APPENDIX B
DISTRIBUTION AGREEMENT
DATED AS OF
MARCH 17, 1999
BETWEEN
▇▇▇▇▇▇▇▇▇ GROUP, INC.
AND
JEF HOLDING COMPANY, INC.
TABLE OF CONTENTS
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ARTICLE I--DEFINITIONS..................................................................................... 2
Section 1.01. Definitions.............................................................................. 2
ARTICLE II--THE DISTRIBUTION............................................................................... 7
Section 2.01. Cooperation Prior to the Distribution.................................................... 7
Section 2.02. JEFG Board Action; Conditions Precedent to the Distribution.............................. 8
Section 2.03. The Distribution......................................................................... 9
ARTICLE III--CONVEYANCE OF ASSETS, OBLIGATIONS AND RIGHTS; ASSUMPTION OF LIABILITIES; CONDUCT OF HOLDING
PENDING DISTRIBUTION..................................................................................... 9
Section 3.01. Conveyance of Assets, Obligations and Rights; Assumption and Release of Liabilities...... 9
Section 3.02. Conduct of Holding and JEFG Pending Distribution......................................... 11
Section 3.03. Further Assurances and Consents.......................................................... 11
ARTICLE IV--INDEMNIFICATION................................................................................ 12
Section 4.01. Holding Indemnification of the ITGI Group................................................ 12
Section 4.02. ITGI Indemnification of the Holding Group................................................ 12
Section 4.03. Insurance and Third Party Obligations.................................................... 12
ARTICLE V--HOLDING REPRESENTATIONS......................................................................... 12
Section 5.01. Holding Representations.................................................................. 12
ARTICLE VI--INDEMNIFICATION PROCEDURES; CONTRIBUTION....................................................... 14
Section 6.01. Notice and Payment of Claims............................................................. 14
Section 6.02. Notice and Defense of Third-Party Claims................................................. 14
Section 6.03. Contribution............................................................................. 15
ARTICLE VII--EMPLOYEE MATTERS.............................................................................. 16
Section 7.01. Benefits Agreement....................................................................... 16
ARTICLE VIII--TAX MATTERS.................................................................................. 16
ARTICLE IX--ACCOUNTING MATTERS............................................................................. 16
Section 9.01. Accounting Treatment of Assets Transferred............................................... 16
ARTICLE X--INFORMATION..................................................................................... 16
Section 10.01. Provision of Corporate Records.......................................................... 17
Section 10.02. Access to Information................................................................... 17
Section 10.03. Litigation Cooperation.................................................................. 17
Section 10.04. Reimbursement........................................................................... 17
Section 10.05. Retention of Records.................................................................... 17
Section 10.06. Confidentiality......................................................................... 17
ARTICLE XI--INTEREST ON PAYMENTS........................................................................... 18
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ARTICLE XII--MISCELLANEOUS................................................................................. 18
Section 12.01. Expenses................................................................................ 18
Section 12.02. Notices................................................................................. 19
Section 12.03. Amendment and Waiver.................................................................... 20
Section 12.04. Entire Agreement........................................................................ 20
Section 12.05. Parties in Interest..................................................................... 20
Section 12.06. Disputes................................................................................ 20
Section 12.07. Survival................................................................................ 21
Section 12.08. Severability............................................................................ 21
Section 12.09. Governing Law........................................................................... 21
Section 12.10. Counterparts............................................................................ 21
Schedule A -- Holding Provided Information Concerning the Merger
Schedule B -- ITGI Provided Information Concerning the Merger
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DISTRIBUTION AGREEMENT
This Distribution Agreement ("AGREEMENT"), dated as of March 17, 1999, is
hereby entered into by and between ▇▇▇▇▇▇▇▇▇ Group, Inc., a Delaware corporation
("JEFG"), and JEF Holding Company, Inc., a Delaware corporation and wholly-owned
subsidiary of JEFG as of the date of this Agreement ("HOLDING").
RECITALS
WHEREAS, the Board of Directors of JEFG has approved the business
transactions pursuant to which all the assets, businesses and Liabilities (as
defined below) of Investment Technology Group, Inc., a Delaware corporation and
approximately 80.5% owned subsidiary of JEFG ("ITGI"), and ITGI's subsidiaries
will be separated from all other assets, businesses and Liabilities of JEFG, on
the terms and subject to the conditions set forth herein and in the Ancillary
Agreements (as defined below);
WHEREAS, concurrently herewith, JEFG and ITGI are entering into an Agreement
and Plan of Merger (the "MERGER AGREEMENT"), pursuant to which (x) ITGI will
merge (the "MERGER") with and into JEFG and (y) all outstanding shares of common
stock, par value $0.01 per share, of ITGI (the "ITGI COMMON STOCK") will be
canceled or converted into the right to receive shares of common stock, par
value $0.01 per share, of JEFG (the "JEFG COMMON STOCK") in the manner set forth
in the Merger Agreement;
WHEREAS, prior to the Distribution (defined below) and Merger (x) JEFG will
transfer to Holding (or to JEFCO, defined herein, prior to the time JEFCO
becomes a subsidiary of Holding in connection with the Contribution, defined
below), and Holding and JEFCO will accept from JEFG, all of the Assets of JEFG
other than JEFG's ownership interest in capital stock of ITGI (the
"CONTRIBUTION"), and JEFG will assign to Holding (or to JEFCO, as appropriate),
and Holding and JEFCO will assume from JEFG, all of the Holding Liabilities (as
defined herein) (individually, the "ASSUMPTION" and together with the
Contribution, collectively, the "TRANSFERS"), and (y) following the Transfers
and the satisfaction of all conditions set forth in Section 2.02 of this
Agreement, all of the common stock of Holding, par value $0.0001 per share
("HOLDING COMMON STOCK"), will be distributed (the "DISTRIBUTION") to JEFG's
stockholders at the rate of one share of Holding Common Stock for each share of
JEFG Common Stock outstanding as of April 20, 1999, or such other date as is
designated by JEFG's Board of Directors as the record date for determining the
stockholders of JEFG entitled to receive the Distribution (the "RECORD DATE");
WHEREAS, (i) pursuant to the Merger, the name of ▇▇▇▇▇▇▇▇▇ Group, Inc. (as
the surviving corporate entity in the Merger) will be changed to Investment
Technology Group, Inc. and (ii) following the consummation of the Distribution
and the Merger, the name of JEF Holding Company, Inc. will be changed to
▇▇▇▇▇▇▇▇▇ Group, Inc.;
WHEREAS, it is intended that the Distribution not be taxable to JEFG or its
stockholders pursuant to Section 355 of the Internal Revenue Code of 1986, as
amended (the "CODE");
WHEREAS, as of March 16, 1999, the Board of Directors of ITGI declared,
subject to the approval and adoption of the Merger Agreement by the stockholders
of JEFG and ITGI and the satisfaction or waiver of all other conditions to the
Pre-Closing (as defined in the Merger Agreement) as set forth in the Merger
Agreement, a cash dividend in an amount equal to $4.00 per share to all holders
of ITGI Common Stock, including JEFG (the "SPECIAL ITGI CASH DIVIDEND");
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NOW, THEREFORE, in consideration of the foregoing premises and the mutual
agreements and covenants contained in this Agreement, the parties hereby agree
as follows:
ARTICLE I
DEFINITIONS
Section 1.01. DEFINITIONS. As used herein, the following terms have the
following meaning:
"Action" means any claim, suit, arbitration, inquiry, proceeding or
investigation by or before any court, governmental or other regulatory or
administrative agency or commission or any other tribunal.
"Analytical" means Jefferies Analytical Trading Group, Inc., a Delaware
corporation.
"Ancillary Agreements" means the Benefits Agreement and the Tax Agreement
and all of the written agreements, instruments, understandings, assignments and
other arrangements entered into in connection with the transactions contemplated
hereby excluding, however, the Merger Agreement and all instruments and
documents related thereto.
"Assets" means all properties, rights, contracts, leases and claims, of
every kind and description, wherever located, whether tangible or intangible,
and whether real, personal or mixed.
"Assumption" is defined in the recitals to this Agreement.
"Benefits Agreement" means the Benefits Agreement entered into in connection
with the Distribution between JEFG and Holding, as amended from time to time.
"Code" is defined in the recitals to this Agreement.
"Commission" means the Securities and Exchange Commission.
"Contribution" is defined in the recitals to this Agreement.
"Distribution" is defined in the recitals to this Agreement.
"Distribution Agent" means EquiServe, in its capacity as agent for JEFG in
connection with the Distribution.
"Distribution Date" means April 27, 1999 or such other business day as of
which the Distribution shall be effective, as determined by the Board of
Directors of JEFG; provided, however, that the Distribution Date shall occur (in
time) prior to the Effective Time.
"Effective Time" means the date and time at which the Merger is consummated.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Form S-4" means the registration statement on Form S-4 filed by JEFG
pursuant to the Securities Act with respect to the JEFG Common Stock issuable in
the Merger pursuant to the Merger Agreement, as such registration statement may
be amended from time to time.
"Form 10" means the registration statement on Form 10 filed by Holding with
the Commission to effect the registration of the class of Holding Common Stock
pursuant to the Exchange Act, as such registration statement may be amended from
time to time.
"Group" means the ITGI Group or the Holding Group, as applicable.
"Holding" is defined in the preamble to this Agreement.
"Holding Assets" means all Assets of JEFG (a) including without limitation
(1) all of the capital stock, and options, warrants or other rights to purchase
capital stock, of Analytical, Investment, Japan, JEFCO, JIL, Licensing, Pacific,
and Switzerland, and all of the preferred stock and options, warrants or
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other rights to purchase capital stock (including all of the common stock) of
W&D, (2) all cash, receivables, marketable securities and real and personal
property of JEFG, (3) all Assets that are (i) owned of record by or held in the
name of a member of the Holding Group, (ii) used exclusively by one or more
members of the Holding Group prior to, on or following the Effective Time and
(4) the names "Jefferies," "▇▇▇▇▇▇▇▇▇ Group" and "▇▇▇▇▇▇▇▇▇ Group, Inc." and all
variations thereof and all trademarks, trade names, copyrights or other
intellectual property right related thereto, but (b) excluding the capital stock
of ITGI.
"Holding Business" means the businesses conducted by JEFG prior to or at the
Effective Time or by any member of the Holding Group prior to, on and following
the Effective Time, excluding in each such case the ITGI Business.
"Holding By-laws" means the By-laws of Holding in the form filed as an
exhibit to the Form 10, as last amended, under the Exchange Act.
"Holding Certificate" means the certificate of incorporation of Holding in
the form filed as an exhibit to the Form 10, as last amended, under the Exchange
Act.
"Holding Common Stock" is defined in the recitals to this Agreement.
"Holding Group" shall mean Holding, Analytical, Investment, Japan, JEFCO,
JIL, Licensing, Pacific, Switzerland and W&D and their successors and permitted
assigns.
"Holding Liabilities" means (i) all Liabilities of Holding under this
Agreement, any Intercompany Agreement or any Ancillary Agreement, (ii) except as
otherwise expressly provided in this Agreement, any Intercompany Agreement or
any Ancillary Agreement, all Liabilities, other than ITGI Group Liabilities, (x)
of JEFG, to the extent those Liabilities arise out of or relate to any event,
occurrence, act, omission or state of affairs that occurred or existed prior to
the Effective Time, (y) of any member of the Holding Group or the Holding
Business, whether arising before, on or after the Effective Time or (z) arising
out of the ownership or use of the Holding Assets, whether arising before, on or
after the Effective Time, (iii) all Liabilities arising under or in connection
with the Form 10 unless and except to the extent that such claims are based upon
the ITGI Provided Information, (iv) subject to the provisions of Section 12.01
of this Agreement, all Liabilities comprising the JEFG Debt Obligation, (v) all
Liabilities arising with respect to claims based upon the Holding Provided
Information included or incorporated by reference into the Form S-4 and (vi)
Liabilities of JEFG under options or other rights to purchase or acquire any
JEFG Common Stock, to the extent such options or rights, prior to the Effective
Time, are not exercised for JEFG Common Stock, canceled or exchanged for options
to purchase shares of Holding Common Stock.
"Holding Provided Information" means information included or incorporated by
reference into the Form S-4, Form 10, or Joint Proxy/Information Statement that
relates exclusively to JEFG (excluding ITGI and its subsidiaries) prior to the
Effective Time, the consolidated financial statements and financial and
statistical data of JEFG (excluding the financial statements and statistical and
financial data of ITGI and its subsidiaries), any member of the Holding Group,
the Holding Business, the Ancillary Agreements, the Transfers, the Distribution
or the Holding provided information concerning the Merger as set forth in
Schedule A attached hereto and made a part hereof.
"Intercompany Agreements" means an amended and restated tax sharing
agreement, dated March 17, 1999, between JEFG, Holding and ITGI.
"Investment" means JEF Investment Company, a Delaware corporation.
"ITGI" means Investment Technology Group, Inc., a Delaware corporation,
before and/or after the Merger, as the context requires as set forth herein.
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"ITGI Business" means the businesses conducted exclusively by ITGI and its
subsidiaries prior to, on and following the Effective Time.
"ITGI Common Stock" is defined in the recitals to this Agreement.
"ITGI Group" means ITGI and its subsidiaries prior to, on and following the
Effective Time.
"ITGI Group Liabilities" means (i) all Liabilities of ITGI (in its own right
or as the successor to JEFG following the Merger) under Sections 4.02 and 12.01
of this Agreement, or under any Intercompany Agreement or any Ancillary
Agreement, (ii) except as otherwise expressly provided in this Agreement, any
Intercompany Agreement or any Ancillary Agreement, all Liabilities (other than
Holding Liabilities) of ITGI, any member of the ITGI Group or the ITGI Business
or Liabilities arising out of the ownership or use of the Assets of the ITGI
Group, in each case whether arising before, on or after the Effective Time,
(iii) all Liabilities with respect to claims based upon the ITGI Provided
Information included and incorporated by reference into the Form 10 and Joint
Proxy/ Information Statement, and (iv) all Liabilities arising with respect to
claims based upon ITGI Provided Information included or incorporated by
reference into the Form S-4.
"ITGI Provided Information" means information included or incorporated by
reference into the Form S-4, Form 10 or Joint Proxy/Information Statement that
relates exclusively to ITGI, any member of the ITGI Group, the ITGI Business,
JEFG after the Effective Time, the consolidated historical financial statements
of ITGI, the pro forma consolidated financial statements of ITGI (as the
successor to JEFG following the Merger), the financial and statistical data of
ITGI, the Special ITGI Cash Dividend or the ITGI provided information concerning
the Merger as set forth in Schedule B attached hereto and made a part hereof.
"Japan" means Jefferies (Japan) Limited, a company formed under the laws of
England.
"JEFCO" shall mean ▇▇▇▇▇▇▇▇▇ & Company, Inc., a Delaware corporation.
"JEFG" is defined in the preamble to this Agreement.
"JEFG Common Stock" is defined in the recitals to this Agreement.
"JEFG Contribution" means an amount of money to be contributed by JEFG to
the capital of JEFCO prior to the Distribution Date equal to at least $60
million.
"JEFG Debt Obligation" means the Liabilities of JEFG in respect of its
8 7/8% Senior Notes due 2004 and 7 1/2% Senior Notes due 2007, including,
without limitation, the related indentures (including all supplemental
indentures thereto), consent solicitations and offering materials.
"JIL" means ▇▇▇▇▇▇▇▇▇ International Limited, a company formed under the laws
of England.
"Joint Proxy/Information Statement" means the joint proxy/information
statement, as amended from time to time, filed by JEFG and Holding with the SEC
under the Exchange Act to be sent to each holder of JEFG Common Stock in
connection with the Distribution and the Merger.
"Liabilities" means any and all claims, debts, commitments, liabilities and
obligations, absolute or contingent, matured or not matured, liquidated or
unliquidated, accrued or unaccrued, known or unknown, whenever arising,
including all costs and expenses relating thereto, and including, without
limitation, those debts, commitments, liabilities and obligations arising under
this Agreement, any law, rule, regulation, action, order or consent decree of
any governmental entity or any award of any arbitrator of any kind, and those
arising under any contract, commitment or undertaking.
"Licensing" means Jefferies Licensing Corporation, a Delaware corporation.
"Merger" is defined in the recitals to this Agreement.
"Merger Agreement" is defined in the recitals to this Agreement.
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"Pacific" means Jefferies Pacific Limited, a company formed under the laws
of Hong Kong.
"Record Date" is defined in the recitals to this Agreement.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
"Special ITGI Cash Dividend" is defined in the recitals to this Agreement.
"Switzerland" means Jefferies (Switzerland) Ltd., a company formed under the
laws of Switzerland.
"Tax" shall have the meaning given to such term in the Tax Agreement.
"Tax Agreement" means the Tax Sharing and Indemnification Agreement entered
into in connection with the Distribution among JEFG, Holding and ITGI, as
amended from time to time.
"Transfers" is defined in the recitals to this Agreement.
"Transactions" shall mean the Transfers, the Distribution and the Merger.
"W&D" means W&D Securities, Inc., a Delaware corporation.
ARTICLE II
THE DISTRIBUTION
Section 2.01. COOPERATION PRIOR TO THE DISTRIBUTION.
(a) JEFG and Holding shall prepare, and JEFG shall mail on or prior to the
Distribution Date to the holders of JEFG Common Stock, the Joint
Proxy/Information Statement, which shall set forth appropriate disclosure
concerning Holding, the Distribution, the Merger and certain other matters
required by the Exchange Act. JEFG and Holding shall also prepare, and Holding
shall file with the Commission, the Form 10, which shall incorporate by
reference portions of the Joint Proxy/Information Statement. JEFG and Holding
shall use all reasonable efforts to cause the Form 10 to be declared, or become,
effective under the Exchange Act as soon as reasonably practicable and on or
before the Distribution Date.
(b) JEFG and Holding shall cooperate in preparing, filing with the
Commission under the Securities Act and causing to become effective any
registration statements or amendments thereto that are appropriate to reflect
the establishment of or amendments to any employee benefit plan contemplated by
the Benefits Agreement.
(c) JEFG and Holding shall, by means of a stock split or stock distribution,
cause the number of outstanding shares of Holding Common Stock held by JEFG as
of the Record Date to be equal to the number of shares of Holding Common Stock
to be distributed in the Distribution.
(d) JEFG and Holding shall take all such action as may be necessary or
appropriate under the securities or blue sky laws of states or other political
subdivisions of the United States in connection with the transactions
contemplated by this Agreement or any Ancillary Agreement.
(e) Holding shall prepare, file and pursue an application to succeed to the
listing of JEFG and thereby effectuate the listing of the Holding Common Stock
on the New York Stock Exchange, and such related matters and other matters as
shall be required by the New York Stock Exchange.
(f) On or prior to the Distribution Date, JEFG and Holding shall cooperate
in carrying out the transactions and events described in Article III hereof.
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Section 2.02. JEFG BOARD ACTION; CONDITIONS PRECEDENT TO THE DISTRIBUTION.
JEFG's Board of Directors shall, in its discretion, establish the Record Date
and the Distribution Date and any appropriate procedures in connection with the
Distribution. In no event shall the Distribution occur unless the following
conditions shall have been satisfied:
(a) any necessary regulatory approvals shall have been received;
(b) the Form 10 shall have been declared, or become, effective under the
Exchange Act;
(c) ITGI shall have declared and paid the Special ITGI Cash Dividend to the
holders of ITGI Common Stock, including JEFG;
(d) the JEFG Contribution and the Transfers shall have been completed;
(e) JEFG and the trustees under the indentures governing the JEFG Debt
Obligation shall have executed supplemental indentures in form and substance
satisfactory to JEFG and such trustees and their respective counsel, pursuant to
which Holding shall assume, and JEFG shall be released from obligations
concerning the JEFG Debt Obligation, effective as of the date the Transfers are
completed;
(f) Holding's Board of Directors, as named in the Form 10, shall have been
elected by JEFG, as sole stockholder of Holding, as directors of Holding
effective as of the Distribution Date, and the Holding Certificate and Holding
By-laws shall be in effect;
(g) the Holding Common Stock shall have been approved for listing on the New
York Stock Exchange, subject to official notice of issuance;
(h) The tax ruling obtained from the Internal Revenue Service ("IRS") on
March 11, 1999 concerning the treatment of the Transfers and the Distribution
and related transactions under Sections 332, 351, 355 and 368(a)(1)(D) of the
Code shall not have been, prior to the Effective Time, withdrawn by the IRS or
modified by the IRS in any material adverse respect;
(i) all conditions to the Pre-Closing (as defined in the Merger Agreement)
of the Merger shall have been satisfied or waived by JEFG or ITGI, as
appropriate, and the Pre-Closing shall have been consummated; and
(j) JEFG shall be reasonably satisfied that, at all relevant times prior to
the Effective Time, JEFG owns at least 80% of the outstanding ITGI Common Stock
and that no capital stock of ITGI (other than ITGI Common Stock) shall have been
issued or outstanding.
Section 2.03. THE DISTRIBUTION. On or before the Distribution Date, subject
to satisfaction or waiver of the conditions set forth in this Agreement, JEFG
shall deliver to the Distribution Agent a certificate or certificates
representing all of the then outstanding shares of Holding Common Stock held by
JEFG, endorsed in blank, and shall instruct the Distribution Agent to distribute
to each holder of record of JEFG Common Stock as of the close of business on the
Record Date a certificate or certificates representing one share of Holding
Common Stock for each share of JEFG Common Stock held of record as of the close
of business on the Record Date. Holding agrees to provide all certificates for
shares of Holding Common Stock that the Distribution Agent shall require in
order to effect the Distribution.
ARTICLE III
CONVEYANCE OF ASSETS, OBLIGATIONS AND RIGHTS;
ASSUMPTION OF LIABILITIES;
CONDUCT OF HOLDING PENDING DISTRIBUTION
Section 3.01. CONVEYANCE OF ASSETS, OBLIGATIONS AND RIGHTS; ASSUMPTION AND
RELEASE OF LIABILITIES.
(a) Prior to the completion of the Transfers, JEFG shall make the JEFG
Contribution.
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(b) Prior to the Distribution Date and effective with the Transfers (i) all
Holding Assets are intended to be and shall become Assets of the Holding Group
and (ii) all Holding Liabilities are intended to be and shall become exclusively
the Liabilities of the Holding Group.
(c) Prior to, or in connection with, the completion of the Transfers, JEFG
shall transfer or cause to be transferred to Holding (or JEFCO, as appropriate),
and JEFG shall disclaim (as appropriate) all right, title and interest of JEFG
in and to any and all of the Holding Assets and the Holding Business. Effective
as of the Transfers, all of JEFG's rights and obligations under the Intercompany
Agreements shall be transferred and assigned, without limitation or alteration
of the rights or responsibilities hereunder or thereunder, to Holding.
(d) Before the Distribution Date, effective as of the date of the Transfers,
Holding shall execute supplemental indentures in form and substance satisfactory
to JEFG, the trustee under the Indentures governing the JEFG Debt Obligation and
their respective counsel pursuant to which, among other things, Holding shall
assume, and JEFG shall be released from, the JEFG Debt Obligation, all of which
shall be effective prior to the Distribution Date.
(e) Set forth on Schedule 3.01(e) hereto is each Holding Asset and each
Holding Liability that requires a third-party consent to transfer such Holding
Asset or Holding Liability from JEFG to Holding (or to JEFCO, as appropriate).
If any such Holding Asset or Holding Liability may not be transferred by reason
of the requirement to obtain the consent of any third party and such consent has
not been obtained by the Distribution Date, then such Holding Asset or Holding
Liability shall not be transferred until such consent has been obtained. In the
event that any conveyance of an Asset constituting a Holding Asset or a
Liability constituting a Holding Liability is not effected on or before the
Distribution Date, the obligation to transfer such Asset or such Liability as
the case may be, shall continue past the Distribution Date and shall be
accomplished as soon thereafter as practicable. JEFG and its successors
(including ITGI) will cooperate with Holding to provide, or cause the owner of
such Holding Asset to use all reasonable efforts to provide, to the appropriate
member of the Holding Group all the rights and benefits under such Holding
Asset, or cause such owner to enforce such Holding Asset for the benefit of such
member. Such parties shall otherwise cooperate and use all reasonable efforts to
provide the economic and operational equivalent of an assignment or transfer of
the Holding Asset or Holding Liability, as the case may be. Holding shall duly
pay, perform or discharge, or cause the appropriate member of the Holding Group
to duly pay, perform or discharge, from and after the date of the Transfers,
each Holding Liability, including without limitation any Holding Liability
referred to in the second sentence of this paragraph; provided, the foregoing
provisions of this paragraph (e) do not affect Holding's obligation to assume
all of the Holding Liabilities at the date of the Transfers and therefore duly
pay, perform or discharge all of the Holding Liabilities from and after such
time.
(f) From and after the Distribution Date, each party shall promptly transfer
or cause the members of its Group promptly to transfer to the other party or the
appropriate member of the other party's Group, from time to time, any property
held by any such party that pursuant to this Agreement is or is intended to be
an Asset of the other party or a member of its Group. Without limiting the
foregoing, funds received by a member of one Group upon the payment of accounts
receivable that pursuant to this Agreement is or is intended to belong to a
member of the other Group shall be transferred to the other Group by wire
transfer not more than five business days after receipt of such payment.
(g) Holding agrees that it will not, without the prior written consent of
ITGI, take any action that attempts or purports to amend or modify any
agreement, including any real property lease or sublease, to which JEFG is a
party at or prior to the Transfers and from which (i) JEFG is not fully and
unconditionally released at or prior to the Transfers and (ii) the Surviving
Corporation (as the successor to JEFG pursuant to the Merger) is not fully and
unconditionally released after the Merger.
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(h) Holding agrees to obtain and deliver to ITGI, for the benefit of ITGI
one or more letters of credit in an aggregate undrawn face amount not less than
the amount by which the aggregate unmitigated Residual Liabilities exceeds the
Applicable Amount, consistent with the definitions and terms provided for under
Section 7(n) of the Merger Agreement. Such letters of credit shall be issued by
one or more nationally recognized financial institutions reasonably satisfactory
to ITGI, be in form and substance reasonably satisfactory to ITGI and expire not
earlier than 135 days after the date on which the related unmitigated Residual
Liabilities terminate.
Section 3.02. CONDUCT OF HOLDING AND JEFG PENDING DISTRIBUTION.
(a) Prior to the Distribution Date, neither Holding nor JEFG shall, without
the prior consent in writing of the other, make any public announcement
concerning the Distribution and each party shall use its respective best efforts
not to take any action which may prejudice or delay the consummation of the
Distribution.
(b) Prior to the Distribution Date, the business of Holding shall be
operated for the sole benefit of JEFG as its sole stockholder.
Section 3.03. FURTHER ASSURANCES AND CONSENTS. In addition to the actions
specifically provided for elsewhere in this Agreement, each of the parties
hereto will use its commercially reasonable efforts to (i) execute and deliver
such further instruments and documents and take such other actions as any other
party may reasonably request in order to effectuate the purposes of this
Agreement and to carry out the terms hereof and (ii) take, or cause to be taken,
all actions, and to do, or cause to be done, all things, reasonably necessary,
proper or advisable under applicable laws, regulations and agreements or
otherwise to consummate and make effective the transactions contemplated by this
Agreement, including, without limitation, using its reasonable efforts to obtain
any consents and approvals and to make any filings and applications necessary or
desirable in order to consummate the transactions contemplated by this
Agreement.
ARTICLE IV
INDEMNIFICATION
Section 4.01. HOLDING INDEMNIFICATION OF THE ITGI GROUP. On and after the
Distribution Date, Holding shall indemnify, defend and hold harmless each member
of the ITGI Group, and each of their respective directors, officers, employees
and agents (the "ITGI Indemnitees") from and against any and all claims, costs,
damages, losses, liabilities and expenses (including, without limitation,
reasonable expenses of investigation and reasonable attorney fees and expenses,
but excluding consequential damages of the indemnified party, in connection with
any and all Actions or threatened Actions) (collectively, "Indemnifiable
Losses") incurred or suffered by any of the ITGI Indemnitees and arising out of,
or due to or otherwise in connection with any of the Holding Liabilities or the
failure of Holding or any member of the Holding Group to assume, pay, perform or
otherwise discharge any of the Holding Liabilities.
Section 4.02. ITGI INDEMNIFICATION OF THE HOLDING GROUP. On and after the
Distribution Date, ITGI (as the successor to JEFG following the Merger) shall
indemnify, defend and hold harmless each member of the Holding Group and each of
their respective directors, officers, employees and agents (the "Holding
Indemnitees") from and against any and all Indemnifiable Losses incurred or
suffered by any of the Holding Indemnitees and arising out of, or due to or
otherwise in connection with any of the ITGI Group Liabilities or the failure of
ITGI or any member of the ITGI Group to pay, perform or otherwise discharge any
of the ITGI Group Liabilities.
Section 4.03. INSURANCE AND THIRD PARTY OBLIGATIONS. No insurer or any other
third party shall be (a) entitled to a benefit it would not be entitled to
receive in the absence of the foregoing
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indemnification provisions, (b) relieved of the responsibility to pay any claims
to which it is obligated or (c) entitled to any subrogation rights with respect
to any obligation hereunder.
ARTICLE V
HOLDING REPRESENTATIONS
Section 5.01. HOLDING REPRESENTATIONS. Holding represents and warrants to
JEFG as follows:
(a) Organization, Etc. Holding is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware and has
all requisite power and authority to own, lease and operate its properties and
to carry on its business as it is now being conducted. Holding is a newly formed
corporation that, since formation and the initial capitalization effected
thereby, has not acquired, assumed or become contractually obligated to acquire
or assume any assets or liabilities, except as set forth on Schedule 5.01(a)
hereof. Since formation, Holding has not conducted any activity other than the
execution and delivery of this Agreement and the Ancillary Agreements and
activities coincident with the Transfers and the Distribution and incidental
hereunder and under the Ancillary Agreements, and other than that which is
contemplated hereby.
(b) Authority of Holding. Holding has full corporate power and authority to
execute, deliver and perform its obligations under this Agreement and each of
the Ancillary Agreements and to effectuate the Transfers and consummate the
Distribution. The execution, delivery and performance of this Agreement and each
of the Ancillary Agreements and the consummation of the Transfers and the
Distribution has been duly and validly authorized by the Board of Directors of
Holding, and no other corporate proceedings on the part of Holding are necessary
to consummate or authorize any of the Ancillary Agreements or to effectuate the
Transfers and consummate the Distribution. Each of this Agreement and the
Ancillary Agreements has been duly and validly executed and delivered by Holding
and constitutes valid and binding agreements of Holding, enforceable against
Holding in accordance with their respective terms.
(c) No Consent. No filing or registration with, or permit, authorization,
consent or approval of, or notification or disclosure (collectively,
"Governmental Consents") to, any United States (federal, state or local) or
foreign government, or governmental, regulatory or administrative authority,
agency or commission, court or other body or any arbitral tribunal (each, a
"Governmental Authority") or any other third party (collectively, "Consents") is
required in connection with the execution, delivery and performance by Holding
of this Agreement or any of the Ancillary Agreements or the consummation by
Holding of the Transfers and the Distribution, except (i) the filing of the Form
10 under the Exchange Act and the effectiveness thereof under the Exchange Act,
(ii) such consents, approvals, orders, permits, authorizations, registrations,
declarations and filings as may be required under the Blue Sky laws of various
states, (iii) the listing on the New York Stock Exchange of the Holding Common
Stock in connection with the Distribution and (iv) as set forth in Schedule
5.01(c) hereof.
(d) No Violation. Assuming that all Consents have been duly made or obtained
as contemplated by Section 5.01(c), the execution, delivery and performance by
Holding of this Agreement and the Ancillary Agreements and the consummation of
the Transfers and the Distribution will not (i) violate any provision of the
certificate of incorporation or bylaws of Holding, (ii) violate any statute,
rule, regulation, order or decree of any Governmental Authority by which Holding
or any of its assets may be bound or affected or (iii) result in a violation or
breach of, or constitute (with or without due notice or lapse of time or both) a
default (or give rise to any right of termination, cancellation, acceleration,
redemption or repurchase) under, any of the terms, conditions or provisions of
(x) any note, bond, mortgage, indenture or deed of trust relating to
indebtedness for borrowed money or (y) any license, lease or other agreement,
instrument or obligation to which Holding is a party or by which it or any of
its assets may be bound or affected.
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(e) Capitalization of Holding. All issued and outstanding shares of capital
stock of Holding are held by JEFG as of the date hereof and are duly authorized
and validly issued, fully paid, nonassessable and free of preemptive rights and
respect thereto. Other than this Agreement and the transactions contemplated
thereby and the awards contemplated by the Benefits Agreement or the Joint
Proxy/Information Statement, there are no options, warrants, calls,
subscriptions, or other rights, agreements or commitments obligating Holding to
issue, transfer or sell any shares of capital stock of Holding or any other
securities convertible into or evidencing the right to subscribe for any such
shares. Prior to the date hereof, there has not been any issuance of capital
stock of Holding other than to JEFG.
ARTICLE VI
INDEMNIFICATION PROCEDURES; CONTRIBUTION
Section 6.01. NOTICE AND PAYMENT OF CLAIMS. If any ITGI or Holding
Indemnitee (the "INDEMNIFIED PARTY") determines that it is or may be entitled to
indemnification by a party (the "INDEMNIFYING PARTY") under Article IV (other
than in connection with any Action or claim subject to Section 6.02), the
Indemnified Party shall deliver to the Indemnifying Party a written notice
specifying, to the extent reasonably practicable, the basis for its claim for
indemnification and the amount for which the Indemnified Party reasonably
believes it is entitled to be indemnified. After the Indemnifying Party shall
have been notified of the amount for which the Indemnified Party seeks
indemnification, the Indemnifying Party shall, within 90 days after receipt of
such notice, pay the Indemnified Party such amount in cash or other immediately
available funds (or reach agreement with the Indemnified Party as to a mutually
agreeable alternative payment schedule) unless the Indemnifying Party objects to
the claim for indemnification or the amount thereof. If the Indemnifying Party
does not give the Indemnified Party written notice objecting to such claim and
setting forth the grounds therefor within the same 90 day period, the
Indemnifying Party shall be deemed to have acknowledged its liability for such
claim and the Indemnified Party may exercise any and all of its rights under
applicable law to collect such amount.
Section 6.02. NOTICE AND DEFENSE OF THIRD-PARTY CLAIMS. Promptly following
the earlier of (a) receipt of notice of the commencement by a third party of any
Action against or otherwise involving any Indemnified Party or (b) receipt of
information from a third party alleging the existence of a claim against an
Indemnified Party, in either case, with respect to which indemnification may be
sought pursuant to this Agreement (a "THIRD-PARTY CLAIM"), the Indemnified Party
shall give the Indemnifying Party written notice thereof. The failure of the
Indemnified Party to give notice as provided in this Section 6.02 shall not
relieve the Indemnifying Party of its obligations under this Agreement, except
to the extent that the Indemnifying Party is materially prejudiced by such
failure to give notice. Within 90 days after receipt of such notice, the
Indemnifying Party may by giving written notice thereof to the Indemnified
Party, (a) acknowledge, as between the parties hereto, responsibility for, and
at its option, elect to assume the defense of such Third-Party Claim at its sole
cost and expense or (b) object to the claim of indemnification set forth in the
notice delivered by the Indemnified Party pursuant to the first sentence of this
Section 6.02; PROVIDED that if the Indemnifying Party does not within the same
90 day period give the Indemnified Party written notice objecting to such claim
and setting forth the grounds therefor or electing to assume the defense, the
Indemnifying Party shall be deemed to have acknowledged, as between the parties
hereto, its responsibility for such Third-Party Claim. Any contest of a Third
Party Claim as to which the Indemnifying Party has elected to assume the defense
shall be conducted by attorneys employed by the Indemnifying Party and
reasonably satisfactory to the Indemnified Party; PROVIDED that the Indemnified
Party shall have the right to participate in such proceedings and to be
represented by attorneys of its own choosing at the Indemnified Party's sole
cost and expense. Notwithstanding the foregoing, (i) the Indemnifying Party
shall not be entitled to assume the defense of any Third-Party Claim (and shall
be liable to the Indemnified Party for the reasonable
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fees and expenses incurred by the Indemnified Party in defending such
Third-Party Claim) if there are one or more legal defenses available only to the
Indemnified Party that conflict, in one or more significant substantive
respects, with those available to the Indemnifying Party with respect to such
Third-Party Claim and (ii) if at any time after assuming the defense of a
Third-Party Claim an Indemnifying Party shall fail to prosecute or shall
withdraw from the defense of such Third-Party Claim, the Indemnified Party shall
be entitled to resume the defense thereof with counsel selected by such
Indemnified Party and the Indemnifying Party shall be liable for the reasonable
fees and expenses of counsel incurred by the Indemnified Party in such defense.
The Indemnifying Party may settle, compromise or discharge a Third-Party Claim,
provided, the Indemnifying Party shall have obtained the prior written consent
of the Indemnified Party, which consent shall not be unreasonably withheld. If,
after receipt of notice of a Third-Party Claim, the Indemnifying Party does not
undertake to defend such Third-Party Claim within 90 days of such notice, the
Indemnified Party may, but shall have no obligation to, contest any lawsuit or
action with respect to such Third-Party Claim and the Indemnifying Party shall
be bound by the results obtained with respect thereto by the Indemnified Party.
Indemnification shall be made by periodic payments of the amount thereof during
the course of the investigation or defense, as and when bills are received or
Indemnifiable Loss is incurred. The parties agree to render to each other such
assistance as may reasonably be requested in order to ensure the proper and
adequate defense of any Third-Party Claim. The remedies provided in this Article
VI shall be cumulative and shall not preclude assertion by any Indemnified Party
of any other rights or the seeking of any and all other remedies against any
Indemnifying Party.
Section 6.03. CONTRIBUTION. To the extent that any indemnification provided
for in Section 4.01 or 4.02 is unavailable to an Indemnified Party or is
insufficient in respect of any of the Indemnifiable Losses of such Indemnified
Party, then the Indemnifying Party, in lieu of, or in addition to, indemnifying
such Indemnified Party hereunder, shall contribute to the amount paid or payable
by such Indemnified Party as a result of such Indemnifiable Losses (i) in such
proportion as is appropriate to reflect the relative benefits received by such
Indemnifying Party on the one hand and the Indemnified Party on the other hand
from the transaction or other matter which resulted in the Indemnifiable Losses
or (ii) if the allocation provided by clause (i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) but also the relative fault of the
Indemnifying Party on the one hand and of the Indemnified Party on the other
hand in connection with the action, inaction, statements or omissions that
resulted from such Indemnifiable Losses as well as any other relevant equitable
considerations.
ARTICLE VII
EMPLOYEE MATTERS
Section 7.01. BENEFITS AGREEMENT. All matters relating to or arising out of
any employee benefit, compensation or welfare arrangement in respect of any
present and former employee of the ITGI Group or the Holding Group shall be
governed by the Benefits Agreement, except as may be expressly stated herein. In
the event of any inconsistency between the Benefits Agreement and this
Agreement, the Benefits Agreement shall govern.
ARTICLE VIII
TAX MATTERS
All matters relating to Taxes shall be governed exclusively by the Tax
Agreement, except as may be expressly stated herein. In the event of any
inconsistency between the Tax Agreement and this Agreement, the Tax Agreement
shall govern.
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ARTICLE IX
ACCOUNTING MATTERS
Section 9.01. ACCOUNTING TREATMENT OF ASSETS TRANSFERRED. All transfers of
Assets of JEFG to JEFCO or Holding pursuant to this Agreement shall constitute
contributions by JEFG to the capital of JEFCO or Holding, as appropriate.
ARTICLE X
INFORMATION
Section 10.01. PROVISION OF CORPORATE RECORDS. ITGI (as successor to JEFG
pursuant to the Merger) and Holding shall arrange as soon as practicable
following the Effective Time for the provision to the other of copies of any
requested corporate documents (e.g. minute books, stock registers, stock
certificates, documents of title, contracts, etc.) in its possession relating to
the other or its business and affairs; provided, however, this Section 10.01
shall not create any obligation to retain documents beyond that which is
required pursuant to such entity's records retention policies. JEFG and Holding
agree that Holding shall retain control and custody of original copies of all
corporate documents of JEFG relating to matters and events on or prior to the
Effective Time.
Section 10.02. ACCESS TO INFORMATION. From and after the Effective Time,
ITGI (as successor to JEFG pursuant to the Merger) and Holding shall each afford
the other and its accountants, counsel and other designated representatives
reasonable access (including using reasonable efforts to give access to persons
or firms possessing information) and duplicating rights during normal business
hours to all records, books, contacts, instruments, computer data and other data
and information in its possession relating to the business and affairs of the
other, insofar as such access is reasonably required by the other including,
without limitation, for audit, accounting and litigation purposes.
Section 10.03. LITIGATION COOPERATION. ITGI (as successor to JEFG pursuant
to the Merger) and Holding shall each use reasonable efforts to make available
to the other, upon written request, its officers, directors, employees and
agents as witnesses to the extent that such persons may reasonably be required
in connection with any legal, administrative or other proceedings arising out of
the business of the other prior to the Effective Time in which the requesting
party may from time to time be involved.
Section 10.04. REIMBURSEMENT. ITGI (as successor to JEFG pursuant to the
Merger) and Holding, each providing copies of documents, information or
witnesses under Sections 10.01, 10.02 or 10.03 to the other, shall be entitled
to receive from the recipient, upon the presentation of invoices therefor,
payment for all reasonable out-of-pocket costs and expenses as may be reasonably
incurred in providing such information or witnesses.
Section 10.05. RETENTION OF RECORDS. Except as otherwise required by law or
agreed to in writing, each party shall, and shall cause the members of its Group
to, retain all information relating to the other's business in accordance with
the past practice of such party. Notwithstanding the foregoing, except as
otherwise provided in the Tax Agreement, either party may destroy or otherwise
dispose of any information at any time following the first anniversary of the
Merger in accordance with the corporate record retention policy maintained by
such party with respect to its own records.
Section 10.06. CONFIDENTIALITY. Each party shall, and shall cause each
member of its Group to, hold and cause its directors, officers, employees,
agents, consultants and advisors to hold, in strict confidence all information
concerning the other party (except to the extent that such information can be
shown to have been (a) in the public domain through no fault of such party or
(b) later lawfully acquired after the Distribution on a non-confidential basis
from other sources not subject to a confidentiality obligation by the party to
which it was furnished), and neither party shall release or disclose such
information to any other person, except its auditors, attorneys, financial
advisors, bankers and other
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consultants and advisors who shall be advised of and agree in writing to comply
with the provisions of this Section 10.06. In the event that a party (the
"RECEIVING PERSON") is requested pursuant to, or required by, applicable law,
regulation, rule or by legal process to disclose any information regarding the
other party (the "DISCLOSING PERSON"), the Receiving Person agrees that it will
provide the Disclosing Person with prompt notice of such request or requirement
in order to enable the Disclosing Person to seek an appropriate protective order
or other remedy, to consult with the Receiving Person with respect to the
Disclosing Person taking steps to resist or narrow the scope of such request or
requirement, or to waive compliance, in whole or in part, with the terms of this
Section 10.06. In any such event, the Receiving Person will disclose only that
portion of any information regarding the Disclosing Party which the Receiving
Person is advised by counsel is legally required and will use its reasonable
best efforts to ensure that all such information that is so disclosed will be
accorded confidential treatment.
ARTICLE XI
INTEREST ON PAYMENTS
Except as otherwise expressly provided in this Agreement, all payments by
one party to the other under this Agreement, any Intercompany Agreement or any
Ancillary Agreement shall be paid, by wire transfer of immediately available
funds to an account in the United States designated by the recipient, within 30
days after receipt of an invoice or other written request for payment setting
forth the specific amount due and a description of the basis therefor in
reasonable detail. Any amount remaining unpaid beyond its due date, including
disputed amounts that are ultimately determined to be payable, shall bear
interest at a floating rate of interest equal to 2.5% over the higher of the
Federal funds rate or the London Interbank Offered Rate.
ARTICLE XII
MISCELLANEOUS
Section 12.01. EXPENSES. The obligations of JEFG and ITGI under Section 7(d)
("Expenses") of the Merger Agreement shall survive (i) any termination of the
Merger Agreement and (ii) the Effective Time of the Merger, with (x) Holding
succeeding to the obligations of, and being credited for any Expense payments
made prior to the Effective Time by, JEFG thereunder and (y) ITGI (as the
successor to JEFG following the Merger) succeeding to the obligations of, and
being credited for any Expense payments made by, ITGI thereunder.
Section 12.02. NOTICES. All notices and communications under this Agreement
after the Distribution Date shall be in writing and any communication or
delivery hereunder shall be deemed to have been duly given when received
addressed as follows:
If to JEFG or any of its successors, to:
Investment Technology Group, Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Chief Financial Officer
With a copy to:
▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇, Esq.
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If to Holding, to:
▇▇▇▇▇▇▇▇▇ Group, Inc.
JEF Holding Company, Inc.
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chief Financial Officer
With a copy to:
▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
Such notices shall be deemed received (i) as of the date of delivery by hand
delivery, (ii) one business day after such notice is given to a national
overnight delivery service or (iii) five business days after placed in the
United States mail, provided such mail is sent by certified mail with return
receipt requested. Either party may, by written notice so delivered to the other
party, change the address to which delivery of any notice shall thereafter be
made.
Section 12.03. AMENDMENT AND WAIVER. This Agreement may not be altered or
amended, nor may rights hereunder be waived, except by an instrument in writing
executed by the party or parties to be charged with such amendment or waiver. No
waiver of any terms, provision or condition of or failure to exercise or delay
in exercising any rights or remedies under this Agreement, in any one or more
instances, shall be deemed to be, or construed as, a further or continuing
waiver of any such term, provision, condition, right or remedy or as a waiver of
any other term, provision or condition of this Agreement.
Section 12.04. ENTIRE AGREEMENT. This Agreement, together with the Merger
Agreement and the Ancillary Agreements, constitutes the entire understanding of
the parties hereto with respect to the subject matter hereof, superseding all
negotiations, prior discussions and prior agreements and understandings relating
to such subject matter. To the extent that the provisions of this Agreement are
inconsistent with the provisions of any Ancillary Agreement, the provisions of
such Ancillary Agreement shall prevail.
Section 12.05. PARTIES IN INTEREST. Neither of the parties hereto may assign
its rights or delegate any of its duties under this Agreement without the prior
written consent of each other party. This Agreement shall be binding upon, and
shall inure to the benefit of, the parties hereto and their respective
successors and permitted assigns. Nothing contained in this Agreement, express
or implied, is intended to confer any benefits, rights or remedies under
Articles IV, V and VI hereof upon any person or entity other than members of the
ITGI Group and the Holding Group and the ITGI Indemnitees and the Holding
Indemnitees and their respective successors and permitted assigns.
Section 12.06. DISPUTES.
(a) Resolution of any and all disputes arising from or in connection with
this Agreement, whether based on contract, tort, statute or otherwise,
including, but not limited to, disputes in connection with claims by third
parties (collectively, "DISPUTES"), shall be subject to the provisions of this
Section 12.06; provided, however, that nothing contained herein shall preclude
either party from seeking or obtaining (i) injunctive relief or (ii) equitable
or other judicial relief to enforce the provisions hereof or to preserve the
status quo pending resolution of Disputes hereunder.
(b) Either party may give the other party written notice of any Dispute not
resolved in the normal course of business. The parties shall thereupon attempt
in good faith to resolve any Dispute promptly by negotiation between executives
who have authority to settle the controversy and who are at a higher
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level of management than the persons with direct responsibility for
administration of this Agreement. Within 20 days after delivery of the notice,
the receiving party shall submit to the other a written response. The notice and
the response shall include a statement of such party's position and a summary of
arguments supporting that position and the name and title of the executive who
will represent that party and of any other person who will accompany such
executive. Within 45 days after delivery of the first notice, the executives of
both parties shall meet at a mutually acceptable time and place, and thereafter
as often as they reasonably deem necessary, to attempt to resolve the Dispute.
All reasonable requests for information made by one party to the other will be
honored.
(c) If the Dispute has not been resolved by negotiation within 60 days of
the first party's notice, or if the parties failed to meet within 45 days, the
parties shall endeavor to settle the Dispute by mediation under the then current
Commercial Mediation Rules of the American Arbitration Association.
(d) If the Dispute has not been resolved within 180 days after delivery of
the first notice under Section 12.06(b), either party may commence any
litigation or other procedure allowed by law.
Section 12.07. SURVIVAL. The rights and obligations under this Agreement
shall survive the Distribution and Merger and any sale or other transfer by any
member of Holding Group and/or the ITGI Group or any assignment or sale by them
of any Assets or Liabilities.
Section 12.08. SEVERABILITY. The provisions of this Agreement are severable
and should any provision hereof be void, voidable or unenforceable under any
applicable law, such provision shall not affect or invalidate any other
provision of this Agreement, which shall continue to govern the relative rights
and duties of the parties as though such void, voidable or unenforceable
provision were not a part hereof.
Section 12.09. GOVERNING LAW. This Agreement shall be construed in
accordance with, and governed by, the laws of the State of New York, without
regard to the conflicts of law rules of such state.
Section 12.10. COUNTERPARTS. This Agreement may be executed in one or more
counterparts each of which shall be deemed an original instrument, but all of
which together shall constitute but one and the same Agreement.
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IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the day and year first above written.
▇▇▇▇▇▇▇▇▇ GROUP, INC.
By /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Executive Vice President and CFO
JEF HOLDING COMPANY, INC.
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Secretary and General Counsel
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