Acquired Company is a subcontractor at any tier in connection with, or otherwise providing goods, services, data or software in support of, a Contract or grant between another Person and a Governmental Entity), including any prime contract, subcontract, letter contract, purchase order, task order, delivery order, teaming agreement or letter of intent.
Governmental Entity” means (i) any federal, international, multinational, national, provincial, state, local, municipal or foreign government, regulatory, self-regulatory, legislative or administrative body, or any agency, bureau, board, commission, court, department, central bank, governor-in-counsel, cabinet, judicial authority, tribunal, instrumentality or any other public authority thereof; (ii) any subdivision, agency or authority of any of the above; (iii) any stock exchange; or (iv) any quasi-government, political subdivision thereof or private bod exercising any administrative, regulatory, expropriation or tax authority under or for the account of any of the above; or (iii) any arbitrator (public or private).
Governmental Official” means any officer or employee of a Governmental Entity or any department, agency or instrumentality thereof, any state-owned entities, or of a public organization or any individual acting in an official capacity for or on behalf of any such government, department, agency, political party or instrumentality or on behalf of any such public organization.
Hazardous Materials” means any material, substance, contaminant, chemical or waste that is identified, regulated, or defined as hazardous, acutely hazardous, toxic, a pollutant, a contaminant or words of similar meaning or import, or for which Liability or standards of conduct can be imposed, under Environmental Laws, including petroleum or crude oil, radioactive materials or wastes, asbestos and polychlorinated biphenyls. Notwithstanding the foregoing, typical office and janitorial products containing de minimis amounts of hazardous or toxic substances as are commonly found in such products and used as intended shall not be considered Hazardous Materials for the purpose of this Agreement.
6



HSR Act” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended.
Indebtedness” means, with respect to each Acquired Company, as of the date and time of determination, without duplication, (i) the unpaid principal amount of all indebtedness for borrowed money of such Acquired Company (which, for this purpose, shall be deemed to include all Liabilities in respect of the Danbury Government Grant); (ii) any indebtedness of such Acquired Company evidenced by any note, bond, debenture or other similar debt security (excluding performance bonds or similar credit support instruments between the Acquired Companies); (iii) all obligations of such Acquired Company for the deferred purchase price of property to the extent the same would be classified as indebtedness on a balance sheet in accordance with the Accounting Principles; (iv) the amount of the liability of such Acquired Company in respect of a finance lease that would at such time be required to be capitalized and reflected as a liability on a balance sheet (excluding the footnotes thereto) in accordance with GAAP or has been capitalized by such Acquired Company in accordance with the Accounting Principles; (v) all obligations of such Acquired Company under any interest rate or currency derivatives or hedging transactions including any premiums, penalties, termination fees, expenses or breakage costs due upon prepayment of, any interest rate and foreign exchange hedging arrangements upon termination, novation or any assignment and assumption of such arrangements at Closing (it being agreed and understood by the Parties that any amounts paid to such Acquired Company upon the termination, novation, or any assignment and assumption of any of the foregoing shall be a reduction of the Indebtedness); (vi) all obligations of such Acquired Company for reimbursement of any obligor under any letters of credit, banker’s acceptances or similar arrangements (but, in each case, only to the extent drawn or the criteria for drawing have been triggered), including all Liabilities related to the Overdraft Facility; (vii) any rent or other liability of such Acquired Company with respect to any leased facility or portion thereof listed on Section 1.1(b) to the Seller Disclosure Letter; (viii) unpaid severance and notice pay payable by an Acquired Company to an employee or other natural service provider of such Acquired Company (A) whose employment or service relationship terminates or (B) who has given or been given notice of termination prior to the Closing Date (other than severance and notice pay payable to a Business Employee whose employment is terminated after the date hereof at the written direction of Buyer) and outstanding unfunded deferred compensation Liabilities payable by an Acquired Company to an employee or other natural service provider (plus, in each case, the employer portion of the employment Taxes with respect thereto); (ix) all Liabilities secured by an Encumbrance on property owned or being purchased by such Acquired Company (but excluding Encumbrances to be released and terminated at Closing without payment of any amount by Buyer or any of its post-Closing Affiliates, other than to the extent included as a reduction to Initial Purchase Price for purposes of calculating the Estimated Closing Date Payment, Final Closing Date Payment and Purchase Price), whether or not such Liabilities shall have been assumed by such Acquired Company or is limited in recourse; (x) any indebtedness of the nature described in the foregoing clauses (i) through (ix) of another Person (other than an Acquired Company) that is guaranteed by such Acquired Company; (xi) all obligations for unpaid income Taxes for Pre-Closing Periods, which shall not be an amount less than zero, and shall not include any reductions with respect to Tax refunds or credits but shall take into account Tax overpayments to the extent such overpayments actually reduce such Taxes under applicable Law; (xii) the aggregate amount of all unpaid 2019 Bonuses and the 2020 Pro-Rata Bonuses (if any) and any employer side Taxes with respect thereto; (xiii) stale checks as
7



determined in accordance with the Accounting Principles; and (xiv) accrued and unpaid interest, fees and other expenses, including prepayment penalties, premiums, make whole payments and breakage fees, due and payable with respect to any indebtedness described in the foregoing clauses (i) through (xiv). Notwithstanding the foregoing, “Indebtedness” shall not include (i) unsecured trade payables or accounts payable incurred in the ordinary course of business; (ii) any indebtedness, liabilities or obligations of any Acquired Company to the extent payable or owed to any other Acquired Company; (iii) any indebtedness, liabilities or obligations incurred by or on behalf of Buyer or any of its Affiliates (including, immediately after the Closing, to the extent incurred by any of the Acquired Companies on behalf of or at the direction of Buyer); (iv) any deferred revenue; (v) except to the extent provided in clause (viii) or (xii) of the foregoing sentence, indebtedness, liabilities or obligations of any Acquired Company under any Seller Plan that is not a Business Plan; (vi) any indebtedness, liabilities or obligations incurred pursuant to the Apple Ridge Funding LLC securitization program or the U.K. Documents, as applicable; and (vii) except to the extent included in clauses (i) to (xv) of the foregoing sentence, Retained Liabilities and other liabilities and obligations that Seller has agreed to retain or indemnify Buyer against under the Transaction Documents. For purposes of calculating Indebtedness at the Calculation Time, liabilities included in the first sentence of this definition (but excluding liabilities in the second sentence of this definition) that are triggered or become payable in whole or part solely as a result of consummation of the Closing shall be included.
Indemnified Taxes” means, without duplication, (i) all Taxes imposed on Seller, (ii) all Taxes imposed on any of the Acquired Companies for or attributable to any Pre-Closing Tax Period, including all Taxes attributable to making the Section 338(h)(10) Election (and including any such Taxes imposed on Buyer or any of its Affiliates), (iii) all Taxes of any Affiliated Group of which any of the Acquired Companies (or any predecessor thereto) is or was a member on or before the Closing Date, including pursuant to Treasury Regulations Section 1.1502-6 or any analogous or similar state, local, or non-U.S. Law, (iv) any and all Taxes imposed upon the Acquired Companies as a transferee or successor, by contract, or otherwise, which Taxes relate to an event or transaction occurring on or before the Closing Date, (v) all Taxes assessed by the relevant Taxing Authority under Public Notice 7 or any other indirect capital gains Taxes as a result of the transactions contemplated by this Agreement that are imposed on the Acquired Companies (or for which Buyer or any of its Affiliates are liable), (vi) any Taxes to the extent resulting from or attributable to any breach or violation (or failure to fully perform) by Seller or its Affiliates (excluding the Acquired Companies after the Closing) of a covenant, agreement, undertaking or obligation in Article IX, (vii) all Taxes attributable to any breach of or inaccuracy in any representation or warranty made in Section 4.9 for or attributable to any Pre-Closing Tax Period (or any Tax Period with respect to a breach of or inaccuracy in the representations and warranties made in Section 4.9(h), (i), and (j)), and (viii) without duplication of amounts borne by Seller pursuant to Section 2.2, all Taxes imposed upon the Acquired Companies (or Buyer and any of its Affiliates) as a result of or attributable to the Restructuring or the Shortfall Transfer.
Indemnitor” means the Party from whom indemnification is sought in accordance with Section 12.4 or Section 12.5, as applicable.
Initial Purchase Price” means $400,000,000.
8



Intellectual Property” means all intellectual property rights, including all U.S. and foreign (i) patents, patent applications, invention disclosures, and all related continuations, continuations-in-part, divisionals, reissues, re-examinations, and extensions thereof, (ii) trademarks, service marks, logos, slogans, social media accounts (including handles and content therein), domain names, and trade dress, together with the goodwill symbolized by any of the foregoing, (iii) registered and unregistered copyrights, copyrightable subject matter and works of authorship, (iv) rights in Software, data, and databases, (v) trade secrets and all other proprietary or confidential information including processes, formulas, ideas, and know-how, and (vi) all applications and registrations for the foregoing.
IRS” means the Internal Revenue Service.
Knowledge of Seller” means the actual knowledge (and not imputed or constructive knowledge) of any person listed in Section 1.1(c) of the Seller Disclosure Letter.
Law” means any law, common law, statute, code, rule, regulation, Order, treaty or other order or pronouncement of any Governmental Entity having the effect of law.
Liability” means all obligations and other liabilities, whether absolute, accrued, matured or inchoate, contingent (or based upon any contingency), known or unknown, determined or determinable, primary or secondary, asserted or unasserted, direct or indirect, liquidated or unliquidated, incurred, fixed or otherwise (and whether or not required to be accrued on a balance sheet under GAAP), or whether due or to become due, including any fines, penalties, losses, costs, interest, charges, expenses, damages, assessments, deficiencies, judgments, awards or settlements and regardless of when asserted or by whom.
Marketing Period” means the first period of eighteen (18) consecutive Business Days after the date of this Agreement commencing (x) on the date that (a) Buyer has been provided the Required Financial Information and (b) all of the conditions set forth in Section 10.1(a)(i) have been and continue to be satisfied and (y) throughout which all other conditions in Section 10.1 and Section 10.2 (other than the completion of the Restructuring) have been and continue to be satisfied or (to the extent permitted by applicable Law) waived (other than those conditions that by their terms or nature are to be satisfied at the Closing, but subject to such conditions being capable of being satisfied at the Closing or other time of measurement); provided that (i) unless otherwise determined by Buyer and provided in written notice to Seller, the Marketing Period shall not commence prior to January 6, 2020; (ii) if the Marketing Period shall not have ended on or prior to August 21, 2020, then the Marketing Period shall not commence prior to September 8, 2020, (iii) if all or any portion of the Debt Financing is taking the form of secured notes, the Marketing Period shall end only after the completion of all marketing periods required by the Debt Commitment Letter in connection with the marketing of such notes; (iv) the Marketing Period shall end on any earlier date on which the Debt Financing is consummated and Buyer shall have obtained all of the proceeds contemplated thereby; and (v) the Marketing Period shall be deemed not to have commenced if, prior to the completion of such eighteen (18) consecutive Business Day period, (A) the applicable auditor shall have withdrawn its audit opinion with respect to any year end audited financial statements constituting Required Financial Information, in which case the Marketing Period shall not commence unless and until a new unqualified audit opinion is issued with respect to such financial statements for the applicable periods by such
9



auditor or another independent public accounting firm of recognized national standing, (B) Seller or any of its Subsidiaries shall have announced, or the board of directors of Seller or any of its Subsidiaries shall have determined, that a restatement of any financial information constituting Required Financial Information is required, in which case the Marketing Period shall be deemed not to commence unless and until such restatement has been completed and the Required Financial Information has been amended to reflect such restatement, (C) if all or any portion of the Debt Financing is taking the form of secured notes as provided in the Debt Commitment Letter, the financial statements included in the Required Financial Information that is available to Buyer on the first day of any such eighteen (18) consecutive Business Day period would be required to be updated under Rule 3-12 of Regulation S-X in order to be sufficiently current on any day during such eighteen (18) consecutive Business Day period to permit a registration statement on Form S-1 using such financial statements to be declared effective by the SEC on the last day of such eighteen (18) consecutive Business Day period, in which case the Marketing Period shall not be deemed to commence until the receipt by Buyer of updated Required Financial Information that would be required under Rule 3-12 of Regulation S-X to permit a registration statement on Form S-1 using such financial statements to be declared effective by the SEC on the last day of such new eighteen (18) consecutive Business Day period, (D) if all or any portion of the Debt Financing is taking the form of secured notes as provided in the Debt Commitment Letter, the Required Financial Information contains any untrue statement of a material fact or omits to state any material fact necessary in order to make the statement contained in the Required Financial Information, in the context in which it was made, not misleading, in which case the Marketing Period shall not be deemed to commence unless and until such Required Financial Information has been updated so that there is no longer any such untrue statement or omission or (E) if all or any portion of the Debt Financing is taking the form of secured notes as provided in the Debt Commitment Letter, the financial statements included in the Required Financial Information that are available to Buyer on the first day of any such eighteen (18) consecutive Business Day period would be insufficient on any day during such eighteen (18) consecutive Business Day period to permit the Acquired Companies’ independent public accountants to issue a customary “comfort” letter to the Debt Financing Sources, including as to negative assurances and change period, on the last day of such eighteen (18) consecutive Business Day period, in which case the Marketing Period shall not be deemed to commence until the receipt by Buyer of updated Required Financial Information that would be sufficient to permit the Acquired Companies’ independent public accountants to issue a customary “comfort” letter to the Debt Financing Sources, including as to negative assurances and change period, on the last day of such new eighteen (18) consecutive Business Day period. If at any time Seller shall reasonably believe that it has provided the Required Financial Information, Seller may deliver to Buyer a written notice to that effect (stating when it believes it completed such delivery), in which case the requirement to deliver the Required Financial Information will be deemed to have been satisfied on the fourth (4th) Business Day following the date such notice is received, unless Buyer in good faith reasonably believes Seller has not completed the delivery of the Required Financial Information and, within three (3) Business Days after the receipt of such notice from Seller, delivers a written notice to Seller to that effect (stating with reasonable specificity which portion(s) of the Required Financial Information Seller has not delivered or are otherwise unsuitable).
Material Adverse Effect” means (a) any change, event, occurrence, circumstance or effect that, individually or in the aggregate with all other changes, events, occurrences,
10



circumstances or effects, has, or would reasonably be expected to have, a material adverse effect on the results of operations or financial condition of the Business, or (b) any change, event, occurrence, circumstance or effect that would or would reasonably be expected to prevent or materially impair or materially delay the ability of Seller to consummate the Transaction; provided that Material Adverse Effect shall not include, solely in the case of clause (a), any change, event, occurrence, circumstance or effect to the extent resulting from, relating to or arising out of (i) general economic, legal, tax, political or regulatory conditions that, in each case, generally affect any of the geographic regions or industries in which such Person or any of its Affiliates, as applicable, conducts its business; (ii) any change in the financial, banking, credit, currency or capital markets in general (whether in the U.S. or any other country or in any international market), including changes in interest rates, commodity prices or raw material prices; (iii) conditions generally affecting any industry in which the Acquired Companies operate; (iv) acts of God, natural disasters, national or international political or social conditions, including the engagement in hostilities by any country in which an Acquired Company is located or operates, whether commenced before or after the date of this Agreement, and whether or not pursuant to the declaration of a national emergency or war (including any escalation or worsening of war), or the occurrence of any military or terrorist attack; (v) any action taken by Buyer or any of its Affiliates in violation of this Agreement; (vi) other than with respect to representations and warranties set forth in Section 4.3 and Section 5.3(b), the negotiation, announcement, pendency, execution, delivery or performance of this Agreement or the consummation of the Transaction, the disclosure of the fact that Buyer is the prospective acquirer of the Business; or any communication by Buyer or any of its Affiliates regarding plans or intentions of Buyer with respect to the Acquired Companies or the Business (including the impact of any of the foregoing on relationships with customers, suppliers, employees or regulators, and any suit, action or proceeding arising therefrom or in connection therewith); (vii) any changes or proposed changes in GAAP (or other applicable accounting regulations) or any change (or proposed change) in applicable Laws or the interpretation thereof; (viii) compliance with the terms of, or the taking of any action required or expressly contemplated by, this Agreement or any of the other Transaction Documents or any action taken, or failure to take action, to which Buyer has given its prior written consent; (ix) any failure by Seller or its Affiliates (including the Acquired Companies) to meet internal or other earnings estimates or financial projections (but the underlying causes thereof are not excluded); or (x) changes in credit ratings or the stock price or trading volume of Seller; provided, however, that the exclusions in clauses (i)-(iv) and (vii) shall not apply to the extent the Business is disproportionately adversely affected by any change, event, occurrence, circumstance or effect in such clauses relative to other similarly situated participants in industries in which the Business operates.
Net Securitization Asset Amount” has the meaning set forth on Section 1.1(d) of the Seller Disclosure Letter.
Net Working Capital” has the meaning set forth on Section 1.1(e) of the Seller Disclosure Letter.
OFAC” means Office of Foreign Assets Control of the U.S. Department of the Treasury.
11



Order” means any decree, order, judgment, injunction, temporary restraining order, determination, award or other order in any Action by or with any Governmental Entity.
Organizational Documents” means, with respect to any Person, such Person’s certificate or articles of incorporation and by-laws, limited partnership agreement, partnership agreement, limited liability company agreement, operating agreement or trust agreement, or such other organizational documents of such Person, including those that are required to be registered or kept in the jurisdiction of incorporation, organization or formation of such Person and which establish the legal personality of such Person.
Overdraft Facility” means the revolving loan facility pursuant to the letter agreement, dated as of August 22, 2019, by and between Lloyds Bank plc and Cartus Limited, as amended.
Permitted Encumbrance” means any (i) mechanics’, materialmens’ or similar Encumbrances with respect to amounts not yet due and payable or the validity of which is being contested in good faith by appropriate procedures and for which adequate reserves with respect thereto are maintained on the books of the applicable Acquired Company in accordance with GAAP; (ii) Encumbrances for Taxes not yet due and payable or the validity of which is being contested in good faith by appropriate procedures and for which adequate reserves with respect thereto are maintained on the books of the applicable Acquired Company in accordance with the Accounting Principles; (iii) Encumbrances securing rental payments under capital lease arrangements; (iv) Encumbrances encumbering any of the Leased Real Property that do not materially interfere with the use or occupancy of the Leased Real Property by the Acquired Companies or the operation of the Business as currently conducted thereon; (v) pledges or deposits to secure obligations under workers’ compensation Laws or similar legislation or to secure public or statutory obligations; (vi) customary contractual provisions providing for retention of title to goods until payment is made; (vii) licenses of Intellectual Property in the ordinary course of business; (viii) Encumbrances set forth on Section 1.1(f) of the Seller Disclosure Letter; (ix) statutory or contractual Encumbrances in favor of lessors arising in connection with any Leased Real Property; and (x) such other encumbrances or imperfections in or failures of title which would be disclosed by a title search or an inspection of the Leased Real Property, including, easements, rights-of-way, covenants, encroachments and servitudes and other similar rights and obligations and zoning or other similar restrictions, in each case, that are not violated by the current use of such Leased Real Property and would not materially impair the operation of the Business.
Person” means an individual or an association, a corporation, a partnership, a limited liability company, a trust, or any other entity or organization, including a Governmental Entity.
Post-Closing Tax Period” means any taxable period (or portion thereof in the case of a Straddle Period) beginning after the Closing Date.
PRC” means the People’s Republic of China (and any political subdivision thereof) and for the purpose of this Agreement only shall exclude Hong Kong, Macau Special Administrative Region and Taiwan (and in each case any political subdivision thereof).
12



Pre-Closing Tax Period” means any taxable period (or portion thereof in the case of a Straddle Period) ending on or prior to the Closing Date.
Public Notice 7” means the Notice Regarding Certain Corporate Income Tax Matters on Indirect Transfer of Properties by Non-Tax Resident Enterprises (Public Notice 2015 No.7) issued by the State Administration of Taxation of the People’s Republic of China (国家税务总局关于非居民企业间接转让财产企业所得税若干问题的公告), effective as of February 3, 2015, (including subsequent amending provisions, as well as any interpretations or procedural rules related thereto).
Purchase Price” means the amount equal to (i) the Initial Purchase Price; (ii) (a) plus the amount, if any, by which the Closing Net Working Capital exceeds the Target Net Working Capital, or (b) minus the amount, if any, by which Target Net Working Capital exceeds the Closing Net Working Capital; plus (iii) the Closing Cash; minus (iv) the Closing Indebtedness; minus (v) the Closing Transaction Expenses, (vi) (a) plus the amount, if any, by which the Closing Net Securitization Asset Amount exceeds the Target Net Securitization Asset Amount, or (b) minus the amount, if any, by which Target Net Securitization Asset Amount exceeds the Closing Net Securitization Asset Amount, in each case as finally determined pursuant to Section 3.5.
R&W Insurance Policy” means a buyer-side representation and warranty insurance policy issued in the name of Buyer in connection with the Transaction, substantially in the form attached hereto as Exhibit B.
R&W Insurer” means Euclid Transactional, LLC.
Representatives” means, as to any Person, such Person’s Affiliates and its and their respective directors, officers, managers, employees, auditors and other agents, representatives and advisors.
Retained Business” means any business of Seller or any of its Subsidiaries other than the Business.
Retained Liabilities” means those liabilities that are set forth in Section 12.2(a)(iii) of the Seller Disclosure Letter.
Retention Pool Amount” means the amount set forth in Section 1.1(g) of the Seller Disclosure Letter.
Sanctioned Country” means, at any time, a country or territory which is itself the subject or target of any country-wide or territory-wide Sanctions Laws (at the time of this Agreement, the Crimea region of Ukraine, Cuba, Iran, North Korea and Syria).
Sanctioned Person” means any Person that is the subject or target of sanctions or restrictions under Sanctions Laws or Export-Import Laws, including (i) any Person listed on any applicable U.S. or non-U.S. sanctions- or export-related restricted party list, including OFAC’s Specially Designated Nationals and Blocked Persons List, OFAC’s list of Foreign Sanctions Evaders, OFAC’s Sectoral Sanctions Identification List, the Entity List maintained by the U.S.
13



Department of Commerce, the Debarred List maintained by the U.S. Department of State, and the European Union Consolidated Financial Sanctions List; (ii) any Person located, organized or resident of a Sanctioned Country; or (iii) any Person that is, in the aggregate, fifty percent (50%) or greater owned, directly or indirectly, or otherwise controlled by any such Person or Persons described in the foregoing clauses (i) and (ii).
Sanctions Laws” means all U.S. and non-U.S. Laws relating to economic or trade sanctions, including the Laws administered or enforced by the U.S. (including by OFAC or the U.S. Department of State), the United Nations Security Council, the United Kingdom, and the European Union and its member states.
SEC” means United States Securities and Exchange Commission.
Securities Act” means the United States Securities Act of 1933, as amended, and the rules and regulations of the SEC (or any successor agency thereto) promulgated thereunder.
Seller Disclosure Letter” means the letter delivered by Seller to Buyer concurrently with the execution and delivery of this Agreement, setting forth, among other things, items the disclosure of which is required under this Agreement, either in response to an express disclosure requirement contained in a provision of this Agreement or as an exception to one or more of the representations, warranties, covenants or agreements contained in this Agreement.
Seller Fundamental Representations” means the representations and warranties set forth in Section 4.1 (Corporate Organization), Section 4.2 (Authority), Section 4.5(a) (Capitalization), Section 5.2 (Authority), Section 5.5 (Ownership), and Section 5.6 (Brokers).
Seller Guarantees” means the guarantees provided by, or on behalf of, Seller or any of its Affiliates and the keepwells, bonding arrangements, net worth maintenance agreements, letters of credit, reimbursement obligations or letters of comfort imposing obligations on Seller or any such Affiliates in connection with the Business or the Acquired Companies or otherwise for the benefit of Seller or any such Affiliates in respect of the Business or the Acquired Companies, in each case, as set forth in Section 1.1(h) of the Seller Disclosure Letter. Such schedule may be updated by Seller prior to the Closing to include any non-collateralized guarantees entered into in the ordinary course of business between the date hereof and the Closing Date; provided that in no event will Seller update such schedule to include any letters of credit or any other collateralized Seller Guarantees (e.g., letters of credit).
Seller Plan” means each Employee Benefit Plan (i) that is maintained, sponsored, contributed to or required to be contributed to by Seller or any of its Subsidiaries for the benefit of any Business Employee or any other natural service provider to the Business, or any of their beneficiaries and dependents, or (ii) with respect to which Seller or its Affiliates (including any of the Acquired Companies) has or would reasonably be expected to have any Liability.
Software” means all (i) computer programs, applications, systems and code, including software implementations of algorithms, models and methodologies, and source code and object code, (ii) internet and intranet websites, databases and compilations, including data and collections of data, whether machine-readable or otherwise, (iii) development and design tools, library functions and compilers, (iv) technology supporting websites, and the contents and
14



audiovisual displays of websites, and (v) documentation and media, including user manuals and training materials, to the extent relating to or embodying any of the foregoing or on which any of the foregoing is recorded.
Straddle Period” means any taxable period that includes (but does not end on) the Closing Date.
Subsidiary” means, with respect to any Person, any corporation, limited liability company, joint venture or partnership of which such Person (i) beneficially owns, either directly or indirectly, at least fifty percent (50%) of (a) the total combined voting power of all classes of voting securities of such entity, (b) the total combined equity interests or (c) the capital or profit interests, in the case of a partnership; or (ii) otherwise has the power to vote or to direct the voting of sufficient securities to elect a majority of the board of directors or similar governing body. For the avoidance of doubt, prior to the Closing Date, Subsidiaries of Seller shall include each of the Acquired Companies to be sold by Seller to Buyer at the Closing.
Systems” means the Software, computer firmware, computer hardware, whether general purpose or special purpose, electronic data processing, information, record keeping, communications, telecommunications, networks, peripherals and computer systems, including any outsourced systems and processes, and other similar or related items of automated, computerized or software systems, that are owned, used or relied on by any of the Acquired Companies.
Target Net Securitization Asset Amount” means (i) if the Calculation Time is between October 1 and December 31 of any year, $52,303,000, (ii) if the Calculation Time is between January 1 and March 31 of any year, $50,796,000, (c) if the Calculation Time is between April 1 and June 30 of any year, $61,444,000 and (d) if the Calculation Time is between July 1 and September 30 of any year, $62,468,000.
Target Net Working Capital” means $(24,984,000).
Tax” means any and all U.S. federal, state, county, local, non-U.S. and other taxes, assessments, charges, duties, fees, levies, imposts or other similar charges imposed by a Governmental Entity, including all income, sales and use, excise, franchise, profits, capital gains, transfer, gross receipts, net or gross proceeds, gross margins, capital stock, production, customs, real property (including general and special assessment), personal property, sales, use, harmonized sales, goods and services, transfer, service, occupation, disability, employment, social security (or similar, including FICA), stamp, premium, windfall, unemployment, payroll, severance, alternative minimum, add-on, value-added, withholding or other taxes, charge fees, levies or similar assessments (however denominated), whether computed on a separate, consolidated, unitary or combined basis or in any other manner, duties or assessments and including any interest, additions to tax or penalties on such amounts, in each case, whether disputed or not.
Tax Period” means any period prescribed by any Law or Governmental Entity for which a Tax Return is required to be filed or a Tax is required to be paid.
15



Tax Proceeding” means any audit, contest, litigation, examination, investigation or other proceeding by, with, or against any Governmental Entity with respect to Taxes or Tax Returns.
Tax Return” means any return, report, declaration, information return, claim for refund, statement, notice, election or similar document filed with or submitted to, or required to be filed with or submitted to any Taxing Authority with respect to Taxes, and including any schedule or attachment thereto and any amendments thereof.
Taxing Authority” means any Governmental Entity responsible for the determination, assessment, administration, implementation, enforcement, imposition or collection of any Tax.
Third Party” means any Person other than Seller, Buyer, the Acquired Companies or any of their respective Affiliates.
Transaction” means the transactions contemplated by the Transaction Documents.
Transaction Documents” means this Agreement (including the Seller Disclosure Letter and the Exhibits to this Agreement), the Transition Services Agreement, the Sublease Agreement and the Deferred Payment Amount Agreement.
Transaction Expenses” means (i) all of the out-of-pocket fees and expenses incurred by any of the Acquired Companies at or prior to the Closing (and not otherwise paid or required to be paid by Seller or by Buyer pursuant to this Agreement), arising out of or in connection with the preparation, negotiation, execution, delivery and consummation of the Transaction, including (a) fees and expenses of counsel, accountants, investment bankers and consultants and other advisors and (b) fees, costs and expenses in connection with obtaining the release and termination of any Encumbrance, (ii) (a) any bonuses payable by an Acquired Company under a Seller Plan (other than the bonuses included in the Retention Pool Amount and the related employer portion of the employment Taxes) to any Person that are incurred, become payable, or are triggered, due to the execution of this Agreement or the consummation of the Transaction other than such bonuses entered into by Buyer or its Affiliates following the Closing (including, following the Closing, the Acquired Companies) and (b) 50% of the Retention Pool Amount (plus in each case, the employer portion of the employment Taxes triggered by any such payments and any gross-up or similar payments for Taxes required to be paid in connection such payment or in connection with any other similar compensatory payment made pursuant to this Agreement); provided that Transaction Expenses shall not include (A) any fees, costs, payments, expenses or disbursements incurred by, on behalf of or for the account of Buyer or any of its Affiliates (including, immediately after the Closing, to the extent incurred by any of the Acquired Companies on behalf of or at the direction of Buyer or its Affiliates) and (B) any amounts payable in respect of commitments made or obligations undertaken by Buyer at or after the Closing in accordance with the terms of this Agreement. For purposes of calculating Transaction Expenses at the Calculation Time, liabilities included in the first sentence of this definition (and not excluded by the provisos therein) that are triggered or become payable in whole or part solely as a result of consummation of the Closing shall be included.
16



Transition Services Agreement” means the Transition Services Agreement by and between Seller, on the one hand, and Buyer, on the other hand, substantially in the form attached hereto as Exhibit C.
Treasury Regulations” means the regulations (including any temporary and proposed regulations) promulgated by the U.S. Department of the Treasury under the Code.
U.K. Documents” means the letter agreement, dated October 27, 2016, by and between Cartus Financing Limited and Lloyds Bank plc and the letter agreement, dated August 22, 2019, by and between Cartus Financing Limited and Lloyds Bank plc, and each other agreement or other document contemplated by or entered into in connection with and/or in replacement of the foregoing, each as amended, restated, refinanced, modified or supplemented; provided that the U.K. Documents shall not include the Overdraft Facility.
U.S.” means the United States of America.
WARN Act” means the Worker Adjustment and Retraining Notification Act of 1988, as amended, and any similar foreign, state or local law relating to plant closings and layoffs.
Willful Breach” means a breach that is a consequence of an act or omission undertaken by the breaching party with the knowledge that the taking of, or failure to take, such act would, or would reasonably be expected to, cause or constitute a material breach of this Agreement; it being acknowledged and agreed, without limitation, that any failure by either Party to consummate the Transaction when required in accordance with the terms of this Agreement after the applicable conditions thereto (other than those conditions that may only be satisfied at the Closing; provided that such conditions are capable of being satisfied) have been satisfied or waived shall constitute Willful Breach of this Agreement.
Section 1.2 Interpretation. Unless the express context otherwise requires:
(a)When a reference is made in this Agreement to an Article, Section, Recital, Schedule, Annex, Exhibit or the Preamble, such reference shall be to an Article, Section, Schedule of, Annex or Exhibit to, or the Preamble of this Agreement unless otherwise indicated.
(b)Whenever the words “include,” “includes” or “including” are used in this Agreement, they shall be deemed to be followed by the words “without limitation.”
(c)Unless the context requires otherwise, words using the singular or plural number also include the plural or singular number, respectively, the use of any gender in this Agreement shall be deemed to include the other genders, words denoting natural persons shall be deemed to include business entities and vice versa and references to a Person shall include such Person’s heirs, executors, personal representatives, administrators, successors and assigns; provided, however, that nothing contained in this Section 1.2(c) is intended to authorize any assignment or transfer not otherwise permitted by this Agreement.
17



(d)References in this Agreement to a Person in a particular capacity or capacities shall exclude such Person in any other capacity. References to any Person include such Person’s predecessors or successors, whether by merger, consolidation, amalgamation, reorganization or otherwise.
(e)The mere inclusion of an item in the Seller Disclosure Letter as an exception to a representation or warranty will not be deemed an admission by Seller or any Acquired Company that such item (or any non-disclosed item or information of comparable or greater significance) represents a material exception or fact, event or circumstance, that such item has had, or is expected to result in, a Material Adverse Effect, or that such item actually constitutes noncompliance with, or a violation of, any Law, Permit or Contract or other topic to which such disclosure is applicable. Notwithstanding anything to the contrary contained in this Agreement or the Seller Disclosure Letter, the information and disclosures contained in any section of the Seller Disclosure Letter shall be deemed to be disclosed and incorporated by reference in any other section of the Seller Disclosure Letter as though fully set forth in such other section for which the applicability of such information and disclosure is reasonably apparent on the face of such information or disclosure.
(f)The Seller Disclosure Letter and Exhibits referred to in this Agreement shall be construed with and as an integral part of this Agreement to the same extent as if they were set forth verbatim herein.
(g)The specification of any dollar amount in the representations and warranties contained in this Agreement or the inclusion of any specific item in the Seller Disclosure Letter is not intended to imply that such amounts (or higher or lower amounts) are or are not material, and neither Party shall use the fact of the setting of such amounts or the fact of the inclusion of any such item in the Seller Disclosure Letter in any claim, dispute or controversy as to whether any obligation, item or matter not described in this Agreement or included in the Seller Disclosure Letter is or is not material for purposes of this Agreement.
(h)The terms “hereof,” “herein,” “hereby,” “hereto” and derivative or similar words refer to this entire Agreement. The word “or” shall be disjunctive but not exclusive (i.e., “or” shall mean “and/or”).
(i)The phrase “to the extent” shall mean the degree to which a subject or other thing extends, and such phrase shall not mean simply “if.”
(j)References to any Law shall be deemed to refer to such Law, as amended from time to time, and to any rules or regulations promulgated thereunder (provided that for purposes of any representations and warranties contained in this Agreement that are made as of a specific date or dates, references to any Law shall be deemed to refer to such Law, as amended, and to any rules or regulations promulgated thereunder, in each case, as of such date).
18



(k)Reference to any Contract or document means such Contract or document; as amended or modified and in effect from time to time on prior to the date of this Agreement in accordance with the terms thereof, together with all addenda, exhibits or schedules (provided that for purposes of any representations and warranties contained in this Agreement that are made as of a specific date or dates, references to any Contract shall be deemed to refer to such Contract, as amended or modified and in effect as of such date), in each case to the extent such amendment, addenda, exhibits or schedules were delivered or made available to Buyer or its Representatives prior to the date of this Agreement.
(l)A reference to any period of days shall be deemed to be to the relevant number of calendar days, unless otherwise specified, and days and times of day shall be determined by reference to local time in New York, New York.
(m)With respect to the determination of any period of time, unless otherwise set forth herein, “from” means “from and including” and “to” means “to but excluding,” and if the last day of such period is a non-Business Day, the period in question shall end at the close of the next succeeding Business Day.
(n)References to any period of time ending on the Closing Date shall refer to a period of time through the end of the Closing Date, without giving effect to the Transaction.
(o)A reference to “$” or “dollar” shall mean the legal tender of the U.S.
(p)Unless otherwise defined in this Agreement (including, for the avoidance of doubt, in the Accounting Principles), a reference to any accounting term (other than Indebtedness or Transaction Expenses) shall have the meaning as defined under GAAP.
(q)The meaning of the terms “domestic” and “foreign” shall be determined by reference to the U.S.
(r)All terms defined in this Agreement shall have the defined meanings when used in any certificate or other document made or delivered pursuant hereto unless otherwise defined therein.
(s)The phrases “delivered” or “made available,” when used in this Agreement, shall mean that the information referred to has been physically made available to a Person during an on-site visit by Buyer’s legal counsel to Seller’s facility at Danbury, Connecticut on October 8, 2019 to October 10, 2019 or such information shall have been posted and remain posted in the virtual “data room” titled “Project Catch” established by Seller or its Representatives, or shall have been delivered to Buyer or its Representatives by electronic mail at the specific request of Buyer or its Representatives, at least six hours prior to the execution of this Agreement.
(t)The Parties have participated jointly in the negotiation and drafting of this Agreement. Consequently, in the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the Parties, and no presumption or burden of proof shall arise favoring or disfavoring any Party by virtue of the authorship of any provision of this Agreement.




19



ARTICLE II
PURCHASE AND SALE
Section 2.1 Purchase and Sale. Upon the terms and subject to the conditions of this Agreement and the provisions of applicable Law, at the Closing, Seller shall sell, assign, transfer, convey and deliver to Buyer, or cause to be sold, assigned, transferred, conveyed and delivered to Buyer, and Buyer shall purchase and acquire from Realogy Services Group LLC, all of the Shares, free and clear of all Encumbrances.
Section 2.2 Restructuring.
(a)Immediately prior to the Calculation Time, Seller shall, and shall cause each of its applicable Affiliates to, consummate the transactions set forth in Section 2.2(a) of the Seller Disclosure Letter to separate the assets and liabilities of the Retained Business from the Acquired Companies and to transfer the Excluded Assets and the Retained Liabilities to Seller or its post-Closing Affiliates (the “Restructuring”); provided that no asset (other than Excluded Assets) shall be transferred pursuant to the Restructuring to the extent primarily related to the Business.
(b)Seller shall be responsible for all Liabilities arising out of the separation of the Retained Business from the Acquired Companies, including as contemplated by the Restructuring, including any (i) Liabilities arising from employee, asset or liability transfers prior to the Closing, (ii) Liabilities for the expenses of the formation of new entities required pursuant to the Restructuring (but, for the avoidance of doubt, excluding any entity formed by Buyer or its Affiliates), (iii) Liabilities arising from a failure by Seller and its applicable Affiliates to comply with this Section 2.2, and (iv) Liabilities for expenses in connection with regulatory filings, notarial and registration fees, and other similar payments to Governmental Entities to implement the Restructuring. For purposes of this Section 2.2(b),
(c)Notwithstanding any other provision of this Agreement to the contrary, this Agreement shall not require and the Restructuring shall not constitute an agreement to sell, contribute, dividend, assign, transfer, convey or deliver any asset, license, lease, permit or property that constitutes an Excluded Asset that is to be transferred from an Acquired Company to an Affiliate of Seller with respect to the Retained Business as part of the Restructuring and any claim or right or benefit arising thereunder or resulting therefrom if an attempted sale, contribution, dividend, assignment, transfer, conveyance or delivery thereof (without the consent, approval or waiver of a Third Party) would violate, constitute a default under or breach of such license, lease, permit or property thereunder or would violate any applicable Law (collectively, a “Non-Assignable Asset”), in each case, without first obtaining all such necessary Consents of such Third Parties as set forth on Section 2.2(c) of the Seller Disclosure Letter, and this Agreement and the Restructuring shall not be deemed to constitute a sale, contribution, dividend, assignment, transfer, conveyance or delivery or attempted contribution, dividend, assignment, transfer, conveyance or delivery thereof and the applicable provisions of this Section 2.2 shall apply in regard to all such Non-Assignable Assets.
20



(d)In the case of a Non-Assignable Asset, to the extent permitted by applicable Law and not expressly prohibited by Contract, Buyer shall cause the applicable Acquired Company to hold, or cause to be held, such Non-Assignable Asset, as of and from the Closing, in trust for Seller or its applicable Affiliate and the covenants and Liabilities thereunder shall be performed by Seller or its applicable Affiliate (and Seller shall, and shall cause such applicable Affiliate to, do so) in the applicable Acquired Company’s name and all benefits and Liabilities existing thereunder shall be for Seller or its applicable Affiliate (in each case, solely to the extent they would otherwise be benefits and Liabilities of Seller or its applicable Affiliate hereunder). Following the Closing, to the extent permitted by applicable Law and not expressly prohibited by Contract, Buyer shall cause the applicable Acquired Company to take, at Seller’s cost and expense, such commercially reasonable actions in its name or otherwise as Seller may reasonably request so as to provide Seller or its applicable Affiliate with the benefits of the Non-Assignable Assets, to effect the collection of money or other consideration that becomes due and payable under the Non-Assignable Assets and to enforce for the benefit of Seller or its applicable Affiliate and at the expense of Seller or such applicable Affiliate, any and all rights against a Third Party arising under such Non-Assignable Asset, and Buyer shall cause the Acquired Companies to promptly pay, or cause to be paid, to Seller or such of its Affiliates all money or other consideration received by the Acquired Company in respect of all Non-Assignable Assets, net of any Tax incurred or payable in connection with the receipt of such money (or other consideration) or required to be withheld on payment.
(e)Following the Closing, for a period of up to one (1) year following the Closing Date, Buyer shall, and shall cause the applicable Acquired Company to, use reasonable best efforts to, with Seller’s participation and assistance, obtain the necessary approvals, consents and waivers to effect the sale, assignment, transfer, conveyance and delivery of any Non-Assignable Asset to Seller or its applicable Affiliate (provided that neither Buyer nor any of its Affiliates shall be required to compensate any Third Party, commence or participate in any litigation, or offer or grant any concession (financial or otherwise) to any Third Party to obtain any such consent, approval or waiver). If and when such necessary approvals, consents and waivers are obtained after the Closing to effect the sale, assignment, transfer, conveyance and delivery of any Non-Assignable Asset, such sale, assignment, transfer, conveyance and delivery shall be reasonably promptly effected in accordance with the terms of this Agreement and/or the Restructuring, for no additional consideration, after which, such Non-Assignable Asset shall no longer be subject to this Section 2.2 as a Non-Assignable Asset.
Section 2.3 Closing.
21



(a)Upon the terms and subject to the conditions of this Agreement, the consummation of the Transaction (the “Closing”) shall take place remotely via exchange of documents and signatures (i) on the date that is the later of (A) the third (3rd) Business Day after the satisfaction or (to the extent permitted by applicable Law) waiver of all of the conditions set forth in Article X (other than those conditions that by their terms or nature are to be satisfied by actions to be taken at the Closing, but subject to such conditions being satisfied at the Closing), and (B) the earlier to occur of (x) the date during the Marketing Period specified by Buyer on five (5) Business Days’ prior written notice to Seller and (y) the third (3rd) Business Day immediately following the final day of the Marketing Period (subject, in the case of each of (x) and (y), to the satisfaction or (to the extent permitted by applicable Law) waiver of all of the conditions set forth in Article X (other than those conditions that by their terms or nature are to be satisfied at the Closing, but subject to such conditions being satisfied at the Closing)), or (ii) at such other date and time as the Parties may agree in writing (giving effect to the provisions of Section 7.12(b)). The date on which the Closing occurs is herein referred to as the “Closing Date.”
(b)At the Closing, the Parties shall deliver the agreements, certificates, and other instruments and documents required to be delivered at or prior to the Closing pursuant to Section 2.4. All deliveries to be made or other actions to be taken at the Closing shall be deemed to occur simultaneously, and no such delivery or action shall be deemed complete until all such deliveries and actions have been completed or the relevant parties have agreed to waive such delivery or action. If the Closing does not occur, any delivery made or other action taken at the Closing shall be deemed not to have occurred and be without force or effect.
Section 2.4 Closing Deliveries.
(a)At the Closing, Buyer shall deliver or cause to be delivered to Seller or its designee each of the following:
(i)the Estimated Closing Date Payment as required by Section 3.2;
(ii)the certificate to be delivered pursuant to Section 10.3(c);
(iii)a counterpart to the Transition Services Agreement, duly executed by Buyer;
(iv)a counterpart to the Deferred Payment Amount Agreement;
(v)duly completed IRS Forms 8023 (and any corresponding forms under U.S. state or local law) electing to make the Section 338(h)(10) Election, duly executed by Buyer (and such other required signatories of Buyer and/or its Affiliates); and
(vi)all other documents and certificates expressly required to be delivered by Buyer or its Affiliates on or prior to the Closing Date pursuant to this Agreement.
(b)At the Closing, Seller shall deliver or cause to be delivered to Buyer or its designee each of the following:
(i)stock certificates representing the Shares accompanied by duly executed stock power or otherwise endorsed to Buyer;
(ii)the certificate to be delivered pursuant to Section 10.2(d);
(iii)a counterpart to the Transition Services Agreement, duly executed by Seller;
22



(iv)a properly completed and duly executed certificate from Seller pursuant to Treasury Regulations Section 1.1445-2(b) that Seller is not a “foreign person” within the meaning of Section 1445 of the Code (a “FIRPTA Certificate”) in the form and substance attached hereto as Exhibit F;
(v)duly completed IRS Forms 8023 (and any corresponding forms under U.S. state or local law) electing to make the Section 338(h)(10) Election, duly executed by Seller (and such other required signatories of Seller and/or its Affiliates);
(vi)written resignations of the directors of the Acquired Companies to be delivered pursuant to Section 7.24;
(vii)written evidence of termination in form and substance reasonably satisfactory to Buyer of all Contracts set forth on Section 7.13(a) of the Seller Disclosure Letter;
(viii)written evidence reasonably acceptable to Buyer of the release and termination of (A) all Encumbrances on assets of the Acquired Companies and (B) any and all guarantees provided by any Acquired Company, in each case effective as of the Closing, in each case, with respect to any Credit Support Obligations of Seller or its Affiliates (including release letters or acknowledgements in customary form executed by the applicable agent or trustee) and the indebtedness set forth on Section 7.21(b) of the Seller Disclosure Letter;
(ix)a counterpart to the Deferred Payment Amount Agreement; and
(x)all other documents and certificates expressly required to be delivered by Seller or its Affiliates on or prior to the Closing Date pursuant to this Agreement.
ARTICLE III
PAYMENT OF THE PURCHASE PRICE
Section 3.1 Purchase Price. On the terms and subject to the conditions set forth in this Agreement, at the Closing, Buyer shall pay and deliver to Seller an amount equal to (a)the Initial Purchase Price; (b) (i) plus the amount, if any, by which the Estimated Net Working Capital exceeds the Target Net Working Capital, or (ii) minus the amount, if any, by which the Target Net Working Capital exceeds the Estimated Net Working Capital; plus (c) the Estimated Cash; minus (d) the Estimated Indebtedness; minus (e) the Estimated Transaction Expenses; (f) (i) plus the amount, if any, by which the Estimated Net Securitization Asset Amount exceeds the Target Net Securitization Asset Amount, or (ii) minus the amount, if any, by which the Target Net Securitization Asset Amount exceeds the Estimated Net Securitization Asset Amount; minus (g) the Deferred Payment Amount (the result of the foregoing clauses (a)-(f), the “Closing Date Payment”). Buyer shall pay the Closing Date Payment to Seller in U.S. dollars by wire transfer of immediately available funds to an account or accounts designated in writing by Seller at least
23



one (1) Business Day prior to the Closing Date. After the Closing, the Closing Date Payment shall be subject to adjustment in accordance with Section 3.5.
Section 3.2 Estimated Closing Date Payment Statement. At least three (3) Business Days but not more than seven (7) Business Days prior to the anticipated Closing Date, Seller shall prepare and deliver to Buyer a statement setting forth Seller’s good faith estimate calculation of the Closing Date Payment (such statement, the “Estimated Closing Statement”), including Seller’s good faith and reasonably detailed calculation of each of (a) the Net Working Capital of the Acquired Companies as of the Calculation Time (the “Estimated Net Working Capital”); (b) the Cash of the Acquired Companies as of the Calculation Time (the “Estimated Cash”); (c) the outstanding and unpaid Indebtedness of the Acquired Companies as of the Calculation Time (the “Estimated Indebtedness”); (d) the outstanding and unpaid Transaction Expenses of the Acquired Companies as of the Calculation Time (the “Estimated Transaction Expenses”); (e) the Net Securitization Asset Amount of the Acquired Companies as of the Calculation Time (the “Estimated Net Securitization Asset Amount”) and (f) on the basis of the foregoing calculations, the resulting amount of the Closing Date Payment after reducing by the Deferred Payment Amount (the “Estimated Closing Date Payment”). The Estimated Closing Statement shall be prepared in accordance with the Accounting Principles. Prior to and after delivering its Estimated Closing Date Payment, Seller shall cooperate and provide such information as reasonably requested by Buyer and its Representatives regarding the calculation of the components thereof and provide such back-up therefor as reasonably requested. Seller will consider in good faith any comments made by Buyer to the Estimated Closing Statement and will make any revisions to the Estimated Closing Statement that are agreed by the Parties (which shall then be the “Estimated Closing Statement” for purposes of this Agreement).
Section 3.3 Withholding. Notwithstanding any other provision of this Agreement, Buyer, Seller, the Acquired Companies (and each of their respective Affiliates and designees) shall be entitled to deduct and withhold from any consideration payable or otherwise deliverable pursuant to this Agreement, such amounts as may be required to be deducted or withheld therefrom under any provision of the U.S. federal, state, local or foreign Tax Law, as applicable; provided, however, that Buyer agrees that, except with respect to any withholding obligation attributable to (x) compensatory payments, (y) any backup withholding requirements or (z) Seller’s failure to deliver the FIRPTA Certificate in accordance with Section 2.4(b)(iv), upon determining that any such deduction or withholding is required, Buyer or the Acquired Companies (and each of their respective Affiliates or designees), as applicable, shall give prompt notice to the Seller, and the Seller shall have the opportunity to mitigate any such potential deduction or withholding by providing forms or other certifications that may reduce or eliminate such deduction or withholding. To the extent any amounts are deducted or withheld under this Section 3.3, such amounts shall be treated for all purposes under this Agreement as having been paid to the Person to whom such amounts would otherwise have been paid.
Section 3.4 Taking of Necessary Actions; Further Actions. If, at any time after the Closing, any further action is necessary or desirable to carry out the purposes of this Agreement, the officers and directors of Buyer, the Acquired Companies and Seller are fully authorized in the name of their respective entities or otherwise to take, and will take, all such lawful and necessary action, so long as such action is not inconsistent with this Agreement.
24



Section 3.5 Post-Closing Adjustment.
(a)Within ninety (90) days following the Closing Date, Buyer shall prepare and deliver to Seller a statement (the “Preliminary Closing Statement”) setting forth (i) Buyer’s good faith reasonably detailed computation of (A) the Net Working Capital of the Acquired Companies as of the Calculation Time (the “Closing Net Working Capital”); (B) the Cash of the Acquired Companies as of the Calculation Time (the “Closing Cash”); (C) the outstanding and unpaid Indebtedness of the Acquired Companies as of the Calculation Time (“Closing Indebtedness”); (D) the outstanding and unpaid Transaction Expenses of the Acquired Companies as of the Calculation Time (the “Closing Transaction Expenses”); (E) the Net Securitization Asset Amount of the Acquired Companies as of the Calculation Time (the “Closing Net Securitization Asset Amount”); and (F) on the basis of the foregoing calculations, after reducing by the Deferred Payment Amount, the resulting amount of the Final Closing Date Payment, and (ii) a reasonably detailed explanation of any differences between an amount reflected in the Preliminary Closing Statement and the amount of the corresponding item as reflected in the Estimated Closing Statement, as well as all work papers, supporting documentation and other information that Buyer has relied upon or otherwise determined supports such differences.
(b)Seller shall have sixty (60) days following receipt to review the Preliminary Closing Statement and to notify Buyer in writing of any dispute regarding the Preliminary Closing Statement, and the respective calculations set forth in each, to determine the final Closing Net Working Capital, the Closing Net Securitization Asset Amount, the Closing Cash, the Closing Indebtedness and the Closing Transaction Expenses, specifying the reasons therefor in reasonable detail (the “Dispute Notice”). If no Dispute Notice is delivered to Buyer within such sixty (60) day review period, or if Seller delivers a written acceptance of the Preliminary Closing Statement during such sixty (60) day period, then the components contained in the Preliminary Closing Statement prepared by Buyer shall be used to calculate the Final Closing Date Payment, and the Final Closing Date Payment shall become final, conclusive, binding and non-appealable as of the end of the sixty (60) day review period or, if earlier, the date of receipt by Buyer of such written acceptance. In connection with its review of, or any dispute with respect to, the Preliminary Closing Statement, Seller and its Representatives shall be given reasonable access, during normal business hours and upon reasonable notice, to all relevant work papers, schedules, memoranda and other documents prepared by Buyer, the Acquired Companies or any of their Affiliates, and to the finance personnel thereof, and any other information which Seller reasonably requests, and Buyer shall, and shall cause the Acquired Companies and their Affiliates to, cooperate with Seller in connection therewith.
25



(c)In the event that Seller delivers a Dispute Notice to Buyer, Seller and Buyer shall cooperate in good faith to resolve such dispute as reasonably promptly as practicable and upon such resolution, if any, any adjustments to the Preliminary Closing Statement or to the Closing Net Working Capital, the Closing Net Securitization Asset Amount, the Closing Cash, the Closing Indebtedness or the Closing Transaction Expenses calculated therein agreed to in writing by Seller and Buyer shall be final, conclusive, binding and non-appealable upon all Parties. If Seller and Buyer are unable to resolve any such dispute within twenty (20) Business Days (or such longer period as Seller and Buyer shall mutually agree in writing) of Seller’s delivery of such Dispute Notice, the specific items or components of the Preliminary Closing Statement that are still in dispute shall be submitted to the dispute resolution department of KPMG LLP or, if such accounting firm is unable or unwilling to serve in such role, another independent nationally recognized accounting, valuation firm to be agreed upon by Seller and Buyer acting reasonably (either such firm, the “Settlement Accountant”). The Settlement Accountant shall determine whether and to what extent, if any, such items or components of the Preliminary Closing Statement require adjustment; provided that (i) the Settlement Accountant may consider only those items and amounts (and related items and amounts) on the Preliminary Closing Statement and/or the Preliminary Closing Statement as to which Seller and Buyer have disagreed within the time periods and on the terms specified above, and (ii) the Settlement Accountant’s determination of any disputed amount set forth on the Preliminary Closing Statement and/or the Preliminary Closing Statement may neither be less than the lower, nor more than the higher, of Seller’s and Buyer’s respective calculations of such amount as set forth in the Dispute Notice. The Settlement Accountant shall be instructed to use reasonable best efforts to make its final determination within thirty (30) days of submission by the Parties of the dispute to it and, in any case, as promptly as practicable after such submission. The Settlement Accountant’s written determination shall be final, conclusive, binding and non-appealable on the Parties and all Acquired Companies, absent manifest error. All negotiations pursuant to this Section 3.5(c)shall be treated as compromise and settlement negotiations for purposes of Rule 408 of the Federal Rules of Evidence and comparable state rules of evidence, and all negotiations and submissions to the Settlement Accountant, and the dispute resolution proceedings under this Section 3.5(c), shall be treated as confidential information. All fees and expenses of the Settlement Accountant incurred pursuant to this Section 3.5(c) shall be borne by Buyer, on the one hand, and Seller, on the other hand, in proportion to the final allocation made by the Settlement Accountant of the disputed items weighted in relation to the claims made by Seller and Buyer, such that the prevailing party pays the lesser proportion of such fees, costs and expenses. For example, if Seller claims that the appropriate adjustments are $1,000 greater than the amount determined by Buyer and if the Settlement Accountant ultimately resolves the dispute by awarding to Seller $300 of the $1,000 contested, then the fees, costs and expenses of the Settlement Accountant shall be allocated thirty percent (30%) (i.e., 300 divided by 1,000) to Buyer and seventy percent (70%) (i.e., 700 divided by 1,000) to Seller. Subject to limitations set forth in Section 3.5(b), Buyer and Seller shall make available to the Settlement Accountant and to each other all relevant books and records and working papers relating to the Preliminary Closing Statement and the Dispute Notice (including reasonable access during reasonable business hours to personnel at the Acquired Companies who prepared the Preliminary Closing Statement) and all other items reasonably requested by the Settlement Accountant. The Preliminary Closing Statement, Closing Net Working Capital, the Closing Net Securitization Asset Amount, the Closing Cash, the Closing Indebtedness and the Closing Transaction Expenses calculated therein (i) if deemed final in accordance with Section 3.5(b) because there is no Dispute Notice given, (ii) as otherwise amended through a mutually agreed upon writing by Buyer and Seller, or (iii) if a Dispute Notice has been timely delivered by Seller in accordance with Section 3.5(b), and not otherwise mutually agreed upon in writing by Buyer and Seller, as finally determined by the Settlement Accountant in accordance with this Section 3.5(c), shall be used to calculate the “Final Closing Date Payment”).
26



(d)If the Final Closing Date Payment exceeds the Estimated Closing Date Payment (the amount of such excess, the “Additional Purchase Price”), then, within three (3) Business Days following such determination, Buyer shall pay to Seller the Additional Purchase Price by wire transfer of immediately available funds to an account designated in writing by Seller.
(e)If the Estimated Closing Date Payment exceeds the Final Closing Date Payment (the amount of such excess, the “Shortfall Amount”), then within three (3) Business Days following such determination, Seller shall pay to Buyer, the Shortfall Amount by wire transfer of immediately available funds to an account designated in writing by Buyer.
(f)Seller and Buyer agree to treat all payments made either to or for the benefit of the other pursuant to this Section 3.5 as adjustments to the Closing Date Payment for all Tax purposes, except as otherwise required by applicable Law.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES REGARDING THE ACQUIRED COMPANIES
Except as disclosed in the Seller Disclosure Letter, Seller hereby represents and warrants to Buyer as follows:
Section 4.1 Corporate Organization. Each Acquired Company (a) is a corporation or other legal entity duly incorporated or organized, validly existing and in good standing (in the case of good standing, to the extent such jurisdiction recognizes such concept) under the Laws of the jurisdiction in which it is incorporated or organized, (b) is duly qualified to do business and is in good standing as a foreign corporation (or other entity, if applicable) in each jurisdiction in which ownership of its properties or the character of its activities is such as to require it to be so licensed or qualified, in each case as set forth in Section 4.1 of the Seller Disclosure Letter and (c) has the requisite corporate or other organizational power and authority to own, lease and operate its assets and properties and to carry on its business as it is now being conducted, except in each of the foregoing clauses (a) – (c), as would not reasonably be expected to result in a Material Adverse Effect.
Section 4.2 Authority. Each Acquired Company has full corporate or other organizational power and authority to execute, deliver and perform its obligations under the Transaction Documents and to consummate the Transaction, except where the failure to have such power and authority would not prohibit or materially impair or delay such Acquired Company’s ability to consummate the Transaction and to execute, deliver and perform its obligations under the Transaction Documents. The execution, delivery and performance by such Acquired Company of the Transaction Documents and the consummation by such Acquired Company of the Transaction have been duly and validly authorized by all required action on the part of such Acquired Company, and no other proceedings on the part of such Acquired Company are necessary to authorize the execution, delivery and performance by such Acquired Company of the Transaction Documents or to consummate the Transaction. Upon execution and delivery of the Transaction Documents to which such Acquired Company is or will be a party,
27



and, assuming the due authorization, execution and delivery by each other party to such Transaction Documents, such Transaction Documents will constitute legal, valid and binding obligations of such Acquired Company enforceable against such Acquired Company in accordance with the terms and provisions of this Agreement (except as may be limited by bankruptcy, insolvency, fraudulent transfer, moratorium, reorganization, preference or similar Laws of general applicability relating to or affecting the rights of creditors generally and subject to general principles of equity (regardless of whether enforcement is sought in equity or at law)).
Section 4.3 No Conflict. Subject to receipt of the Consents set forth in Section 4.3 of the Seller Disclosure Letter, neither the execution, delivery or performance of the Transaction Documents nor the consummation of the Transaction will: (a) violate, breach or conflict with, or allow any Person to exercise any rights under, the Organizational Documents of the Acquired Companies; (b) require a Consent under, conflict with, result in a material violation or breach of, or constitute a material default under, result in the modification or acceleration of, create in any party the right to payment under or the right to accelerate, terminate or cancel any Material Contract; (c) constitute or result in the creation of any Encumbrance upon any material asset or property used or held for use in the Business, in each case, other than Permitted Encumbrances; (d) constitute or result in a breach or violation of any Order applicable to the Business or by which any of the properties or assets of the Acquired Companies or Seller may be bound or affected; (e) result in a breach or violation, or cause the termination or revocation, of any Consent held by any Acquired Company that is necessary to the operation of the Business, in each case, which would be material to the Business, taken as a whole; or (f) violate any Law to which the Acquired Companies are subject (to the extent relating to the Business), except with respect to each of the foregoing clauses (b) – (f) as would not have a material impact on the Acquired Companies, taken as a whole.
Section 4.4 Litigation; Orders. As of the date of this Agreement, there are no, and for the three (3) years prior to the date of this Agreement has not been any (a) pending or, to the Knowledge of Seller, threatened, material Actions against or involving any Acquired Company that would reasonably be expected to (a) result in payment of Damages in excess of $2,500,000 by such Acquired Company, (b) materially impair or delay the performance or operation of the Business or any portion thereof, or (c) prohibit or materially impair or delay the performance or consummation of the Transaction. No Acquired Company is subject to any outstanding or unsatisfied Order. None of the Acquired Companies is a party or subject to any Order from any Governmental Entity.
Section 4.5 Capitalization.
28



(a)Section 4.5(a) of the Seller Disclosure Letter sets forth the (i) authorized capital stock of each Acquired Company, (ii) number of issued and outstanding capital stock of, or other equity interests in, each Acquired Company that are owned by Seller or an Acquired Company (the “Business Equity Interests”), (iii) record holder of such Business Equity Interests, and (iv) jurisdiction of organization of each Acquired Company. The Business Equity Interests were not issued in violation of any preemptive or other rights of any Person. There are no liabilities for, or obligations with respect to, any dividends, distributions or similar participation interests declared or accumulated but unpaid with respect to any of the Business Equity Interests. The Business Equity Interests have been duly authorized by all necessary entity action, have been duly issued and are fully paid and non-assessable. Except for the rights created in favor of Buyer under this Agreement, Seller has never created nor committed to create, nor allowed the creation of, any of the following, and none of the following exists as a result of any actions taken by or on behalf of Seller: (A) any authorized or outstanding subscription, warrant, option, unit appreciation right, phantom unit, profit participation, call or similar right, convertible security, or other right (contingent or otherwise) to purchase or otherwise acquire from Seller or the Acquired Companies equity securities in the Acquired Companies; (B) any commitment on the part of Seller or the Acquired Companies to issue, exchange, transfer, deliver or sell or cause to be issued, exchanged, transferred, delivered or sold, any units, subscriptions, warrants, options, profits interests, calls convertible securities, or other right; (C) any voting trust or agreement, members’ agreement, pledge agreement, buy-sell agreement, right of first refusal or offer, preemptive right or proxy relating to any securities or interests of the Acquired Companies or to which Seller or any of the Acquired Companies is a party in respect of the Business Equity Interests; or (D) any restrictions on the transfer of the Business Equity Interests, except for restrictions imposed by applicable Law.
(b)True and complete copies of the Organizational Documents of each Acquired Company as currently in effect (including all amendments thereto) have been made available to Buyer. No Acquired Company is in material breach, default or violation (and no event has occurred that with the giving of notice, the lapse of time, or both, or the happening of any other event or condition, would constitute a breach, default or violation) of any term, condition or provision of its Organizational Documents.
Section 4.6 Financial Statements. Section 4.6 of the Seller Disclosure Letter sets forth (a) the unaudited, combined balance sheet of the Business at December 31, 2018, and the related unaudited, combined statement of income and cash flows of the Business for the year then ended and (b) the unaudited, combined balance sheet of the Business at September 30, 2019, and the related unaudited statement of income and cash flows of the Business for the nine (9) month period then ended (collectively, the “Unaudited Financial Statements”), which in each case, have been compiled by management of Seller from source documentation subject to the controls and procedures of Seller’s accounting systems and have been prepared in accordance with GAAP. The Unaudited Financial Statements fairly present in all material respects the financial condition, results of operations and cash flows of the Business at their respective dates and for the periods covered by such statements, subject to certain adjustments described therein and subject to the omission of footnotes, none of which are material, individually or in the aggregate, but do not reflect what the consolidated results of operations and financial positions would have been if the Business had been operated independently of Seller during the periods presented in that they include allocations of certain assets, liabilities, revenues and expenses. The balance sheet of the Business as of September 30, 2019 is referred to in this Agreement as the “Balance Sheet,” and the date thereof as the “Balance Sheet Date.”
Section 4.7 Absence of Certain Changes. Except as set forth in Section 4.7 of the Seller Disclosure Letter or as otherwise contemplated by the Restructuring, during the period beginning on the Balance Sheet Date and ending on the date of this Agreement, (a) there has not occurred any Material Adverse Effect; (b) the Business has been conducted in all material respects in the ordinary course consistent with past practices; (c) none of the Acquired
29



Companies has suffered any Damages, destruction or other casualty affecting any of its material properties or assets, whether or not covered by insurance; (d) no event has occurred and there has not been adoption of any material plan of merger, consolidation, reorganization, liquidation or dissolution filing of a petition in bankruptcy under any provisions of federal or state bankruptcy Law or consent to the filing of any bankruptcy petition against it under any similar Law by any Acquired Company; (e) no Intellectual Property owned by Seller or its Affiliates and used by the Business has lapsed or has been abandoned, sold, assigned, transferred or licensed (except non-exclusive licenses granted in the ordinary course of business); (f) there has not been any transfer of any employees of Seller or its Affiliates into the Acquired Companies or the Business and there has not been any transfer of any employees of the Acquired Companies or the Business into Seller or its Affiliates (other than the Acquired Companies); and (g) none of the Acquired Companies has taken (or failed to take) any action, that if taken or occurred after the date of this Agreement, would have required Buyer’s consent pursuant Section 7.1 or otherwise resulted in a breach thereof.
Section 4.8 Undisclosed Liabilities. There are no material Liabilities of the Acquired Companies of any nature, whether or not accrued, contingent or otherwise other than those Liabilities (a) to the extent reflected or reserved against on the Balance Sheet or otherwise disclosed in Section 4.8 of the Seller Disclosure Letter or to the extent to be reflected or reserved for in the calculation of Transaction Expenses, Net Working Capital or Indebtedness as finally determined in accordance with Section 3.5; (b) that have been incurred in the ordinary course of business consistent with past practice since the Balance Sheet Date (excluding any Liabilities resulting from noncompliance with any applicable Laws, breach of contract, breach of warranty, tort, infringement, violation of law, misappropriation or Action) and to the extent included in the calculation of Closing Net Working Capital as finally determined in accordance with Section 2.4(c) that have been discharged or paid off in full prior to the Calculation Time without further liability to any Acquired Company; or (c) that are not material to the Acquired Companies, taken as a whole.
Section 4.9 Taxes.
(a)Each Acquired Company has filed or caused to be filed on a timely basis (taking into account any valid extensions of time) all material Tax Returns that are required to have been filed by it. All such Tax Returns are true, correct, and complete in all material respects and were prepared in substantial compliance with applicable Law. Each of the Acquired Companies has timely paid all material Taxes which are due and payable (whether or not shown on such Tax Returns).
(b)There are no pending or current material Tax Proceedings for or with respect to any material Tax Return or liability in respect of material Taxes of the Acquired Companies. No Acquired Company has received from any Taxing Authority any written notice of a proposed adjustment, deficiency, or underpayment of income or other material Taxes that has not been fully satisfied or completely withdrawn. There are no outstanding agreements, arrangements, waivers or objections extending the statutory period or providing for an extension of time with respect to the assessment or reassessment of material Taxes of, or the filing of any material Tax Return.
30



(c)There are no material Encumbrances (other than Permitted Encumbrances) for Taxes against any assets of the Acquired Companies.
(d)None of Seller or any of the Acquired Companies has distributed to its shareholders or security holders stock or securities of a controlled corporation, nor has stock or securities of Seller or any of the Acquired Companies been distributed, in each case in a transaction that was purported or intended to be governed in whole or in part by Section 355 or Section 361 of the Code, in the two (2) years prior to the date of this Agreement.
(e)None of Seller nor any of the Acquired Companies has engaged in or has been party to a “listed transaction” as defined in Section 6707A(c)(2) of the Code and as set forth in Treasury Regulation Section 1.6011-4(b)(2) or any analogous provision of state or local Law.
(f)Each Acquired Company has properly withheld and collected all material amounts required by Law to be withheld or collected by such Acquired Company on account of Taxes, and has timely remitted all such amounts to the appropriate Taxing Authority within the time prescribed under Law.
(g)No written claim has been made by any Taxing Authority in any jurisdiction where any of the Acquired Companies does not file Tax Returns that any of the Acquired Companies is or may be subject to a material amount of Tax by or required to file a Tax Return in that jurisdiction. None of the Acquired Companies is subject to Tax in any country other than the country in which it is organized by virtue of (i) a permanent establishment (within the meaning of an applicable income Tax treaty) or other office or fixed place or business or (ii) having a source of income in that country.
(h)No Acquired Company has been a member of an Affiliated Group (other than an Affiliated Group the common parent of which is Seller) filing a consolidated, combined, unitary or other similar Tax Return.
(i)The Acquired Companies will be not required to include any item of income in, or exclude any item of deduction from, taxable income for any taxable period (or portion thereof) ending after the Closing as a result of any: (i) change in or use of an improper method of accounting for a Pre-Closing Tax Period; (ii) “closing agreement” as described in Section 7121 of the Code (or any corresponding or similar provision of Law) executed by any Acquired Company prior to the Closing; (iii) installment sale or open transaction disposition made on or prior to the Closing Date; or (iv) prepaid amount received by any Acquired Company on or prior to the Closing Date.
(j)None of the Acquired Companies is a party to or bound by any Tax allocation, indemnity or sharing agreement (other than customary written contracts entered into in the ordinary course of business the primary purposes of which does not relate to Taxes).
(k)No Acquired Company has requested or received any material rulings or entered into any material arrangements with any Tax authority, or received or benefited from any material Tax exemption, Tax holiday or other material Tax reduction agreement or order, or other material special Tax regime.
31



(l)Seller has filed a consolidated U.S. federal income Tax Return with the U.S. Acquired Companies that are treated as corporations for U.S. federal income tax purposes for the taxable year immediately preceding the current taxable year and is eligible to make a valid election under Section 338(h)(10) of the Code.
Section 4.10 Material Contracts.
(a)Section 4.10(a) of the Seller Disclosure Letter sets forth a list, as of the date of this Agreement, of each of the following categories of Contracts, other than any Seller Plan, Real Property Lease, enterprise-wide vendor or supplier Contract or this Agreement (or any arrangement or agreement contemplated by this Agreement), that relate primarily to the Business and to which any Acquired Company is a party or by which any of the Acquired Companies is bound (such Contracts listed or required to be listed, “Material Contract”):
(i)other than a Contract of the type described in Section 4.10(a)(ii), any Contract involving aggregate consideration payable by or to any Acquired Company in excess of $250,000 in the twelve (12) month period ended December 31, 2018, which, in each case, cannot be cancelled by Seller or such Acquired Company, as applicable, without material penalty or without more than one hundred and twenty (120) days’ notice;
(ii)is a purchase or sale agreement (other than purchase orders issued in the ordinary course of business that do not materially modify the terms of any underlying Contract pursuant to which such purchase orders are issued) with any customer who, in the twelve (12) month period prior to September 30, 2019, was one of the thirty (30) largest sources of revenues for the Business, based on amounts paid or payable;
(iii)any Contract that contains a non-compete provision restricting an Acquired Company from competing with another Person in any material respect;
(iv)any Contract for the supply or purchase of materials, supplies, equipment or services or payments by, such Acquired Company of an amount or value in excess of $250,000 in the twelve (12) month period ended December 31, 2018;
(v)any Contract that contains any (A) “most favored nation” or similar provision in favor of a Person, (B) a provision expressly requiring any Acquired Company to purchase goods or services exclusively from another Person, or (C) provision limiting the freedom of an Acquired Company to engage in any line of business or compete with another Person, in the case of clauses (A) through (C), excluding client Contracts and confidentiality Contracts entered into in the ordinary course of business consistent with past practices;
32



(vi)any Contract (A) for the license of any material Intellectual Property, whether licensed out by Acquired Companies to any other Person or licensed in to the Acquired Companies by any other Person (excluding any (1) “off-the-shelf” or other Software that is available to such Acquired Company pursuant to a standard form commercial license agreement, (2) non-exclusive licenses granted to customers in the ordinary course of business and (3) open source licenses), (B) under which an Acquired Company developed material Intellectual Property for any Person or any Person develops material Intellectual Property for an Acquired Company (other than agreements with employees and independent contractors entered into in the ordinary course of business on standard forms of agreement); or (C) entered into to resolve any material Intellectual Property-related dispute, including settlement agreements, covenants not to sue, coexistence agreements, consent to use agreements, or similar agreements;
(vii)any Contract evidencing Indebtedness of the Acquired Companies (other than any Indebtedness between or among any such Acquired Company, on the one hand, and any of Seller and its Affiliates, on the other hand), agreement of guarantee, support or endorsement of, or any similar commitment with respect to, the obligations, Liabilities or Indebtedness of any other Person (other than another Acquired Company), in each case, in an amount in excess of $150,000;
(viii)any Contract related to the Apple Ridge Funding LLC securitization program or the U.K. Documents (including such documents);
(ix)any Contract requiring capital expenditures by any Acquired Company in excess of $250,000;
(x)any Government Contract;
(xi)any Contract for the acquisition or disposition of any business, or substantially all of the assets (in a single or related series of transactions), properties or rights of such business that has been consummated or is not yet consummated within the three (3) years prior to the date of this Agreement under which any of the Acquired Companies or the Business has any continuing or future liability, including obligations with respect to an “earn-out,” contingent purchase price, deferred purchase price or similar contingent payment obligations or other contingent obligations, indemnification obligations or non-competitive provisions, in each case, with respect to such acquisition or disposition;
(xii)any Labor Agreement;
(xiii)Contract pursuant to which any Acquired Company grants a power of attorney to any other Person, other than power of attorney granted in the ordinary course of business;
(xiv)any Contract pursuant to which such Acquired Company is a lessee of any machinery, equipment, motor vehicles, office furniture, fixtures or other personal property involving annual rental payment in excess of $250,000 in the aggregate and that cannot be terminated by the Acquired Company within thirty (30) days after giving notice of termination without resulting in any material costs or penalty to the Acquired Company;
33



(xv)any material Contract relating to settlement or other final disposition of any Action pursuant to which any Acquired Company would reasonably be expected to be required to make payments in excess of $200,000 in the aggregate;
(xvi)any Contract relating to the disposition or acquisition of all or substantially all of the assets of, or any equity interest in, any Acquired Company; and
(xvii)any partnership, joint venture or similar arrangement between any Acquired Company and any Third Party.
(b)Each Material Contract is in full force and effect and constitutes a legal, valid and binding obligation of the Acquired Company that is party thereto, and is enforceable against such Acquired Company and, to the Knowledge of Seller, represents the legal, valid and binding obligations of and are enforceable against the other parties thereto, in accordance with their terms (except as may be limited by bankruptcy, insolvency, fraudulent transfer, moratorium, reorganization, preference or similar Laws of general applicability relating to or affecting the rights of creditors generally and subject to general principles of equity (regardless of whether enforcement is sought in equity or at law)); and (ii) none of the Acquired Companies, nor to the Knowledge of Seller, any of the other parties thereto, is in material breach of or default under, or has failed to perform any material obligation required to be performed by it under, any Material Contract, and neither the Acquired Companies nor Seller has received any written or, to the Knowledge of Seller, oral notice of any such breach or default and to the Knowledge of Seller, no event has occurred, which individually or in the aggregate, would reasonably be expected to result in a material breach of, a material default under or permit the termination, modification or acceleration of any material obligation under, any Material Contract (in each case, with or without notice or lapse of time or both).
34



(c)Except as set forth in Section 4.10(c) of the Seller Disclosure Letter, with respect to any Government Contract to which any Acquired Company is or has been a party in the past three (3) years: (i) the Acquired Company has been in material compliance with contract requirements and has maintained necessary performance qualifications, certifications and approvals to ensure adequate performance; (ii) representations and certifications applicable to such Government Contract and associated bids or proposals were accurate in all material respects when made and have been updated to remain current if required; (iii) invoices and reports submitted to a customer were accurate in all material respects, and any required adjustments or overpayments have been promptly credited and reported to the applicable customer and recorded in the financial records of the Acquired Company; and (iv) no such Government Contract was awarded on the basis of “small business” status or other preferred bidder status or a disclosure of incurred or projected costs or commercial pricing data, nor includes a pricing guarantee or a duty to accumulate, allocate or report costs of performance, nor requires or involves access to classified information or facilities, nor provides a Governmental Entity or customer with rights to ownership of the Intellectual Property of the Acquired Company. For the three (3) years prior to the date of this Agreement, neither the Acquired Company nor any of its officers, directors, principals, owners or managers has been suspended or debarred from contracting with a Governmental Entity or has been notified in writing of any proposed suspension, debarment or exclusion or received any show cause notice from a suspending or debarring official. As of the date of this Agreement, the Acquired Company does not have a material conflict of interest that would affect the validity of or ability to obtain a government-funded contract and has not been in violation of any applicable restriction or requirement relating to payments to or the offering or giving of anything of value to a Governmental Official. With respect to any Government Contract to which any Acquired Company is or has been a party in the past three (3) years, the Acquired Company has not submitted any materially false or fraudulent claims nor any disclosures to a Governmental Entity pertaining thereto, nor received or made written assertions or demands relating to breach, termination, cure or show-cause notice, audit, investigation, non-responsibility, conflict of interest, inaccurate certification, improper invoicing, false or reckless claim, false statement, fraud, kickback or violation of Law arising under or related to a government-funded contract or an associated bid or proposal.
Section 4.11 Customers and Suppliers. Section 4.11 of the Seller Disclosure Letter sets out the twenty (20) largest customers of the Business (solely based on the aggregate revenues of the Business as set forth on Section 4.11 of the Seller Disclosure Letter) and the ten (10) largest suppliers of the Business (solely based on the aggregate expenditures of the Business (but excluding any enterprise-wide suppliers of Seller) as set forth on Section 4.11 of the Seller Disclosure Letter), in each case for both the twelve (12) month period ended December 31, 2018 and the nine (9) month period ended September 30, 2019. Except as set out in Section 4.11 of the Seller Disclosure Letter or as would not, individually or in the aggregate, reasonably be expected to be material to the Business, taken as a whole, since the Balance Sheet Date to the date of this Agreement, no Acquired Company has received written notice from any such customer or supplier that such customer or supplier, as applicable, intends to terminate or materially modify any existing Contracts or relationship with any Acquired Company, and, to the Knowledge of Seller, no such termination, cancellation, or material or adverse modification has been threatened by any such supplier or customer
Section 4.12 Intellectual Property.
(a)Section 4.12(a) of the Seller Disclosure Letter sets forth a complete and accurate list, as of the date of this Agreement, of all U.S. and foreign applications and registrations for Intellectual Property owned by each Acquired Company and used in the Business. Except as set forth on Section 4.12(a) of the Seller Disclosure Letter, an Acquired Company is the sole and exclusive beneficial and record owner of all of the Intellectual Property set forth thereon, and all such Intellectual Property is subsisting and, to the Knowledge of Seller, valid and enforceable. For the three (3) years prior to the date of this Agreement, there has been no claim asserted or, to the Knowledge of Seller, threated in writing against any Acquired Company challenging the validity or enforceability of any such Intellectual Property.
35



(b)The Acquired Companies take reasonable measures to protect the confidentiality of their material trade secrets, and to the Knowledge of Seller, there has not been any disclosure of or access to any trade secrets used by or in the Business in a manner that has resulted or is likely to result in the loss of trade secret rights in and to such information. Each employee or independent contractor who has contributed to the development of Intellectual Property owned by an Acquired Company has entered into a valid and enforceable agreement (or has similar obligations by operation of law) assigning to an Acquired Company or a predecessor owner such employee’s or contractor’s rights in and to such Intellectual Property and obligating such employee or independent contractor to maintain the confidentiality of the trade secrets and other Confidential Information of the Business.
(c)Each of the Acquired Companies and Seller and its other Affiliates (with respect to the Business) has used commercially reasonable efforts to protect the Systems, including maintaining the confidentiality, integrity, and security of the Systems (and all information stored or contained therein or transmitted thereby from any unauthorized intrusion, breach, use, access, interruption or modification by any Person) and to ensure that all Systems are fully functional and operate and run in a reasonable and efficient business manner. For the three (3) years prior to the date of this Agreement, there have been no failures, breakdowns, outages, bugs, continued substandard performance, or other adverse events affecting any of the Systems that have caused or could reasonably be expected to result in the substantial disruption or interruption in or to the Business which have not been resolved. The Systems are sufficient for the operation of the Business in all material respects. Each of the Acquired Companies and Seller and its other Affiliates (with respect to the Business) has taken commercially reasonable steps to ensure that the Business can continue to operate in all material respects in the event of a failure of the Systems, has implemented and maintains commercially reasonable back-up and disaster recovery plans, and has in place commercially reasonable technical and organizational measures to protect against the unauthorized or unlawful processing of, or accidental loss, destruction or damage of, data.
(d)Each of the Acquired Companies has been, and is, in compliance in all material respects with all Data Security Requirements. For the three (3) years prior to the date of this Agreement, there has been no actual or alleged unauthorized use or theft of, access to, or intrusion or breach of security with respect to, (i) any of the Systems, or (ii) any personal information, payment card information, confidential or proprietary data, or any other information collected, maintained, or stored by or on behalf of the Business or any of the Acquired Companies (or any loss, destruction, compromise, or unauthorized disclosure thereof) in any material respect. During the three (3) years prior to the date of this Agreement, no Acquired Company nor Seller nor any of its other Affiliates (with respect to the Business) has received, or been subject to, any notice, complaint, investigation, inquiry or enforcement proceedings from any Person, alleging material non-compliance with the Data Security Requirements or claiming material compensation or damages in respect thereof, and no such complaint, investigation, inquiry or proceedings have been threatened or are pending.
36



(e)No proprietary Software of an Acquired Company incorporates, embeds, links to, or otherwise uses any “freeware” or “open source” Software in a manner that requires the disclosure, licensing, or distribution of any source code for any portion of the proprietary Software or of any Intellectual Property owned by an Acquired Company, or otherwise requires an Acquired Company to distribute any proprietary Software of an Acquired Company on a royalty-free basis. Each Acquired Company and Seller and its Affiliates (with respect to the Business) has taken commercially reasonable steps to maintain the source code to the proprietary Software of the Acquired Companies in confidence and (i) the source code of such proprietary Software has not been disclosed to any Person other than employees and contractors subject to valid and enforceable written agreements (or similar obligations by operation of law) providing for confidentiality, (ii) there is no current or contingent obligation to disclose any such source code to any other Person, and (iii) no Person other than the Acquired Companies (and such employees and contractors) is in possession of any such source code. Each Acquired Company is in material compliance with all obligations under any agreement pursuant to which such Acquired Company has obtained the right to use any third party Software, including open source software, and in particular such Acquired Company has purchased a sufficient number of seat licenses therefor.
Section 4.13 Real Property.
(a)Except as set forth on Section 4.13(a) of the Seller Disclosure Letter, none of the Acquired Companies nor any of their respective Subsidiaries own any real property. Nothing in this Section 4.13(a) applies to, and no representation is given with respect to, residential homes owned or held by Cartus Corporation, Cartus Financial Corporation, Cartus Relocation Canada Limited, Cartus Limited or Cartus Financing Ltd. for the benefit of their clients in connection with the Business.
(b)Section 4.13(b) of the Seller Disclosure Letter sets forth the addresses of all of the leasehold or subleasehold estates and other rights to use or occupy any land, buildings, structures, improvements, fixtures or other interests in real property held by any of the Acquired Companies (to the extent relating to the Business) (the leased real property listed on Section 4.13(b) of the Seller Disclosure Letter being referred to collectively as the “Leased Real Properties”) and the leases, subleases, licenses, concessions or other similar such agreements (written or oral, together with all amendments, extensions, renewals, guaranties and other agreements with respect thereto in the possession of Seller) pursuant to which the applicable Acquired Company has an interest in the Leased Real Properties (collectively, the “Real Property Leases”), including the date of each such Real Property Lease document. Seller or its Affiliates have delivered to Buyer a true and complete copy of each Real Property Lease in Seller’s possession as of the date of this Agreement, and in the case of any known oral Real Property Lease, a written summary of the material terms of such oral Real Property Lease.
37



(c)With respect to each Real Property Lease: (i) such Real Property Lease constitutes the entirety of the agreement in possession of Seller to which the applicable Acquired Company is a party with respect to the Leased Real Property; (ii) each Real Property Lease is legal, valid and binding and enforceable in accordance with its terms; (iii) except as may be set forth in Section 4.13(c) of the Seller Disclosure Letter to the contrary, the applicable Acquired Company has not assigned, sublet, transferred or conveyed any interest in such Real Property Lease or the applicable Leased Real Property (other than any sublease or license that will expire prior to the Closing); (iv) neither the applicable Acquired Company nor, to the Knowledge of Seller, any other party has received notice of any material breach or material default under any Real Property Lease and, to the Knowledge of Seller, no event has occurred or circumstance exists which, with the delivery of notice, the passage of time, or both, would constitute such a breach or default thereunder; (v) there are no condemnation or eminent domain proceedings overtly threatened in writing or, to the Knowledge of Seller, pending or contemplated concerning the Leased Real Property; (vi) to the Knowledge of Seller, the applicable Acquired Company’s possession and quiet enjoyment of the Leased Real Property under each Real Property Lease has not been disturbed, and to the Knowledge of Seller, there are no material disputes with respect to any such Real Property Lease; and (vii) no Acquired Company has collaterally assigned or granted any other security interest in any Real Property Lease or any interest therein, except as may be set forth to the contrary in the Real Property Leases.
(d)The Leased Real Property constitutes all of the real property used or intended to be used in, or otherwise related to, the Business and, to the Knowledge of Seller, all Leased Real Property is in good condition and repair, normal wear and tear excepted, and sufficient for the operation of the Business and in the condition and repair as required under the relevant lease.
Section 4.14 Employees. Section 4.14 of the Seller Disclosure Letter sets forth a complete list, as of the date of this Agreement, of the identification number and position of each employee of: (a) the Acquired Companies whose duties and responsibilities are primarily related to the Business, and (b) Seller or its Affiliates (not including the Acquired Companies) identified by Seller as supporting the Business (the “Business Employees”), as such list may be updated in accordance with Section 8.1(a).
Section 4.15 Labor Matters.
(a)Except as set forth in Section 4.15(a) of the Seller Disclosure Letter, none of the Acquired Companies or the Business is party to, or bound by, any labor agreement, collective bargaining agreement or any other labor-related agreements with any labor union, works council, or other labor organization (to the extent relating to the Business) (“Labor Agreement”).
(b)For the past three (3) years, no labor union, labor organization or group of employees of the Acquired Companies, the Offer Employees, or Inactive Employees has made a demand for recognition or certification, and there are no representation or certification proceedings or petitions seeking a representation proceeding presently pending or threatened to be brought or filed with the National Labor Relations Board or any other labor relations tribunal or authority (to the extent relating to the Business). To the Knowledge of Seller, in the past three (3), there have been no ongoing or threatened labor union organizing activities with respect to any Acquired Companies (to the extent relating to the Business), the Offer Employees, or Inactive Employees.
(c)For the past three (3) years, there has been no actual or, to the Knowledge of Seller, threatened unfair labor practice charges, material grievances, material arbitrations, strikes, lockouts, work stoppages, slowdowns, picketing, hand billing or other labor disputes against or affecting the Acquired Companies (to the extent relating to the Business), the Offer Employees, or Inactive Employees. With respect to the Transaction, the Acquired Companies and Seller and its Affiliates have satisfied all notice, consultation, bargaining, and consent obligations owed to the Business Employees under applicable Law or Labor Agreement.
38



(d)The Acquired Companies and Seller and its Affiliates (to the extent relating to the Business) are, and for the past three (3) years have been, in compliance in all material respects with all applicable Laws relating to labor and employment matters, including those relating to wages, working time (including payment of overtime and monitoring of working time), equal opportunity, fair labor standards, nondiscrimination, workers compensation, collective bargaining, employees’ mandatory representation, workplace safety, immigration, employee and worker classification, and the payment and withholding of social security and other payroll Taxes. Except as would not result in material Liability to the Acquired Companies or the Business: (i) the Acquired Companies and Sellers and its Affiliates have fully and timely paid all wages, salaries, wage premiums, prevailing wages, commissions, bonuses, fees, and other compensation which have come due and payable to its current and former employees and independent contractors under applicable Law, Contract, or Acquired Company policy; and (ii) each individual who has provided services to the Acquired Companies in the three (3) years prior to the date of this Agreement and was classified and treated by the Acquired Companies or Seller or its Affiliates as an independent contractor, consultant, or other service provider is and was properly classified and treated for all applicable purposes.
(e)To the Knowledge of Seller, no officer or executive of the Acquired Companies, Offer Employee, or Inactive Employee: (i) has any present intention to terminate his or her employment with the Acquired Companies within the first twelve (12) months following the Closing Date; or (ii) is a party to or bound by any confidentiality, non-competition, proprietary rights or other agreement that would materially restrict the performance of such employee’s employment duties or the ability of Acquired Companies to conduct their business.
(f)The Acquired Companies have investigated all material allegations of employment discrimination and sexual harassment by, or against, any employee.
Section 4.16 Employee Benefit Plans
(a)Section 4.16(a) of the Seller Disclosure Letter sets forth a list of each material Seller Plan, separately designating each Business Plan, and indicating whether such plan is a Foreign Plan. Except as specifically indicated on Section 4.16(a) of the Seller Disclosure Letter, no Business Plan covers employees of Seller or any of its Affiliates (other than the Acquired Companies). With respect to each material Business Plan, Seller or its Affiliates have made available to Buyer a true and complete copy of the following items (in each case, only if applicable): (i) the plan document (or if such Business Plan is not reduced to writing, a summary of the material terms of such Business Plan) and any amendments thereto; (ii) each trust, insurance or other funding arrangement; (iii) each summary plan description and summary of material modifications; (iv) the most recently filed annual report on the IRS Form 5500 and all required schedules and attachments; (v) the most recent financial statements and actuarial or other valuation reports prepared with respect thereto; (vi) the most recently received IRS determination or opinion letter; and (vii) each form award or grant agreement or notice. With respect to each material Seller Plan that is not a Business Plan, Seller or its Affiliates have made available to Buyer a current and complete copy of the most recent summary plan description or a summary of the material terms thereof.
(b)The Seller Plans have been established, maintained, funded and operated in all material respects in compliance with their terms and, to the extent applicable, provisions of ERISA, the Code and all other applicable Laws. Other than routine claims for benefits, there are no Actions pending or, to the Knowledge of Seller, threatened in writing with respect to any Seller Plan, except as would not result in a material Liability to any of the Acquired Companies, Buyer or any of its Affiliates.
39



(c)Each Seller Plan intended to be qualified under Section 401(a) of the Code has received a favorable determination or opinion letter from the IRS that it is so qualified, and each related trust that is intended to be exempt from federal income Tax pursuant to Section 501(a) of the Code has received a determination or opinion letter from the IRS that it is so exempt, and, to the Knowledge of Seller, there are no existing circumstances or events that would reasonably be expected to adversely affect such qualification or exemption, as the case may be.
(d)Except as set forth on Section 4.16(d) of the Seller Disclosure Letter, no Seller Plan or Business Plan is, and none of Seller, the Acquired Companies, their Subsidiaries or their ERISA Affiliates have or could reasonably be expected to have any Liability under or with respect to, (i) a “multiemployer plan” (within the meaning of Section 3(37) of ERISA), (ii) any single employer defined benefit pension plan or other pension plan subject to Title IV or Section 302 of ERISA or Sections 412 or 430 of the Code or (iii) a plan, agreement or arrangement that provides for medical, life insurance or other welfare-type benefits after termination of employment or service, except as required under Section 4980B of the Code or any other similar applicable Law for which the covered individual pays the full premium cost or for coverage through the end of the calendar month in which a termination of employment occurs.
(e)Except as would not result in a material Liability to any of the Acquired Companies, Buyer or any of its Affiliates, (i) all contributions, distributions, premium payments and disbursements required to be made with respect to any Seller Plan have been timely made or properly accrued, (ii) there have been no “prohibited transactions” (as that term is defined in Section 406 of ERISA or Section 4975 of the Code) or breaches of fiduciary duty with respect to any Seller Plan, and (iii) all reports, returns and similar documents required to be filed with any Governmental Entity or distributed to any Seller Plan participant have been timely filed or distributed. None of the Acquired Companies have incurred, nor do any of them reasonably expect to incur, any material Liability under Sections 4980B, 4980D, 4980H, 6721 or 6722 of the Code.
(f)Except as would not result in a material Liability to any of the Acquired Companies, Buyer or any of its Affiliates, each Foreign Plan (i) to the extent required to be registered or approved by a non-U.S. Governmental Entity, has been registered or approved and has been maintained in good standing with applicable regulatory authorities, and, to the Knowledge of Seller, no event has occurred since the date of the most recent approval or application therefor relating to any such Foreign Plan that would reasonably be expected to adversely affect any such approval or good standing; (ii) that is intended to qualify for special Tax treatment meets all requirements for such treatment; and (iii) if required to be book reserved, funded or insured, is so reserved, funded or insured, in compliance with applicable Laws. No Foreign Plan is a defined benefit pension plan or provides similar pension benefits or has any material unfunded Liabilities that are not reflected or reserved against on the Balance Sheet, nor are such material unfunded Liabilities reasonably expected to arise in connection with the Transaction.
40



(g)Neither the execution of this Agreement nor the Transaction could (either alone or in combination with the occurrence of any additional or subsequent events, directly or indirectly): (i) result in any payment becoming due or increase the amount of any compensation due to any current or former Business Employee or any other natural service provider to the Business, (ii) increase any compensation or benefits otherwise payable under, or trigger any funding obligation under or to, any Seller Plan, (iii) accelerate the time of payment, funding or vesting of any such benefits or (iv) result in any “parachute payment” as defined in Section 280G(b)(2) of the Code that would not be deductible for U.S. federal income tax purposes.
(h)No Seller Plans provide for a “gross-up” of interest or Taxes incurred under Section 4999 or Section 409A of the Code.
Section 4.17 Compliance with Laws
(a)Each Acquired Company is in compliance with all applicable Laws (to the extent relating to the Business) except where the failure to comply would not, individually or in the aggregate, reasonably be expected to result in Damages in excess of $2,500,000 payable by any Acquired Company or to materially impair the operation of the Business. In the five (5) years prior to the date of this Agreement, no Acquired Company has received any written or, to the Knowledge of Seller, oral notice or inquiry relating to any such actual or potential violation of or material liability or potential responsibility under any such Laws (to the extent relating to the Business).
(b)All material approvals, authorizations, permits, registrations, franchises, certificates and licenses (collectively, “Permits”) required to conduct the Business, as conducted on the date of this Agreement and immediately prior to Closing, are in the possession of the Acquired Companies, are in full force and effect and the Business is being operated in compliance therewith, except for where the failure to possess such Permits or be in compliance therewith would not be material to the Business taken as a whole.
(c)Neither Seller, nor any of the Acquired Companies (in each case, to the extent relating to the Business), nor any of their respective Affiliates acting on their behalf, nor, to the Knowledge of Seller as of the date of this Agreement, any of their respective agents or other third parties acting on their behalf: (i) is currently, or has, in the five (5) years prior to the date of this Agreement, been, (A) a Sanctioned Person, (B) organized, resident or located in a Sanctioned Country, (C) engaging in any dealings or transactions with any Sanctioned Person or in any Sanctioned Country, to the extent such activities violate applicable Sanctions Laws or Export-Import Laws or (D) otherwise in material violation of applicable Sanctions Laws or Export-Import Laws (collectively, “Trade Control Laws”); or (ii) has at any time made any unlawful payment or given, offered, promised, authorized, received or agreed to give or receive, any money or thing of value, directly or indirectly, to or from any Governmental Official or other Person in material violation of any Anti-Bribery Laws or has otherwise been in material violation of any Anti-Bribery Laws.
(d)In the five (5) years prior to the date of this Agreement, neither Seller nor any of the Acquired Companies, in each case concerning any actual or alleged violation or wrongdoing related to Trade Control Laws or Anti-Bribery Laws, has (i) received from any Governmental Entity or any other Person any written notice, inquiry, or internal or external allegation, (ii) made any voluntary or involuntary disclosure to a Governmental Entity or (iii) conducted any internal investigation or audit.
41



(e)To the Knowledge of Seller, the Acquired Companies and Seller (in each case, to the extent relating to the Business) have been for the three (3) years prior to the date of this Agreement and are in compliance with Laws directly applicable to the Acquired Companies and Seller (in each case, to the extent relating to the Business) pertaining to the protection or processing of personal data or other personally identifiable information and non-public information of individuals, except as would not, individually or in the aggregate, reasonably be expected to be material to the Business, taken as a whole. Neither any Acquired Company nor Seller (in each case, to the extent relating to the Business), have or has within the three (3) years prior to the date of this Agreement received any written claims, notices or complaints regarding the use or processing by the Business or the Acquired Companies of any personal data or other personally identifiable information and non-public information of individuals, except as would not, individually or in the aggregate, reasonably be expected to be material to the Business, taken as a whole.
(f)No audit, review, or examination of any Acquired Company by any Governmental Entity or its agents has resulted in material adverse findings, directives, requests, Orders, or corrective actions, that have not been fully resolved, implemented, or otherwise remain outstanding. None of Seller nor any Acquired Company has received written notice from any Governmental Entity threatening to suspend, revoke, withdraw or modify any such Consent and none of the material Consents are reasonably expected to be terminated as a result of or in connection with the Transaction or any Transaction Documents.
Section 4.18 Environmental Matters
(a)For the three (3) years prior to the Closing Date (or earlier for matters which have not been fully resolved), neither Seller nor any of the Acquired Companies has received written notice that any of the Acquired Companies or the Business is not in compliance with or has any Liability under any applicable Environmental Laws.
(b)Seller (with respect to the Business) and the Acquired Companies (i) are and for the three (3) years prior to the Closing Date, have been in material compliance with all Environmental Laws, and (ii) have obtained, and are and, for the three (3) years prior to the Closing Date, have been in compliance with (except where the failure to comply would not be material), all material Permits that are required pursuant to any Environmental Laws in order to conduct the Business, including as conducted as of the date of this Agreement.
42



(c)Except as set forth in Section 4.18(c) of the Seller Disclosure Letter, Seller and the Acquired Companies have received no unresolved notice of any claim of exposure of any Person to any Hazardous Materials. Except as set forth in Section 4.18(c) of the Seller Disclosure Letter, there has been no treatment, storage, disposal, transport or release of, contamination by, or exposure of any Person to any Hazardous Materials (including at, on, under or from: (i) the Leased Real Property or (ii) any other property currently or formerly owned, leased or operated by any Acquired Company or otherwise in connection with the Business in any way or by any other Person not in connection with the Business) in a manner that has given or would give rise to any material Liability relating to, Environmental Laws for any Acquired Company. Nothing in this Section 4.18(c) applies to, and no representation is given with respect to, residential homes owned or held by Cartus Corporation, Cartus Financial Corporation, Cartus Relocation Canada Limited, Cartus Limited or Cartus Financing Ltd. for the benefit of their clients in connection with the Business.
(d)Seller and the Acquired Companies have furnished to Buyer all environmental assessments, audits and reports and other material environmental documents in their possession or control relating to the Business.
Section 4.19 Insurance. Section 4.19 of the Seller Disclosure Letter lists, as of the date of this Agreement, each insurance policy maintained by, or which covers the assets, properties, directors, officers or liabilities of, the Acquired Companies (to the extent relating to the Business), whether maintained by the Acquired Companies or Seller or any of their respective Affiliates, and a description of any self-insurance or co-insurance arrangements by or affecting any Acquired Company, including any reserves established thereunder (all of the insurance policies set forth or required to be set forth in Section 4.19 of the Seller Disclosure Letter, the “Insurance Policies”). As of the date of this Agreement, neither Seller nor its Subsidiaries has received written notice of cancellation, termination, denial of coverage or material increase in deductible or premiums with respect to any such Insurance Policy, and each such Insurance Policy is and will remain through the Closing Date in full force and effect. Neither Seller nor its Subsidiaries is in default in any material respect with respect to its obligations under any of such Insurance Policies, and all premiums or other payments due and payable under such Insurance Policies have been paid on a timely basis. No current or historical limits under any Insurance Policy has been eroded or materially impaired by claims. There has not been any failure by the Acquired Companies or Seller or any of their respective Affiliates to give notice of any material pending claim under any Insurance Policy in a timely fashion or in the manner or detail required by such Insurance Policy. No written disallowance of, or reservation of rights letter with respect to, any material claim under any Insurance Policy has been received by any Acquired Company or Seller or any Affiliate of Seller. No Acquired Company nor Seller or any of its Affiliates has been refused any insurance (other than, for the avoidance of doubt, pursuant to a decision made by the carrier in the ordinary course not to provide a quote for any particular coverage), nor has any of their coverage been limited by any insurance carrier to which any of them has applied for insurance or with which any of them has carried insurance during the three (3) years prior to the date of this Agreement.
Section 4.20 Title to and Sufficiency of Acquired Company Assets.
(a)The Acquired Companies have good and valid title or a valid leasehold interest to possess or use all of their material property and assets (other than the Excluded Assets), whether tangible or intangible, used or held for use in the Business, located on its premises to the extent related to the Business, reflected on the Financial Statements or acquired since the Balance Sheet Date, free and clear of all Encumbrances, except for Permitted Encumbrances.
43



(b)At the Closing and following the Restructuring, the assets, property and interests of the Acquired Companies, together with the assets used to provide services to Buyer under the Transition Services Agreement, will constitute all of the material assets, property and interests (other than the Excluded Assets) used in the conduct of the Business during the past twelve (12) months (including all right, title and interest of the Seller and its Affiliates to “Alpha” and “MovePro360”).
Section 4.21 Affiliate Transactions
(a)Except as set forth on Section 4.21(a) of the Seller Disclosure Letter, no Affiliate of the Acquired Companies (other than another Acquired Company) is a party to any Contract with any Acquired Company (collectively, the “Affiliated Contracts”).
(b)Section 4.21(b) of the Seller Disclosure Letter sets forth as of the date of this Agreement all Contracts of Seller and/or any of its Affiliates (other than the Acquired Companies) from which the Acquired Companies and/or the Business derive a material benefit (other than any Contract to which an Acquired Company is a party and any Contract relating to the services provided under the Transition Services Agreement).
(c)Except as set forth and described on Section 4.21(c) of the Seller Disclosure Letter, none of the material assets or properties (real, personal or mixed, tangible or intangible) used by the Acquired Companies are owned by Seller or any of its Affiliates (other than the Acquired Companies).
(d)Section 4.21(d) of the Seller Disclosure Letter sets forth a true and complete list of all guarantees, assurances and other credit support provided by any of the Acquired Companies, in each case to support obligations of Seller or any of its Affiliates (the “Credit Support Obligations”) and all guarantees, security agreements, pledge agreements, trust agreements and other documents, instruments and financing statements providing for a pledge of any capital stock or other equity interests of any Acquired Company, granting an Encumbrance over any assets of any Acquired Company or otherwise providing for any guarantee or other Credit Support Obligations by any Acquired Company with respect to or securing obligations under the Credit Support Obligations (the guarantees, security agreements, pledge agreements, trust agreements and other documents, instruments and financing statements listed or required to be listed on Section 4.21(d) of the Seller Disclosure Letter, collectively, the “Credit Support Documents”).
(e)No right, title or interest in any property, plant, equipment, Intellectual Property or Systems of any Acquired Company has been transferred to Seller or any of its Affiliates (other than another Acquired Company) since January 1, 2019.
Section 4.22 Disclaimer. EXCEPT AS SET FORTH IN THIS ARTICLE IV AND ARTICLE V AND THE CERTIFICATE CONTEMPLATED IN SECTION 10.2(D), NEITHER SELLER, THE ACQUIRED COMPANIES NOR ANY OF THEIR RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES OR REPRESENTATIVES MAKE OR HAVE MADE ANY OTHER REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, AT LAW OR IN EQUITY, IN RESPECT OF SELLER, THE ACQUIRED COMPANIES OR THEIR AFFILIATES OR THEIR RESPECTIVE BUSINESS, OPERATIONS, ASSETS, LIABILITIES, CONDITIONS (FINANCIAL OR OTHERWISE). NOTWITHSTANDING THE DELIVERY OR DISCLOSURE TO BUYER OR ANY OF ITS REPRESENTATIVES OF ANY DOCUMENTATION, FORECASTS OR OTHER INFORMATION WITH RESPECT TO ANY
44



ONE OR MORE OF THE FOREGOING, INCLUDING WITH RESPECT TO MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE. WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, NEITHER SELLER, ANY OF THE ACQUIRED COMPANIES NOR ANY OTHER PERSON MAKES OR HAS MADE ANY EXPRESS OR IMPLIED REPRESENTATION OR WARRANTY TO BUYER OR ANY OF ITS REPRESENTATIVES WITH RESPECT TO (A) ANY FINANCIAL PROJECTION, FORECAST, ESTIMATE OR BUDGET RELATING TO SELLER, ANY OF THE ACQUIRED COMPANIES, THE BUSINESS OR ANY OF THEIR RESPECTIVE REPRESENTATIVES OR, (B) EXCEPT FOR THE REPRESENTATIONS AND WARRANTIES MADE BY SELLER IN THIS Article IV AND Article V AND THE CERTIFICATE CONTEMPLATED IN SECTION 10.2(D), ANY ORAL OR WRITTEN INFORMATION PRESENTED TO BUYER OR ANY OF ITS REPRESENTATIVES IN THE COURSE OF THEIR DUE DILIGENCE INVESTIGATION OF SELLER, ANY OF THE ACQUIRED COMPANIES, THE BUSINESS, THE NEGOTIATION OF THE TRANSACTION DOCUMENTS OR THE COURSE OF THE TRANSACTION.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF SELLER
Except as disclosed in the Seller Disclosure Letter, Seller hereby represents and warrants to Buyer as follows:
Section 5.1 Corporate Organization. Seller (a) is a corporation duly organized, validly existing and in good standing under the Laws of the State of Delaware and (b) has the requisite corporate or other organizational power and authority to own, lease and operate its assets and properties and to carry on its business as it is now being conducted, in each case.
Section 5.2 Authority. Seller has full corporate power and authority to execute, deliver and perform its obligations under the Transaction Documents and to consummate the Transaction, except where the failure to have such power and authority would not prohibit or materially impair or delay Seller’s ability to consummate the Transaction and to execute, deliver and perform its obligations under the Transaction Documents. The execution, delivery and performance by Seller of the Transaction Documents and the consummation by Seller of the Transaction have been duly and validly authorized by all required action on the part of Seller, and no other proceedings on the part of Seller are necessary to authorize the execution, delivery and performance by Seller of the Transaction Documents or to consummate the Transaction. This Agreement has been duly and validly executed and delivered by Seller and, assuming the due authorization, execution and delivery of this Agreement by Buyer, constitutes a legal, valid and binding obligation of Seller enforceable against Seller in accordance with the terms and provisions of this Agreement (except as may be limited by bankruptcy, insolvency, fraudulent transfer, moratorium, reorganization, preference or similar Laws of general applicability relating to or affecting the rights of creditors generally and subject to general principles of equity (regardless of whether enforcement is sought in equity or at law)).
Section 5.3 Consents and Approvals; No Conflict
45



(a)No filing with or notice to, and no Consent of, any Governmental Entity is required on the part of Seller or any Acquired Company for the execution, delivery and performance by Seller of this Agreement or any Transaction Document or the consummation by Seller of the Transaction, except (i) compliance with the applicable requirements of the HSR Act and any non-U.S. Antitrust Laws set forth on Section 5.3(a)(i) of the Seller Disclosure Letter; (ii) compliance with the Permits relating to the Business set forth on Section 5.3(a)(ii) of the Seller Disclosure Letter; or (iii) as otherwise set forth on Section 5.3(a)(iii) of the Seller Disclosure Letter.
(b)Subject to receipt of the Consents set forth in Section 5.3(b) of the Seller Disclosure Letter, neither the execution, delivery or performance of any of the Transaction Documents nor the consummation by Seller of the Transaction will: (i) violate, breach or conflict with, or allow any Person to exercise any rights under the Organizational Documents of Seller; or (ii) except as would not reasonably be expected to have, individually or in the aggregate, a material and adverse effect on Seller’s ability to perform its obligations hereunder, (x) violate any Law (related to the Business) to which Seller is subject or (y) require a Consent under, conflict with, result in a violation or breach of, or constitute a default under, result in the acceleration of, create in any party the right to accelerate, terminate or cancel any material Contract to which Seller is a party.
Section 5.4 Litigation; Orders. As of the date of this Agreement, there are no pending or, to the Knowledge of Seller, threatened Actions against Seller that, if adversely determined, would (a) reasonably be expected to have, individually or in the aggregate, a material and adverse effect on Seller’s ability to perform its obligations hereunder or (b) prohibit or materially impair or delay the performance or consummation of the Transaction. Seller is not subject to any Order which would prohibit or materially impair or delay the consummation of the Transaction.
Section 5.5 Ownership.
(a)Seller has good and valid title to and beneficial ownership of the Shares, and the Shares are (i) validly issued, fully paid and non-assessable and (ii) except as set forth in Section 5.5(a) of the Seller Disclosure Letter, free and clear of all Encumbrances.
(b)Other than the Shares listed on Section 4.5(a)(ii) and Section 5.5(a) of the Seller Disclosure Letter, Seller owns no equity interest of the Acquired Companies.
Section 5.6 Brokers. Except for Barclays Capital Inc., no broker, investment banker, financial advisor or other Person is entitled to any broker’s, finder’s, financial advisor’s or other similar fee or commission in connection with this Agreement or the Transaction based upon arrangements made by or on behalf of the Acquired Companies or Seller; provided that any such fee or commission (contingent or otherwise) will be the sole responsibility of Seller.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer hereby represents and warrants to Seller as follows:
46



Section 6.1 Corporate Organization. Buyer (a) is a corporation duly organized, validly existing and in good standing under the Laws of the State of Delaware and (b) has the requisite corporate or other organizational power and authority to own, lease and operate its assets and properties and to carry on its business as it is now being conducted.
Section 6.2 Authority. Buyer has full corporate power and authority to execute, deliver and perform its obligations under the Transaction Documents and to consummate the Transaction, except where the failure to have such power and authority would not prohibit or materially impair or delay Buyer’s ability to consummate the Transaction and to execute, deliver and perform its obligations under the Transaction Documents. The execution, delivery and performance by Buyer of the Transaction Documents and the consummation by Buyer of the Transaction have been duly and validly authorized by all required action on the part of Buyer, and no other proceedings on the part of Buyer are necessary to authorize the execution, delivery and performance by Buyer of the Transaction Documents or to consummate the Transaction. This Agreement has been duly and validly executed and delivered by Buyer and, assuming the due authorization, execution and delivery of this Agreement by Seller, constitutes a legal, valid and binding obligation of Buyer, enforceable against Buyer in accordance with the terms and provisions of this Agreement (except as may be limited by bankruptcy, insolvency, fraudulent transfer, moratorium, reorganization, preference or similar Laws of general applicability relating to or affecting the rights of creditors generally and subject to general principles of equity (regardless of whether enforcement is sought in equity or at law)).
Section 6.3 Consents and Approvals; No Conflict. Neither the execution, delivery or performance of any of the Transaction Documents, nor the consummation by Buyer of the Transaction will: (a) violate, breach or conflict with, or allow any Person to exercise any rights under, the Organizational Documents of Buyer; (ii) violate any Law to which Buyer is subject or (iii) require a Consent under, conflict with, result in a violation or breach of, or constitute a default under, result in the acceleration of, create in any party the right to accelerate, terminate or cancel any material Contract to which Buyer is a party.
Section 6.4 Litigation; Orders. There are no pending or, to the knowledge of Buyer, threatened, Actions against Buyer that, if adversely determined, would (a) reasonably be expected to have, individually or in the aggregate, a material and adverse effect on Buyer’s ability to perform its obligations hereunder or (b) prohibit or materially impair or delay the performance or consummation of the Transaction. Buyer is not subject to any Order which would prohibit or materially impair or delay the consummation of the Transaction.
Section 6.5 Investment Purpose. Buyer is acquiring the Shares for its own account with the present intention of holding such securities for investment purposes and not with a view to, or for sale in connection with, any distribution of such securities in violation of any federal or state securities Laws. Buyer (a) is able to bear the economic risk of its investment in the Shares, (b) acknowledges that the Shares have not been registered under the Securities Act and therefore are subject to certain restrictions on transfer unless registered for resale or subject to an exempt transaction under the Securities Act and any applicable state securities Law and none of Seller or the Acquired Companies is under any obligation to file a registration statement with the SEC with respect to the Shares and (c) has such knowledge and experience in financial and business matters that it is capable of evaluating the merits and risks of its investment in the Shares.
47



Section 6.6 Financial Capacity.
(a)Buyer has delivered to Seller true, accurate and complete copies of (i) the fully executed debt commitment letter (including all exhibits, schedules and annexes thereto and the executed fee letter associated therewith and referenced therein (which fee letters may be redacted with respect to any interest rates, fee amounts, pricing caps and other similar economic terms (including flex terms) set forth therein)), dated as of November 6, 2019, between Buyer and Barclays, Deutsche Bank AG New York Branch, Deutsche Bank Securities Inc., Bank of America, N.A. and BofA Securities, Inc. (the “Debt Commitment Letter”) and (ii) the fully executed commitment letter (including all exhibits, schedules and annexes thereto and the executed fee letter associated therewith and referenced therein (which fee letters may be redacted with respect to any interest rates, fee amounts, pricing caps and other similar economic terms (including flex terms) set forth therein)), dated as of November 6, 2019, between an Affiliate of Buyer and Wells Fargo Bank, National Association, and Wells Fargo Bank, N.A., London Branch (the “Securitization Commitment Letter” and, together with the Debt Commitment Letter, collectively, the “Debt Financing Commitments”), pursuant to which Debt Financing Sources party thereto have committed, subject only to the terms and conditions expressly set forth therein, to provide debt financing and securitization financing, respectively, in the amounts set forth therein for the purposes of funding the Transaction and terminating the existing U.S. securitization facilities of the Acquired Companies (the “Debt Financing”) and (iii) the executed equity commitment letter (including all exhibits, schedules and annexes thereto), dated as of November 6, 2019, between Buyer and the Guarantors (the “Equity Financing Sources” and such equity commitment letter, the “Equity Financing Commitments” and, together with the Debt Financing Commitments, the “Financing Commitments”), pursuant to which the Equity Financing Sources have committed, subject only to the terms and conditions expressly set forth therein, to provide equity financing in the amounts set forth therein for the purposes of funding the Transaction (the “Equity Financing” and, together with the Debt Financing, the “Financing”).
48



(b)The Equity Financing Commitments provide, and will continue to provide, that Seller is an express Third Party beneficiary thereof on the terms specified therein with respect to the provisions specified therein. Each of the Financing Commitments, as delivered, is in full force and effect on the date of this Agreement and, as of the date of this Agreement, the respective commitments contained in the Financing Commitments have not been withdrawn, rescinded or terminated, or otherwise amended, supplemented or modified in any respect, and no withdrawal, rescission, termination, amendment, supplement or modification is contemplated (except in connection with any amendments or modifications to effectuate any “market flex” terms contained in the Debt Financing Commitments provided as of the date hereof or to add any additional agents or other financial institutions thereto as provided for therein). As of the date of this Agreement, the Financing Commitments constitute legal, valid and binding obligations of Buyer and, to the knowledge of Buyer, the other parties thereto, enforceable in accordance with its respective terms against the parties thereto (except as may be limited by bankruptcy, insolvency, fraudulent transfer, moratorium, reorganization, preference or similar Laws of general applicability relating to or affecting the rights of creditors generally and subject to general principles of equity (regardless of whether enforcement is sought in equity or at law)). As of the date of this Agreement, Buyer has fully paid (or caused to be fully paid) any and all commitment fees, costs and expenses or other fees, costs and expenses required to be paid on or prior to the date of this Agreement pursuant to the Financing Commitments, and Buyer will fully pay (or will cause to be fully paid), after the date of this Agreement, any and all other commitments or other fees, costs and expenses pursuant to the Financing Commitments as and when they become due and payable. Except for the Financing Commitments and as set forth therein, there are no other agreements, side letters, understandings or other arrangements of any kind to which Buyer or any of its Affiliates is a party that (i) relate to the Financing, or (ii) impose additional conditions, or modify, amend or expand the conditions to the funding of the Financing in a manner that would impair the availability of the Financing. Assuming satisfaction of the conditions set forth in Article X, as of the date of this Agreement, Buyer does not know of any facts or circumstances that could be expected to result in Buyer being unable to satisfy, prior to Closing, any term or condition of Closing to be satisfied by it contained in the Financing Commitments, or that could otherwise cause the Financing to be unavailable on the Closing Date. As of the date of this Agreement, no party to any Financing Commitment has notified Buyer, or any of its Affiliates, of its intention to terminate the Financing Commitment or not to provide the Financing.
(c)As of the date of this Agreement, no event has occurred or circumstance exists which, with or without notice, lapse of time or both, would (x) constitute a default or breach on the part of Buyer or, to Buyer’s knowledge, any other party thereto under any term or condition of any of the Financing Commitments or (y) result in any portion of the Financing Commitments being unavailable on the Closing Date. As of the date of this Agreement, neither Buyer nor any of its Affiliates has any reason to believe (both before and after giving effect to any market flex provisions contained in the Debt Financing Commitments) that any of the terms or conditions contained in the Financing Commitments will not be satisfied on a timely basis on or before the Closing Date or that the full amounts committed pursuant to the Financing will not be available to Buyer on the Closing Date if the terms or conditions to be satisfied by it contained in the Financing Commitments are satisfied. The aggregate proceeds contemplated by the Financing Commitments and cash held by Buyer will be sufficient for Buyer to (i) pay the Closing Date Payment, (ii) to pay any and all fees and expenses required to be paid by Buyer in connection with the Financing or the Transaction, (iii) (without duplication to clause (i)), to satisfy when due all of the payment obligations of Buyer required pursuant to this Agreement to consummate the Transactions and the Financing on or prior to the Closing, (iv) repay or refinance all Indebtedness set forth in Section 7.21(a) of the Seller Disclosure Letter required to be repaid, refinanced, redeemed and (v) terminate and repay in full the Apple Ridge Funding LLC securitization program (as in effect on the date hereof) of the Acquired Companies (clauses (i) through (v), the “Required Amount”).
49



(d)Concurrently with the execution of this Agreement, Buyer has caused the Guarantors to deliver a true, accurate and complete copy of the fully executed Limited Guaranty (including all exhibits, schedules and annexes thereto), dated as of the date of this Agreement, to Seller. The Limited Guaranty is in full force and effect and has not been withdrawn or terminated or otherwise amended, supplemented or modified in any respect. The Limited Guaranty is a legal, valid and binding obligation of the Guarantors, enforceable against the Guarantors in accordance with its terms. The execution and delivery of the Limited Guaranty by each Guarantor, and the consummation of the transactions contemplated thereby in accordance with the terms thereof, do not (i) violate, conflict with or result in a default (whether after the giving of notice, lapse of time or both) under, or give rise to a right of termination of any provision of the Organizational Documents of such Guarantor, (ii) violate or result in a violation of, or constitute a default (whether after the giving of notice, lapse of time or both) under, any provision of material Law applicable to such Guarantor, or (iii) violate, conflict with or result in a default (whether after the giving of notice, lapse of time or both) under, or give rise to a right of termination under, or require any Consent under, any material Contract to which such Guarantor is a party. No event has occurred or circumstance exists that, with or without notice, lapse of time or both, could constitute a default or breach on the part of the Guarantors under such Limited Guaranty.
(e)Buyer acknowledges that, subject in all respects to Article XI and Section 13.8(b), its obligations set forth in this Agreement are not contingent or conditioned upon Buyer’s, its Affiliate’s or any other Person’s ability to obtain financing (including the Financing or any Alternative Financing) for or in connection with the Transaction.
Section 6.7 Solvency. Assuming (a) that the representations and warranties in Article IV, Article V and the other Transaction Documents are true and correct in all material respects, (b) that Seller and Buyer and its Subsidiaries and Affiliates have each complied in all material respects with their respective obligations under this Agreement, (c) the satisfaction of the conditions to Buyer’s obligation to consummate the Transaction, and (d) that, immediately prior to the Closing, without giving effect to the Financing, the Business is solvent, then, immediately after giving effect to the Transaction, Buyer and its Subsidiaries (including the Acquired Companies) taken as a whole on a consolidated basis shall (i) be able to pay its debts as they become due; (ii) own property having a fair saleable value greater than the amounts required to pay debts (including a reasonable estimate of the amount of all contingent liabilities); and (iii) have adequate capital to carry on its business. No transfer of property is being made and no obligation is being incurred in connection with the Transaction with the intent to hinder, delay or defraud either present or future creditors of Buyer.
Section 6.8 Brokers. No broker, investment banker, financial advisor or other Person is entitled to any broker’s, finder’s, financial advisor’s or other similar fee or commission in connection with this Agreement or the Transaction based upon arrangements made by or on behalf of Buyer or any of its Affiliates.
Section 6.9 No Reliance. Buyer has conducted, to its satisfaction, its own independent investigation, review and analysis of the business, results of operations, prospects, condition (financial or otherwise) or assets of the Acquired Companies, and acknowledges that it and its Representatives (a) have received adequate access to (i) such books and records, facilities, properties, premises, equipment, contracts and other assets of the Acquired Companies which it and its Representatives have deemed necessary to review and (ii) the “data rooms” and “virtual data rooms” in connection with the Transaction, and (b) have had adequate opportunity to meet with the management of Seller and the Acquired Companies and to discuss the business and assets of the Acquired Companies. In making its determination to proceed with the Transaction, Buyer has relied solely on the results of its own independent review and analysis and the covenants, representations and warranties in this Agreement (including Article IV and Article V), the other Transaction Documents and the certificate contemplated in Section 10.2(d). Buyer hereby acknowledges that, notwithstanding anything contained in this Agreement to the contrary,
50



(x) neither Seller, any of the Acquired Companies, nor any other Person, makes or has made or is making any express or implied representation or warranty with respect to the Acquired Companies or their respective business or operations, including with respect to the accuracy or completeness of any information provided or made available to Buyer or any of its Representatives or any information developed by Buyer or any of its Representatives other than those expressly given solely by Seller in this Agreement (including Article IV and Article V),the other Transaction Documents and the certificate contemplated in Section 10.2(d); and (y) Buyer is not relying on any express or implied representation or warranty with respect to Seller or any of the Acquired Companies or their respective business or operations, including with respect to the accuracy or completeness of any information provided or made available to Buyer or any of its Representatives or any information developed by Buyer or any of its Representatives other than those expressly given solely by Seller in this Agreement (including Article IV and Article V), the other Transaction Documents and the certificate contemplated in Section 10.2(d). In connection with Buyer’s independent investigation, Buyer, as well as its Representatives, may have certain projections and other forecasts, including projected financial statements, cash flow items, certain business plan information and other data related to the Acquired Companies. Buyer acknowledges that (i) there are uncertainties inherent in attempting to make such projections, forecasts and plans, (ii) Buyer is familiar with such uncertainties and is taking responsibility for making its own evaluation of the adequacy and accuracy of all projections, forecasts and plans so furnished to Buyer or its Representatives and (iii) no Person (including Buyer or its Representatives) shall have any claim against anyone with respect to any such projections or other forecasts.
ARTICLE VII
COVENANTS
Section 7.1 Conduct of the Business.
(a)From the date of this Agreement until the earlier to occur of the Closing or the termination of this Agreement in accordance with its terms, except (w) as otherwise expressly required in the Transaction Documents, (x) as required by Law, (y) as required in connection with the Restructuring or (z) as set forth in Part A of Section 7.1 of the Seller Disclosure Letter, Seller shall cause each Acquired Company to (i) operate the Business, in all material respects, in the ordinary course of business consistent with past practice (including with respect to receivables, payables, securitization facilities and accrued expenses), (ii) take the actions referred to in Part B of Section 7.1 of the Seller Disclosure Letter, (iii) solely with respect to matters pertaining to the Business, use its commercially reasonable efforts to preserve intact in all material respects (x) the assets of the Business and the operations and goodwill related to the Business and (y) the business relationships of the Business with material suppliers, contractors, licensors, employees, customers and distributors of the Business, (iv) make capital expenditures in the ordinary course of business and continue with the development plan of the Acquired Companies’ and Seller’s and its Affiliates’ (to the extent related to the Business) technology platforms, programs and applications, including Alpha and MovePro360, and (v) without the prior written consent of Buyer (which consent shall not be unreasonably withheld, conditioned or delayed) not do any of the following (to the extent relating to the Business):
51



(i)amend any of the Organizational Documents of any Acquired Company;
(ii)issue or sell, or cause to be issued or sold, any additional Business Equity Interests or other equity interests of the Acquired Companies, or securities convertible into or exchangeable or exercisable for the Business Equity Interests or other equity interests of the Acquired Companies, or issue or grant any options, warrants, calls, subscription rights or other rights of any kind to acquire additional Business Equity Interests or other equity interests of the Acquired Companies;
(iii)except with respect to working capital assets and homes in inventory, in each case in the ordinary course of business, sell, assign, transfer, lease or otherwise dispose of, or agree to sell, assign, transfer, lease or otherwise dispose of, any of the material tangible assets of the Business;
(iv)adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, amalgamation, reclassification or other reorganization with respect to the Acquired Companies;
(v)sell, assign, transfer, license, permit to lapse, abandon, or otherwise dispose of any Intellectual Property of the Business, other than non-exclusive licenses granted to customers or vendors in the ordinary course of business;
(vi)(A) except in the ordinary course of business, enter into any new, extend, modify, amend, transfer, terminate or renew any Material Contract or Real Property Lease (or any Contract which would have been a Material Contract or Real Property Lease had such Contract been entered into prior to the date of this Agreement), (B) except for annual renewals in the ordinary course of business (which renewals shall solely be with respect to a renewal of the term of the facility and no other material modifications or amendments shall be made in respect thereof), enter into any new, extend, modify, amend, transfer, terminate or renew any Contract with respect to the Apple Ridge Funding LLC securitization program of the Acquired Companies or (C) waive any right of material value under any Material Contract or Real Property Lease (or any Contract which would have been a Material Contract or Real Property Lease had such Contract been entered into prior to the date of this Agreement);
52



(vii)other than (A) disclosed on Section 7.1(a)(vii)of the Seller Disclosure Letter, (B) as required by the terms of any Seller Plan existing on the date hereof and disclosed on Section 4.16(a) of the Seller Disclosure Letter, or (C) as required by applicable Law, (I) grant or increase any severance or termination pay of (or amend or modify any existing severance or termination pay arrangement with) any Business Employee, (II) enter into any employment, deferred compensation or other similar agreement (or amend or modify any such existing agreement) with any Business Employee, (III) enter into, establish, adopt, renew, terminate or amend any Business Plan, or any new arrangement for the benefit of any Business Employee that would be a Business Plan if it were in existence as of the date of this Agreement, (IV) transfer any Seller Plan to any of the Acquired Companies, (V) increase the annual base salary, incentive compensation percentage opportunity or other benefits of any Business Employee (other than: (1) increases in base salary in the ordinary course of business consistent with past practice and (2) increases in benefits made in connection with any action pursuant to any broad-based Seller Plan that applies uniformly to the Business Employees and similarly situated other employees of Seller and its Affiliates,), (VI) take any action to accelerate the vesting or payment of, or fund or otherwise secure the payment of, any compensation or benefits under any Business Plan, (VII) hire or terminate (other than for cause) any Business Employee or other service provider with an annual base salary or compensation that exceeds $250,000, or (VIII) make or grant any bonus or similar award (except in the ordinary course of business);
(viii)except as required by Law, recognize any labor union, works council, or other labor organization as the bargaining representative of any Business Employees;
(ix)(A) sell, transfer or otherwise dispose of or subject to Encumbrances (other than Permitted Encumbrances), any Intellectual Property owned by the Acquired Companies or (B) agree to terminate or permit the lapse of any material registered owned Intellectual Property of the Acquired Companies;
(x)except as would not reasonably be expected to affect any Tax liability or Tax attribute of the Buyer or any of the Acquired Companies (A) make or change any material Tax election, (B) change any material annual Tax accounting period, (C) file any material amended Tax Return, (D) settle or compromise any material Tax Proceeding, (E) agree to or request an extension or waiver of the statute of limitations with respect to the assessment or determination a material amount of Taxes, (F) enter into any closing agreement with respect to an income or other material amount of Tax, (G) surrender any right to claim an income or other material Tax refund or material credit of Taxes, (H) incur any liability for material Taxes outside the ordinary course of business, or (I) change its U.S. federal income tax classification.
(xi)change any method of accounting or accounting practice used by any Acquired Company, other than such changes required by a change in Law or GAAP;
(xii)with respect to any Acquired Companies, (A) acquire (by merger, consolidation, acquisition of stock or assets or otherwise) any Person or (B) acquire any material equity interest or other securities of any Person;
(xiii)(A) make any loans or investments (in each case, solely with respect to the Business), in excess of $1,000,000, in the aggregate, or (B) incur any indebtedness (solely with respect to the Business), in excess of $1,000,000, in the aggregate, in each case, other than (i) in the ordinary course of the business, (ii) pursuant to any Indebtedness instrument outstanding as of the date of this Agreement and made available to Buyer as of the date of this Agreement or (iii) Indebtedness that is repaid at or prior to the Closing;
53



(xiv)incur, authorize or commit to make any capital expenditure (or series of related capital expenditures) of the Acquired Companies that commit the Buyer or its Affiliates (including the Acquired Companies) to make capital expenditures after the Closing Date in excess of $5,000,000 in the aggregate;
(xv)transfer (including rehiring after termination or resignation) any Business Employees to Seller or its Affiliates (other than the Acquired Companies), not including any Inactive Employee, or transfer any employees of Seller or its Affiliates to become Business Employees;
(xvi)after the Calculation Time, distribute (whether by dividend, redemption, capital reduction, repayment of intercompany notes or otherwise) any amount included in the calculation of Estimated Closing Cash to Seller or its Affiliates;
(xvii)fail to maintain in full force and effect any insurance policies covering the Business and set forth on Section 4.19 of the Seller Disclosure Letter, except for any such policy replaced by a new or successor policy of substantially similar coverage; or
(xviii)authorize any of, or commit or agree to take any of, the foregoing actions.
Notwithstanding the foregoing, nothing in this Section 7.1 or anywhere else in this Agreement shall give Buyer, directly or indirectly, the right to control or direct the operations of the Acquired Companies prior to the Closing, and, prior to the Closing, Seller and its Affiliates shall exercise, consistent with the covenants, terms and conditions of this Agreement, complete and unilateral control and supervision over the operation of the Acquired Companies.
Section 7.2 Public Announcements. Prior to the Closing, neither Buyer nor any of its Affiliates, on the one hand, nor Seller nor any of its Affiliates, on the other hand, shall issue any press release or public announcement concerning this Agreement or the Transaction without obtaining the prior written consent of the other Party (which consent shall not be unreasonably withheld, conditioned or delayed), except to the extent, disclosure is otherwise required by Law or by the applicable rules of any stock exchange on which such Party (or any of its respective Affiliates) lists its securities; provided, however, that, to the extent disclosure is required by applicable Law or by the rules of any such stock exchange, the Party intending to make such release or announcement shall consult in advance with the other Party and make any changes in respect to the text thereof reasonably requested by such other Party; provided, further, that, no Party shall be required to obtain the approval of the other Party pursuant to this Section 7.2 if all of the information about this Agreement or the Transaction that is contained in any proposed release or announcement has previously been made public without any breach of this Section 7.2 by the Party proposing to issue such release or announcement; provided, further, that following the initial public announcement of the Transaction in accordance with the last sentence of this Section 7.2, each of the Parties may make internal announcements to their respective employees and Seller, Buyer and their respective Affiliates may make announcements to their respective customers, in each case, (x) in form and substance reasonably acceptable to the other Party and (y) regarding a general description of the Transaction that is otherwise consistent with the
54



Parties’ permitted prior public disclosures regarding this Agreement and the Transaction. Notwithstanding the foregoing or anything in this Agreement to the contrary, (a) Seller may disclose any information concerning the Transaction which it deems appropriate in its reasonable judgment, in light of its status as a publicly owned company, including to securities analysts and institutional investors and in press interviews; provided, however that in no event shall any fee letter associated with the Debt Financing be disclosed in connection therewith and provided that Seller shall not disparage the Business or the Buyer or any of their respective officers, directors or managers in such communications, (b) Seller, Buyer and their respective Affiliates may provide general information about the subject matter of this Agreement in connection with its fundraising, marketing, informational or reporting activities and (c) Buyer may schedule and announce the scheduling of any meetings in connection with the Financing. The Parties agree that the initial press release to be issued with respect to the Transaction shall be in form and substance as agreed to by Seller and Buyer on or prior to the date hereof.
Section 7.3 Financing.
55



(a)Buyer shall, and shall cause its Subsidiaries to, use its reasonable best efforts to cause its Representatives to, use their respective reasonable best efforts to take, or cause to be taken, all actions, and to do, or cause to be done, all things necessary, proper or advisable to consummate and obtain the Debt Financing on the terms and subject only to the conditions (including the market flex provisions) expressly set forth in the Debt Financing Commitment, including using their respective reasonable best efforts to (i) comply with and maintain in effect the Debt Financing Commitments in accordance with the terms and subject to the conditions thereof until the Transaction is consummated or this Agreement is terminated in accordance with its terms, (ii) satisfy or obtain a waiver of all conditions applicable to Buyer and its Affiliates in the Debt Financing Commitments that are within its or its Affiliates’ control, (iii) negotiate and enter into definitive agreements with respect to the Debt Financing on the terms and subject only to the conditions (including the market flex provisions) set forth in the Debt Financing Commitments, (iv) consummate the Debt Financing on or prior to the Closing Date; and (v) enforce its rights under the Debt Financing Commitments; provided that the foregoing shall not require Buyer or any of its Subsidiaries to institute an Action or other legal proceeding. Without the prior written consent of Seller, Buyer shall not permit any amendment, supplement or modification to be made to, or any waiver of any provision or remedy under, or any replacement of, any of the Debt Financing Commitments if such amendment, supplement, replacement, modification or waiver would reasonably be expected to: (x) reduce (or have the effect of reducing) the aggregate amount of the Debt Financing (including by increasing the amount of fees to be paid or original issue discount in respect of the Debt Financing) such that the aggregate Financing that would be available on the Closing Date would not be sufficient to pay the Required Amount; (y) impose any new or additional conditions or contingencies to the Debt Financing Commitments in a manner that would reasonably be expected to materially impair, delay or prevent or make less likely to occur the funding of the Debt Financing (or satisfaction of the conditions to the Debt Financing) on the Closing; or (z) adversely affect the ability of Buyer to enforce its rights against the other parties to the Debt Financing Commitment or other agreements relating to the Debt Financing as provided by this Section 7.3(a). Notwithstanding the foregoing, any amendment, supplement or modification to effectuate any “market flex” terms contained in the Debt Financing Commitments provided as of the date hereof or to add any additional agents or other financial institutions thereto as provided for therein shall be permitted and shall not require written consent of Seller. Buyer shall promptly deliver to Seller copies of any amendment, modification, supplement or waiver to or under, or any replacement of, any Debt Financing Commitment.
(b)Buyer shall, upon Seller’s reasonable request, keep Seller informed on a reasonably current basis and in reasonable detail with respect to all material developments with respect to the status of its efforts to arrange, obtain and complete the Debt Financing (including providing Seller with copies of all executed definitive agreements related to the Financing).
(c)Buyer shall give Seller prompt written notice (and, in any event, within two (2) Business Days after becoming aware) of: (i) any termination of any Debt Financing Commitments; (ii) any actual or threatened breach, default, termination or repudiation of any provisions of the Debt Financing Commitments, in each case, by any party thereto, of which Buyer becomes aware; and (iii) the occurrence of any event or development that would reasonably be expected to adversely impact the ability of Buyer to obtain all or any portion of the Debt Financing contemplated by the Debt Financing Commitments on the terms and conditions, in the manner or from the sources contemplated by any of the Debt Financing Commitments. If any portion of the Debt Financing becomes unavailable on the terms and conditions (including any market flex provisions) thereof or from the Debt Financing Sources contemplated in the Debt Financing Commitments or any of the Debt Financing or Debt Financing Commitments (or any definitive financing agreement relating thereto) shall expire or be withdrawn, terminated, repudiated or rescinded, in whole or in part, for any reason (but without limiting the obligations of Buyer in this Section 7.3(a)) (unless such portion of the Debt Financing is not reasonably required to consummate the Transaction), Buyer shall use its reasonable best efforts to (x) arrange and obtain, as promptly as practicable following the occurrence of such event, alternative financing from the same or alternative sources (the “Alternative Financing”) in an amount sufficient to consummate the Transaction with terms and conditions not materially less favorable in the aggregate to Buyer than those set forth in the Debt Financing Commitments (or replace any unavailable portion of the Financing) and (y) obtain a debt financing commitment letter (including any associated fee letter) with respect to such Alternative Financing, true, accurate and complete copies of which shall be promptly provided to Seller upon execution thereof (which fee letters may be redacted with respect to any interest rates, fee amounts, pricing caps and other similar economic terms (including flex terms) set forth therein). The Alternative Financing (A) shall be sufficient to pay, when added to the Equity Financing and the remaining Debt Financing (if any), the Required Amount and (B) shall not include conditions or contingencies that could reasonably be expected to materially impair, delay or prevent or make less likely to occur the funding of the Debt Financing (or satisfaction of the conditions to the Debt Financing) on the Closing. For purposes of this Agreement, references to the term “Debt Financing Commitments” shall mean the Debt Financing Commitments as permitted or required to be amended, supplemented, modified or replaced by this Section 7.3, and references to the “Debt Financing” and the “Financing” shall include the financing contemplated by the Debt Financing Commitments as permitted or required to be amended, modified, supplemented or replaced by this Section 7.3.
56



(d)Buyer shall not agree to, or permit, any amendment or modification of, or waiver under, or replacement of, the Equity Financing Commitments or other documentation relating to the Equity Financing other than to increase the amount of the Equity Financing. In addition, Buyer shall take, or use its reasonable best efforts to cause to be taken, all actions and do, or use its reasonable best efforts to cause to be done, all things necessary, proper or advisable to obtain the Equity Financing, including to (i) maintain in effect the Equity Financing Commitments, (ii) satisfy on a timely basis all conditions applicable to Buyer in such Equity Financing Commitments that are within its control, (iii) consummate the Equity Financing at or prior to the Closing, (iv) enforce its rights (including through litigation) under the Equity Financing Commitments, including seeking any specific performance of the parties’ obligations thereunder and (v) cause the Equity Financing Sources and any other Person providing financing to fund the Equity Financing no later than the Closing.
(e)Notwithstanding anything contained in this Section 7.3 or anything else in this Agreement, in no event shall the reasonable best efforts of Buyer be deemed or construed to required Buyer to, and Buyer shall not be required to, (x) incur or pay any fees to obtain a waiver or amendment of any term of the Debt Financing Commitments or fees (in the aggregate) in excess of those contemplated by the Debt Financing Commitments as of the date hereof, (y) agree to conditionality or economic terms of the Debt Financing Commitments that are less favorable than those contemplated by the Debt Financing or related fee letter (including any flex provisions therein) as of the date hereof, or (z) seek equity financing from a Person other than the Guarantors or in an amount in excess of the Equity Financing Commitments as of the date hereof.
(f)Notwithstanding anything in this Agreement to the contrary, but without limiting or amending the provisions of Article XI or Section 13.8, Buyer acknowledges and agrees that its obligations set forth in this Agreement are not contingent or conditioned upon any Person’s ability to obtain financing for or in connection with the Transaction.
Section 7.4 Financing Cooperation.
57



(a)
58



(a)
59



(a)Prior to the Closing Date, Seller shall use, and shall cause its Subsidiaries (including the Acquired Companies) to use, reasonable best efforts to provide reasonable cooperation as is customary in connection with the arrangement and reasonably requested by Buyer in connection with the arrangement of the Debt Financing, including the following: (i) cooperate with the Debt Financing Sources’ due diligence, to the extent customary and reasonable and to the extent not unreasonably interfering with the business and operations of the Acquired Companies; (ii) upon reasonable advance notice and during normal business hours of the Acquired Companies, cause the appropriate senior officers of the Acquired Companies to participate in a reasonable number of lender meetings, road shows, due diligence sessions and sessions with rating agencies at locations and times to be mutually agreed; (iii) reasonably cooperate with the marketing efforts of Buyer for all or any portion of the Debt Financing, including reasonable assistance with the preparation of appropriate and customary materials for rating agency presentations, bank information memoranda, offering memoranda, private placement memoranda, prospectuses and similar documents customarily required in connection with obtaining financing, including providing customary authorization letters to the Debt Financing Sources as contemplated by the Debt Financing Commitments (provided that such customary authorization letters (or the bank information memoranda, offering memoranda or private placement memoranda in which such letters are included) shall include language that exculpates Seller, the Acquired Companies and their respective Representatives from any liability in connection with the use or misuse by the recipients thereof of the information set forth in any such bank confidential information memoranda or similar memoranda or report distributed in connection therewith); (iv) furnish to the Debt Financing Sources at least three (3) Business Days prior to the Closing Date (to the extent requested at least ten (10) Business Days prior to the Closing Date) all documentation and other information required by regulatory authorities under applicable “know your customer,” beneficial ownership and anti-money laundering rules and regulations, including the PATRIOT Act to the extent required by the Debt Financing Commitments; (v) request customary accountants’ consents with respect to financial information derived from the financial statements of the Acquired Companies in respect of the Business, and use commercially reasonable efforts to provide the financial information requested by Buyer’s accounting firm, as applicable, to enable it to comply with such request; (vi) assist Buyer and its counsel in delivery of customary legal opinions by Buyer and its counsel in connection with effectuating the Debt Financing; (vii) provide such financial and other pertinent information regarding the Business and the Acquired Companies as may be reasonably requested by Buyer to assist in its preparation of customary bank information memoranda, offering documents, private placement memoranda, offering memoranda, prospectuses and other customary information documents used in financings of the type contemplated by the Debt Financing Commitments (including any offering or private placement of non-convertible debt securities pursuant to Rule 144A under the Securities Act) as of the date hereof (provided that other than with respect to the Required Financial Information, Seller shall have no obligation to provide any financial or other information that is not reasonably available to Seller); (viii) prevent the offer, placement, issuance or arrangement of any debt securities or bank or other credit facilities by or on behalf of the Acquired Companies (but excluding any debt securities or bank or other credit facilities, indebtedness expressly permitted under this Agreement, intercompany indebtedness, deferred purchase price obligations, advances under securitization and mortgage repurchase facilities, indebtedness incurred in the ordinary course of business (including, without limitation, working capital facilities, capital lease obligations, purchase money and equipment financings, borrowings of revolving credit loans and letters of credit) of the Retained Business) that would reasonably be expected to have a material adverse impact on the primary syndication of the Debt Financing Commitments; provided that notices, requests for consent and other contacts with customers shall not be required prior to Closing; (ix) take all actions (including delivery of all notices and any other documents, obtain all Consents, delivery of any reports (including any audits, field exams and requested weekly report information) and any financial data (including on a pro forma basis), and execute any agreements, transfers, or amendments) necessary to facilitate the sale of the receivables under the securitization facilities included in the Debt Financing; (x) cooperate as reasonably requested in connection with the obtaining, amending, funding and the taking of any other action otherwise required in connection with any securitization financing included as part of the Debt Financing; (xi) take such corporate actions as shall be reasonably requested by Buyer (which actions shall not be effective prior to the Closing) by persons that shall remain officers or directors of the Acquired Companies after the Closing to authorize and permit the consummation of the Debt Financing (including (subject to and contingent upon the Closing) the Acquired Companies executing agreements to pledge, grant security interests in, and otherwise grant liens on, the assets of the Acquired Companies); (xii) if all or any portion of the Debt Financing is taking the form of secured notes as provided in the Debt Commitment Letters, execute and deliver a customary certificate of the chief financial officer (or other comparable officer) of the Seller in customary form with respect to financial information constituting Required Financial Information that is included in the offering materials used in connection with the offer and sale of secured notes as reasonably requested by the Debt Financing Sources; and (xiii) request and facilitate the independent auditors of the Acquired Companies to (A) provide comfort letters (including “negative assurance” comfort and change period comfort) with respect to financial information relating to the Acquired Companies as reasonably requested by Buyer as necessary or customary for financing similar to the Debt Financing (including any offering or private placement of debt securities pursuant to Rule 144A under the Securities Act) and (B) participating in accounting due diligence sessions. Notwithstanding anything to the contrary set forth herein, in no event shall Seller or any of its Affiliates (including the Acquired Companies) be required to: (1) pay any commitment or other similar fee or reimburse any expenses with respect to the Debt Financing, or incur any other actual or potential liability in connection with the Financing (excluding in connection with any authorization letters delivered by Seller in connection with the Debt Financing or contemplated by clause (iii) above); (2) take any actions to the extent such actions would unreasonably interfere with their respective ongoing business or operations; (3) take any action that would reasonably be expected to conflict with, or result in any violation or breach of, or default (with or without notice or lapse of time, or both) under, any of their respective organizational and governing documents, any applicable Laws or any Contract to which such Person is a party; (4) cause any condition to Closing set forth in Article X to not be satisfied or otherwise cause any breach of this Agreement; (5) provide access to or disclose information that Seller reasonably determines would violate any attorney-client privilege of, or conflict with any confidentiality requirements applicable to, Seller or any or any of its Affiliates (including the Acquired Companies) or waive or eliminate any privilege (provided that in the case of any confidentiality obligation, Seller shall, to the extent permitted by such confidentiality obligations, notify Buyer if any such information that Buyer or any Debt Financing Source has specifically identified and requested is being withheld as a result of any such obligation of confidentiality); provided, that if all or any portion of the Debt Financing is taking the form of secured notes as provided in the Debt Commitment Letter, Buyer will take reasonable steps to ensure that the Required Financial Information does not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statement contained in the Required Financial Information, in the context in which it was made, not misleading; (6) become an issuer or other obligor with respect to the Debt Financing, except, solely in the case of the Acquired Companies, unless and until the Closing occurs; (7) take any action that could result in any director, officer or employee of Seller or any of its Subsidiaries (including the Acquired Companies) to incur or have any personal liability under the Debt Financing Commitments or any other agreements related to the Debt Financing or having to give any indemnity in connection with the Debt Financing (except, solely in the case of the Acquired Companies, unless and until the Closing occurs); (8) deliver or cause the delivery of any legal opinions in connection with the Debt Financing; or (9) execute or deliver, or take any corporate or other action to adopt or approve, any document, agreement, certificate or instrument with respect to the Financing, except, any authorization letters delivered by Seller in connection with the Debt Financing or contemplated by clause (iii) above, and, solely in the case of the Acquired Companies, that would be effective prior to the Closing. Seller consents to the reasonable use of the logos of the Acquired Companies in connection with the Debt Financing if such logos are used solely in a manner that is not intended to or reasonably likely to harm or disparage Seller, any of its Affiliates (including the Acquired Companies) or the reputation or goodwill of any of the foregoing.
(b)Except as otherwise provided by Section 7.4(c) or Section 7.4(d) with respect to providing the financial information required to be delivered thereunder, whether or not the Closing occurs, Buyer shall, reimburse Seller, on the earlier of the Closing Date or the termination of this Agreement in accordance with Article XI, for all out-of-pocket costs and expenses incurred by Seller or any of its Representatives in connection with such cooperation pursuant to Section 7.4(a) or otherwise in connection with the Financing, including reasonable fees and expenses of legal, accounting and other advisors. Buyer shall indemnify and hold harmless Seller and its Representatives from and against any and all Damages suffered or incurred by any of them in connection with the Financing and any information used in connection therewith, except to the extent any such Damage results from the Fraud, bad faith, willful misconduct or gross negligence of Seller as determined by a court of competent jurisdiction in a final and non-appealable judgment.
60



(c)Without limiting the generality of the foregoing provisions of Section 7.4(a), Seller shall prepare and provide to Buyer (i) as promptly as reasonably practicable and in any event on or prior to February 29, 2020 copies of an audited (x) balance sheet of the Business as of December 31, 2018, and (y) statement of income and cash flows of the Business for the year ended December 31, 2018, in each case prepared in accordance with GAAP, addressed to Cartus and which Buyer may use for purposes of the Debt Financing, (ii) on or prior to February 29, 2020, copies of an unaudited (x) balance sheet of the Business and (y) statement of income and cash flows of the Business reviewed by an independent auditor under SAS 100 for the nine (9) months ended September 30, 2019 and prepared in accordance with GAAP, (iii) (A) if the Closing has not occurred by January 1, 2020 and all or any portion of the Debt Financing is taking the form of secured notes as provided in the Debt Commitment Letters or (B) if the Closing has not occurred by March 31, 2020, copies of audited (x) balance sheet of the Business as of December 31, 2019, and (y) statements of income and cash flows of the Business for the year ended December 31, 2019, in each case prepared in accordance with GAAP, addressed to Cartus and which Buyer may use for purposes of the Debt Financing (the “2019 Audited Financial Statements”) as promptly as reasonably practicable and in any event by no later than March 31, 2020, (iv) if the Closing has not occurred prior to the forty-fifth (45th) day following the end of each fiscal quarter commencing with the fiscal quarter ending December 31, 2019, copies of an unaudited (x) balance sheet of the Business and (y) statements of income and cash flows of the Business for each such fiscal quarter, by no later than forty-five (45) days after the end of each such fiscal quarter, (v) the Unaudited Financial Statements, (vi) subject to the proviso set forth in Section 7.17(a), such other financial and other pertinent information regarding the Business, Seller and the Acquired Companies (including information regarding the business, operations and financial projections thereof) as may be reasonably requested by Buyer to assist in the preparation of a customary confidential information memorandum, offering memorandum, private placement memorandum or other customary information documents used in financings of the type contemplated by the debt commitment letter (including, without limitation, a “Rule 144A-for-life” offering involving high yield debt securities), including information with respect to total assets, total liabilities, revenue, operating income and, to the extent available, EBITDA, with respect to Acquired Companies that will be non-guarantors in the aggregate, (vii) such other historical financial information regarding the Acquired Companies as is reasonably requested by Buyer in connection with Buyer's preparation of pro forma financial statements prepared in accordance with Article 11 of Regulation S-X under the Securities Act and necessary to satisfy the condition set forth in paragraph 7 of Exhibit C to the Debt Financing Commitments, (viii) if all or any portion of the Debt Financing is taking the form of secured notes as provided in the Debt Commitment Letters, all other financial data that would be reasonably necessary for Buyer to receive customary comfort letters from the independent accountants of the Acquired Companies in connection with the offering (including as to negative assurances and change period comfort) and (ix) if all or any portion of the Debt Financing is taking the form of secured notes as provided in the Debt Commitment Letters, such records, data or other information necessary to support any statistical information or claims relating to the Business, Seller and the Acquired Companies appearing in the aforementioned information documents ((i)-(ix), collectively, the “Required Financial Information”). If the Closing occurs, Buyer shall, promptly upon request by Seller, reimburse Seller for 50% of the reasonable and documented out-of-pocket costs and expenses incurred by Seller or any of its Representatives in connection with the preparation, review and audit of the Required Financial Information described in clauses (i) - (ix) above pursuant to this Section 7.4(c).
61



(d)Unless delivered prior to the Closing in accordance with Section 7.4(c), on or before March 31, 2020, if the Closing occurs, Seller shall cause the 2019 Audited Financial Statements to be delivered to Buyer and the Debt Financing Sources. Furthermore, if the Closing occurs, Seller shall deliver to Buyer (x) on or prior to February 29, 2021, an audited balance sheet of the Business as of the Closing Date and statements of income, cash flows, and equity for the Business for the period from January 1, 2020 to the Closing Date, in each case, with an independent auditor’s report that shall be addressed to Cartus and (y) within forty-five (45) days after each quarterly period ended on or after January 1, 2020 and prior to the Closing Date, an unaudited balance and statement of income, cash flows and equity for the Business reviewed by the independent accountants for Buyer or the Business as provided in Statement on Auditing Standards No. 100 or the successor thereto addressed to Cartus. In addition, Seller covenants and agrees that, following the Closing Date, it will provide Buyer and the independent accountants for the Business with reasonable access to all books, records and other information within it or its Affiliates’ control and access to Seller’s and its Affiliates’ independent accountants and accounting and financial reporting personnel in order to enable Buyer and the independent accountants for the Business and statutory auditors to prepare, support and complete such other financial statements and financial and other information and disclosure documents (including a management’s discussion and analysis) as required by the Debt Financing Commitments or Law for periods ending on or prior to Closing Date or that include the Closing Date, including as such financial statements or financial information may be audited or reviewed by the independent accountants for Buyer or the Business as provided in applicable Statement on Auditing Standards; provided, however, that Buyer acknowledges that Seller shall have the right to prepare all financial statements in respect of the Business with respect to any period ending on or prior to the Closing Date and Buyer shall not separately require cooperation to prepare such financial statements to the extent that Seller is timely preparing and delivering such financial statements to Buyer. Buyer shall reimburse Seller promptly upon request for all costs and expenses incurred by it and its Affiliates (including any fees and costs of auditors) in connection with providing information pursuant to the immediately foregoing sentence of this Section 7.4(d).
(e)Notwithstanding anything to the contrary in this Agreement, it is understood and agreed that the condition precedent set forth in Section 10.2(b), as applied to Seller’s obligations under Section 7.4(a) shall be deemed to be satisfied unless the Debt Financing has not been obtained as a result of Seller’s breach of its obligations under Section 7.4(a) and such breach remains uncured as of the date that is ten (10) days following receipt of written notice by Seller of such breach from Buyer.
Section 7.5 Directors and Officers Liability.
(a)From and after the Closing, Buyer shall cause the applicable Acquired Companies to (i) indemnify and hold harmless each present and former director, officer or equivalent positions in non-U.S. entities of such Acquired Companies (collectively, the “Covered Persons”), against any Damages incurred or suffered by any of the Covered Persons in connection with any liabilities or any Action, arising out of or pertaining to matters existing or occurring prior to the Closing, whether asserted or claimed prior to, at or after the Closing, to the fullest extent that the Acquired Companies would have been permitted under the Organizational Documents of such Acquired Companies as in effect on the date of this Agreement, to indemnify such Covered Persons and (ii) advance expenses as incurred by any Covered Person in connection with any matters for which such Covered Person is entitled to indemnification from Buyer pursuant to this Section 7.5(a) to the fullest extent permitted under such Organizational Documents of such Acquired Companies; provided, however, that the Covered Person to whom expenses are advanced provides an undertaking to repay such advances if it is ultimately finally determined by a court of competent jurisdiction and all rights of appeal have lapsed, that such Covered Person is not entitled to indemnification under applicable Law, the Organizational Documents of the Acquired Companies, or pursuant to this Section 7.5(a).
(b)For a period of six (6) years following the Closing, Buyer shall cause each Acquired Company to maintain in effect a directors’ and officers’ liability insurance policy covering those persons who are currently covered by such Acquired Company’s directors’ and officers’ liability insurance policy with coverage in amount and scope at least as favorable as Buyer’s existing coverage.
(c)Buyer hereby agrees that it will not (i) cause or permit any Acquired Company to amend or modify the indemnification provisions in the Organizational Documents of such Acquired Company or (ii) amend or revoke any indemnification agreement between any Acquired Company and its director or officer currently in effect, in each case, in any way that diminishes or adversely affects the indemnification or exculpation provisions as provided therein or herein.
62



(d)In the event that Buyer, the Acquired Companies or any of their respective successors and assigns (i) consolidates with or merges into any other Person and shall not be the continuing or surviving entity in such consolidation or merger, (ii) has all of its equity securities purchased by or transferred or conveyed to any Person or (iii) transfers all or substantially all of its properties and assets to any Person, then, and in each such case, proper provision shall be made so that the successors and assigns of Buyer or the Acquired Companies, as the case may be, fulfill and comply with the indemnification and other obligations set forth in this Section 7.5. Any such assumption of the obligations of Buyer or the Acquired Companies, as the case may be, shall not operate to release, relieve, waive, terminate or modify the obligations of Buyer or the Acquired Companies, as the case may be, under this Section 7.5.
(e)The terms and provisions of this Section 7.5 are intended to be in addition to the rights otherwise available to the Covered Persons by applicable Law or the Organizational Documents, and shall operate for the benefit of, and shall be enforceable by, the Covered Persons and their respective heirs and Representatives, each of whom is an intended Third Party beneficiary of this Section 7.5.
Section 7.6 Regulatory and Other Authorizations.
63



(a)In accordance with the terms and subject to the conditions of this Agreement, each Party shall use their respective reasonable best efforts to cause the conditions set forth in Article X to be satisfied as soon as practicable following the date of this Agreement (giving effect, among other things, to the remaining provisions of this Section 7.6 (including the last sentence of this Section 7.6(a) and Section 7.6(b)) and in any event on or prior to the Outside Date (as the same may be extended in accordance with this Agreement) and to cause the Closing to occur on the terms and (unless otherwise validly waived by a Party) subject to the conditions specified in this Agreement as soon as practicable after the Required Financial Information has been delivered (giving effect to the provisions of the Marketing Period and Section 2.3)), including using reasonable best efforts to accomplish the following: (i) the obtaining of all necessary Consents and approvals from the Governmental Entities necessary in connection with the consummation of the Transaction, and the making of all necessary registrations and filings (including filings with the Governmental Entities, if any) and the taking of all reasonable steps as may be necessary to obtain an approval from, or to avoid an Action by, any Governmental Entity necessary in connection with the consummation of the Transaction; (ii) the defending of any Actions, whether judicial or administrative, challenging this Agreement or the consummation of the Transaction, performed or consummated by such Party in accordance with the terms of this Agreement, including seeking to have any stay or temporary restraining order entered by any court or other Governmental Entity vacated or reversed; and (iii) the execution and delivery of any additional instruments reasonably necessary to consummate the Transaction and any other transactions to be performed or consummated by such Party in accordance with the terms of this Agreement and to carry out fully the purposes of this Agreement. Each Party shall (x) promptly (and in no event later than ten (10) Business Days following the date of this Agreement) make and not withdraw its respective filings under the HSR Act, (y) as promptly as reasonably practicable, make any other applications and filings as reasonably determined by the Parties to be required under any other applicable Antitrust Laws with respect to the Transaction and (z) promptly (and in no event later than ten (10) Business Days following the date of this Agreement) make and not withdraw its respective filings set forth on Section 7.6(a) of the Seller Disclosure Letter; neither Buyer nor Seller shall, without prior written consent of the other Party (not to be unreasonably delayed, conditioned, or withheld (including if it may cause a delay in Closing (including as a result of the condition in Section 10.1(a)) as long any Closing would reasonably be expected to occur prior to the Outside Date (as may be extended in accordance herewith)): (i) withdraw its filing under the HSR Act or any other applicable Antitrust Laws or (ii) commit to or agree with any Governmental Entity to stay, toll or extend any applicable waiting period under the HSR Act or applicable Antitrust Laws or to delay consummation of the Transaction.
(b)Buyer shall use its reasonable best efforts to take, and shall cause its Affiliates to use their reasonable best efforts to take, promptly any and all steps necessary to avoid or eliminate each and every impediment and obtain all Consents under any Antitrust Laws that may be required by any foreign or U.S. federal, state or local Governmental Entity, in each case, with competent jurisdiction, so as to enable the parties to consummate the Transaction as promptly as practicable, including committing to or effecting, by consent decree, hold separate orders, trust, or otherwise, the sale or other disposition of such assets or businesses as are required to be divested, or other behavioral remedies or other commitments, in each case, in order to avoid the entry of, or to effect the dissolution of or vacate or lift, any Order, that would otherwise have the effect of preventing or materially delaying the consummation of the Transaction as promptly as practicable. Notwithstanding anything in this Agreement to the contrary, Buyer will not be obligated to take or refrain from taking, or to agree that Buyer will take or refrain from taking, any action, or to suffer to exist any condition, limitation, restriction or requirement that with any other actions, conditions, limitations, restrictions or requirements, would result in, either individually or in the aggregate, the reduction, on a pro forma basis, of annual revenues of Buyer and its Affiliates (including the Acquired Companies) on a combined basis by an amount in excess of $30,000,000 of revenues for the year ended December 31, 2018.
64



(c)Each Party shall furnish to the other Party such necessary information and reasonable assistance as the other Party may reasonably request in connection with the preparation of any required governmental filings or submissions and will cooperate in responding to any inquiry from a Governmental Entity, including (i) promptly informing the other Party of such inquiry, (ii) consulting in advance before making any substantive presentations or submissions to a Governmental Entity, (iii) giving the other Party advance notice of, and the opportunity to attend and participate in any substantive meetings or discussions with any Governmental Entity, to the extent not prohibited by such Governmental Entity, and (iv) supplying each other with copies of all material correspondence, filings or communications between either Party and any Governmental Entity with respect to this Agreement; provided that materials provided pursuant to this Section 7.6(c) may be redacted (A) to remove references concerning the valuation of the Acquired Companies, (B) as necessary to comply with contractual arrangements, (C) as necessary to comply with applicable Law, and (D) as necessary to address reasonable privilege or confidentiality concerns; provided, further, that Buyer and Seller may reasonably designate any competitively sensitive material provided to the other under this Section 7.6(c) as “Outside Counsel Only.” The foregoing obligations in this Section 7.6(c) shall be subject to any attorney-client, work product or other privilege considerations. Notwithstanding anything to the contrary herein, each of Buyer and Seller shall consult and cooperate with one another, and consider in good faith the views of one another, in connection with any analyses, appearances, presentations, memoranda, briefs, arguments, opinions and proposals made or submitted by or on behalf of any Party hereto in connection with proceedings under or relating to the HSR Act or any applicable foreign antitrust or competition-related Antitrust Law. Buyer and Seller shall cooperate fully with each other in connection with the making of all such filings or responses.
(d)Notwithstanding anything in this Section 7.6 to the contrary, nothing in this Section 7.6 shall require, or be deemed to require, Seller or any of its Affiliates to propose, negotiate, offer to commit, effect or agree to (i) any sale, divestiture, license or disposition of assets or businesses of the Acquired Companies or (ii) any behavioral remedy of the Acquired Companies that is not conditioned on the occurrence of the Closing.
Section 7.7 Shared Contracts; Required Third Party Consents.
(a)The Parties acknowledge that Seller and its Affiliates are parties to certain contracts set forth on Section 7.7(a) of the Seller Disclosure Letter that relate to both the operations or conduct of the Business and the Retained Business (the “Shared Contracts”). From the date of this Agreement until the earlier of termination of this Agreement or the Closing, the Parties shall reasonably cooperate and shall use their respective commercially reasonable efforts to separate the Shared Contracts and obtain the agreement of the counterparties to each such Shared Contract to enter into a new Contract (or an amendment thereto, as applicable), effective as of the Closing Date or as soon thereafter as is reasonably possible, pursuant to which Seller or its Affiliate, as applicable, will receive substantially the same goods, services and Intellectual Property rights provided to Seller and its Affiliates with respect to the Business as of the date of this Agreement pursuant to the Shared Contract (the “Shared Contract Rights”) on terms and conditions substantially similar to those contained in the Shared Contract as of the date of this Agreement (each, a “Replacement Contract”) and to cause the applicable counterparty to release Buyer and its applicable Affiliates from any obligations under the Shared Contract that become the obligation of Seller or its Affiliates under the Replacement Contract. If one or more Replacement Contracts are not so obtained (unless the Parties otherwise agree in writing or unless doing so would not be permitted by applicable Law, the terms of the applicable Shared Contract or the applicable counterparty) for a reasonable period of time following the Closing (not to exceed six (6) months), Buyer will, or will cause its applicable Affiliate to, use commercially reasonable efforts, and Seller will cooperate in all reasonable respects with Buyer and/or its Affiliates, as applicable, so that Seller or its Affiliates, as applicable, receive the benefits of the Shared Contract Rights following the Closing Date. Seller shall bear the economic, Tax and other liabilities under such Shared Contract related to the Shared Contract Rights given to Seller or its Affiliates in accordance with the foregoing, and if Seller fails to timely and fully bear such liabilities with respect to any Shared Contract, Buyer shall no longer be obligated to provide Shared Contract Rights for any Shared Contract hereunder. Buyer shall bear the economic, Tax and other liabilities under such Shared Contract related to the rights retained by the Buyer or its Affiliates in accordance with the foregoing and will be responsible for all pre-Closing breaches of all Shared Contracts.
65



(b)From the date of this Agreement until the earlier of termination of this Agreement or the Closing, if requested by Buyer, the Parties shall cooperate and shall use their respective commercially reasonable efforts to obtain any necessary Consents, approvals or waivers under the U.K. Documents, the Overdraft Facility or otherwise from any Third Parties required by the terms of a Material Contract (including because consummation of the Transaction would result in breach thereof or acceleration of or increase any rights of a counterparty to such Material Contract or obligations of any Acquired Company under such Material Contract) as a result of the Transaction (collectively, “Required Third Party Consents”).
(c)With respect to Section 7.7(a), (i) no Replacement Contract shall impose any liability on Buyer or its Affiliates after the Closing; (ii) neither Buyer nor any of its Affiliates shall be required (A) to expend any money with respect to any Replacement Contract, (B) to remedy any breach under or with respect thereto, or (C) to commence or participate in any Action or offer or grant any accommodation (financial or otherwise) to any Third Party in order to provide Seller with the benefits with a Replacement Contract; and (iii) no representation, warranty or covenant of Buyer contained in the Transaction Documents shall be breached, or deemed breached, and no condition shall be deemed not satisfied, and neither Buyer nor any of its Affiliates will have any liability whatsoever to Seller or any of its Affiliates, based on, arising out of or relating to (A) the failure to obtain any Replacement Contract or (B) any Action commenced or threatened in writing by or on behalf of any Person arising out of or relating to the failure to obtain any Replacement Contract.
(d)With respect to Section 7.7(b), (i) no Required Third Party Consent shall impose any liability on Seller or its Affiliates after the Closing; (ii) neither Seller nor any of its Affiliates shall be required (A) to expend any money with respect to any Required Third Party Consent, (B) to remedy any breach under or with respect thereto, or (C) to commence or participate in any Action or offer or grant any accommodation (financial or otherwise) to any Third Party in order to provide Buyer with the benefits with a Required Third Party Consent; and (iii) no representation, warranty or covenant of Seller contained in the Transaction Documents shall be breached, or deemed breached, and no condition shall be deemed not satisfied, and neither Seller nor any of its Affiliates will have any liability whatsoever to Buyer or any of its Affiliates, based on, arising out of or relating to (A) the failure to obtain any Required Third Party Consent or (B) any Action commenced or threatened in writing by or on behalf of any Person arising out of or relating to the failure to obtain any Required Third Party Consent.
Section 7.8 Shared Property. At the Closing, Seller shall enter, or cause its applicable Affiliates to enter, into sublease agreements with respect to each leased office space set forth on Section 7.8 of the Seller Disclosure Letter (the “Designated Premises”), substantially in the form attached hereto as Exhibit D (the “Danbury Sublease Agreement”) and Exhibit E (the “Irving Sublease Agreement,” and, collectively, the “Sublease Agreements”), with the applicable tenant under each lease for the Designated Premises, for such portion of the Designated Premises that Seller or its Affiliates will be using in the operation of the Retained Business after the Closing. The Sublease Agreements shall provide for the pass-through to Seller or its applicable Affiliate of all of the applicable tenant’s costs and expenses related to the subleased portion of the Designated Premises, and each Sublease Agreement shall be co-terminus with the respective lease for the Designated Premises, unless an earlier termination date is required pursuant to such lease.
Section 7.9 Wrong Pockets.
(a)During the twelve (12) month period following the Closing Date, if Buyer or Seller discovers that any:
66



i.Excluded Asset was, directly or indirectly, transferred to Buyer (or held by the Acquired Companies) at the Closing (each, a “Held Asset”), Buyer shall, and shall cause its Affiliates to, use reasonable best efforts to (A) promptly assign and transfer all right, title and interest in such Held Asset to Seller or its designated assignee, and (B) pending such transfer, (x) hold in trust such Held Asset and provide to Seller or its designated assignee all of the benefits associated with the ownership of the Held Asset, and (y) cause such Held Asset to be used or retained as may be reasonably instructed by Seller; or
ii.asset of an Acquired Company or an asset of Seller and its Affiliates primarily used in the operation of the Business was not, directly or indirectly through an Acquired Company, transferred to Buyer at the Closing (each, an “Omitted Asset”), Seller shall, and shall cause its Affiliates to, use reasonable best efforts to (A) promptly assign and transfer all right, title and interest in such Omitted Asset to Buyer or its designated assignee, and (B) pending such transfer, (x) hold in trust such Omitted Asset and provide to Buyer or its designated assignee all of the benefits associated with the ownership of the Omitted Asset, and (y) cause such Omitted Asset to be used or retained as may be reasonably instructed by Buyer.
(b)Buyer or Seller, as applicable, shall, and shall cause their Affiliates, as applicable, to, use reasonable best efforts to, in addition to the other actions set forth in Section 7.9(a)(i) and Section 7.9(a)(ii), promptly upon the request of the other party, (i) reasonably cooperate to obtain all consents from Persons necessary or appropriate for the purposes of transferring, assigning and conveying such Held Asset or Omitted Asset (or part thereof), as applicable, or the relevant interests in them to the other party and (ii) reasonably cooperate to allow the requesting party to complete all such further acts or things as the other party may reasonably direct in order to transfer, assign and convey such Held Asset or Omitted Asset (or parts thereof), as applicable, or the relevant interests in them to the other party; provided that the transferring party and its Affiliates shall not be required to incur any out-of-pocket expense pursuant to this clause (b) which is not agreed to be paid or reimbursed by the transferring party or its Affiliates.
67



(c)To the extent that, on or after the Closing Date, (i) Buyer or any of its Affiliates receives any payment or instrument that (x) is for the account of Seller or any of its Affiliates according to the terms of this Agreement or the Transition Services Agreement or (y) relates to any business or business segment of Seller other than the Business, in each case to the extent not included in Cash, Net Working Capital or Net Securitization Asset Amount, Buyer shall promptly deliver such amount or instrument to Seller or its Affiliates, as applicable, and (ii) Seller or any of its Affiliates receives any payment or instrument that is for the account of Buyer or any of its Affiliates (including the Acquired Companies) according to the terms of this Agreement or the Transition Services Agreement, Seller shall promptly deliver such amount or instrument to Buyer or its Affiliates, as applicable. All amounts due and payable under this Section 7.9(c) shall be due and payable by the applicable Party in immediately available funds net of any Tax incurred or payable in connection with the receipt of such payment or instrument or required to be withheld on payment, by wire transfer to the account designated in writing by the relevant Party. Notwithstanding the foregoing, each Party hereby undertakes to use its commercially reasonable efforts to direct or forward all bills, invoices or like instruments to the appropriate Party.
(d)Buyer or the applicable Acquired Company shall promptly forward any claim for any Liability of the Retained Business to Seller after the Closing and Seller shall forward any claim for any Liability of the Acquired Companies (to the extent such claim is due to a post-Closing Liability) or the Business to Buyer after the Closing.
Section 7.10 Further Assurances. From time to time, at the request of the other Party, without further consideration, each Party shall execute and cause to be delivered to the other Party such instruments and other documents, and shall use reasonable best efforts to take or cause to be taken such other action, as such other Party may reasonably request (prior to, at or after the Closing) for the purpose of carrying out or evidencing the Transaction and for executing and performing the Transaction Documents.
Section 7.11 Restrictive Covenants.
(a)From the date of this Agreement until the Closing Date, Buyer shall not, and shall not permit any of its Representatives to, directly or indirectly, solicit for employment or service any person employed by Seller or its Subsidiaries as of the date of this Agreement with whom Buyer or any of its Representatives first came in contact with in connection to the Transaction or encourage any such employee to leave such employment (other than solicitations through general advertising or other general solicitation, including through the use of a recruitment agency, in each case, not targeted at such persons).
(b)From the date of this Agreement until five (5) years after the Closing Date, Seller shall not, and shall not permit any of its Representatives to, directly or indirectly, solicit or hire for employment or service any (i) Continuing Employee, (ii) Business Employee or other employee of the Acquired Companies as of the date hereof, or (iii) employee of Buyer or its Representatives with whom Seller or any of its Representatives first came in contact with in connection with the Transaction, or, in each case, as applicable, encourage any such employee to leave such employment (other than solicitations through general advertising or other general solicitation, including through the use of a recruitment agency, in each case, not targeted at such persons or specifically targeted or directed at the senior management of any Acquired Company, or with the prior written permission of Buyer); provided that nothing in this Section 7.10(b) shall prevent Seller or any of its Representatives from hiring or soliciting (A) any Business Employee or other employee whose employment has been terminated by the Acquired Companies or Buyer and its Representatives after the Closing; or (B) after ninety (90) days from the date of termination of employment, any Business Employee or other employee whose employment has been terminated by the employee after the Closing.
68



(c)From the Closing Date until five (5) years after the Closing Date (the “Restricted Period”), Buyer shall not, and shall not permit any of its Representatives to, directly or indirectly, solicit or hire for employment or service any employee of Seller or its Representatives with whom Buyer or any of its Representatives first came in contact with in connection to the Transaction, or, in each case, as applicable, encourage any such employee to leave such employment (other than solicitations through general advertising or other general solicitation, including through the use of a recruitment agency, in each case, not targeted at such persons or specifically targeted or directed at the senior management of Seller or its Representatives, or with the prior written permission of Seller); provided that nothing in this Section 7.11(c) shall prevent Buyer or any of its Representatives from hiring or soliciting (x) any employee whose employment has been terminated by Seller or its Representatives; or (y) after ninety (90) days from the date of termination of employment, any employee whose employment has been terminated by the employee.
(d)During the Restricted Period, Seller shall not (and shall cause its controlled Affiliates not to), without the prior written consent of Buyer, directly or indirectly, (A) own any interest in, manage, control, operate, or participate in (whether as an officer, director, manager, employee, partner, agent, representative, supplier or otherwise) or in any other manner engage in the business or operations of, any Person engaged in or otherwise competing with the Business anywhere in the world, or (B) induce or attempt to induce any customer, supplier or other business relation of Buyer or any of its Subsidiaries (in respect of the Business) to cease doing business with Buyer or any of its Subsidiaries (in respect of the Business) or to materially reduce or materially modify the terms of its business relationship with Buyer or any of its Subsidiaries (in respect of the Business) or in any way interfere with the relationship between any such customer, supplier or business relation, on the one hand, and Buyer or any of its Subsidiaries (in respect of the Business) on the other hand (the foregoing clauses (A) and (B), collectively, the “Restricted Activities”); provided that nothing in this Section 7.11(d) shall prohibit Seller or any of its Affiliates from being a passive owner of less than five percent (5%) of the outstanding shares of any class or series of capital stock of a corporation that is publicly traded and, directly or indirectly, engages in any Restricted Activity so long as Seller does not have any active participation in the business of such corporation. Notwithstanding the foregoing, this Section 7.11(d) shall not prohibit Seller or its Affiliates from owning any interest in, managing, controlling, participating in (whether as an officer, director, manager, employee, partner, agent, representative or otherwise) or in any other similar manner engaging anywhere (inside or outside the U.S.) in the Retained Business and in any business engaged in real estate brokerage franchising, owned real estate brokerage, the purchase and selling of real estate (other than in respect of the Business), property management (other than in respect of the Business), real estate title (including title insurance underwriting) and settlement services and mortgage origination, mortgage brokerage and property and casualty insurance. Seller shall not target its marketing efforts toward corporate sponsored relocation programs (for the avoidance of doubt to include lump-sum benefit programs). Subject to the immediately preceding sentence, nothing contained in this Agreement shall restrict Seller’s or its Affiliates’ ability to directly market its Affinity Programs to (i) companies that may otherwise provide employee relocation programs, (ii) relocation clients that approach Seller or one of its Affiliates directly, (iii) participants in Affinity Program (e.g., Military Rewards, Turnkey, etc.) that do not directly target employees receiving “lump-sum” relocation benefits, (iv) non-Affinity Program membership groups or (v) companies that offer a suite of benefits services where affinity is one benefit among a suite of products (e.g., BenefitHub).
69



(e)It is the desire and intent of the Parties that the provisions of this Section 7.11 shall be enforced to the fullest extent permissible under the Laws and public policies applied in each jurisdiction in which enforcement is sought. If any particular provisions or portion of this Section 7.11 shall be adjudicated to be invalid or unenforceable, this Section 7.11 shall be deemed amended to delete therefrom such provision or portion adjudicated to be invalid or unenforceable, such amendment to apply only with respect to the operation of this Section 7.11 in the particular jurisdiction in which such adjudication is made.
(f)Seller acknowledges and agrees that (i) Buyer would not receive the benefit of the bargain in connection with the Transaction if Seller were not to comply fully and in all respects with its obligations under this Section 7.11, (ii) each of the Acquired Companies would be irreparably damaged if Seller were not to comply fully and in all respects with its obligations under this Section 7.11 and that any such failure to comply would result in a significant loss of goodwill by the Acquired Companies, and (iii) the Business has been, or is currently contemplated to be, conducted by the Acquired Companies on a global basis throughout the world.
Section 7.12 Securitization Matters.
70



(a)Without limiting Seller’s obligations under Section 7.4, at all times prior to the Closing, Buyer and Seller shall fully cooperate with each other, to take all actions to effectuate the termination of the Apple Ridge Funding LLC securitization program of the Acquired Companies and the termination and release of all obligations, guaranties, liens and other security interests with respect to such securitization facilities to allow for the satisfaction of the liabilities thereunder at the Closing in accordance with the Debt Commitment Letters. Seller shall also cooperate to obtain any documentation evidencing such releases, including any payoff letters and UCC termination statements, to ensure the transfer of the receivables under any such Apple Ridge Funding LLC securitization program free and clear of all Encumbrances in connection with the termination of the Apple Ridge Funding LLC securitization program and satisfaction of liabilities thereunder as contemplated by the Debt Commitment Letters. Further, until the Closing, Seller shall provide any reasonably requested cooperation to assist Buyer in transitioning the receivables of the Business into any securitization program of the Buyer or its Affiliates effective as of the Closing, including termination or assignment of account control agreements and transfers of such accounts to Buyer or its Affiliates, establishing new bank accounts, assignments and transfers of receivables, delivery of notices (including negotiating and obtaining any reduced notice periods in connection with the termination of the securitization facilities), negotiating and executing any necessary amendments, or any other action necessary to effectuate as of the Closing (i) the termination of the Apple Ridge Funding LLC securitization program, (ii) release of the receivables of the Business from all Encumbrances and (iii) transitioning of the receivables into any securitization facility of the Buyer or its Affiliates contemplated by the Debt Commitment Letter; provided that notices to, requests for consent and other contact with, customers shall not be required prior to Closing. Further, for purposes of facilitating the termination of the Acquired Companies’ Apple Ridge Funding LLC securitization program and the implementation of the securitization programs of Buyer and its Affiliates on the Closing Date, Seller shall provide as soon as practicable after the date hereof to the extent permitted by and in a manner permitted by Law (but in any event within three (3) Business Days after the date that the condition in Section 10.1(a)(i) has been satisfied) the following information: (A) billed and unbilled receivable aging and rollforward amounts, in each case, including the Person that owns such receivables pursuant to the Contract with any Acquired Company, (B)  equity loan aging and rollforward amounts, including additions, prepaid funding and adjustments and the Person that owns the receivable pursuant to the Contract with any Acquired Company, (C) an unidentified cash report, including the original date received, the client name and the bank name where the deposit was originally received, (D) a cash receipt report with transaction line item postings entered into the system by bank account (including possible misdirected deposits that need to be transferred between accounts), the original date received in bank account and the system application date, and the Person that owns the receivable and cash receipt pursuant to the Contract with any Acquired Company, (E) an adjustment report for billed and unbilled receivables, separating voids, write-offs, etc. and the Person that owns the receivable pursuant to the Contract with any Acquired Company, (F) accrued contract rebates, client deposits, service level agreements and liability balances, and Person party to the client Contract that the bank will look to reduce the advance amount and (G) the originator for each item or the obligor, including tracking of the top 25 client balances on a weekly basis and information to understand which originator and country as it relates to any limits therein. For each item in clauses (A) - (G), the information provided shall delineate the Person, source system, client name, client identification number, transferee identification number and name, service program, unique transaction line item identifier for complete life cycle and system status traceability, transaction description, transaction status, balance amount, currency, and original service date, invoice number and invoice billed date. The Parties acknowledge and agree that any information disclosed pursuant to this Section 7.12 will be subject to the provisions of the Confidentiality Agreement and that Seller may designate any competitively sensitive information made available to Buyer under the last and second-to-last sentence of this Section 7.12 as “clean team members only,” and such information shall be given only to (i) the clean team members of Buyer pursuant to the Confidentiality Agreement and (ii) any additional Persons set forth on Section 7.12(a) of the Seller Disclosure Letter, and may not be shared with Buyer or any of its Subsidiaries or any of their respective Representatives (other than such clean team members) and may redact information as necessary to comply with applicable Law.
(b)Buyer and Seller shall cooperate in good faith in order to determine the most appropriate Closing Date in light of the provisions of the Apple Ridge Funding LLC securitization program, including any agreed amendments to such facility to facilitate the redemption. 

Section 7.13 Affiliate Arrangements.
(a)Except for the Transition Services Agreement, the Sublease Agreement or as set forth in Section 7.13(a) of the Seller Disclosure Letter, effective upon the Closing, all Contracts between an Acquired Company, on the one hand, and Seller or any of its Affiliates (other than an Acquired Company), on the other hand (collectively, “Terminating Agreements”), shall be terminated as between them without any further force and effect, and there shall be no further obligations of any of the relevant parties thereunder. Buyer agrees to take and to cause the Acquired Companies and their Subsidiaries to take any action following the Closing that would be required to give effect to the termination of the Terminating Agreements.
71



(b)Except as set forth in Section 7.13(b) of the Seller Disclosure Letter, all inter-company accounts, whether payables or receivables, between an Acquired Company, on the one hand, and Seller or any of its Affiliates (other than an Acquired Company), on the other hand, effective upon the Closing, shall be eliminated (by way of capital contribution, cash settlement or as otherwise determined by Seller in its sole discretion) prior to the Calculation Time, in each case without any Liability to any Acquired Company.
(c)At or prior to Closing, Seller shall cause each confidentiality and invention assignment agreement between Seller or any of its Affiliates, on the one hand, and any employee of the Acquired Companies whose duties include design or engineering of products or creation of Intellectual Property, on the other hand, and each of the Contracts set forth on Section 7.13(c) of the Seller Disclosure Letter (collectively, the “Assigned Contracts”) to be assigned with respect to the Business to Buyer (or an Acquired Company designated by Buyer).
(d)Effective as of the Closing, Seller hereby transfers all of its and its Subsidiaries’ respective right, title and interest (if any) in and to all assets and property (including any and all Intellectual Property rights and registrations and applications therefor, including any of the foregoing for which ownership interests arise through the operation of any assignment provisions in employment agreements or employee invention assignment agreements) that are listed on Schedule 7.13 attached hereto and all other Intellectual Property that is used exclusively in the operation of the Business, in each case other than the Excluded Assets. From and after the Closing, Seller hereby renounces, on behalf of itself and its Subsidiaries, any and all ownership interest and any and all other rights, title and interest of Seller and/or any of its Subsidiaries in any assets or property (including any and all Intellectual Property rights and registrations and applications therefor) of the Acquired Companies, including all assets located on the premises of any Acquired Company or otherwise conveyed to the Acquired Company hereunder, in each case other than the Excluded Assets.
Section 7.14 Seller Guarantees. With respect to each Seller Guaranty, Buyer shall use its reasonable best efforts to (a) cause itself or one or more of its Affiliates to be substituted in all respects for Seller or any of its Affiliates, as applicable, effective as of the Closing, in respect of all obligations of Seller or its Affiliates under any Seller Guaranty by offering such beneficiary a guaranty of Buyer of like character and on terms (financial and otherwise) no less favorable to such beneficiary and (b) arrange for the release effective at or as soon as reasonably practicable after the Closing of Seller and its Affiliates from their respective obligations to the beneficiary of such Seller Guaranty. To the extent any Seller Guarantees are not terminated or released, from and after the Closing, Buyer shall (i) indemnify, defend and hold harmless Seller and its Representatives (individually, a “Seller Indemnified Person” and collectively, the “Seller Indemnified Persons”) from and against any and all Damages incurred by any of them relating to the Seller Guarantees and (ii) not permit any of the Acquired Companies or any of its Subsidiaries or Affiliates to (x) renew or extend the term of or (y) increase its obligations under, or transfer to another Third Party, any loan, lease, Contract or other obligation for which any Seller Indemnified Person is or would reasonably be expected to be liable under such Seller Guaranty. The failure by Buyer or its Affiliates to achieve any such substitution or release shall not (A) constitute a failure to satisfy any condition set forth in Article X, (B) relieve Seller from its obligation to consummate the Transaction or any of the other Transaction Documents or (C) relieve Buyer from its obligation under Section 12.3.
72



Section 7.15 R&W Insurance Policy. The Parties acknowledge that, as of the date of this Agreement, Buyer has obtained a binder to the R&W Insurance Policy, a true and correct copy of which is attached hereto as Exhibit B. The Parties further acknowledge that obtaining the R&W Insurance Policy is a material inducement to Seller entering into the Transaction and the other Transaction Documents, and that Seller is relying on Buyer’s covenants and obligations set forth in this Section 7.15. Buyer shall bear the cost of all fees, expenses and premiums relating to the procurement and binding of the R&W Insurance Policy. Prior to and after the Closing, Buyer shall take all commercially reasonable actions necessary to complete the conditions in the conditional binder to the R&W Insurance Policy within the times set forth therein so that the R&W Insurer will issue the R&W Insurance Policy. The R&W Insurance Policy shall provide that the R&W Insurer shall waive and not pursue any subrogation rights against Seller, except for Fraud. Following the Closing, the R&W Insurance Policy may not be amended in any manner materially adverse to Seller (including with respect to the subrogation provisions, policy term, retention amount or coverage amount), and neither Buyer nor any of Buyer’s Affiliates shall cause the cancellation of the R&W Insurance Policy, without Seller’s prior written consent (which consent shall be given or withheld in the sole and absolute discretion of Seller).
Section 7.16 Confidentiality.
(a)The Parties acknowledge that following the date of this Agreement, the terms of the Confidentiality Agreement shall remain in full force and effect in accordance with its terms until the Closing, at which time the Confidentiality Agreement shall terminate and Section 7.17 shall govern. If this Agreement is, for any reason, terminated prior to the Closing, the Confidentiality Agreement shall continue in full force and effect as provided in Section 11.2 in accordance with its terms.
(b)Except as provided in Section 7.16(d), for a period commencing on the Closing Date and terminating on the date that is thirty-six (36) months after the Closing Date, Seller shall maintain the existence and terms of this Agreement and the other Transaction Documents and all non-public, proprietary and confidential information relating to Buyer, the Acquired Companies, their respective Representatives or the Business (collectively, “Buyer Confidential Information”) disclosed to Seller or any of its Representatives in connection with this Agreement, in confidence and not disclose to any other Person any Buyer Confidential Information or use any such Buyer Confidential Information for any purpose.
(c)Except as provided in Section 7.16(d), for a period commencing on the Closing Date and terminating on the date that is thirty-six (36) months after the Closing Date, Buyer shall, and shall cause its Representatives (including the Acquired Companies) to, maintain the existence and terms of this Agreement and the other Transaction Documents and all non-public, proprietary and confidential information relating to (i) Seller or its Representatives (other than the Acquired Companies) or (ii) the Retained Business (collectively, “Seller Confidential Information”) disclosed to Buyer or any of its Representatives in connection with this Agreement or made available to or in the possession of any of the Acquired Companies, in confidence and not disclose to any other Person any Seller Confidential Information or use any such Seller Confidential Information for any purpose.
73



(d)The obligations of each Party (a “Receiving Party”) set forth in this Section 7.16 shall not apply to (i) any information that becomes available to the general public prior to, on or after the Closing Date (other than as a result of disclosure by the Receiving Party or any of its Representatives in violation of this Section 7.16), (ii) any information that becomes available to the Receiving Party or any of its Representatives after the Closing Date on a non-confidential basis from a source other than the other Party (the “Disclosing Party”) or its Representatives; provided that such source was not, to the knowledge of the Receiving Party, prohibited from disclosing such information by a legal, contractual, fiduciary or other obligation, (iii) except as provided in clause (vi) below, any disclosure requested or required by applicable Law or any Governmental Entity, including any applicable Tax Laws, securities Laws or securities exchange or listing regulations or requirements; provided that, to the extent such disclosure is requested or required in connection with an Order, the Receiving Party shall, to the extent reasonably practicable and legally permissible, promptly notify the Disclosing Party of such disclosure under this clause (iii) prior to making such disclosure with reasonably sufficient time, where reasonably practicable, to allow the Disclosing Party to seek protective measures for such Confidential Information (and the Receiving Party and its Representatives shall cooperate with the Disclosing Party in seeking such protection, at the Disclosing Party’s sole cost and expense), (iv) any Order in connection with the enforcement of a Party’s rights or remedies under this Agreement or the other Transaction Documents solely to the extent necessary for any filings with a Governmental Entity (provided that to the extent possible, the applicable Party shall request that such Governmental Entity treat such Confidential Information as confidential and non-public), (v) any disclosure or use of Confidential Information in connection with the preparation of financial statements, (vi) in connection with and to the extent necessary for a Party or any of its Representatives to prepare or file Tax Returns or other Tax filings, (vii) any disclosure or use of Confidential Information that is necessary for a Party to perform or satisfy any of its obligations under this Agreement or any of the other Transaction Documents or (viii) any information that is independently developed by the Receiving Party or its Representatives without reference to or use of any Confidential Information of the Disclosing Party.
Section 7.17 Access to Properties, Books and Records.
74



(a)From the date of this Agreement until the earlier of termination of this Agreement or the Closing, Seller shall give Buyer and the Debt Financing Sources reasonable access, upon reasonable notice during normal business hours to all properties, books, records (other than personnel records) and key management personnel of or pertaining to the Acquired Companies (to the extent relating to the Business), solely for purposes of consummating the Transaction and as otherwise provided in Section 7.25; provided, however, that the foregoing will not: (i) interfere unreasonably with the day-to-day operations of the Acquired Companies; or (ii) require the Acquired Companies to provide access or to disclose information where such access or disclosure would contravene any Law or Contract, or would relate to commercially sensitive information, or would result in the waiver of any legal privilege or work-product protection as identified by Seller’s legal counsel. Any information disclosed will be subject to the provisions of the Confidentiality Agreement. In the event of a conflict or inconsistency between the terms of this Agreement and the Confidentiality Agreement, the terms of this Agreement will govern. The Parties acknowledge and agree that the Acquired Companies may designate any competitively sensitive information made available to Buyer under this Agreement as “clean team members only,” and such information shall be given only to the clean team members of Buyer and may not be shared with Buyer or any of its Subsidiaries or any of their respective Representatives (other than such clean team members). Notwithstanding anything herein or in the Confidentiality Agreement to the contrary, the parties agree that the Agreed Communications Plans shall be implemented substantially in accordance with its terms and no such party shall be in breach of this Agreement or the Confidentiality Agreement as a result of such implementation in accordance with its terms.
(b)From the Closing Date and subject to Section 7.16 and applicable Law, until the date which is six (6) years following the Closing Date, Buyer shall, and shall cause its Representatives to, afford Seller and its Representatives reasonable access, upon reasonable notice, during normal business hours to all books, records and Representatives of Buyer to the extent pertaining to the Acquired Companies or the Business in the form presently operated, and to such other information to the extent relating to the Business for audit purposes or in connection with any dispute or proceeding brought by or against any Third Party or Governmental Entity; provided, however, that the foregoing will not: (i) interfere unreasonably with the day-to-day operations of Buyer or the Acquired Companies; or (ii) require Buyer or the Acquired Companies to provide access or to disclose information where such access or disclosure would violate (based upon good faith advice of outside counsel) any Law or Contract to which Buyer or any of its Affiliates (including the Acquired Companies) is subject or is a party, or would relate to Buyer Confidential Information or other commercially sensitive information unrelated to the Business in the form as presently operated, or would (based upon good faith advice of outside counsel) result in the waiver of any legal privilege or work-product protection relating to such information (provided that Buyer will use its reasonable best efforts to provide Seller such access or make such disclosure (or as much of it as possible) in a manner that does not have such consequences).
(c)From the Closing Date and subject to applicable Law, until the date which is six (6) years following the Closing Date, Seller shall, and shall cause its Representatives to, afford Buyer and its Representatives reasonable access, upon reasonable notice, during normal business hours to all books, records and Representatives of Seller to the extent pertaining to the Acquired Companies or the Business prior to the Closing, and to such other information to the extent relating to the Business prior to the Closing for audit purposes or in connection with any dispute or proceeding brought by or against any Third Party or Governmental Entity; provided, however, that the foregoing will not: (i) interfere unreasonably with the day-to-day operations of Seller and its Affiliates; or (ii) require Seller or its Affiliates to provide access or to disclose information where such access or disclosure would violate (based upon good faith advice of outside counsel) any Law or Contract to which Seller or any of its Affiliates is subject or is a party, or would relate to confidential information of Seller or other commercially sensitive information unrelated to the Business prior to the Closing, or would (based upon good faith advice of outside counsel) result in the waiver of any legal privilege or work-product protection relating to such information (provided that Seller will use its reasonable best efforts to provide Buyer such access or make such disclosure (or as much of it as possible) in a manner that does not have such consequences).
75



(d)At the Closing, (i) Seller shall cause all tangible books and records (and copies of all intangible books and records) of the Acquired Companies or otherwise primarily related to the Business to be located on the Leased Real Properties to be transferred to Buyer by possession of such premises and (ii) Seller shall transfer, or cause to be promptly transferred, to Buyer all original corporate records of the Acquired Companies relating to the legal existence, ownership and corporate governance of the Acquired Companies.
(e)For a period of five (5) years after the Closing, Buyer shall provide reasonable assistance to Seller (at Seller’s sole cost and expense) in connection with any reporting obligations of Seller pursuant to the Securities Act or the Securities Exchange Act of 1934, as amended, or any of the rules or regulations promulgated thereunder, and any other financial reporting obligations of Seller, in each case, related to the operations of the activities of the Business or the Acquired Companies prior to Closing.
Section 7.18 Insurance. Effective at the time of the Closing, other than pursuant to the Transition Services Agreement, the Acquired Companies and the Business shall cease to be insured by any insurance policies or self-insurance programs of Seller and its Affiliates. In addition, with respect to any claims, acts, omissions, events, circumstances, occurrences or losses that occur prior to the Closing and which Seller or any of its Affiliates becomes aware (excluding constructive knowledge) of prior to the Closing for which coverage under such policies would be available, Seller shall use commercially reasonable efforts to file all claims for coverage thereunder in the ordinary course of business in accordance with its standard risk management and claims procedures. For the avoidance of doubt, subject to its obligations pursuant to this Agreement, Seller shall retain all rights to control its insurance policies and self-insurance programs, including the right to exhaust, settle, release, commute, buy-back or otherwise resolve disputes (but not the policies themselves) with respect to any of its insurance policies and self-insurance programs to the extent provided in the third-to-last sentence of this Section 7.18 and Seller shall retain any premiums or other retentions paid by the Business prior to the Closing Date in respect of any insurance coverage. For any claim that may be asserted by the Acquired Companies or their Affiliates with respect to the Business after the Closing Date arising out of events, incidents, conduct or circumstances that occurred prior to the Closing (such claims, “Pre-Closing Claims”), the Acquired Companies or their Affiliates may tender such Pre-Closing Claim to Seller for submission by Seller or one of its Affiliates to the applicable Third Party insurer under any of the Third Party insurance policies of Seller or its Affiliates issued prior to the Closing Date to the extent such insurance coverage exists at the time the Pre-Closing Claim is tendered to Seller and under which the Acquired Companies or the Business were insured as of the date of the events, incidents, conduct or circumstances giving rise to such Pre-Closing Claim if permitted by the terms of such policy (such policies, the “Pre-Closing Policies” and each such claim, a “Noticed Pre-Closing Claim”), and Seller shall reasonably promptly thereafter tender, or cause one of its Subsidiaries to, tender such Pre-Closing Claim to the applicable insurer for coverage; provided, however, that (a) none of Buyer, the Acquired Companies or any of their respective Affiliates shall have any recourse to Seller pursuant to this Section 7.18 for any uninsured or uncovered amounts for such Pre-Closing Claims (including any deductible or other amount for which Seller provides self-insurance), except for (i) amounts directly resulting from a breach of Seller to provide timely notice of any Noticed Pre-Closing Claim to the applicable insurer upon Seller’s receipt of notice of such Noticed Pre-Closing Claim from the Acquired
76



Companies or their Affiliates if required to do so under this Section 7.18 or (ii) matters with respect to which any Buyer Indemnified Person is entitled to indemnification in accordance with this Agreement; (b) except for matters with respect to which any Buyer Indemnified Person is entitled to indemnification in accordance with this Agreement, Buyer or the applicable Acquired Company shall be responsible for the satisfaction or payment of any and all associated self-retentions, deductibles, costs and expenses with respect to any Pre-Closing Claims and shall promptly reimburse Seller or its applicable Affiliates for its respective reasonable out-of-pocket costs and expenses incurred in connection with collecting insurance proceeds in respect of such claims or otherwise under this Section 7.18; (c) Buyer shall reasonably cooperate with Seller with respect to the tendering of any such claims including providing notices, information and backup materials as may be necessary in connection therewith; (d) the Parties shall work in good faith and use commercially reasonable efforts to ensure compliance with all of the applicable terms of such policies so as to minimize the risk of loss of coverage thereunder; (e) Seller shall not be required to make any concessions to any insurance carrier in connection with any Pre-Closing Claim; and (f) Seller shall not be required to take any action that would violate any Pre-Closing Policy (and Seller makes no representation or warranty with respect to the ability to take any of the actions otherwise contemplated by this Section 7.18). Seller shall notify Buyer and the applicable Acquired Company of all coverage determinations made by the insurer(s) in respect of any Pre-Closing Claims and, if any amounts are paid or to be paid by the insurer in respect thereof, shall request that such insurer make payment directly to the applicable Acquired Company, or shall transfer such insurance net proceeds actually received by Seller or its applicable Affiliates to the applicable Acquired Company no later than ten (10) days after receipt of such insurance proceeds. Seller shall not release, commute, buy-back or otherwise eliminate the coverage available under any Pre-Closing Policy without Buyer’s consent (not to be unreasonably delayed, conditioned or withheld). Buyer agrees (A) that neither it nor any of the Acquired Companies shall have the right to request that Seller make any claim under any Pre-Closing Policy unless Buyer has previously made or is contemporaneously making a claim under the R&W Insurance Policy or any other insurance policy of Buyer, in each case that would reasonably be expected to cover such losses and to the extent that any such insurance proceeds are received with respect to such claim after the date that an insurance payment is made hereunder, then the Buyer shall return to Seller such amounts so recovered from its insurers (but not to exceed the amount of the proceeds received from the Pre-Closing Policy, and net of the cost of obtaining such recovery) and (B) in no event will Buyer or any of the Acquired Companies have the right to receive any benefits or coverage under any Pre-Closing Policy (either individually or together with all other claims made or benefits or coverage sought by Buyer or any of the Acquired Companies after the Closing) in excess of thirty three and one-third percent (33.3%) of the limit of such policy. Nothing in this Agreement is intended to waive or abrogate in any way Seller’s or its Affiliates’ own rights to insurance coverage for any liability, whether relating to the Acquired Companies or otherwise.
Section 7.19 Mutual Release.
77



(a)Effective as of the Closing, Seller does hereby, for itself and each of its Affiliates (other than the Acquired Companies) (each, a “Seller Releasing Party”), release and absolutely forever discharge each Acquired Company, Buyer and each of their respective Affiliates (each, a “Seller Released Party”) from and against all Seller Released Matters. For purposes of this Agreement, “Seller Released Matters” means any and all claims, demands, proceedings, damages, debts, liabilities, obligations, costs, expenses (including attorneys’ and accountants’ fees and expenses), actions and causes of action of any nature whatsoever, whether now known or unknown, suspected or unsuspected, primary or secondary, direct or indirect, absolute or contingent (“Claims”), that any Seller Releasing Party now has, or at any time previously had, or shall or may have in the future, as an owner of the Business or any of the Acquired Companies, or as a counterparty to any Contract with any Acquired Company or otherwise, in each case, arising with respect to any matter occurring at or prior to the Closing; provided that Seller Released Matters shall not include (i) any Claim arising out of, relating to or pursuant to this Agreement or any other Transaction Document or (ii) any Claim unrelated to the Business and the Acquired Companies, the Transaction or any other Transaction Document. It is the intention of Seller in providing this release to the Seller Released Parties, and in giving and receiving the consideration called for in this Agreement, that this release shall be effective as a full and final accord and satisfaction and general release of and from all Seller Released Matters and the final resolution by the applicable Seller Releasing Party and the Seller Released Parties of all Seller Released Matters.
(b)Effective as of the Closing, Buyer does hereby, for itself and each of the Acquired Companies and each of its Affiliates (each, a “Buyer Releasing Party”), release and absolutely forever discharge Seller and each of its Affiliates (other than the Acquired Companies) (each, a “Buyer Released Party”) from and against all Buyer Released Matters. For purposes of this Agreement, “Buyer Released Matters” means any and all Claims that any Buyer Releasing Party now has, or at any time previously had, or shall or may have in the future, as a Buyer Released Party, or as an owner of the Business, or as a counterparty to any Contract with any Buyer Released Party, or as Person managed or otherwise directed by any Buyer Released Party or otherwise, in each case, arising with respect to Seller’s ownership of the Business at or prior to the Closing; provided that Buyer Released Matters shall not include (i) any Claim arising out of, relating to or pursuant to this Agreement or any other Transaction Document or (ii) any Claim unrelated to the Business and the Acquired Companies or the Transaction or any other Transaction Document. It is the intention of Buyer agreeing to the Buyer Releasing Parties providing this release to the Buyer Released Parties, and in giving and receiving the consideration called for in this Agreement, that this release shall be effective as a full and final accord and satisfaction and general release of and from all Buyer Released Matters and the final resolution by the applicable Buyer Releasing Party and the Buyer Released Parties of all Buyer Released Matters.
Section 7.20 Required Cash Distributions. Prior to the Calculation Time, Seller shall take (and shall cause each of its Affiliates (including the Acquired Companies) to take) all actions required such that at the Calculation Time (i) all Cash of each Acquired Company organized under the laws of any state of the U.S. (other than such an Acquired Company that is Person that is a Subsidiary of a Person organized outside the U.S.) have been distributed to Seller or an Affiliate of Seller (other than an Acquired Company), as directed by Seller, (ii) all Cash of the Acquired Companies organized under the laws of any jurisdiction outside the U.S. and Subsidiaries of an Acquired Company organized under the laws of any jurisdiction outside the U.S. (“Foreign Cash”) is not less than $16,000,000, and (iii) Foreign Cash in excess of $16,000,000 has been distributed to Seller and its Affiliates; provided that (a) no such
78



distribution of Cash shall be required hereunder to the extent such distribution would be prohibited by applicable Law and (b) no such distribution of Cash shall involve the creation or assumption of any intercompany loans or accounts (whether (i) between Seller or any of its Affiliates (other than the Acquired Companies), on the one hand, and any of the Acquired Companies, on the other hand, or (ii) between or among any Acquired Companies), in each case, that are not extinguished at or prior to the Calculation Time without Liability to Buyer or any of the Acquired Companies from and after the Calculation Time. Without limiting Seller’s obligations under the preceding sentence, in the event that Seller leaves less than $16,000,000 in Foreign Cash as of the Calculation Time in the Acquired Companies, Seller will have the opportunity to cure such shortfall (which will not be considered a breach under this Agreement as long as such shortfall is inadvertent) by transferring such shortfall amount to the Acquired Company or one of its Subsidiaries, or, at Seller’s option and expense, to Buyer with further direction to Buyer to transfer such