Common use of Earn-Out Clause in Contracts

Earn-Out. (a) Seller shall receive, as additional purchase price the following payments, if any, determined in accordance with the terms and conditions of this Section 2.2 (collectively, “Additional Purchase Price Payments”) and the Business EBITDA Benchmarks set forth below, without duplication (the “Business EBITDA Benchmarks”): (i) If the Business EBITDA is greater than or equal to $50,000,000 in any calendar year following the Closing from and including calendar year 2007 to and including calendar year 2009, Buyer shall pay to Seller a one time payment of $25,000,000; (ii) If the Business EBITDA is greater than or equal to $55,000,000, in any calendar year following the Closing from and including calendar year 2007 to and including calendar year 2009, Buyer shall pay to Seller a one time payment of an aggregate of $40,000,000, less any amounts previously paid to Seller under Section 2.2(a)(i); (iii) If the Business EBITDA is greater than or equal to $59,000,000, in any calendar year following the Closing from and including calendar year 2007 to and including calendar year 2009, Buyer shall pay to Seller a one time payment of an aggregate of $50,000,000, less any amounts previously paid to Seller under Sections 2.2(a)(i) and (ii); and (iv) Notwithstanding the foregoing, if the Business EBITDA is less than $59,000,000 in each calendar year following the Closing from and including calendar year 2007 to and including calendar year 2009 but is greater than or equal to $59,000,000 in calendar year 2010, Buyer shall pay to Seller a one time payment of $10,000,000, less any amounts previously paid to Seller under Sections 2.2(a)(i), (ii) and (iii) in excess of $40,000,000. For the avoidance of doubt, the Parties hereby agree that Seller shall be entitled to receive no more than $50,000,000 under any circumstances under this Section 2.2. The Business EBITDA Benchmarks may be adjusted pursuant to Section 2.2(g) and Section 2.2(h)(ii) below. (b) On or before March 31st of each of 2008, 2009, 2010 and 2011, Buyer shall (i) provide a statement of the Business EBITDA for the preceding calendar year derived from Buyer’s audited consolidated Financial Statements, which Buyer’s audited consolidated Financial Statements shall be prepared in accordance with GAAP, and Buyer’s calculation of the Additional Purchase Price Payments, if any (collectively the “Earn-Out Statement”), and (ii) deliver the Earn-Out Statement to Seller; provided that such statements shall cease to be required following aggregate Additional Purchase Price Payments of $50,000,000. For up to ninety- (90) days immediately following Seller’s receipt of an Earn-Out Statement (the “Receipt Date”), Seller shall be permitted to review the working papers and Books and Records of the Business and shall be permitted to discuss such matters with the chief financial officer and other executive officers of Buyer, the Company and the Company Subsidiaries and with Buyer’s, the Company’s and the Company Subsidiaries’ accountants for the purpose of confirming the determination of the applicable calendar year’s Business EBITDA. The determination of the Business EBITDA and the calculation of any Additional Purchase Price Payments included in an Earn-Out Statement shall become final and binding upon the Parties ninety (90) days following Receipt Date, unless Seller gives written notice of its disagreement (a “Notice of Disagreement Regarding Additional Purchase Price Payments”) to Buyer prior to such date (the period commencing on the Receipt Date and ending on the earlier of (i) ninety (90) days thereafter and (ii) the date a Notice of Disagreement Regarding Additional Purchase Price Payments is given, the “Earn-Out Review Period”). For up to fifteen (15) days following delivery of a Notice of Disagreement Regarding Additional Purchase Price Payments (the “Negotiation Period”), the Parties shall seek in good faith to resolve in writing any differences which they have with respect to the matters specified in the Notice of Disagreement Regarding Additional Purchase Price Payments. Following delivery of a Notice of Disagreement Regarding Additional Purchase Price Payments, Buyer and its agents and representatives shall be permitted to review Seller’s and its representatives’ working papers relating to its calculation of Business EBITDA and the Earn-Out

Earn-Out. (a) With respect to the period of time beginning on (and including) the first day of Buyer’s first full accounting month after the Closing Date (such first day being December 31, 2012) and ending on (and including) the last day of the twelfth consecutive full accounting month following the Closing Date (such last day being December 29, 2013) (such period of time, “Year One”), Seller shall receive, as additional purchase price be entitled to the following payments, amount (if any) based upon the COH (as defined below) for Year One (any such payment, determined in accordance with the terms and conditions of this Section 2.2 (collectively, an “Additional Purchase Price Payments”) and the Business EBITDA Benchmarks set forth below, without duplication (the “Business EBITDA BenchmarksEarn-Out Payment”): (i) If if COH for Year One is less than or equal to $2,700,000, then Seller shall not be entitled to any Earn-Out Payment for such period of time; (ii) if the Business EBITDA COH for Year One is greater than $2,700,000 but less than $3,650,000, then Seller shall be entitled to receive an Earn-Out Payment for such period of time that is equal to: $750,000 multiplied by the result of: (1) (the COH for Year One minus $2,700,000) divided by (2) $950,000; or (iii) if the COH for Year One is greater than or equal to $50,000,000 in any calendar year 3,650,000, then Seller shall be entitled to receive an Earn-Out Payment for such period of time that is equal to $750,000. (b) With respect to the period of time beginning on (and including) the first day of Buyer’s thirteenth full accounting month after the Closing Date (such first day being December 30, 2013) and ending on (and including) the last day of the 24th consecutive full accounting month following the Closing from and including calendar year 2007 Date (such last day being December 28, 2014) (such period of time, “Year Two”), Seller shall be entitled to and including calendar year 2009an Earn-Out Payment (if any) based upon the COH for Year Two: (i) if the COH for Year Two is less than or equal to $2,700,000, Buyer then Seller shall pay not be entitled to Seller a one time payment any Earn-Out Payment for such period of $25,000,000time; (ii) If if the Business EBITDA COH for Year Two is greater than $2,700,000 but less than $4,800,000, then Seller shall be entitled to receive an Earn-Out Payment for such period of time that is equal to the positive difference, if any, resulting from: (1) [$1,500,000 multiplied by the result of: (A) (the COH for Year Two minus $2,700,000) divided by (B) $2,100,000] minus (2) [the Earn-Out Payment for Year One (if any)]; or (iii) if the COH for Year Two is greater than or equal to $55,000,0004,800,000, in any calendar year following the Closing from and including calendar year 2007 to and including calendar year 2009, Buyer shall pay to Seller a one time payment of an aggregate of $40,000,000, less any amounts previously paid to Seller under Section 2.2(a)(i); (iii) If the Business EBITDA is greater than or equal to $59,000,000, in any calendar year following the Closing from and including calendar year 2007 to and including calendar year 2009, Buyer shall pay to Seller a one time payment of an aggregate of $50,000,000, less any amounts previously paid to Seller under Sections 2.2(a)(i) and (ii); and (iv) Notwithstanding the foregoing, if the Business EBITDA is less than $59,000,000 in each calendar year following the Closing from and including calendar year 2007 to and including calendar year 2009 but is greater than or equal to $59,000,000 in calendar year 2010, Buyer shall pay to Seller a one time payment of $10,000,000, less any amounts previously paid to Seller under Sections 2.2(a)(i), (ii) and (iii) in excess of $40,000,000. For the avoidance of doubt, the Parties hereby agree that then Seller shall be entitled to receive no more than $50,000,000 under any circumstances under this Section 2.2. The Business EBITDA Benchmarks may be adjusted pursuant to Section 2.2(g) and Section 2.2(h)(ii) below. (b) On or before March 31st of each of 2008, 2009, 2010 and 2011, Buyer shall (i) provide a statement of the Business EBITDA for the preceding calendar year derived from Buyer’s audited consolidated Financial Statements, which Buyer’s audited consolidated Financial Statements shall be prepared in accordance with GAAP, and Buyer’s calculation of the Additional Purchase Price Payments, if any (collectively the “an Earn-Out Statement”), and (ii) deliver Payment for such period of time that is equal to $1,500,000 minus the Earn-Out Statement to Seller; provided that such statements shall cease to be required following aggregate Additional Purchase Price Payments of $50,000,000Payment for Year One (if any). For up illustrative purposes only, if the COH for Year One is $3,000,000, then Seller shall be entitled to ninety- (90) days immediately following Seller’s receipt of receive an Earn-Out Statement Payment for such period of time that is equal to $236,842.10, which equals $750,000 multiplied by the result of: (1) $3,000,000 minus $2,700,000 (or $300,000) divided by (2) $950,000. In addition, for illustrative purposes only, if the “Receipt Date”)COH for the following year (Year Two) was $3,500,000, then Seller shall be permitted entitled to review the working papers and Books and Records of the Business and shall be permitted to discuss such matters with the chief financial officer and other executive officers of Buyer, the Company and the Company Subsidiaries and with Buyer’s, the Company’s and the Company Subsidiaries’ accountants for the purpose of confirming the determination of the applicable calendar year’s Business EBITDA. The determination of the Business EBITDA and the calculation of any Additional Purchase Price Payments included in receive an Earn-Out Statement shall become final and binding upon Payment for such period of time that is equal to $334,586.47, which equals (1) [$1,500,000 multiplied by the Parties ninety result of: (90A) days following Receipt Date($3,500,000 minus $2,700,000) divided by (B) $2,100,000] minus (2) [$236,842.10]. (c) For purposes of this Section 1.6, unless Seller gives written notice of its disagreement (a “Notice of Disagreement Regarding Additional Purchase Price Payments”) to Buyer prior to such date (the period commencing on the Receipt Date and ending on the earlier of (i) ninety “COH” (90or Contribution to Overhead) days thereafter shall be calculated by Buyer in accordance with Buyer’s accounting methods, policies, practices and procedures and shall mean, for each applicable year (iie.g., Year One and Year Two), (x) the date a Notice revenue earned by the Business for such year, minus (y) the cost of Disagreement Regarding Additional Purchase Price Payments is givenservices to the Business for such year, which shall consist of billable staffing contractor payments, the “Earn-Out Review Period”). For up to fifteen temporary payroll, temporary payroll Taxes, temporary benefits paid by Buyer or its Affiliates (15as defined below) days following delivery of a Notice of Disagreement Regarding Additional Purchase Price Payments (the “Negotiation Period”), the Parties shall seek in good faith to resolve in writing any differences which they have with respect to the matters specified in Business, and worker’s compensation insurance cost associated with the Notice of Disagreement Regarding Additional Purchase Price Payments. Following delivery of a Notice of Disagreement Regarding Additional Purchase Price Paymentstemporary payroll, Buyer and its agents and representatives shall be permitted to review Seller’s and its representatives’ working papers minus (z) expenses relating to its calculation the branch of Business EBITDA and the Earn-OutBusiness, which shall not include any allocation of corporate overhead from Buyer to Seller.

Earn-Out. (a) Seller shall receiveAt the First Effective Time, as additional purchase price the following payments, if any, determined in accordance with the terms provisions of ‎Section 2.2(b) and conditions the Allocation Schedule, 7GC shall issue or cause to be issued to each Pre-Closing Holder, such Pre-Closing Holder’s proportionate allocation (based on such Pre-Closing Holder’s Closing Merger Consideration) of 5,850,000 restricted 7GC New Class A Shares, which shall be subject to the vesting and forfeiture provisions provided for in this Section 2.2 ‎Section 2.6 (collectively, “Additional Purchase Price Payments”) and the Business EBITDA Benchmarks set forth below, without duplication (the “Business EBITDA BenchmarksEarn Out Shares”): (i) If 1,950,000 of the Business EBITDA Earn Out Shares will vest upon the occurrence of Triggering Event I (the “$12 Earn Out Shares”); (ii) 1,950,000 of the Earn Out Shares will vest upon the occurrence of Triggering Event II (the “$14 Earn Out Shares”); and (iii) 1,950,000 Earn Out Shares will vest upon the occurrence of Triggering Event III (the “$16 Earn Out Shares”). For illustrative purposes, if, prior to the expiry of the Earn Out Period: (i) the Closing Price of the 7GC New Class A Shares is greater than or equal to $50,000,000 in 12.00 over any calendar year following twenty (20) Trading Days within any thirty- (30-) consecutive Trading Day period, all of the Closing from and including calendar year 2007 to and including calendar year 2009, Buyer $12 Earn Out Shares shall pay to Seller a one time payment of $25,000,000automatically vest; (ii) If the Business EBITDA Closing Price of the 7GC New Class A Shares is greater than or equal to $55,000,00014.00 over any twenty (20) Trading Days within any thirty- (30-) consecutive Trading Day period, in any calendar year following all of the Closing from and including calendar year 2007 to and including calendar year 2009$14 Earn Out Shares shall vest and, Buyer if not already vested, all of the $12 Earn Out Shares shall pay to Seller a one time payment of an aggregate of $40,000,000, less any amounts previously paid to Seller under Section 2.2(a)(i);vest; and (iii) If the Business EBITDA Closing Price of the 7GC New Class A Shares is greater than or equal to $59,000,00016.00 over any twenty (20) Trading Days within any thirty- (30-) consecutive Trading Day period, all of the $16 Earn Out Shares shall vest and, if not already vested, all of the $12 Earn Out Shares and $14 Earn Out Shares shall vest. (b) The Earn Out Shares shall be shown as issued and outstanding on the 7GC’s financial statements, and shall be legally outstanding under applicable state law as of the First Effective Time. Subject to the limitations contemplated herein, each Pre-Closing Holder shall have all of the rights of a stockholder with respect to the Earn Out Shares, including the right to receive dividends and to vote such shares; provided, other than pursuant to Section 2.6(f), that the Earn Out Shares shall not entitle the holder thereof to consideration in connection with any sale or other transaction and may not be offered, sold, transferred, redeemed, assigned, pledged, hypothecated, encumbered or otherwise disposed of (whether by operation of law or otherwise) by any Pre-Closing Holder or be subject to execution, attachment or similar process without the consent of 7GC, and shall bear a customary legend with respect to such transfer restrictions. Any attempt to so sell, transfer, assign, pledge, hypothecate, encumber or otherwise dispose of such Earn Out Shares shall be null and void. (c) Any Earn Out Shares distributed to individuals who held a vested Company Option as of immediately prior to the First Effective Time in accordance with this Agreement shall be granted to such individuals pursuant to the New Incentive Plan. (d) If the applicable Triggering Event has not occurred prior to the expiry of the Earn Out Period, then all Earn Out Shares which would vest in connection with such Triggering Event shall be automatically forfeited and deemed transferred to 7GC and shall be cancelled by 7GC and cease to exist. For the avoidance of doubt, prior to such forfeiture, all Earn Out Shares shall be entitled to any dividends or distributions made to the holders of 7GC New Class A Shares and shall be entitled to the voting rights generally granted to holders of 7GC New Class A Shares. (e) In the event of occurrence of any Triggering Event set forth in ‎Section 2.6(a), as soon as practicable (but in any calendar year following event within twenty (20) Business Days), 7GC will deliver to the Sponsor and the Company (the “Earn Out Approval Parties”) a written statement (each, a “Stock Price Earn Out Statement”) that sets forth (i) the Closing from and including calendar year 2007 to and including calendar year 2009, Buyer shall pay to Seller a one time payment of an aggregate of $50,000,000, less any amounts previously paid to Seller under Sections 2.2(a)(i) Price over the applicable 20-Trading Day period and (ii); and) the calculation of the Earn Out Shares in connection therewith and the Allocation Schedule. Either or both of the Earn Out Approval Parties may deliver written notice to 7GC and the other Earn Out Approval Party on or prior to the fifteenth (15th) day after receipt of a Stock Price Earn Out Statement specifying in reasonable detail any items that they wish to dispute and the basis therefor. If neither of the Earn Out Approval Parties deliver such written notice in such fifteen- (15-) day period, then the Earn Out Approval Parties and the Pre-Closing Holders will be deemed to have waived their right to contest such Stock Price Earn Out Statement and the calculations set forth therein. If either or both of the Earn Out Approval Parties provide 7GC and the other Earn Out Approval Party with written notice of any objections to the Stock Price Earn Out Statement in such fifteen (15) day period, then 7GC and each of the Earn Out Approval Parties will, for a period of twenty (20) days following the date of delivery of such notice, attempt to resolve their differences and any written resolution by signed by each of the Earn Out Approval Parties and 7GC as to any disputed amount will be final and binding for all purposes under this Agreement. If at the conclusion of such twenty (20) day period the Earn Out Approval Parties and 7GC have not reached an agreement on any objections with respect to the Stock Price Earn Out Statement, then upon the written request of any of 7GC or the Earn Out Approval Parties the parties will refer the dispute to an independent accountant of national standing as shall be mutually agreed upon in good faith by the Earn Out Approval Parties and 7GC for final resolution of the dispute as promptly as practicable. (ivf) Notwithstanding In the foregoingevent that there is a 7GC Sale after the Closing and prior to the expiry of the Earn Out Period that will result in the holders of 7GC New Class A Shares receiving a 7GC Sale Price equal to or in excess of the applicable price per share attributable to any Triggering Event, then immediately prior to the consummation of the 7GC Sale any such Triggering Event that has not previously occurred shall be and the related vesting conditions in ‎Section 2.6(e) also shall be deemed to have occurred and the holders of such Earn Out Shares shall be eligible to participate in such 7GC Sale. For avoidance of doubt, assuming no prior Triggering Events have occurred: (i) if the Business EBITDA is less than $59,000,000 in each calendar year following 7GC Sale Price for acquisition of the Closing from and including calendar year 2007 to and including calendar year 2009 but 7GC New Class A Shares is greater than or equal to $59,000,000 in calendar year 201012.00 but less than $14.00 per 7GC New Class A Share, Buyer the $12 Earn Out Shares shall pay be deemed to Seller a one time payment of have fully vested (and the $10,000,000, less any amounts previously paid to Seller under Sections 2.2(a)(i14 Earn Out Shares and $16 Earn Out Shares shall be deemed forfeited and shall be cancelled by 7GC), ; (ii) if the 7GC Sale Price for acquisition of the 7GC New Class A Shares is greater than or equal to $14.00 but less than $16.00 per 7GC New Class A Share, the $12 Earn Out Shares and the $14 Earn Out Shares shall be deemed to have vested (and the $16 Earn Out Shares shall be deemed forfeited and shall be cancelled by 7GC); (iii) in excess if the 7GC Sale Price for acquisition of the 7GC New Class A Shares is greater than or equal to $40,000,000. For the avoidance of doubt16.00 per 7GC New Class A Share, the Parties hereby agree that Seller $12 Earn Out Shares, the $14 Earn Out Shares and the $16 Earn Out Shares shall be entitled deemed to receive no more have fully vested; provided, that if the 7GC Sale Price for acquisition of the 7GC New Class A Shares is less than $50,000,000 under any circumstances under this Section 2.2. The Business EBITDA Benchmarks may 12.00 per 7GC New Class A Share, then no Earn Out Shares shall be adjusted pursuant deemed to Section 2.2(g) have vested and Section 2.2(h)(ii) belowall such Earn Out Shares shall be deemed forfeited and shall be cancelled by 7GC. (bg) On or before March 31st of each of 2008, 2009, 2010 From and 2011, Buyer shall (i) provide a statement after the Closing until the expiration of the Business EBITDA for the preceding calendar year derived from Buyer’s audited consolidated Financial StatementsEarn Out Period, which Buyer’s audited consolidated Financial Statements 7GC shall be prepared in accordance with GAAPnot, and Buyer’s calculation shall not knowingly and intentionally cause any of its Subsidiaries (including the Additional Purchase Price PaymentsGroup Companies) to, if knowingly and intentionally take any (collectively actions with the “Earn-Out Statement”)express intent of, and (ii) deliver the Earn-Out Statement to Seller; provided that such statements shall cease to be required following aggregate Additional Purchase Price Payments of $50,000,000. For up to ninety- (90) days immediately following Seller’s receipt of an Earn-Out Statement (the “Receipt Date”), Seller shall be permitted to review the working papers and Books and Records of the Business and shall be permitted to discuss such matters with the chief financial officer and other executive officers of Buyer, the Company and the Company Subsidiaries and with Buyer’s, the Company’s and the Company Subsidiaries’ accountants for the primary purpose of confirming which is to, avoid the determination of the applicable calendar year’s Business EBITDA. The determination of the Business EBITDA and the calculation occurrence of any Additional Purchase Price Payments included in an Earn-Out Statement shall become final and binding upon the Parties ninety (90) days following Receipt Date, unless Seller gives written notice of its disagreement (a “Notice of Disagreement Regarding Additional Purchase Price Payments”) to Buyer prior to such date (the period commencing on the Receipt Date and ending on the earlier of (i) ninety (90) days thereafter and (ii) the date a Notice of Disagreement Regarding Additional Purchase Price Payments is given, the “Earn-Out Review Period”). For up to fifteen (15) days following delivery of a Notice of Disagreement Regarding Additional Purchase Price Payments (the “Negotiation Period”), the Parties shall seek in good faith to resolve in writing any differences which they have with respect to the matters specified in the Notice of Disagreement Regarding Additional Purchase Price Payments. Following delivery of a Notice of Disagreement Regarding Additional Purchase Price Payments, Buyer and its agents and representatives shall be permitted to review Seller’s and its representatives’ working papers relating to its calculation of Business EBITDA and the Earn-OutTriggering Event.

Earn-Out. (a) With respect to the period of time beginning on (and including) the first day of Buyer’s first full accounting month after the Closing Date (such first day being February 23, 2015) and ending on (and including) the last day of the twelfth consecutive full accounting month following the Closing Date (such last day being February 21, 2016) (such period of time, “Year One”), Seller shall receive, as additional purchase price be entitled to the following payments, amount (if any) based upon the COH for Year One (any such payment, determined in accordance with the terms and conditions of this Section 2.2 (collectively, “Additional Purchase Price Payments”) and the Business EBITDA Benchmarks set forth below, without duplication (the “Business EBITDA BenchmarksYear One Payment”): (i) If the Business EBITDA if COH for Year One is greater less than or equal to $50,000,000 in 3,000,000, then Seller shall not be entitled to any calendar year following the Closing from and including calendar year 2007 to and including calendar year 2009, Buyer shall pay to Seller a one time payment of $25,000,000Year One Payment; (ii) If if the Business EBITDA COH for Year One is greater than or equal to $55,000,0003,000,000, in any calendar year following the Closing from and including calendar year 2007 to and including calendar year 2009, Buyer shall pay to Seller a one time payment of an aggregate of $40,000,000, less any amounts previously paid to Seller under Section 2.2(a)(i); (iii) If the Business EBITDA is greater than or equal to $59,000,000, in any calendar year following the Closing from and including calendar year 2007 to and including calendar year 2009, Buyer shall pay to Seller a one time payment of an aggregate of $50,000,000, less any amounts previously paid to Seller under Sections 2.2(a)(i) and (ii); and (iv) Notwithstanding the foregoing, if the Business EBITDA is less than $59,000,000 in each calendar year following the Closing from and including calendar year 2007 to and including calendar year 2009 but is greater than or equal to $59,000,000 in calendar year 2010, Buyer shall pay to Seller a one time payment of $10,000,000, less any amounts previously paid to Seller under Sections 2.2(a)(i), (ii) and (iii) in excess of $40,000,000. For the avoidance of doubt, the Parties hereby agree that then Seller shall be entitled to receive no more than a Year One Payment that is equal to: ; provided, that the Year One Payment shall not exceed $50,000,000 under any circumstances under this Section 2.2. The Business EBITDA Benchmarks may be adjusted pursuant to Section 2.2(g) and Section 2.2(h)(ii) below3,500,000. (b) On or before March 31st With respect to the period of each time beginning on (and including) the first day of 2008Buyer’s thirteenth full accounting month after the Closing Date (such first day being February 22, 2009, 2010 2016) and 2011, Buyer shall ending on (iand including) provide a statement the last day of the Business EBITDA for 24th consecutive full accounting month following the preceding calendar year derived from Buyer’s audited consolidated Financial StatementsClosing Date (such last day being February 19, which Buyer’s audited consolidated Financial Statements shall be prepared in accordance with GAAP2017) (such period of time, and Buyer’s calculation of the Additional Purchase Price Payments, if any (collectively the “Earn-Out Statement”), and (ii) deliver the Earn-Out Statement to Seller; provided that such statements shall cease to be required following aggregate Additional Purchase Price Payments of $50,000,000. For up to ninety- (90) days immediately following Seller’s receipt of an Earn-Out Statement (the “Receipt DateYear Two”), Seller shall be permitted entitled to review the working papers and Books and Records of following amount (if any) based upon the Business and COH for Year Two (any such payment, the “Year Two Payment”): (i) if the COH for Year Two is less than or equal to $3,000,000, then Seller shall not be entitled to any Year Two Payment; (ii) if the COH for Year Two is greater than $3,000,000, then Seller shall be permitted entitled to discuss such matters with receive a Year Two Payment that is equal to: ; provided, that (1) if the chief financial officer result of this calculation is a negative number, then the Year Two Payment shall be zero, and other executive officers (2) if the Year Two Payment plus the Year One Payment (if any) would exceed $3,500,000, then the Year Two Payment shall equal $3,500,000 minus the Year One Payment. (c) With respect to the period of time beginning on (and including) the first day of Buyer’s 25th full accounting month after the Closing Date (such first day being February 20, the Company and the Company Subsidiaries and with Buyer’s, the Company’s and the Company Subsidiaries’ accountants for the purpose of confirming the determination of the applicable calendar year’s Business EBITDA. The determination of the Business EBITDA and the calculation of any Additional Purchase Price Payments included in an Earn-Out Statement shall become final and binding upon the Parties ninety (902017) days following Receipt Date, unless Seller gives written notice of its disagreement (a “Notice of Disagreement Regarding Additional Purchase Price Payments”) to Buyer prior to such date (the period commencing on the Receipt Date and ending on (and including) the earlier last day of the 36th consecutive full accounting month following the Closing Date (such last day being February 25, 2018) (such period of time, “Year Three”), Seller shall be entitled to the following amount (if any) based upon the COH for Year Three (any such payment, the “Year Three Payment”): (i) ninety (90) days thereafter and if the COH for Year Three is less than or equal to $3,000,000, then Seller shall not be entitled to any Year Three Payment; (ii) if the date COH for Year Three is greater than $3,000,000, then Seller shall be entitled to receive a Notice Year Three Payment that is equal to: ; provided, that (1) if the result of Disagreement Regarding Additional Purchase Price Payments this calculation is givena negative number, then the Year Three Payment shall be zero, and (2) if the Year Three Payment plus the Year One Payment (if any) plus the Year Two Payment (if any) would exceed $3,500,000, then the Year Three Payment shall equal $3,500,000 minus the Year One Payment minus the Year Two Payment. For illustrative purposes only, if the COH for Year One is $3,300,000, then Seller shall be entitled to receive a Year One Payment that is equal to $900,000, which equals three multiplied ($3,300,000 minus $3,000,000). In addition, for illustrative purposes only, if the COH for the following year (Year Two) was $3,500,000, then Seller shall be entitled to receive a Year Two Payment that is equal to $600,000, which equals [three multiplied by ($3,500,000 minus 3,000,000)] minus $900,000. For illustrative purposes only, if the COH for the following year (Year Three) was $4,000,000, then Seller shall be entitled to receive a Year Three Payment that is equal to $1,500,000, which equals [three multiplied by ($4,000,000 minus 3,000,000)] minus $900,000 minus $600,000. (d) For purposes of this Section 1.6,“ COH” (or Contribution to Overhead) shall be calculated by Buyer in accordance with Buyer’s accounting methods, policies, practices and procedures and shall mean, for each applicable year (e.g., Year One, Year Two and Year Three), (x) the revenue earned by Buyer, BG Staffing or their respective Affiliates or assignees that is attributable to the Business for such year, minus (y) the cost of services to the Business for such year, which shall consist of billable staffing independent contractor payments, the temporary payroll, the temporary payroll Taxes, temporary benefits paid by Buyer or its Affiliates with respect to the Business, fees and costs associated with the Patient Protection and Affordable Care Act, and worker’s compensation insurance cost associated with the temporary payroll, minus (z) direct operating expenses relating to the Houston branch of the Business, which shall not include any allocation of corporate overhead. (e) The Year One Payment, the Year Two Payment and the Year Three Payment (each, an “Earn-Out Review PeriodPayment”), if any, shall be paid by Buyer to Seller in accordance with Section 1.5 within 60 days of the last day of the applicable twelve-month period (e.g., Year One, Year Two and Year Three) for which such Earn-Out Payment is calculated; provided, that the conditions for payment of such Earn-Out Payment as set forth in this Section 1.6 have been satisfied and subject to Section 5.6; and provided, further, that any dispute as to the applicable Earn-Out Payment has been resolved pursuant to Section 1.6(f). For up to fifteen (15) days following delivery of a Notice of Disagreement Regarding Additional Purchase Price Payments (the “Negotiation Period”)each fiscal month during Year One, the Parties shall seek in good faith to resolve in writing any differences which they have with respect to the matters specified in the Notice of Disagreement Regarding Additional Purchase Price Payments. Following delivery of a Notice of Disagreement Regarding Additional Purchase Price PaymentsYear Two and Year Three, Buyer and its agents and representatives shall be permitted agrees to review deliver to Seller’s and its representatives’ working papers relating to its , within 30 days after the end of such fiscal month, a statement showing the calculation of Business EBITDA the COH (each, a “COH Statement”) for such fiscal month and the cumulative COH for the applicable twelve-month period that includes such fiscal month. The COH Statement covering Year One, Year Two or Year Three, as applicable, shall include a calculation of the resulting Earn-OutOut Payment, if any, and is referred to herein as an “Annual COH Statement.”

Earn-Out. (aA) Seller SFX Entertainment shall receive, as make or shall cause Buyer to make an additional purchase price payment to Sellers (the following payments"EARN-OUT PAYMENT") after the Closing based on the aggregate EBITDA of the Companies and the business conducted by Buyer and/or its Affiliates formed from Network 40's assets for calendar year 1998 ("1998 EBITDA"), if any, determined in accordance with the terms and conditions of this Section 2.2 (collectively, “Additional Purchase Price Payments”) and the Business EBITDA Benchmarks set forth below, without duplication (the “Business EBITDA Benchmarks”): (i) If the Business 1998 EBITDA is equal to or greater than or $9,000,000. The Earn-Out Payment will be calculated as follows: 1998 EBITDA Earn-Out Payment ========================================================= ========================================================= equal to $50,000,000 in any calendar year following the Closing from and including calendar year 2007 to and including calendar year 2009, Buyer shall pay to Seller a one time payment of 9,000,000 $25,000,000;4,000,000 $9,000,000 - $10,000,000 $4,000,000 + 4(1998 EBITDA - $9,000,000) $10,000,000 - $11,000,000 $8,000,000 + 6 (1988 EBITDA - $10,000,000) greater than $11,000,000 $14,000,000 ========================================================= ========================================================= (iiB) If The Earn-Out Payment will be made in the Business EBITDA is greater than or equal to $55,000,000form of shares of Class A Common Stock of SFX Entertainment ("EARN-OUT SECURITIES"). The number of Earn-Out Securities comprising the Earn-Out Payment will be calculated by dividing the Earn-Out Payment by the average daily closing price of the Class A Common Stock of SFX Entertainment for the twenty (20) Trading Days ending on March 15, in any calendar year following the Closing from and including calendar year 2007 to and including calendar year 2009, Buyer shall pay to Seller a one time payment of an aggregate of $40,000,000, less any amounts previously paid to Seller under Section 2.2(a)(i); (iii) If the Business EBITDA is greater than or equal to $59,000,000, in any calendar year following the Closing from and including calendar year 2007 to and including calendar year 2009, Buyer shall pay to Seller a one time payment of an aggregate of $50,000,000, less any amounts previously paid to Seller under Sections 2.2(a)(i) and (ii); and (iv) 1999. Notwithstanding the foregoing, (i) if the Business 1998 EBITDA is less than $59,000,000 in each calendar year following the Closing from and including calendar year 2007 to and including calendar year 2009 but is greater than or equal to $59,000,000 in calendar year 20109,600,000, Buyer shall and SFX Entertainment may, in their sole discretion, pay to Seller a one time payment of $10,000,000, less any amounts previously paid to Seller under Sections 2.2(a)(i), (ii) and (iii) in excess of $40,000,000. For the avoidance of doubt, the Parties hereby agree that Seller shall be entitled to receive no more than $50,000,000 under any circumstances under this Section 2.2. The Business EBITDA Benchmarks may be adjusted pursuant to Section 2.2(g) and Section 2.2(h)(ii) below. (b) On or before March 31st of each of 2008, 2009, 2010 and 2011, Buyer shall (i) provide a statement of the Business EBITDA for the preceding calendar year derived from Buyer’s audited consolidated Financial Statements, which Buyer’s audited consolidated Financial Statements shall be prepared in accordance with GAAP, and Buyer’s calculation of the Additional Purchase Price Payments, if any (collectively the “Earn-Out Statement”)Payment in the form of cash, and (ii) deliver if the Spin-Off has not been consummated prior to the date on which the Earn-Out Statement to Seller; provided that such statements shall cease to Payment must be required following aggregate Additional Purchase Price Payments of $50,000,000. For up to ninety- (90) days immediately following Seller’s receipt of an made, the Earn-Out Statement (the “Receipt Date”), Seller Payment shall be permitted to review made in the working papers and Books and Records form of the Business and shall be permitted to discuss such matters with the chief financial officer and other executive officers of Buyer, the Company and the Company Subsidiaries and with Buyer’s, the Company’s and the Company Subsidiaries’ accountants for the purpose of confirming the determination of the applicable calendar year’s Business EBITDA. The determination of the Business EBITDA and the calculation of any Additional Purchase Price Payments included in an cash. (C) Any Earn-Out Statement Securities issued to Sellers pursuant to this Section 2.9 shall become final be issued to Sellers, and binding upon the Parties ninety (90) days following Receipt Date, unless Seller gives written notice of its disagreement (a “Notice of Disagreement Regarding Additional Purchase Price Payments”) to Buyer prior to such date (the period commencing on the Receipt Date and ending on the earlier of (i) ninety (90) days thereafter and (ii) the date a Notice of Disagreement Regarding Additional Purchase Price Payments is given, the “any Earn-Out Review Period”). For up Payment made in cash shall be paid to fifteen Sellers, in either case no later than March 20, 1999, by wire transfer of immediately available funds to an account or accounts, and in the percentages, identified to Buyer by each of the Sellers in a written notice delivered to Buyer no later than ten (1510) days following delivery before the date on which any issuance of Earn-Out Securities or payment of cash is required to be made pursuant to this Section 2.9. Any Earn-Out Securities will be treated as "Securities" for purposes of Sections 2.7 and 2.8. (D) Within sixty (60) days after the Earn-Out Securities have been issued to Sellers, SFX Entertainment agrees to file with the SEC a Notice of Disagreement Regarding Additional Purchase Price Payments post-effective amendment to the Registration Statement or a new registration statement on Form S-3, if available (the “Negotiation Period”"EARN-OUT REGISTRATION STATEMENT"), in the Parties shall seek in good faith to resolve in writing any differences which they have with respect to the matters manner specified in the Notice Securities Act, to include all of Disagreement Regarding Additional Purchase Price Paymentsthe Earn- Out Securities to the extent not previously included in the Registration Statement. Following delivery of a Notice of Disagreement Regarding Additional Purchase Price Payments, Buyer and its agents and representatives shall be permitted to review Seller’s and its representatives’ working papers relating to its calculation of Business EBITDA and In the event the Earn-OutOut Registration Statement is required, SFX Entertainment shall use its best efforts to cause the Earn-Out Registration Statement to be declared effective by the SEC as soon as practicable after its filing with the SEC, and to remain effective and current until such time as all Earn-Out Securities are sold pursuant to the Earn-Out Registration Statement or the Registration Statement, as applicable. (E) For purposes of this Section 2.9, the parties acknowledge and agree that 1998 EBITDA shall be calculated without giving effect to any sale (other than sales of inventory in the Ordinary Course of Business), lease or other disposition by Buyer of any asset or property of Network 40 or either Company, including the sale, lease or other disposition of any of the Intellectual Property Assets. If Buyer takes any such action the parties shall use best efforts to calculate 1998 EBITDA on a pro forma basis as though such action were not taken.

Earn-Out. In addition to the Closing Purchase Price, JAKKS Pacific shall pay the Earn-Out to the Agent in the form of Common Stock for the benefit and account of the several Shareholders in the amount and payable in the manner and upon the terms and conditions set forth below: (a) Seller The Earn-Out for each Earn-Out Year shall receive, as additional purchase price be determined by the following paymentsincrease, if any, determined in accordance with Kidz Biz Sales for such Earn-Out Year over the terms and conditions prior year's Kidz Biz Sales, expressed as a percentage of this Section 2.2 (collectively, “Additional Purchase Price Payments”) and the Business EBITDA Benchmarks set forth below, without duplication prior year's Kidz Biz Sales (the “Business EBITDA Benchmarks”):"Percentage Y/O/Y Increase"), and shall be earned and payable as follows: (i) If if the Business EBITDA Percentage Y/O/Y Increase is greater less than or equal to $50,000,000 in any calendar year following five (5%) percent, there will be no Earn-out Payment for the Closing from and including calendar year 2007 to and including calendar year 2009, Buyer shall pay to Seller a one time payment of $25,000,000Earn-Out Year; (ii) If if the Business EBITDA Percentage Y/O/Y Increase is greater than five (5%) percent but less than or equal to $55,000,000ten (10%) percent, in any calendar year following the Closing from Earn-out Payment for such Earn-Out Year will equal the number of shares of Common Stock equal to the product of (i) a fraction the numerator of which is five (5%) percent and including calendar year 2007 to the denominator of which is the excess of the Percentage Y/O/Y Increase over five (5%) percent and including calendar year 2009, Buyer shall pay to Seller a one time payment (ii) 25,749 shares of an aggregate of $40,000,000, less any amounts previously paid to Seller under Section 2.2(a)(i);Common Stock; and (iii) If if the Business EBITDA Percentage Y/O/Y Increase is greater than or equal to $59,000,000, in any calendar year following the Closing from and including calendar year 2007 to and including calendar year 2009, Buyer shall pay to Seller a one time payment of an aggregate of $50,000,000, less any amounts previously paid to Seller under Sections 2.2(a)(iten (10%) and (ii); and (iv) Notwithstanding the foregoing, if the Business EBITDA is less than $59,000,000 in each calendar year following the Closing from and including calendar year 2007 to and including calendar year 2009 but is greater than or equal to $59,000,000 in calendar year 2010, Buyer shall pay to Seller a one time payment of $10,000,000, less any amounts previously paid to Seller under Sections 2.2(a)(i), (ii) and (iii) in excess of $40,000,000. For the avoidance of doubtpercent, the Parties hereby agree that Seller shall Earn-out Payment for such Earn-Out Year will be entitled to receive no more than $50,000,000 under any circumstances under this Section 2.2. The Business EBITDA Benchmarks may be adjusted pursuant to Section 2.2(g) and Section 2.2(h)(ii) below25,749 shares of Common Stock. (b) On or before March 31st of each of 2008, 2009, 2010 and 2011, Buyer shall (i) provide a statement of the Business EBITDA for the preceding calendar year derived from Buyer’s audited consolidated Financial Statements, which Buyer’s audited consolidated Financial Statements shall be prepared in accordance with GAAP, and Buyer’s calculation of the Additional Purchase Price Payments, if any (collectively the “The Earn-Out Statement”)Shares, if any, for each Earn-Out Year shall be delivered as soon as practicable, but in any event not later than sixty (60) days, after the end of such Earn-Out Year. (c) On each Earn-Out Payment Date, JAKKS Pacific shall pay the Earn-Out, if any, for the applicable Earn-Out Year to the Agent (for the benefit and (iiaccount of the several Shareholders) deliver in the manner provided in a Notice given to JAKKS Pacific pursuant to Section 3.2 or, if no such Notice is given, by delivering share certificates for the Earn-Out Statement Shares in the names of each Shareholder to Seller; provided that such statements shall cease the Agent, each certificate to be required following aggregate Additional Purchase Price Payments for the same proportion of $50,000,000. For up to ninety- (90) days immediately following Seller’s receipt of an the Earn-Out Statement (the “Receipt Date”), Seller shall be permitted to review the working papers and Books and Records of the Business and shall be permitted to discuss such matters with the chief financial officer and other executive officers of Buyer, the Company and the Company Subsidiaries and with Buyer’s, the Company’s and the Company Subsidiaries’ accountants Shares for the purpose of confirming the determination of the applicable calendar year’s Business EBITDA. The determination of the Business EBITDA and the calculation of any Additional Purchase Price Payments included in an that Earn-Out Statement Year as the proportion of Earn-Out Shares received by such Shareholder in payment of the last preceding Earn-Out Payment, or if no preceding Earn-Out Payment has then been made, for the same proportion of the Earn-Out Shares as the proportion of the JAKKS Pacific Shares received by such Shareholder on Closing. (d) In the event that JAKKS Pacific ceases to control Kidz Biz UK or Far East and David Lipman's employment is terminated without "cause" by Kidz Biz UK xx xx Xxxxx Xipman for "good reason" (as such terms are used in the Employmexx Xxxxxxxxx) prior to the end of the term of the Employment Agreement, JAKKS Pacific shall become final within ten (10)business days thereafter deliver to the Agent for the benefit and binding upon account of the Parties ninety Shareholders 25,749 shares of Common Stock in respect of the then current Earn-Out Year in which such events occur in full satisfaction of the Earn-Out obligation for such Earn-Out Year, and 25,749 shares of Common Stock in respect of each Earn-Out Year thereafter, such delivery to occur within thirty (9030) days following Receipt Dateafter the end of the relevant subsequent Earn-Out Year, unless Seller gives written notice if any, provided, however, that if such termination occurs after the third anniversary of its disagreement (a “Notice the Closing under this Agreement, the number of Disagreement Regarding Additional Purchase Price Payments”) to Buyer shares of Common Stock thereafter deliverable on account of the Earn-Out shall equal the average number of shares of Common Stock delivered in satisfaction of the Earn-Out obligation, if any, during the Earn-Out Years ending prior to such date (the period commencing on the Receipt Date and ending on the earlier of (i) ninety (90) days thereafter and (ii) the date a Notice of Disagreement Regarding Additional Purchase Price Payments is given, the “Earn-Out Review Period”). For up to fifteen (15) days following delivery of a Notice of Disagreement Regarding Additional Purchase Price Payments (the “Negotiation Period”), the Parties shall seek in good faith to resolve in writing any differences which they have with respect to the matters specified in the Notice of Disagreement Regarding Additional Purchase Price Payments. Following delivery of a Notice of Disagreement Regarding Additional Purchase Price Payments, Buyer and its agents and representatives shall be permitted to review Seller’s and its representatives’ working papers relating to its calculation of Business EBITDA and the Earn-Outtermination.

Earn-Out. (a) Seller Purchaser shall receive, pay to the Sellers as additional purchase price consideration for the following payments, if any, determined Purchased Assets an amount in cash not to exceed in the aggregate $53,000,000 (the “Earn-Out”) in accordance with the terms and conditions of this Section 2.2 2.7. An Earn-Out Payment (collectivelyas defined below) may be achieved for each of the 12-month periods ending on December 31, 2014 and December 31, 2015 (each, an “Additional Purchase Price PaymentsEarn-Out Year”) and the Business EBITDA Benchmarks set forth below, without duplication (the “Business EBITDA Benchmarks”): (i) If the Business EBITDA is greater than or equal to $50,000,000 in any calendar year following the Closing from and including calendar year 2007 to and including calendar year 2009, Buyer shall pay to Seller a one time payment of $25,000,000; (ii) If the Business EBITDA is greater than or equal to $55,000,000, in any calendar year following the Closing from and including calendar year 2007 to and including calendar year 2009, Buyer shall pay to Seller a one time payment of an aggregate of $40,000,000, less any amounts previously paid to Seller under Section 2.2(a)(i); (iii) If the Business EBITDA is greater than or equal to $59,000,000, in any calendar year following the Closing from and including calendar year 2007 to and including calendar year 2009, Buyer shall pay to Seller a one time payment of an aggregate of $50,000,000, less any amounts previously paid to Seller under Sections 2.2(a)(i) and (ii); and (iv) Notwithstanding the foregoing, if the Business EBITDA is less than $59,000,000 in each calendar year following the Closing from and including calendar year 2007 to and including calendar year 2009 but is greater than or equal to $59,000,000 in calendar year 2010, Buyer shall pay to Seller a one time payment of $10,000,000, less any amounts previously paid to Seller under Sections 2.2(a)(i), (ii) and (iii) in excess of $40,000,000. For the avoidance of doubt, the Parties hereby agree that Seller shall be entitled to receive no more than $50,000,000 under any circumstances under this Section 2.2. The Business EBITDA Benchmarks may be adjusted pursuant to Section 2.2(g) and Section 2.2(h)(ii) below.as follows: (b) On or before March 31st of each of 2008February 28, 20092015, 2010 and 2011Purchaser shall pay to the Sellers, Buyer shall an amount based on Total Revenues for the Earn-Out Year ending December 31, 2014, calculated as follows: (i) if Total Revenues for such Earn-Out Year are less than $30,000,000, no Earn-Out Payment will be due and payable; or (ii) if Total Revenues for such Earn-Out Year are greater than $30,000,000 but less than $50,000,000, an amount equal to fifteen percent (15%) of the Total Revenues for such Earn-Out Year multiplied by a fraction, the numerator of which is Total Revenues for such Earn-Out Year in excess of $30,000,000 and the denominator of which is $20,000,000; or (iii) if Total Revenues for such Earn-Out Year are greater than $50,000,000, an amount equal to fifteen percent (15%) of Total Revenues. (c) On or before February 29, 2016, Purchaser shall pay to the Sellers, an amount based on Total Revenues for the Earn-Out Year ending December 31, 2015, calculated as follows: (i) if Total Revenues for such Earn-Out Year are less than $40,000,000, no Earn-Out Payment will be due and payable; or (ii) if Total Revenues for such Earn-Out Year are greater than $40,000,000 but less than $60,000,000, an amount equal to fifteen percent (15%) of the Total Revenues for such Earn-Out Year multiplied by a fraction, the numerator of which is Total Revenues for such Earn-Out Year in excess of $40,000,000 and the denominator of which is $20,000,000; or (iii) if Total Revenues for such Earn-Out Year are greater than $60,000,000, an amount equal to fifteen percent (15%) of Total Revenues. (d) No later than 30 days after Astronics Corporation files its quarterly financial statements for a quarter of an Earn-Out Year with the Securities and Exchange Commission, Purchaser will provide a statement reasonably detailed breakdown of all of Purchaser’s and Astronics Corporation’s (including any Subsidiaries’) revenues includable in Total Revenues to Sellers in a form that will enable Sellers to reasonably estimate the amount of the Business EBITDA for potential Earn-Out Payment attributable to such quarter. Purchaser shall deliver to the preceding calendar year derived from Buyer’s audited consolidated Financial Statements, which Buyer’s audited consolidated Financial Statements shall be prepared in accordance with GAAP, and Buyer’s calculation of the Additional Purchase Price Payments, if any Sellers a computation (collectively the “Earn-Out Statement”)) of Total Revenue and the portion of the Earn-Out, if any, attributable to such period (an “Earn-Out Payment”) at the time it makes the Earn-Out Payment; provided, however, if no Earn-Out Payment is payable with respect to an Earn-Out Year, such Earn-Out Statement will be delivered no later than the last day of February of the year immediately following such Earn-Out Year. Unless within twenty (20) days after receipt of such computation, the Sellers deliver written notice to the Purchaser setting forth any and all items of disagreement relating to such computation, the computation will be conclusive and binding on the Sellers. Such 20-day period shall be tolled while Sellers are waiting to receive any work papers or other information reasonably requested by Sellers which were used by the Purchaser or its Affiliates in connection with their preparation of the Earn-Out Statement. (e) If the Sellers deliver a dispute notice within such 20-day period, as adjusted, following receipt of the Earn-Out Statement, the Purchaser and the Sellers shall use commercially reasonable efforts to resolve their differences for a period of ten (10) days. If the Purchaser and the Sellers are unable to resolve their differences within such period, the dispute shall be resolved by the Independent Accountants. The Purchaser and the Sellers will request that the Independent Accountants render a determination as to the computation of the Earn-Out Payment within thirty (30) days after their retention, and (ii) deliver the Purchaser and the Sellers will cooperate fully with the Independent Accountants so as to facilitate a final determination as quickly and as accurately as possible. In making such resolution, the Independent Accountants will consider only those issues, items or amounts in the Earn-Out Statement as to Seller; provided that such statements shall cease to be required following aggregate Additional Purchase Price Payments of $50,000,000which the Sellers have disagreed in writing in the aforementioned dispute notice. For up to ninety- The Independent Accountants’ final determination (90) days immediately following Seller’s receipt of an the “Final Earn-Out Statement Report”) for any given Earn-Out Year will be in writing and will be binding on the Purchaser and the Sellers. The fees and expenses of the Independent Accountants will be paid by the Purchaser and the Sellers in the same proportion as the dollar amount of the determination in such party’s favor reflected in the Final Earn-Out Report bears to the total dollar amount of all disputed items. In the event that any amount is payable as the Earn-Out Payment under this Section 2.7(e), the Purchaser will pay such amount by wire transfer of immediately available funds to an account designated by the Sellers as soon as reasonably practicable but in no event later than five Business Days following the receipt of the Final Earn-Out Report. (f) Any Earn-Out Payments to which the Sellers are entitled to under this Section 2.7 shall bear simple interest at a rate equal to 6% per annum commencing on March 1st of the year immediately following the applicable Earn-Out Year for which such Earn-Out Payment is due. Such interest shall be payable to the Sellers in immediately available funds upon demand. In addition, the Sellers shall be promptly reimbursed from the Purchaser for any and all costs or expenses of any nature or kind whatsoever (including, but not limited to, all attorneys’ fees) incurred in seeking to collect such unpaid Earn-Out Payments or to enforce the provisions of this Section 2.7. (g) The Purchaser agrees to act in good faith and in a manner consistent with the intention of the Parties such that the Sellers have a reasonable opportunity to earn the full Earn-Out. It is the Parties’ expectation that during the period of the Earn-Out the Business shall be managed and operated in a manner that is substantially consistent with past practice. Notwithstanding anything in this Agreement to the contrary, (i) in no event will the Purchaser be required to enter any line of business in which the Sellers were not engaged prior to the Closing Date (a “Receipt DateNew Business Line”), Seller shall be permitted including but not limited to review the working papers transmission of content to and Books and Records of the Business and shall be permitted to discuss such matters with the chief financial officer and other executive officers of Buyer, the Company and the Company Subsidiaries and with Buyer’s, the Company’s and the Company Subsidiaries’ accountants for the purpose of confirming the determination of the applicable calendar year’s Business EBITDA. The determination of the Business EBITDA and the calculation of any Additional Purchase Price Payments included in an Earn-Out Statement shall become final and binding upon the Parties ninety (90) days following Receipt Date, unless Seller gives written notice of its disagreement (a “Notice of Disagreement Regarding Additional Purchase Price Payments”) to Buyer prior to such date (the period commencing on the Receipt Date and ending on the earlier of (i) ninety (90) days thereafter from aircraft and (ii) as to any New Business Line, Purchaser reserves the date right at all times and in all situations to pursue, or not pursue a Notice New Business Line in its sole discretion, based on its sole judgment, including but not limited to its determination that not pursuing the New Business Line is in Purchaser’s or any of Disagreement Regarding Additional Purchase Price Payments its Affiliate’s best interests, even if those interests conflict with the specific interests of the Sellers. Purchaser shall have no obligation whatsoever to pursue any New Business Line, it does not wish to, and the Parties agree that the Purchaser’s judgment in such matters is given, the “final. (h) If in any Earn-Out Review Period”). For up Year there is a sale of substantially all of the assets of Purchaser to fifteen a third party, and the provisions of this Section 2.7 are not binding upon the acquiror in such an asset sale by operation of Law or are not expressly assumed by the acquiror in such asset sale (15) days following delivery of a Notice of Disagreement Regarding Additional Purchase Price Payments (the an “Negotiation PeriodAsset Sale”), the Parties shall seek applicable Earn-Out Payment in good faith to resolve in writing any differences which they have with respect to the matters specified in the Notice of Disagreement Regarding Additional Purchase Price Payments. Following delivery of a Notice of Disagreement Regarding Additional Purchase Price Payments, Buyer and its agents and representatives shall be permitted to review Seller’s and its representatives’ working papers relating to its calculation of Business EBITDA and the Earn-OutOut Year in which such a transaction occurs, notwithstanding any other provision of this Section 2.7 to the contrary, will be equal to the sum of a pre-Asset Sale Earn-Out Payment amount and a post-Asset Sale Earn Out payment amount, calculated as follows: (i) The pre-Asset Sale Earn-Out Payment amount will be calculated in accordance with Section 2.7 (b) or (c) as applicable, except (A) Total Revenues shall mean Total Revenues for such Earn-Out Year through the date of the Asset Sale and (B) the dollar thresholds provided under Subsections 2.7(b) and (c), as applicable, will be reduced to an amount equal to such dollar threshold amount multiplied by a fraction the numerator of which is the total number of days in the Earn-Out Year through the closing date of the Asset Sale and the denominator of which is the total number of days in the Earn-Out Year (the “Pre-Asset Sale Fraction”); and (ii) if the Asset Sale occurs in the 2014, the post-Asset Sale Earn-Out Payment will be equal to the sum of (A) fifteen percent (15%) of the product of (x) $68,000,000 multiplied by (y) one minus the Pre-Asset Sale Fraction, plus (B) $13,950,000; or (iii) if the Asset Sale occurs in 2015, the post-Asset Sale Earn-Out Payment will be equal to fifteen percent (15%) of the product of (A) $93,000,000 multiplied by (B) one minus the Pre-Asset Fraction.

Earn-Out. In addition to the Closing Purchase Price, JAKKS Pacific shall pay the Earn-Out to the Agent in the form of Common Stock for the benefit and account of the several Shareholders in the amount and payable in the manner and upon the terms and conditions set forth below: (a) Seller The Earn-Out for each Earn-Out Year shall receive, as additional purchase price be determined by the following paymentsincrease, if any, determined in accordance with Kidz Biz Sales for such Earn-Out Year over the terms and conditions prior year's Kidz Biz Sales, expressed as a percentage of this Section 2.2 (collectively, “Additional Purchase Price Payments”) and the Business EBITDA Benchmarks set forth below, without duplication prior year's Kidz Biz Sales (the “Business EBITDA Benchmarks”):"Percentage Y/O/Y Increase"), and shall be earned and payable as follows: (i) If if the Business EBITDA Percentage Y/O/Y Increase is greater less than or equal to $50,000,000 in any calendar year following five (5%) percent, there will be no Earn-out Payment for the Closing from and including calendar year 2007 to and including calendar year 2009, Buyer shall pay to Seller a one time payment of $25,000,000Earn-Out Year; (ii) If if the Business EBITDA Percentage Y/O/Y Increase is greater than five (5%) percent but less than or equal to $55,000,000ten (10%) percent, in any calendar year following the Closing from Earn-out Payment for such Earn-Out Year will equal the number of shares of Common Stock equal to the product of (i) a fraction the numerator of which is five (5%) percent and including calendar year 2007 to the denominator of which is the excess of the Percentage Y/O/Y Increase over five (5%) percent and including calendar year 2009, Buyer shall pay to Seller a one time payment (ii) 25,749 shares of an aggregate of $40,000,000, less any amounts previously paid to Seller under Section 2.2(a)(i);Common Stock; and (iii) If if the Business EBITDA Percentage Y/O/Y Increase is greater than or equal to $59,000,000, in any calendar year following the Closing from and including calendar year 2007 to and including calendar year 2009, Buyer shall pay to Seller a one time payment of an aggregate of $50,000,000, less any amounts previously paid to Seller under Sections 2.2(a)(iten (10%) and (ii); and (iv) Notwithstanding the foregoing, if the Business EBITDA is less than $59,000,000 in each calendar year following the Closing from and including calendar year 2007 to and including calendar year 2009 but is greater than or equal to $59,000,000 in calendar year 2010, Buyer shall pay to Seller a one time payment of $10,000,000, less any amounts previously paid to Seller under Sections 2.2(a)(i), (ii) and (iii) in excess of $40,000,000. For the avoidance of doubtpercent, the Parties hereby agree that Seller shall Earn-out Payment for such Earn-Out Year will be entitled to receive no more than $50,000,000 under any circumstances under this Section 2.2. The Business EBITDA Benchmarks may be adjusted pursuant to Section 2.2(g) and Section 2.2(h)(ii) below25,749 shares of Common Stock. (b) On or before March 31st of each of 2008, 2009, 2010 and 2011, Buyer shall (i) provide a statement of the Business EBITDA for the preceding calendar year derived from Buyer’s audited consolidated Financial Statements, which Buyer’s audited consolidated Financial Statements shall be prepared in accordance with GAAP, and Buyer’s calculation of the Additional Purchase Price Payments, if any (collectively the “The Earn-Out Statement”)Shares, if any, for each Earn-Out Year shall be delivered as soon as practicable, but in any event not later than sixty (60) days, after the end of such Earn-Out Year. (c) On each Earn-Out Payment Date, JAKKS Pacific shall pay the Earn-Out, if any, for the applicable Earn-Out Year to the Agent (for the benefit and (iiaccount of the several Shareholders) deliver in the manner provided in a Notice given to JAKKS Pacific pursuant to Section 3.2 or, if no such Notice is given, by delivering share certificates for the Earn-Out Statement Shares in the names of each Shareholder to Seller; provided that such statements shall cease the Agent, each certificate to be required following aggregate Additional Purchase Price Payments for the same proportion of $50,000,000. For up to ninety- (90) days immediately following Seller’s receipt of an the Earn-Out Statement (the “Receipt Date”), Seller shall be permitted to review the working papers and Books and Records of the Business and shall be permitted to discuss such matters with the chief financial officer and other executive officers of Buyer, the Company and the Company Subsidiaries and with Buyer’s, the Company’s and the Company Subsidiaries’ accountants Shares for the purpose of confirming the determination of the applicable calendar year’s Business EBITDA. The determination of the Business EBITDA and the calculation of any Additional Purchase Price Payments included in an that Earn-Out Statement Year as the proportion of Earn-Out Shares received by such Shareholder in payment of the last preceding Earn-Out Payment, or if no preceding Earn-Out Payment has then been made, for the same proportion of the Earn-Out Shares as the proportion of the JAKKS Pacific Shares received by such Shareholder on Closing. (d) In the event that JAKKS Pacific ceases to control Kidz Biz UK or Far East and Xxxxx Xxxxxx'x employment is terminated without "cause" by Kidz Biz UK or by Xxxxx Xxxxxx for "good reason" (as such terms are used in the Employment Agreement) prior to the end of the term of the Employment Agreement, JAKKS Pacific shall become final within ten (10)business days thereafter deliver to the Agent for the benefit and binding upon account of the Parties ninety Shareholders 25,749 shares of Common Stock in respect of the then current Earn-Out Year in which such events occur in full satisfaction of the Earn-Out obligation for such Earn-Out Year, and 25,749 shares of Common Stock in respect of each Earn-Out Year thereafter, such delivery to occur within thirty (9030) days following Receipt Dateafter the end of the relevant subsequent Earn-Out Year, unless Seller gives written notice if any, provided, however, that if such termination occurs after the third anniversary of its disagreement (a “Notice the Closing under this Agreement, the number of Disagreement Regarding Additional Purchase Price Payments”) to Buyer shares of Common Stock thereafter deliverable on account of the Earn-Out shall equal the average number of shares of Common Stock delivered in satisfaction of the Earn-Out obligation, if any, during the Earn-Out Years ending prior to such date (the period commencing on the Receipt Date and ending on the earlier of (i) ninety (90) days thereafter and (ii) the date a Notice of Disagreement Regarding Additional Purchase Price Payments is given, the “Earn-Out Review Period”). For up to fifteen (15) days following delivery of a Notice of Disagreement Regarding Additional Purchase Price Payments (the “Negotiation Period”), the Parties shall seek in good faith to resolve in writing any differences which they have with respect to the matters specified in the Notice of Disagreement Regarding Additional Purchase Price Payments. Following delivery of a Notice of Disagreement Regarding Additional Purchase Price Payments, Buyer and its agents and representatives shall be permitted to review Seller’s and its representatives’ working papers relating to its calculation of Business EBITDA and the Earn-Outtermination.