MEMBERSHIP INTEREST PURCHASE AGREEMENT

LLC Membership Agreement

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Data Management I LLC | M&F WORLDWIDE CORP

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Title: MEMBERSHIP INTEREST PURCHASE AGREEMENT
Governing Law: New York Date: 2/14/2008
Industry: Food Processing Law Firm: Skadden Arps;Morgan Lewis Sector: Consumer/Non-Cyclical

MEMBERSHIP INTEREST PURCHASE AGREEMENT, Parties: data management i llc , m&f worldwide corp

Exhibit 2.1

EXECUTION VERSION

MEMBERSHIP INTEREST PURCHASE AGREEMENT

dated as of February 13, 2008

among

NCS PEARSON, INC.,

PEARSON INC.

and

M&F WORLDWIDE CORP.

TABLE OF CONTENTS

Page

ARTICLE I			DEFINITIONS	1
	1.1	Definitions		1
	1.2	Construction		11
ARTICLE II			PURCHASE AND SALE	11
	2.1	Purchase and Sale of the Interests		11
	2.2	Closing Date		11
	2.3	Transactions to be Effected at the Closing		12
	2.4	Pre-Closing Purchase Price Adjustment		12
	2.5	Post-Closing Purchase Price Adjustment		12
ARTICLE III			REPRESENTATIONS AND WARRANTIES RELATING TO THE SELLER AND THE INTERESTS	15
	3.1	Organization and Good Standing		15
	3.2	Authority and Enforceability		15
	3.3	No Conflicts		15
	3.4	The Interests		16
ARTICLE IV			REPRESENTATIONS AND WARRANTIES RELATING TO THE COMPANY AND THE BUSINESS	16
	4.1	Organization and Good Standing		17
	4.2	Capitalization; Books and Records		17
	4.3	No Conflicts		17
	4.4	Financial Statements		18
	4.5	Taxes		19
	4.6	Compliance with Law; Authorizations		19
	4.7	Real Property		20
	4.8	The Assets		22
	4.9	Intellectual Property		22
	4.10	Absence of Certain Changes or Events		23
	4.11	Contracts		23
	4.12	Litigation		24

	4.13	Employee Benefits		25
	4.14	Labor Matters		26
	4.15	Environmental		27
	4.16	Insurance		28
	4.17	Brokers		28
	4.18	Transactions with Affiliates		29
	4.19	Key Customers and Key Suppliers		29
ARTICLE V			REPRESENTATIONS AND WARRANTIES OF THE PURCHASER	29
	5.1	Organization and Good Standing		29
	5.2	Authority and Enforceability		30
	5.3	No Conflicts		30
	5.4	Litigation		30
	5.5	Purchase for Investment		31
	5.6	Availability of Funds		31
	5.7	Brokers		31
	5.8	Due Diligence; No Knowledge of Misrepresentations or Omissions		31
	5.9	No Other Representations
ARTICLE VI			COVENANTS OF THE SELLER	32
	6.1	Conduct of Business		32
	6.2	Access to Information		34
	6.3	Resignations		34
	6.4	Notification		35
	6.5	Reorganization		35
	6.6	Non-Compete		35
	6.7	Non-Solicit		37
	6.8	Confidentiality		37
ARTICLE VII			COVENANTS OF THE PURCHASER	37
	7.1	Confidentiality		37
	7.2	Support Services		38
	7.3	Financing		38

	7.4	Credit Support Arrangements		38
ARTICLE VIII			COVENANTS OF THE PURCHASER AND THE SELLER	39
	8.1	Commercially Reasonable Efforts; Antitrust Clearance		39
	8.2	Consents		40
	8.3	Public Announcements		40
	8.4	Tax Matters		40
	8.5	Procedures Relating to Tax Claims		42
	8.6	Purchase Price Allocations		42
	8.7	Employment Matters		43
	8.8	Worker Notification		45
	8.9	Further Action		45
	8.10	No Use of Names		46
	8.11	Intellectual Property Matters		46
	8.12	Insurance Matters		47
ARTICLE IX			CONDITIONS TO CLOSING	47
	9.1	Conditions to Obligations of the Purchaser and the Seller		47
	9.2	Conditions to Obligation of the Purchaser		48
	9.3	Conditions to Obligation of the Seller		49
ARTICLE X			TERMINATION	49
	10.1	Termination		49
	10.2	Effect of Termination		50
	10.3	Remedies		50
ARTICLE XI			INDEMNIFICATION	50
	11.1	Survival		50
	11.2	Indemnification by the Seller		51
	11.3	Indemnification by the Purchaser		51
	11.4	Indemnification Procedure for Third Party Claims		51
	11.5	Indemnification Procedures for Non-Third Party Claims		53
	11.6	Limitations on Indemnification		53
	11.7	Exclusive Remedy		54

iii

	11.8	Characterization of Indemnification Payments		55
ARTICLE XII			MISCELLANEOUS	55
	12.1	Notices		55
	12.2	Amendments and Waivers		56
	12.3	Expenses		56
	12.4	Successors and Assigns		56
	12.5	Governing Law		57
	12.6	Guarantee		57
	12.7	Consent to Jurisdiction		57
	12.8	Counterparts		58
	12.9	No Third Party Beneficiaries		58
	12.10	Entire Agreement		58
	12.11	Captions		58
	12.12	Severability		58
	12.13	Interpretation		58

EXHIBIT LIST

Exhibit A – Supply and Services Agreement

Exhibit B – Net Working Capital Target

Exhibit C – Transition Services Agreement

Exhibit D-1 and D-2 – Paper Purchase Agreements

Exhibit E – Trademark License Agreement

Exhibit F-1 and F-2– Patent Licenses

MEMBERSHIP INTEREST PURCHASE AGREEMENT

This MEMBERSHIP INTEREST PURCHASE AGREEMENT is dated as of February 13, 2008 (this “ Agreement ”) among Pearson Inc., a Delaware corporation (the “ Seller Parent ”) (solely for the purposes of Section 12.6), NCS Pearson Inc., a Minnesota corporation (the “ Seller ”), and M&F Worldwide Corp., a Delaware corporation (the “ Purchaser ”).

WHEREAS, the Seller is the record and beneficial owner of all of the limited liability membership interests (the “ Interests ”) in Data Management I LLC, a Delaware limited liability company (the “ Company ”); and

WHEREAS, the Seller desires to sell the Interests to the Purchaser, and the Purchaser desires to purchase the Interests from the Seller, upon the terms and subject to the conditions set forth in this Agreement.

NOW, THEREFORE, in consideration of the foregoing, the representations, warranties and covenants contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:

ARTICLE I

DEFINITIONS

1.1 Definitions . When used in this Agreement, the following terms shall have the meanings assigned to them in this Section 1.1.

“ Acquisition ” has the meaning set forth in Section 2.1.

“ Action ” has the meaning set forth in Section 4.12.

“ Affiliate ” means, with respect to any Person, any other Person directly or indirectly controlling, controlled by or under common control with such Person.

“ Agreement ” has the meaning set forth in the preamble hereto.

“ Ancillary Agreements ” means, collectively, the Reorganization Documents, the Transition Services Agreement, the Paper Purchase Agreements, the Supply and Services Agreement, the Patent Licenses, the Trademark License Agreement and any other documents executed and delivered in connection with the Acquisition.

“ Antitrust Laws ” means (a) the Sherman Act, as amended, the Clayton Act, as amended, the HSR Act, the Federal Trade Commission Act, as amended, and all other federal, state and foreign, if any, statutes, rules, regulations, orders, decrees, administrative and judicial doctrines and other Laws that are designed or intended to prohibit, restrict or regulate actions having the

purpose or effect of monopolization or restraint of trade or lessening of competition or the creation or strengthening of a dominant position through merger or acquisition, in any case, that are applicable to the transactions contemplated by this Agreement, and (b) any foreign investment Laws.

“ Approved Costs ” has the meaning set forth in Section 8.12(b).

“ Assets ” means the assets of every type and description (including rights under Contracts, accounts receivable, inventory, prepaid expenses, property, plant and equipment) that are owned, leased or licensed by the Seller and its Affiliates, including the goodwill related thereto, whether on the date hereof or acquired after the date hereof and prior to the Closing, used principally in connection with the operation of the Business, other than the Excluded Assets. Assets shall not include any rights to the Names other than as expressly permitted by Section 8.10.

“ Assumed Liabilities ” means (a) any and all Liabilities of the Seller and its Affiliates, whether arising before or after the Closing Date, arising out of the Business (other than the Excluded Liabilities), and (b) the Liabilities set forth in Section 1.1(f) of the Seller Disclosure Schedule. Without limitation to the foregoing, the Assumed Liabilities shall include all Liabilities arising out of (x) the ownership, possession or use of the Assets and (y) except as otherwise specifically provided in this Agreement, the employment of the Business Employees.

“ Audited Financial Statements ” has the meaning set forth in Section 4.4(a).

“ Authorization ” means any authorization, approval, consent, certificate, license, permit or franchise of or from any Governmental Entity or pursuant to any Law.

“ Balance Sheet ” has the meaning set forth in Section 4.4(a).

“ Basis of Accounting ” has the meaning set forth in Section 4.4(a).

“ Benefit Plan ” means any employment, consulting, bonus, incentive compensation, deferred compensation, pension, profit sharing, retirement, stock purchase, stock option, stock ownership, stock appreciation rights, phantom stock, leave of absence, layoff, vacation, day or dependent care, legal services, cafeteria, life, health, accident, disability, workers compensation or other insurance, severance, separation or other employee benefit plan, policy or arrangement of any kind, including without limitation any employee benefit plan within the meaning of Section 3(3) of ERISA (whether or not subject thereto), whether for the benefit of a single individual or more than one individual, and whether oral or written, funded or unfunded, or insured or self-insured, maintained or contributed to by the Seller, the Company or any of its Affiliates, or to which any of them are a party, for the benefit of Business Employees.

“ Business ” means, collectively, (a) the research, development, sale, resale, lease, loan, maintenance, support and engineering and manufacturing for sale, resale, lease or loan of scanners and data collection products, including proprietary optical mark readers, other image scanning units, software (including data collection, assessment, survey and medical coding and patient charge), electronic student response devices typically referred to as clickers and scannable forms and booklets to address specific customer requirements; (b) servicing such products through customer services including, but not limited to, field maintenance, training and

systems integration; (c) the provision of survey consulting and survey data collection services; and (d) the provision of medical device tracking services, in each case, constituting the data management division of the Seller.

“ Business Bank Account ” has the meaning set forth in Section 6.1.

“ Business Benefit Plans ” has the meaning set forth in Section 4.13(a).

“ Business Day ” means a day other than a Saturday, Sunday or other day on which banks located in New York, New York are authorized or required by Law to close.

“ Business Employee ” means each employee of the Business who is employed immediately prior to the Closing (whether salaried or hourly, and full-time or part-time), whether or not actively employed on the date hereof, e.g., including employees on vacation and leave of absence, including maternity, family, sick, military or disability leave.

“ Business Employee Bonuses ” has the meaning set forth in Section 8.7(h).

“ Business Licenses ” has the meaning set forth in Section 4.9(c).

“ Business Intellectual Property ” has the meaning set forth in Section 4.9(a).

“ Business Owned Intellectual Property ” has the meaning set forth in Section 4.9(b).

“ Cap ” has the meaning set forth in Section 11.6(b).

“ Claim Notice ” has the meaning set forth in Section 11.4(a).

“ Closing ” has the meaning set forth in Section 2.2.

“ Closing Date ” has the meaning set forth in Section 2.2.

“ Closing Net Working Capital ” has the meaning set forth in Section 2.5(a).

“ Closing Net Working Capital Statement ” has the meaning set forth in Section 2.5(a).

“ Code ” means the Internal Revenue Code of 1986, as amended from time to time, and the rules and regulations promulgated thereunder.

“ Company ” has the meaning set forth in the recitals hereto.

“ Confidentiality Agreement ” has the meaning set forth in Section 7.1.

“ Contract ” means any written agreement, contract, commitment, lease, license, indenture, agreement, or other legally binding arrangement.

“ Credit Support Arrangements ” mean (a) the letters of credit, guarantees, performance bonds and other credit support arrangements entered into or issued by or on behalf of the Seller or any of its Affiliates outstanding as of the date of this Agreement for the benefit of the

Business as set forth in Section 1.1(a) of the Seller Disclosure Schedule and (b) any letters of credit, guarantees, performance bonds and other credit support arrangements entered into or issued by or on behalf of the Seller or any of its Affiliates for the benefit of the Business after the date of this Agreement (which shall be updated in Section 1.1(a) of the Seller Disclosure Schedule after the date of this Agreement) in the ordinary course of business consistent with past practice.

“ Election Notice ” has the meaning set forth in Section 8.5(b).

“ Environmental Laws ” means all foreign, federal, state and local Laws, regulations, rules and ordinances relating to pollution or protection of the environment or human or worker health and safety as it relates to exposure to Hazardous Substances, including, without limitation, such Laws relating to: (a) releases or threatened releases of Hazardous Substances into the indoor or outdoor environment (including, without limitation, ambient air, surface water, groundwater, land, surface and subsurface strata); (b) the manufacture, processing, distribution, use, treatment, storage, release, transport or handling of Hazardous Substances; (c) recordkeeping, notification, disclosure and reporting requirements respecting Hazardous Substances, and (d) protection of endangered or threatened species of fish, wildlife, plants and natural resources.

“ Equipment Leases ” means the agreements to be entered into between the Company and each of (a) Xerox Corporation, granting the Company the right to use the equipment that is used principally in connection with Business and is leased by the Seller (or its Affiliates) pursuant to that certain Managed Services Agreement between the Seller Parent and Xerox Corporation, dated as of January 29, 2007, and (b) CIT Technologies Corporation, granting the Company the right to use the equipment that is used principally in connection with the Business and is leased by the Seller (or its Affiliates) pursuant to that certain Master Lease Agreement between the Seller and CIT Technologies Corporation, dated as of July 23, 2004.

“ ERISA ” means the Employee Retirement Income Security Act of 1974, as amended, and the rules and regulations promulgated thereunder.

“ ERISA Affiliate ” means any Person that, together with the Company, would be treated as a single employer under Section 414 of the Code.

“ Estimated Net Working Capital ” has the meaning set forth in Section 2.4(a).

“ Estimated Working Capital Adjustment Amount ” has the meaning set forth in Section 2.4(b).

“ Estimated Net Working Capital Statement ” has the meaning set forth in Section 2.4(a).

“ Excluded Assets ” means the assets described in Section 1.1(b) of the Seller Disclosure Schedule and the Retention/Severance Agreements.

“ Excluded Environmental Liabilities ” means any Liabilities arising under Environmental Law or related to Hazardous Substances, with respect to the Business, arising from or related to: (a) any real properties other than the Real Property; and (b) the storage, transportation, treatment, disposal, discharge or recycling of Hazardous Substances, or the arrangement for such activities,

on or prior to the Closing Date, at any location other than the Real Property, by or on behalf of the Business.

“ Excluded Liabilities ” means any Liabilities of the Seller and its Affiliates to the extent arising out of (a) Taxes for Pre-Closing Periods, (b) the Excluded Assets, (c) the Seller Transaction Expenses, (d) obligations to be retained by the Seller pursuant to Section 8.7, (e) Excluded Environmental Liabilities, (f) Liabilities resulting solely from the actions taken to effect the Reorganization (as opposed to Liabilities to be transferred to the Company as part of the Reorganization, which Liabilities are Assumed Liabilities) or (g) any other business of the Seller or its Affiliates other than the Business.

“ Final Net Working Capital ” has the meaning set forth in Section 2.5(d).

“ Financial Statements ” has the meaning set forth in Section 4.4(b).

“ Financing ” has the meaning set forth in Section 5.6.

“ GAAP ” means United States generally accepted accounting principles.

“ GAAP Audited Financials ” has the meaning set forth in Section 6.2(b).

“ Governmental Entity ” means any entity or body exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to United States federal, state or local government or foreign, international, multinational or other government, including any department, commission, board, agency, bureau, official, arbitral, tribunal, or other regulatory, administrative or judicial authority thereof.

“ Hazardous Substances ” means (a) any petrochemical or petroleum products, radioactive materials, asbestos, and polychlorinated biphenyls; (b) any chemicals, materials or substances defined as or included in the definition of “hazardous substances,” “hazardous wastes,” “hazardous materials,” “restricted hazardous materials,” “extremely hazardous substances,” “toxic substances,” “contaminants” or “pollutants” or words of similar meaning and regulatory effect under any applicable Environmental Law; or (c) any other chemical, material or substance, exposure to which is prohibited, limited, or regulated by or to which Liabilities may attach pursuant to any applicable Environmental Law.

“ HIPAA ” means the U.S. Health Insurance Portability and Accountability Act of 1996, as amended.

“ HSR Act ” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended.

“ Indebtedness ” means indebtedness for money borrowed, under any note, bond or credit agreement, the debt portion of any capitalized lease or any guarantee or make-whole or similar indebtedness to another Person.

“ Indemnitee ” means any Person that is seeking indemnification from an Indemnitor pursuant to the provisions of this Agreement.

“ Indemnitor ” means any party hereto from which any Indemnitee is seeking indemnification pursuant to the provisions of this Agreement.

“ Independent Accounting Firm ” has the meaning set forth in Section 2.5(c).

“ Intellectual Property ” means all intellectual property and industrial property rights of any kind or nature, including all U.S. and foreign (a) Trade Secrets, (b) patents and patent applications (including all reissues, re-examinations, divisions, continuations, continuations-in-part, substitutions, and extensions thereof), (c) trademarks, trademark registrations, trademark applications, service marks, service mark registrations, service mark applications, names, corporate names, trade names, logos, slogans, trade dress, and other similar designations of source or origin, together with the goodwill symbolized by any of the foregoing, (d) copyright registrations, copyright applications, and copyrightable subject matter, and mask work registrations and applications, (e) domain names, (f) rights of publicity and rights of privacy, (g) rights in computer programs (whether in source code, object code, or other form), algorithms, databases, compilations and data, technology supporting the foregoing, and all documentation, including user manuals and training materials, related to any of the foregoing, (h) all rights in the foregoing and in other similar intangible assets, and (i) all rights and remedies against past, present, and future infringement, misappropriation, or other violation thereof.

“ Insurance Policies ” has the meaning set forth in Section 4.16.

“ Interests ” has the meaning set forth in the recitals hereto.

“ Key Customers ” has the meaning set forth in Section 4.19.

“ Key Suppliers ” has the meaning set forth in Section 4.19.

“ Knowledge of the Seller ”, “ Seller’s Knowledge ” and words of similar import mean, with respect to the Seller, the actual knowledge, after reasonable inquiry, of the persons identified on Section 1.1(c) of the Seller Disclosure Schedule.

“ Law ” means any statute, law, ordinance, rule or regulation of any Governmental Entity.

“ Leased Real Property ” has the meaning set forth in Section 4.7(b).

“ Leases ” has the meaning set forth in Section 4.7(b).

“ Liability ” means, collectively, any indebtedness, guarantee, endorsement, loss, damage, deficiency, adverse claim, Tax, obligation or responsibility (whether direct or indirect, known or unknown, asserted or unasserted, absolute or contingent, accrued or unaccrued, liquidated or unliquidated, or due or to become due, and whether in contract, tort, strict liability or otherwise, including any product liability) and including all costs and expenses relating thereto.

“ Licensed Patents ” mean the patents, as specified on Section 1.1(d) of the Seller Disclosure Schedule, which are included in Excluded Assets and which are used by the Seller in the Business but primarily are used in other parts of the business operations of the Seller and its Affiliates.

“ Lien ” means any mortgage, lien, pledge, charge, security interest, leases, subleases, covenants, rights, options, claims, restrictions or other encumbrance.

“ Losses ” has the meaning set forth in Section 11.2.

“ Material Adverse Effect ” means any change, event or effect that, individually or in the aggregate, has or would reasonably be expected to have a material adverse effect on (a) the Assets or Liabilities, financial condition or results of operation of the Business or the Company, or (b) the ability of the Seller to consummate the Acquisition and the other transactions contemplated hereby, provided , however , that none of the following, either alone or in combination, shall be considered in determining whether there has been a Material Adverse Effect: (i) any change affecting general national, international or regional political, economic, financial or capital market conditions, including changes in interest or exchange rates; (ii) any change generally affecting the industries in which the Business operates; (iii) any change in Law or GAAP, or any interpretation thereof; (iv) acts of war, sabotage or terrorism, or any escalation or worsening thereof; (v) any change arising from the execution of this Agreement or the Ancillary Agreements (other than the Reorganization Documents) or the announcement of the transactions contemplated hereby or thereby (other than the transactions contemplated by the Reorganization Documents); (vi) any breach by the Purchaser of any provision of this Agreement or the Ancillary Agreements; and (vii) any action taken at the written request of the Purchaser; unless, in the cases of clauses (i) through (iv), such change, event or effect, individually or in the aggregate, is disproportionately more adverse to the Business than to other Persons in the same or similar industry as the Business.

“ Names ” means “Pearson”, “NCS”, any name, logo, domain name or trademark that includes “Pearson”, “NCS”, and any variations and derivatives thereof. For the purposes of clarity, the Names shall not be included in the Assets.

“ Net Working Capital ” means an amount (which may be greater than, equal to or less than zero) equal to (a) the sum of the amount of (i) cash on hand and short-term investments with original maturities of less than three months, (ii) all inventories, (iii) all accounts receivable, net of allowance for doubtful accounts, and (iv) prepaid and other current assets, less (b) the sum of the amount of (i) all accounts payable, (ii) all accrued compensation and awards, (iii) other accrued liabilities, (iv) all current deferred income and (v) any Seller Transaction Expenses assumed by or otherwise the responsibility of the Company, in each case determined in accordance with GAAP consistently applied on the same basis as in the Audited Financial Statements.

“ Net Working Capital Target ” means $15,000,000, which is the net working capital target calculated as set forth in Exhibit B .

“ Notice of Objection ” has the meaning set forth in Section 2.5(b).

“ Order ” means any award, injunction, judgment, decree, order, ruling, subpoena or verdict or other decision issued, promulgated or entered by or with any Governmental Entity of competent jurisdiction.

“ Outside Date ” has the meaning set forth in Section 10.1(a)(ii).

“ Owned Real Property ” has the meaning set forth in Section 4.7(a).

“ Paper Purchase Agreements ” means, collectively, the paper purchase agreements between Strategic Paper Group, a division of Central Lewmar LLC, and each of the Seller Parent and the Company, to be dated as of the Closing Date and to be entered into immediately prior to the Closing in substantially the forms attached hereto as Exhibits D-1 and D-2 .

“ Patent Licenses ” means the patent license agreements to be entered into by the Company with the Seller (or its applicable Affiliates) at or prior to the Closing as part of the Reorganization in substantially the forms attached hereto as Exhibits F-1 and F-2 .

“ Permitted Liens ” means (a) Liens for Taxes that are not yet due and payable or that are being contested in good faith by appropriate proceedings and for which adequate reserves have been taken on the Financial Statements, (b) Liens of landlords and workers’, carriers’, materialmen’s, suppliers’ and mechanics’ or other like Liens incurred in the ordinary course of business, that are being contested in good faith or that are not yet due and payable, (c) with respect to the Real Property, any condition that may be shown by a current and accurate survey, or that would be apparent as part of a physical inspection, of the applicable Asset, in each case which does not materially adversely interfere with the present use of the Asset it affects, (d) with respect to real property any Lien which a reputable title insurance company would be willing to omit as an exception, or affirmatively insure, in its title insurance policy for the applicable Asset, (e) Liens that will be released prior to or as of the Closing, (f) zoning and building restrictions, recorded easements and covenants, recorded rights-of-way and similar restrictions recorded in the public records, (g) Liens which do not materially adversely interfere with the present use of the Assets they affect, and (h) those Liens and other matters listed on Section 1.1(e) of the Seller Disclosure Schedule.

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

“ Post-Closing Period ” means any taxable period or portion thereof beginning after the Closing Date or, as the context may require, all such periods. If a taxable period begins on or before the Closing Date and ends after the Closing Date, then the portion of the taxable period that begins on the day following the Closing Date shall constitute a Post Closing Period.

“ Pre-Closing Period ” means any taxable period or portion thereof ending on or before the Closing Date or, as the context may require, all such periods. If a taxable period begins on or before the Closing Date and ends after the Closing Date, then the portion of the taxable period to the end of the Closing Date shall constitute a Pre-Closing Period.

“ Proposed Allocation ” has the meaning set forth in Section 8.6(b).

“ Purchase Price ” has the meaning set forth in Section 2.1.

“ Purchaser ” has the meaning set forth in the preamble hereto.

“ Purchaser Material Adverse Effect ” has the meaning set forth in Section 5.1.

“ Purchaser Parties ” has the meaning set forth in Section 11.2.

“ Purchaser’s 401(k) Plan ” has the meaning set forth in Section 8.7(e).

“ Real Property ” means the Owned Real Property and Leased Real Property.

“ Reorganization ” means (a) the contribution, assignment, transfer, conveyance and delivery to the Company by the Seller and its Affiliates of the Assets, (b) the assumption by the Company of the Assumed Liabilities, (c) the entry by the Company and the Seller (or its applicable Affiliate) into the Patent Licenses and the Trademark License Agreement, and (d) the entry by the Company and the applicable counterparty thereto into the Equipment Leases.

“ Reorganization Documents ” has the meaning set forth in Section 6.5.

“ Restricted Business ” has the meaning set forth in Section 6.6.

“ Retention/Severance Agreements ” has the meaning set forth in Section 8.7(d).

“ Review Period ” has the meaning set forth in Section 2.5(b).

“ Seller ” has the meaning set forth in the preamble hereto.

“ Seller Benefit Plans ” has the meaning set forth in Section 4.13(a).

“ Seller Disclosure Schedule ” has the meaning set forth in the preamble to Article III.

“ Seller Parent ” has the meaning set forth in the preamble hereto.

“ Seller Parties ” has the meaning set forth in Section 11.3.

“ Seller Transaction Expenses ” shall mean (a) all fees and expenses of all third parties providing Seller or its Affiliates (including the Company) with services (including legal, accounting and tax services) in connection with (i) the Acquisition, the Reorganization and the other transactions contemplated by this Agreement (including the auction process and any other contemplated strategic transactions relating to the Business) and the Ancillary Agreements and (ii) the negotiation, preparation and drafting of this Agreement and the Ancillary Agreements, including, without limitation, the fees of HSBC Securities (USA) Inc. and Morgan, Lewis & Bockius LLP, (b) the cost of the audit previously undertaken by PricewaterhouseCoopers for Pearson Data Management, for the fiscal years ended December 31, 2006 and December 31, 2005 to produce the Audited Financial Statements set forth on Section 4.4(a) of the Seller Disclosure Schedule as well as any costs to be borne by the Seller pursuant to Section 6.2(b) of this Agreement and (c) all out-of pocket costs and expenses arising out of or related to the Reorganization.

“ Specified Representations ” has the meaning set forth in Section 11.1.

“ Straddle Period ” means any taxable period that begins on or before and ends after the Closing Date.

“ Subsidiary ” means, with respect to any Person, any corporation, partnership, limited liability company, joint venture or other legal entity of any kind of which such Person (either alone or through or together with one or more of its other Subsidiaries), owns, directly or indirectly, more than 50% of the capital stock or other equity interests the holders of which are (a) generally entitled to vote for the election of the board of directors or other governing body of such legal entity or (b) generally entitled to share in the profits or capital of such legal entity.

“ Supply and Services Agreement ” means the product and services purchase and supply agreement between the Seller and the Company, to be dated as of the Closing Date and to be entered into immediately prior to the Closing, in substantially the form attached hereto as Exhibit A .

“ Tax ” or “ Taxes ” means any and all U.S. federal, state, local or foreign net or gross income, alternative or add-on minimum, gross receipts, net proceeds, lease, wage, service, service use, excise, Transfer Taxes, license, ad valorem, value added, franchise, withholding, payroll, employment, excise, real property gains, deed, alternative or add-on minimum, occupation, severance, occupation, windfall profits, unemployment, social security, workers’ compensation, disability, capital stock, paid in capital, business occupation, business license, custom duties, environmental, estimated, capital, premium and other taxes, charges, fees, levies, imposts, duties or assignments of any kind whatsoever, imposed or required to be withheld by any Tax authority, including any interest, additions to Tax or penalties applicable or related thereto.

“ Tax Audits ” has the meaning set forth in Section 4.5(a)(ii).

“ Tax Claim ” means (a) any written claim with respect to Taxes made by any Taxing Authority or other Person that, if pursued successfully, could serve as the basis for a claim for indemnification of the Purchaser or Seller under this Agreement, or (b) a rejection by a Taxing Authority of a claim for a Tax refund with respect to a taxable period of the Company or the Business ending on or before the Closing Date.

“ Tax Returns ” means any return, declaration, report, claim for refund or information return or statement relating to Taxes, including any schedule or attachment thereto and any amendment thereof.

“ Taxing Authority ” means any Governmental Entity having jurisdiction with respect to any Tax.

“ Third Party Claim ” has the meaning set forth in Section 11.4(a).

“ Third Party Licenses ” has the meaning set forth in Section 4.9(c).

“ Trade Secrets ” means any trade secrets and other confidential inventions, know-how, formulae, processes, models, methodologies and information.

“ Trademark License Agreement ” means the trademark license agreement between the Seller and the Company, to be dated as of the Closing Date, in substantially the form attached hereto as Exhibit E .

“ Transfer Taxes ” means sales, use, transfer, real property transfer, recording, registration, documentary, stamp, registration and stock transfer taxes and fees and any similar taxes, including any interest, additions to Transfer Tax or penalties applicable or related thereto.

“ Transition Services Agreement ” means the services agreement between the Seller and the Purchaser, to be dated as of the Closing Date, in substantially the form attached hereto as Exhibit C .

“ Unaudited Balance Sheet ” has the meaning set forth in Section 4.4(b).

“ Unaudited Financial Statements ” has the meaning set forth in Section 4.4(b).

1.2 Construction . For the purposes of this Agreement, except as otherwise expressly provided herein or unless the context otherwise requires: (a) words using the singular or plural number also include the plural or singular number, respectively, and the use of any gender herein shall be deemed to include the other gender; (b) references herein to “Articles,” “Sections,” “subsections” and other subdivisions, and to Exhibits, Schedules, Annexes, Attachments and other attachments, without reference to a document are to the specified Articles, Sections, subsections and other subdivisions of, and Exhibits, Schedules, Annexes, Attachments and other attachments to, this Agreement; (c) a reference to a subsection or other subdivision without further reference to a Section is a reference to such subsection or subdivision as contained in the same Section in which the reference appears; (d) the words “herein”, “hereof”, “hereunder”, “hereby” and other words of similar import refer to this Agreement as a whole and not to any particular provision; (e) the words “include”, “includes” and “including” are deemed to be followed by the phrase “without limitation”; and (f) all accounting terms used and not defined herein have the respective meanings given to them under GAAP.

ARTICLE II

PURCHASE AND SALE

2.1 Purchase and Sale of the Interests . Upon the terms and subject to the conditions of this Agreement, at the Closing the Seller shall sell the Interests to the Purchaser and the Purchaser shall purchase the Interests from the Seller, free and clear of all Liens. The purchase price for the Interests shall be $225,000,000 in cash (the “ Purchase Price ”). The Purchase Price shall be paid as provided in Section 2.3, and is subject to adjustment as provided in Sections 2.4 and 2.5. The purchase and sale of the Interests is referred to herein as the “ Acquisition ”.

2.2 Closing Date . The closing of the Acquisition (the “ Closing ”) shall take place at the offices of Morgan, Lewis & Bockius LLP, 101 Park Avenue, New York, NY, at 10:00 a.m. on the later of (a) February 22, 2008 and (b) the third Business Day after satisfaction (or waiver as provided herein) of the conditions set forth in Article IX (other than those conditions that by their nature will be satisfied at the Closing, but subject to the satisfaction (or, to the extent permitted, the waiver) of those conditions), or such other time, date or place as shall be agreed in writing by the parties. The date on which the Closing occurs is referred to herein as the “ Closing Date .” In the event that, pursuant to the terms of the immediately preceding sentence, the Closing would occur on a date that is not February 22, 2008 or another date that is the last day of

a Seller fiscal month, the Purchaser and the Seller shall use their commercially reasonable efforts to agree upon a mutually acceptable date for the Closing, taking into account the financial and accounting systems of the Seller; provided , however , that the Closing shall not be delayed pursuant to this sentence more than five Business Days past the date on which it would otherwise occur pursuant to the immediately preceding sentence. The Closing shall be deemed effective as of 11:59 p.m. Eastern time on the Closing Date.

2.3 Transactions to be Effected at the Closing .

(a) At the Closing, the Purchaser shall deliver to the Seller (i) by wire transfer of immediately available funds to an account or accounts designated in writing by the Seller to the Purchaser no later than two Business Days prior to the Closing Date (A) the Purchase Price, plus or minus (B) the Estimated Working Capital Adjustment Amount, and (ii) all documents required to be delivered by the Purchaser to the Seller pursuant to Section 9.3.

(b) At the Closing, the Seller shall deliver to the Purchaser (i) certificates representing the Interests, duly endorsed by the Seller for transfer to the Purchaser or accompanied by separate membership interest powers attached thereto and signed in blank; (ii) all documents required to be delivered by the Seller to the Purchaser pursuant to Section 9.2; (iii) the resignations described in Section 6.3 and (iv) fully executed copies of the Reorganization Documents (and, in the case of any deeds transferring any Owned Real Property, evidence of the recordation of such deeds in the real estate records of the applicable jurisdiction).

2.4 Pre-Closing Purchase Price Adjustment .

(a) At least three but no more than ten Business Days before the Closing Date, the Seller shall deliver to the Purchaser an unaudited statement (the “ Estimated Net Working Capital Statement ”), setting forth in reasonable detail (including the components of such calculation) Seller’s reasonable good faith estimation of Net Working Capital as of 11:59 p.m. Eastern time on the expected Closing Date (“ Estimated Net Working Capital ”). The Estimated Net Working Capital Statement shall be prepared in accordance with the same accounting principles, practices, methodologies and policies used in the preparation of the Audited Financial Statements and in the calculation of the Net Working Capital Target; provided , however , that in no event shall the Estimated Net Working Capital Statement include any Excluded Assets or Excluded Liabilities.

(b) The amount by which the Estimated Net Working Capital is greater than or less than the Net Working Capital Target shall be referred to herein as the “ Estimated Working Capital Adjustment Amount ”.

2.5 Post-Closing Purchase Price Adjustment . The Purchase Price shall be subject to adjustment on a dollar-for-dollar basis after the Closing Date as set forth below.

(a) Within 90 days after the Closing Date, the Purchaser will prepare, or cause to be prepared, and deliver to the Seller an unaudited statement (the “ Closing Net Working Capital Statement ”), which shall set forth the Purchaser’s calculation of Net Working Capital as of 11:59 p.m. Eastern time on the Closing Date (“ Closing Net Working Capital ”). The Closing Net Working Capital Statement shall be prepared in accordance with the same accounting

principles, practices, methodologies and policies (including the determination of reserves) used in the preparation of the Audited Financial Statements and in the calculation of the Net Working Capital Target; provided , however , that in no event shall the Closing Net Working Capital Statement include any Excluded Assets or Excluded Liabilities. After the Closing Date, Purchaser shall provide the Seller and its representatives with any information reasonably requested by them and shall give them access, during normal business hours and upon reasonable notice, to the personnel, properties, books and records of the Company for the purpose of its review of the Closing Net Working Capital Statement in accordance with this Section 2.5.

(b) Upon receipt from the Purchaser, the Seller shall have 30 days to review the Closing Net Working Capital Statement (the “ Review Period ”). If the Seller disagrees with the Purchaser’s computation of Closing Net Working Capital, the Seller may, on or prior to the last day of the Review Period, deliver a notice to the Purchaser (the “ Notice of Objection ”), which sets forth its objection to the Purchaser’s calculation of Closing Net Working Capital; provided , however , that the Notice of Objection shall include only objections based on (i) non compliance with the standards set forth in Section 2.5(a) for the preparation of the Closing Net Working Capital Statement and (ii) mathematical errors in the computation of Closing Net Working Capital. Any Notice of Objection shall specify those items or amounts with which the Seller disagrees, together with a detailed written explanation of the reasons for disagreement with each such item or amount, and shall set forth the Seller’s calculation of Closing Net Working Capital based on such objections. To the extent not set forth in the Notice of Objection, the Seller shall be deemed to have agreed with the Purchaser’s calculation of all other items and amounts contained in the Closing Net Working Capital Statement. The parties hereto acknowledge that (x) the sole purpose of the determination of Closing Net Working Capital is to adjust the Purchase Price so as to reflect the difference between the Closing Net Working Capital and the Estimated Net Working Capital and (y) the calculation of the Closing Net Working Capital is to be made on a basis completely consistent with the calculation of the Net Working Capital Target using the same accounting principles, practices, methodologies and policies.

(c) Unless the Seller delivers the Notice of Objection to the Purchaser within the Review Period, the Seller shall be deemed to have accepted the Purchaser’s calculation of Closing Net Working Capital and the Closing Net Working Capital Statement shall be final, conclusive and binding on all parties hereto. If the Seller delivers the Notice of Objection to the Purchaser within the Review Period, the Purchaser and the Seller shall, during the 30 days following such delivery or any mutually agreed extension thereof, use their commercially reasonable efforts to reach agreement on the disputed items and amounts in order to determine the amount of Closing Net Working Capital. If, at the end of such period or any mutually agreed extension thereof, the Purchaser and the Seller are unable to resolve their disagreements, they shall jointly retain and refer their disagreements to a nationally recognized independent public accounting firm mutually acceptable to the Purchaser and the Seller (the “ Independent Accounting Firm ”). If the Purchaser and the Seller are unable to so agree, each shall select a nationally recognized independent accounting firm and those two firms shall select a third such firm, in which event “ Independent Accounting Firm ” shall mean the third such firm. The parties shall instruct the Independent Accounting Firm promptly to review this Section 2.5 and to determine solely with respect to the disputed items and amounts so submitted whether and to what extent, if any, the Closing Net Working Capital set forth in the Closing Net Working Capital Statement requires adjustment. The Independent Accounting Firm shall base its

determination solely on written submissions by the Purchaser and the Seller and not on an independent review. The Purchaser and the Seller shall make available to the Independent Accounting Firm all relevant books and records and other items reasonably requested by the Independent Accounting Firm. As promptly as practicable, but in no event later than 45 days after its retention, the Independent Accounting Firm shall deliver to the Purchaser and the Seller a report which sets forth its resolution of the disputed items and amounts and its calculation of Closing Net Working Capital; provided , however , that in no event shall Closing Net Working Capital as determined by the Independent Accounting Firm be less than the Purchaser’s calculation of Closing Net Working Capital set forth in the Closing Net Working Capital Statement nor more than the Seller’s calculation of Closing Net Working Capital set forth in the Notice of Objection. The decision of the Independent Accounting Firm shall be final, conclusive and binding on the parties. After final determination of Closing Net Working Capital, the Seller shall have no further right to make any claims against the Purchaser in respect of any element of Closing Net Working Capital that the Seller raised or could have raised in the Notice of Objection. The Purchaser and the Seller shall each pay their own costs and expenses incurred under this Section 2.5. The Independent Accounting Firm shall allocate its fees, costs and expenses in accordance with the percentage which the portion of the contested amount not awarded to the Purchaser, on the one hand, and the Seller, on the other hand, bears to the amount actually contested by or on behalf of such parties.

(d) For the purposes of this Agreement, “ Final Net Working Capital ” means the Closing Net Working Capital: (i) as shown in the Closing Net Working Capital Statement delivered by the Purchaser to the Seller pursuant to Section 2.5(a), if no Notice of Objection with respect thereto is timely delivered by the Seller to the Purchaser pursuant to Section 2.5(b); or (ii) if a Notice of Objection is so delivered, (A) as agreed by the Purchaser and the Seller pursuant to Section 2.5(c) or (B) in the absence of such agreement, as shown in the Independent Accounting Firm’s calculation delivered pursuant to Section 2.5(c). The Purchase Price shall be increased by the amount by which Final Net Working Capital exceeds the Estimated Net Working Capital, and the Purchase Price shall be decreased by the amount by which Final Net Working Capital is less than the Estimated Net Working Capital. If, pursuant to the preceding sentence, the Purchase Price is decreased, the Seller shall, and if the Purchase Price is increased, the Purchaser shall, within five Business Days after the Final Net Working Capital is determined, make payment by wire transfer in immediately available funds, to an account designated in writing by the party receiving such payment no later than two Business Days prior to the date of such payment, the amount of such adjustment, together with interest thereon at a rate equal to the rate of interest from time to time announced publicly by Citibank, N.A. as its prime rate, calculated on the basis of the actual number of days elapsed divided by 365, from the Closing Date to the date of payment.

(e) In the period beginning on the Closing Date and ending on the earliest date of final resolution of Final Net Working Capital and the adjustment to the Purchase Price pursuant to this Section 2.5, no changes made by the Purchaser to the accounting methodology of the Business on which the Closing Net Working Capital is to be based, shall have an impact upon the calculation of Closing Net Working Capital or the calculation of any adjustment to the Purchase Price contemplated by this Section 2.5.

ARTICLE III

REPRESENTATIONS AND WARRANTIES RELATING TO THE

SELLER AND THE INTERESTS

The Seller represents and warrants to the Purchaser that, except as set forth in the corresponding section of the Schedules delivered by the Seller to the Purchaser on the date hereof (collectively, the “ Seller Disclosure Schedule ”) (it being understood that each section of the Seller Disclosure Schedule shall be deemed to incorporate by reference all information disclosed in any other section of the Seller Disclosure Schedule, to the extent, but only to the extent, that the relevance of such disclosure in such other section is reasonably apparent), each statement contained in this Article III is true and correct as of the date hereof and as of the Closing Date (except with respect to those representations and warranties that expressly address matters only as of a particular date, in which case, as of such date).

3.1 Organization and Good Standing . The Seller is a legal entity duly organized, validly existing and in good standing under the Laws of the jurisdiction of its organization. The Seller has all requisite corporate or similar legal power to own, lease and operate the Assets and to carry on the Business as now being conducted. The Seller is duly qualified or licensed to do business as a foreign corporation, and is in good standing as a foreign corporation, in every jurisdiction in which the ownership of the Assets or the conduct of the Business requires such qualification or license, except where the failure to do so would not have a Material Adverse Effect.

3.2 Authority and Enforceability . Each of the Seller and the Company, as applicable, has the requisite power and authority to execute and deliver this Agreement and the Ancillary Agreements to which it is a party and to consummate the Acquisition, the Reorganization and the other transactions contemplated hereby and thereby. The execution and delivery of this Agreement and such Ancillary Agreements and the consummation of the Acquisition, the Reorganization and the other transactions contemplated hereby and thereby have been, or will be, duly authorized by all necessary corporate or other similar action on the part of the Seller and the Company, as applicable. This Agreement has been, and at the Closing each Ancillary Agreement to which the Seller or the Company, as applicable, is a party will be, duly executed and delivered by the Seller or the Company, as applicable, and, assuming the due authorization, execution and delivery hereof and thereof by the Purchaser, constitute the valid and binding obligation of the Seller or the Company, as applicable, enforceable against it in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar Laws affecting or relating to creditors’ rights generally, and the availability of injunctive relief and other equitable remedies.

3.3 No Conflicts .

(a) Except as set forth in Section 3.3(a) of the Seller Disclosure Schedule, the execution and delivery by the Seller and the Company of this Agreement and the Ancillary Agreements to which each is a party do not, and the consummation by the Seller and the Company of the Reorganization, the Acquisition and the other transactions contemplated hereby and thereby will not conflict with, or result in any violation of or default (with or without notice

or lapse of time, or both) or payment of any material amount under, or give rise to a right of termination or cancellation or acceleration of any obligation or to a loss of a material benefit under, or result in the creation of any Lien upon any of the Assets under, any provision of (i) the governing or constitutive documents of the Seller, (ii) any Contract related to the Business to which the Seller or any of its Affiliates is a party or by which the Assets are bound, or (iii) any Law or Order applicable to the Seller in connection with its operation of the Business, except in the case of the immediately preceding clauses (ii) and (iii) where such violation would not have a Material Adverse Effect.

(b) No Authorization or Order of, registration, declaration or filing with, or notice to any Governmental Entity is required to be obtained or made by or with respect to the Seller in connection with the execution and delivery of this Agreement or the Ancillary Agreements to which the Seller is a party or the consummation of the Acquisition or the other transactions contemplated hereby or thereby, except for such Authorizations, Orders, registrations, declarations, filings and notices (i) as may be required under the HSR Act and other Antitrust Laws set forth in Section 3.3(b) of the Seller Disclosure Schedule or (ii) as set forth in Section 3.3(b) of the Seller Disclosure Schedule.

3.4 The Interests . The Seller is the sole beneficial owner of the Interests and has good and valid title to the Interests, free and clear of all Liens. Assuming the Purchaser has the requisite power and authority to be the lawful owner of the Interests, upon delivery to the Purchaser at the Closing of certificates representing the Interests, duly endorsed by the Seller for transfer to the Purchaser or accompanied by separate membership interest powers attached thereto and signed in blank, and upon the Seller’s receipt of the Purchase Price pursuant to Section 2.3(a), good and valid title to the Interests will pass to the Purchaser, free and clear of any Liens (other than those arising from acts of the Purchaser or its Affiliates) or claims of any Person with respect thereto. Other than this Agreement, the Interests are not subject to any voting trust agreement or other Contract restricting or otherwise relating to the voting, dividend rights or disposition of the Interests.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES RELATING

TO THE COMPANY AND THE BUSINESS

The Seller represents and warrants to the Purchaser that, except as set forth in the corresponding section of the Seller Disclosure Schedule (it being understood that each section of the Seller Disclosure Schedule shall be deemed to incorporate by reference all information disclosed in any other section of the Seller Disclosure Schedule, to the extent, but only to the extent, that the relevance of such disclosure in such other section is reasonably apparent), each statement contained in this Article IV is true and correct as of the date hereof and as of the Closing Date (except with respect to those representations and warranties that expressly address matters only as of a particular date, in which case, as of such date).

4.1 Organizati on and Good Standing . The Company is a legal entity duly organized, validly existing and in good standing under the Laws of its jurisdiction of organization. The

Company has all requisite corporate or similar legal power to own, lease and operate the Assets and to carry on the Business as now being conducted. The Company is, or as of the Closing will be, duly qualified or licensed to do business and is in good standing in each jurisdiction in which the conduct or nature of the Business or the ownership, leasing or holding of the Assets makes such qualification necessary, except where the failure to be so qualified would not have a Material Adverse Effect.

4.2 Capitalization; Books and Records .

(a) The authorized capital of the Company is set forth in Section 4.2(a) of the Seller Disclosure Schedule. The Interests are duly authorized, validly issued, fully paid and nonassessable. Other than the Interests and as set forth in Section 4.2(a) of the Seller Disclosure Schedule, the Company does not have outstanding any equity interests or any other securities exercisable or exchangeable for or convertible into equity interests. The Company has no Subsidiaries.

(b) The Company has delivered to the Purchaser true and complete copies of the certificate of formation, limited liability company agreement, any other formation documents and any resolutions or minute books, each as amended to date, of the Company. The resolutions and minute books of the Company are true and complete in all material respects.

4.3 No Conflicts .

(a) Except as set forth in Section 4.3(a) of the Seller Disclosure Schedule, the execution and delivery by the Seller and the Company of this Agreement and the Ancillary Agreements to which each is a party do not, and the consummation by the Seller and the Company of the Reorganization, the Acquisition and the other transactions contemplated hereby and thereby will not conflict with, or result in any violation of or default (with or without notice or lapse of time, or both) or payment of any material amount under, or give rise to a right of termination or cancellation or acceleration of any obligation or to a loss of a material benefit under, or result in the creation of any Lien upon any of the Assets under, any provision of (i) the governing or constitutive documents of the Company, (ii) any Contract to which the Company is a party or by which the Assets are bound, or (iii) any Law or Order applicable to the Company, except in the case of the immediately preceding clauses (ii) and (iii), where such violation would not have a Material Adverse Effect.

(b) No Authorization or Order of, registration, declaration or filing with, or notice to any Governmental Entity is required to be obtained or made by or with respect to the Company in connection with the execution and delivery of this Agreement or the Ancillary Agreements or the consummation of the Acquisition or the other transactions contemplated hereby and thereby, except for such Authorizations, Orders, registrations, declarations, filings and notices (i) as may be required under the HSR Act and other Antitrust Laws set forth in Section 4.3(b) of the Seller Disclosure Schedule, or (ii) as set forth in Section 4.3(b) of the Seller Disclosure Schedule.

4.4 Financial Statements .

(a) Set forth in Section 4.4(a) of the Seller Disclosure Schedule are the audited “Statement of Assets to be Sold and Liabilities to be Transferred” for the Business as of December 31, in each of the years 2005 and 2006 (the “ Balance Sheet ”) and the audited statements of Revenues and Operating Expenses for the year as of December 31 in each of the years 2005 and 2006 (together with the Balance Sheet, the “ Audited Financial Statements ”). Except as set forth in Section 4.4(a) of the Seller Disclosure Schedule, the Audited Financial Statements have been prepared in accordance with the Other Comprehensive Basis of Accounting set forth in Note 1 to the Audited Financial Statements (the “ Basis of Accounting ”) applied on a consistent basis throughout the periods involved (except as may be indicated in the notes thereto) and on such basis fairly present in all material respects the financial condition and the results of operations of the Business as of the respective dates thereof and for the respective periods covered thereby. The Balance Sheet does not reflect any assets or liabilities that should be retained by the Seller or its Affiliates (other than the Company) in order to give effect to the Reorganization and the closing of the transactions contemplated hereby.

(b) Set forth in Section 4.4(b) of the Seller Disclosure Schedule are the unaudited “Statement of Assets to be Sold and Liabilities to be Transferred” for the Business as of September 30, 2007 (the “ Unaudited Balance Sheet ”) and the unaudited statements of Revenues and Operating Expenses for the nine-month period ended September 30, 2007 (together with the Unaudited Balance Sheet, the “ Unaudited Financial Statements ” and, together with the Audited Financial Statements, the “ Financial Statements ”). Except as set forth in Section 4.4(b) of the Seller Disclosure Schedule, the Unaudited Financial Statements have been prepared in accordance with the Basis of Accounting applied on a consistent basis throughout the period involved (except as may be indicated in the notes thereto) and on such basis fairly present in all material respects the financial condition and the results of operations of the Business as of September 30, 2007 and for the nine month period ended September 30, 2007, subject to immaterial normal year-end audit adjustments and the absence of notes. The Unaudited Balance Sheet does not reflect any assets or liabilities that should be retained by the Seller or its Affiliates (other than the Company) in order to give effect to the Reorganization and the closing of the transactions contemplated hereby.

(c) The Company does not have, and will not have immediately following the Reorganization and at the Closing, any material Liabilities or obligations of any nature required by GAAP to be recorded or reserved for or any “off-balance sheet arrangements” as such term is defined in Item 303(a)(4)(ii) of Regulation S-K, except (i) as disclosed or reserved against in the Financial Statements, (ii) for Liabilities and obligations incurred in the ordinary course of business consistent with past practice since the date of the Unaudited Financial Statements and not in violation of this Agreement, and (iii) for Taxes that are not due and payable or that may thereafter be paid without penalty (including any Taxes that may be incurred in connection with the consummation of the Transactions contemplated by this Agreement).

(d) The Company has no outstanding Indebtedness other than capitalized leases set forth in the Financial Statements.

4.5 Taxes .

(a) Except as set forth in Section 4.5(a) of the Seller Disclosure Schedule:

(i) All material U.S. federal, state, local and foreign Tax Returns required to have been filed by the Seller, or by each Affiliate of the Seller that holds or has held the Assets in respect of the Business, have been or will be filed in accordance with all applicable Laws (taking into account applicable extensions), and each such Tax Return is or will be true, complete and accurate in all material respects. All Taxes with respect to the Assets shown on such Tax Returns as due have been paid or will be paid before the Closing Date.

(ii) There are no U.S. federal, state or local audits, actions, suits, proceedings, investigations, claims, or administrative proceedings pending against the Seller or its Affiliates in respect of any Taxes owed in connection with the Business (collectively, “ Tax Audits ”). To the Knowledge of the Seller, no Tax Audit has commenced, and neither the Seller nor any of its Affiliates has received any notice of any proposed or threatened Tax Audit.

(iii) There are no material Liens on any of the Assets that arose in connection with any failure (or alleged failure) to pay any Tax, other than Permitted Liens.

(iv) The Seller has withheld and paid all material Taxes required to have been withheld and paid in connection with amounts paid or owing to any third party in connection with the Business, including any withholding with respect to wages or other amounts paid to employees.

(v) The Seller has not waived any statute of limitations in respect of Taxes or agreed to any extension of time with respect to a Tax assessment or deficiency.

(vi) The Company is a “domestic eligible entity” with a single owner within the meaning of Treasury regulation Section 301.7701-3. Neither the Seller nor any of its Affiliates has made an election under Treasury regulation Section 301.7701-3 to treat the Company as an association taxable as a corporation.

4.6 Compliance with Law; Authorizations .

(a) The Business and the Company are in compliance with all material Laws to which the Business or the Company is subject.

(b) Section 4.6(b) of the Seller Disclosure Schedule sets forth, as of the date of the Agreement, all Authorizations issued or granted to the Seller which are material to the operation of the Business. Except as set forth in Section 4.6(b) of the Seller Disclosure Schedule, the Seller does, and immediately following the Reorganization and at the Closing, the Company will, own, hold, possess or lawfully use in the operation of the Business all Authorizations which are material to the conduct of the Business, and all such Authorizations are valid and in full force and effect.

(c) To the extent subject thereto, since December 31, 2000, the Business and the Company have been in compliance with the applicable provisions of HIPAA, and any rules

or regulations promulgated thereunder regarding the privacy and security of protected health information and any other local, state or foreign Law related to the privacy or security of individually identifiable health or medical information. Since December 31, 2000, none of the Seller or its Affiliates, with respect to the Business, has received any notice or communication in writing from any Governmental Entity alleging that the Business or the Company has failed to comply with one or more of HIPAA’s provisions.

4.7 Real Property .

(a) Section 4.7(a) of the Seller Disclosure Schedule contains a list of all real property owned by the Seller or any of its Affiliates which is used principally in connection with the operation of the Business (collectively, the “ Owned Real Property ”). The Seller or one of its Affiliates, as identified on the Seller Disclosure Schedule, has good, valid and marketable fee simple title to each parcel of Owned Real Property free and clear of all Liens, except for Permitted Liens. Immediately after giving effect to the Reorganization and at the Closing, the Company will so own all of the Owned Real Property free and clear of all Liens, except for Permitted Liens (other than Permitted Liens described in clause (e) of the definition of Permitted Liens).

(b) Section 4.7(b) of the Seller Disclosure Schedule contains a list of all leases and subleases of real property that are used principally in connection with the operation of the Business (collectively, the “ Leases ”). The real property demised under any Lease is referred to herein as the “ Leased Real Property ”. A true and complete copy of each Lease has heretofore been made available to the Purchaser. Section 4.7(b) of the Seller Disclosure Schedule identifies the lessor and lessee, or sublessor and sublessee, as the case may be, of each parcel of Leased Real Property and the Seller or one of its Affiliates, as identified on Section 4.7(b) of the Seller Disclosure Schedule, has a good and valid leasehold interest in and to the Leased Real Property. The Seller has not received or sent a notice of default under any Lease which remains uncured, except where such default would not have a Material Adverse Effect. All Leases are binding and enforceable in accordance with their respective terms and are in full force and effect. Immediately after giving effect to the Reorganization and at the Closing, the Company will be a lessee, sublessee or sub-sublessee, as applicable, of all of the Leased Real Property, and all Leases will be valid, binding and in full force and effect with respect to the Company.

(c) True and complete copies of (i) all deeds, title insurance policies, mortgages and surveys relating to the Owned Real Property and (ii) all documents evidencing all Liens upon the Owned Real Property and, to the extent in the Seller’s possession, the Leased Real Property, have heretofore been made available to the Purchaser.

(d) To the Seller’s Knowledge, there are no facts or conditions affecting any of the buildings, structures, fixtures, building systems and equipment included in the Real Property which would interfere in any material respect with the operation of the Business.

(e) Except as set forth in Section 4.7(e) of the Seller Disclosure Schedule, neither the Seller nor any of its Affiliates has leased or otherwise granted to any Person (other than pursuant to this Agreement) any right to occupy or possess or otherwise encumber any portion of the Real Property. Neither the Seller nor any of its Affiliates is a party to or obligated

under any option, right of first refusal or other contractual right to sell, dispose of or lease any of the Real Property or any portion thereof or interest therein to any Person (other than pursuant to this Agreement). Neither the Seller nor its Affiliates, with respect to the Business, nor the Company is a party to any agreement or option to purchase any real property or interest therein.

(f) Neither the whole nor any portion of the Owned Real Property nor, to the Seller’s Knowledge, the Leased Real Property is subject to any Order mandating the sale, condemnation, expropriation or taking by any Governmental Entity with or without payment or compensation therefor, nor, to the Knowledge of the Seller, has any such sale, condemnation, expropriation or taking been proposed.

(g) Neither the Seller nor any of its Affiliates has received any notice of, or other writing referring to, any requirements or recommendations by any insurance company that has issued a policy covering any part of the Real Property or by any board of fire underwriters or other body exercising similar functions, requiring or recommending any repairs or work to be done on any part of the Real Property, which repair or work has not been completed.

(h) The Seller has obtained all material Authorizations required to use and operate the Real Property in the operation of the Business. True and complete copies of all such Authorizations in the possession of the Seller have heretofore been made available to the Purchaser. The Seller has, and immediately following the Reorganization and at the Closing, the Company will have, all Authorizations required to use and operate the Real Property as used and operated; and no such Authorizations will be required, as a result of the transactions contemplated by this Agreement, to be issued after the date hereof in order to permit the Company, following the Reorganization, to continue to use and operate the Real Property in the same manner in which the Real Property is being used and operated in the conduct of the Business, other than any such Authorizations that are ministerial in nature and are normally issued in due course upon application therefor without further action by the applicant.

(i) Each parcel of Owned Real Property has direct vehicular and pedestrian access to a public street adjoining such Owned Real Property or has vehicular and pedestrian access to a public street via an easement appurtenant to such parcel of Owned Real Property, and such access is not dependent on any land or other real property interest which is not included in the Owned Real Property. None of the buildings, structures, fixtures, building systems and equipment included in the Real Property or any portion thereof are dependent for its access, use or operation on any land, building, improvement or other real property interest which is not included in the Owned Real Property, including its appurtenances.

(j) To the Seller’s Knowledge, there is no physical defect on the Owned Real Property which would adversely and materially impact the marketability of the Owned Real Property to a buyer of such Owned Real Property intending to use the Owned Real Property in substantially the same manner and for the same purposes as are currently used for the Business.

(k) The present uses of the Owned Real Property in connection with the Business are in compliance with all applicable Laws, including all applicable zoning Laws and with all registered deeds or restrictions of record affecting such Owned Real Property, and the Seller has no Knowledge of any proposed change therein that would materially and adversely

affect any of the Owned Real Property or its present use and the Seller has no Knowledge of any violation of such Law or deeds or restrictions of record.

4.8 The Assets . Except for the Excluded Assets, the Assets will, as of the Closing Date, constitute all of the assets used to conduct the Business in all material respects as conducted on the date hereof and on the Closing Date. Immediately following the Reorganization and at the Closing, the Company will have good and valid title to all of the Assets free and clear of all Liens, other than Permitted Liens or as otherwise disclosed in Section 4.8 of the Seller Disclosure Schedule. The tangible Assets are in good operating condition and repair (ordinary wear and tear excepted).

4.9 Intellectual Property .

(a) Section 4.9(a) of the Seller Disclosure Schedule sets forth a correct and complete list of all material Intellectual Property owned by the Seller or its Affiliates (including the Company) that is (i) included in the Assets and (ii) registered or subject to an application for registration. Such list includes the jurisdictions where such Intellectual Property is registered or where applications have been filed, and all corresponding registration or application numbers. Except as set forth in Section 4.9(a) of the Seller Disclosure Schedule, immediately following the Reorganization and at the Closing, the Company will be the sole beneficial owner, free and clear of all Liens (except for Permitted Liens), of all such registered and applied-for Intellectual Property and all such Intellectual Property is subsisting and, to the Knowledge of the Seller, valid and enforceable. Except as set forth in Section 4.9(a) of the Seller Disclosure Schedule, the Seller owns or has the valid right to use all Intellectual Property integral to or used principally in the conduct of the Business (the “ Business Intellectual Property ”). Except as set forth in Section 4.9(a) of the Seller Disclosure Schedule, immediately after giving effect to the Reorganization and at the Closing, the Company will own or have the valid right to use the Business Intellectual Property.

(b) To the Seller’s Knowledge, no Person is infringing, misappropriating, or otherwise violating any Business Intellectual Property owned by the Seller or its Affiliates (the “ Business Owned Intellectual Property ”) or any Business Intellectual Property exclusively licensed to the Seller or its Affiliates. No such claims have been asserted or threatened against any Person by the Seller or its Affiliates in the past three years.

(c) Except as set forth in Section 4.9(c) of the Seller Disclosure Schedule or where any default would not materially impair the Business, the Seller and its Affiliates are not in default in the performance, observance or fulfillment of any obligation, covenant or condition contained in any Contract to which the Seller or its Affiliates are a party or otherwise bound pursuant to which any third party is licensed or authorized by the Seller or its Affiliates to use or register any Business Intellectual Property (“ Business Licenses ”) or pursuant to which the Business is licensed, or otherwise authorized to use, Intellectual Property owned by a third Person (“ Third Party Licenses ”).

(d) Except as set forth in Section 4.9(d) of the Seller Disclosure Schedule, the conduct of the Business (including the products and services of the Seller and Company) within the past three years has not infringed or otherwise violated any Person’s Intellectual Property

rights. As of the date hereof, there are no claims pending nor, to the Seller’s Knowledge, threatened against the Seller or its Affiliates alleging that the Business infringes, misappropriates, or otherwise violates the Intellectual Property rights of any Person. There has been no claim asserted nor, to the Seller’s Knowledge, threatened in the past three years against the Seller or its Affiliates or that the Business infringes, misappropriates, or otherwise violates the Intellectual Property rights of any Person.

(e) The Seller has taken reasonable measures to maintain in confidence all material Trade Secrets of the Business, including requiring, as appropriate, Persons having access thereto to execute written non-disclosure agreements.

(f) Except as set forth in Section 4.9(f) of the Seller Disclosure Schedule and for the Licensed Patents, immediately following the Reorganization and at the Closing, the Seller and its Affiliates (other than the Company) will not own, or license from third parties, any Business Intellectual Property.

(g) Except as set forth in Section 4.9(g) of the Seller Disclosure Schedule, the consummation of the transactions contemplated by the Reorganization and this Agreement will not result in the material loss or impairment of or payment of any material additional amounts with respect to, nor require the consent of any other Person in respect of, the Company’s right to own, use, or hold for use any of the Intellectual Property integral to or used principally in the conduct of the Business.

4.10 Absence of Certain Changes or Events . Except as set forth in Section 4.10 of the Seller Disclosure Schedule, since December 31, 2006 to the date hereof, (i) there has been no Material Adverse Effect and (ii) except for any actions taken to effect the Reorganization, the Business has been conducted in all material respects in the ordinary course consistent with past practice. Without limiting the generality of the foregoing, since December 31, 2006 to the date hereof, the Seller has not with respect to the Business taken, and has not permitted the Company to take, any action which if taken from the date hereof through the Closing Date would be required to be disclosed on Section 6.1 of the Seller Disclosure Schedule.

4.11 Cont

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