STOCK PURCHASE AGREEMENT

Exhibit 2.1

STOCK PURCHASE AGREEMENT

This STOCK PURCHASE AGREEMENT (this “ Agreement ”) is made as of this 27 ^th day of March, 2009, by and among ICF Consulting Group, Inc., a Delaware corporation (“ Purchaser ”), ICF International, Inc., a Delaware corporation (“ ICF ”), info GROUP Inc., a Delaware corporation (“ Parent ”), and Opinion Research Corporation, a Delaware corporation (“ Seller ”).

R E C I T A L S

A. Macro International Inc., a Delaware corporation (the “ Company ”), together with its Subsidiaries, is a professional services firm engaged primarily in the business of research and evaluation, management consulting, information technology, and social marketing and health communications, focused principally on the public sector.

B. Seller owns 100% of the issued and outstanding shares of capital stock of the Company. Seller is a wholly owned subsidiary of Parent.

C. Purchaser is a wholly owned subsidiary of ICF.

D. Purchaser desires to purchase and acquire, and Seller and Parent desire to sell, assign and transfer to Purchaser, all of the issued and outstanding shares of capital stock of the Company (the “ Shares ”), on the terms and subject to the conditions of this Agreement.

A G R E E M E N T

In consideration of the foregoing recitals and in further consideration of the respective covenants, agreements, representations and warranties contained herein, the parties hereto agree as follows:

ARTICLE 1

DEFINITIONS

1.1 Defined Terms . Unless otherwise defined, capitalized terms used herein shall have the following meanings:

“ Action ” shall mean any action, claim, suit, litigation, proceeding, investigation, arbitration or mediation, including without limitation any administrative proceeding of or before a Governmental Entity.

“ Affiliate ” shall mean a Person that directly, or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with, the Person referred to.

“ Ancillary Agreements ” shall mean the TD Escrow Agreement, the SunTrust Escrow Agreement and the Transition Services Agreement.

“ Books and Records ” shall mean all of the Company’s and its Subsidiaries’ books, ledgers, files, records, manuals, and other materials (in any form or medium, including electronic and computer files), including, but not limited to, all correspondence, personnel records, payroll records, purchasing materials and records, vendor lists, operation and quality control records and procedures, research and development files, Intellectual Property disclosures and documentation, accounting records, accounting systems, sales order files, purchase order files, advertising materials, catalogs, product brochures, mailing lists, customer files, customer lists, distribution lists, sales and promotional materials, and all other records utilized by the Company or its Subsidiaries and all Software and data files necessary to access or review or continue to compile or utilize any of the foregoing.

“ Business Day ” shall mean any day of the year, other than a Saturday, Sunday or any day on which major banks are closed for business in the City of New York.

“ Code ” shall mean the Internal Revenue Code of 1986, as amended.

“ Company Software ” shall mean Software proprietary to the Company or its Subsidiaries.

“ Company Engagement ” shall mean all contracts and other arrangements pursuant to which one or more of the Company and its Subsidiaries is to provide services, and all proposals, bids and offers for future such contracts and arrangements.

“ Computer Loan Program ” shall mean that certain program pursuant to which eligible Company employees may obtain interest-free loans from the Company in an amount not to exceed $1,200 per employee for the purpose of purchasing personal computer equipment.

“ Confidential Information ” shall mean all technical, proprietary and business information related to Purchaser, ICF, the Company or its Subsidiaries, as applicable, whether in written, electronic or oral form, including but not limited to, financial plans and records, marketing plans, business strategies and relationships with third parties, client lists, present and proposed products and services, trade secrets, computer software programs and descriptions of functions and features of software, source code, computer hardware designs, and information regarding customers, suppliers, and employees. Notwithstanding the foregoing, Confidential Information shall not include any information which (a) is generally available to the public, or (b) becomes available to the public as a result of actions by Persons not bound by contractual, legal or fiduciary obligations of confidentiality.

“ Confidentiality Agreement ” shall mean the Confidentiality and Non-Disclosure Agreement between ICF and Parent effective December 19, 2008, as amended.

“ Contracts ” shall mean all contracts, arrangements, licenses, leases, powers of attorney and other agreements to which the Company or any of its Subsidiaries is subject or a party, whether express, implied, written or oral, together with any amendments, modifications and supplements thereto.

 

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“ Copyrights ” shall mean United States and foreign registered copyrights and pending applications to register the same.

“ Corporate Records ” shall mean the corporate records of the Company, including (i) all charter documents and by-laws, (ii) all minutes of meetings and resolutions of shareholders and directors (and any committees), and (iii) the share certificate books, securities register, register of transfers and register of directors.

“ Credit Facility ” shall mean (a) that certain Second Amended and Restated Credit Agreement dated February 14, 2006, by and among Parent, various lenders, LaSalle Bank National Association and Citibank, F.S.B., as syndication agents, Bank of America, N.A. as documentation agent and Wells Fargo Bank, National Association as sole lead arranger, sole book runner and administrative agent, as amended, (b) that certain Amended and Restated Security Agreement, dated February 14, 2006, by and among Wells Fargo Bank, National Association, as collateral agent, Parent, and certain other parties identified therein or subject thereto pursuant to subsequent joinders, including Seller, the Company and its Subsidiaries, as amended, (c) that certain Amended and Restated Pledge Agreement, dated February 14, 2006, by and among Wells Fargo Bank, National Association, as administrative agent, Parent, and certain other parties identified therein or subject thereto pursuant to subsequent joinders, including Seller, the Company and its Subsidiaries, (d) that certain Amended and Restated Subsidiaries Guaranty, dated February 14, 2006, made by the guarantors thereunder and certain other parties identified therein or subject thereto pursuant to subsequent joinders, including Seller, the Company and its Subsidiaries and (e) such other documents and agreements entered into by Parent, Seller, the Company and/or its Subsidiaries pursuant to or as contemplated by the documents and agreements identified in (a)-(d) above.

“ Current Assets ” shall mean the current assets of the Company and its Subsidiaries as of the Closing, excluding the Excluded Current Assets.

“ Customer Contract ” shall mean any contract, agreement or commitment with any customer, client or partner, including without limitation any Government Contract or Grant.

“ Damages ” shall mean any loss, Liability, damage or expense, including, without limitation, interest, penalties and attorneys’, accountants’ and experts’ fees and out-of-pocket costs of investigation and defense incurred as a result thereof.

“ Disclosure Schedule ” means the Disclosure Schedule dated the date hereof delivered by Seller and Parent to Purchaser.

“ dollars ” or “ $ ” shall mean US dollars.

 

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“ Employee Benefit Plan(s) ” shall mean: (a) any “employee welfare benefit plan,” as defined in Section 3(1) of ERISA or any “employee pension benefit plan,” as defined in Section 3(2) of ERISA, which the Company or any Subsidiary sponsors or to which the Company or any Subsidiary contributes or is required to contribute, or under which the Company or any Subsidiary may incur any Liability, and which covers an employee, retiree or former employee of the Company or any Subsidiary (or beneficiary, survivor or dependent of any), including each multi-employer welfare benefit plan; (b) any “multi-employer plan,” as defined in Section 3(37) or 4001(a)(3) of ERISA, to which the Company or any Subsidiary has contributed or been obligated to contribute at any time or under which the Company or any Subsidiary may incur any Liability, and which covers an employee, retiree or former employee of the Company or any Subsidiary (or beneficiary, survivor or dependent of any), (c) any single employer pension plan (within the meaning of Section 4001(a)(15) of ERISA), including a single employer plan for which the Company or any of its Subsidiaries could incur Liability under Section 4063 or 4064 of ERISA, and (d) any incentive compensation (including any Management Incentive Plan), vacation pay, holiday pay, scholarship or tuition reimbursement, dependent care assistance, immigration assistance, salary continuation, employee loan or loan guarantee, split dollar arrangement, deferred compensation plan, severance pay, bonus plan, profit sharing plan, stock option plan, employee stock purchase plan, restricted stock, stock appreciation right, phantom stock, retirement, medical, dental, vision care, hospital, life insurance, disability, prescription drugs and any other employee benefit plan, agreement, arrangement, or commitment maintained by the Company or any Subsidiary, or to which the Company or any Subsidiary contributes or is required to contribute, or under which the Company or any Subsidiary may incur any Liability, which covers any employee, retiree or former employee of the Company or any Subsidiary (or beneficiary, survivor or dependent of any), other than government-sponsored pension, employment insurance, health insurance, prescription drugs and workers’ compensation plans.

“ Encumbrance ” shall mean any claim, lien, pledge, option, charge, easement, security interest, deed of trust, mortgage, right-of-way, encroachment, restriction, encumbrance or other right of third parties, of any kind or nature.

“ Environmental, Health, and Safety Requirements ” shall mean all Laws and Contracts with Governmental Entities concerning public health and safety, worker health and safety, and pollution or protection of the environment, including without limitation, all those relating to the presence, use, production, generation, handling, transportation, treatment, storage, disposal, distribution, labeling, testing, processing, discharge, release, threatened release, control or cleanup of any hazardous materials, substances, or wastes, chemical substances or mixtures, pesticides, pollutants, contaminants, toxic chemicals, petroleum products or byproducts, asbestos, polychlorinated biphenyls, noise, or radiation, and all Permits issued pursuant to such Laws, Contracts and other statutory requirements.

“ ERISA ” shall mean the Employee Retirement Income Security Act of 1974, as amended.

“ Escrow Agreements ” shall mean the TD Escrow Agreement and the SunTrust Escrow Agreement.

“ Escrow Amount ” shall mean the sum of the Working Capital Escrow and the Indemnity Escrow.

 

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“ Excluded Current Assets ” shall mean (i) amounts receivable from Parent, Seller or their Affiliates, (ii) amounts receivable with respect to income Taxes, and (iii) current deferred income Tax receivables.

“ Excluded Liabilities ” shall mean (i) amounts payable to Parent, Seller or their Affiliates, (ii) amounts payable with respect to income Taxes, (iii) deferred income Tax payables, (iv) the accrual for health and accident claims and expenses that are the responsibility of Parent and Seller pursuant to Section 5.8(c), and (v) deferred rent and deferred leasehold incentives of the Company and its Subsidiaries as of Closing.

“ Executive Compensation Agreements ” shall mean, collectively, the following: (i) Agreement for Compensation Plan for 2007-2011, dated January 21, 2007, between Macro International Inc. and Steve Fulton, as amended on January 27, 2009; (ii) Agreement for Compensation Plan for 2007-2011, dated January 19, 2007, between Macro International Inc. and Mary Look (n/k/a Mary Lang); (iii) Agreement for Compensation Plan for 2007-2011, dated January 18, 2007 between Macro International Inc. and Greg Mahnke and (iv) Severance and Change in Control Agreement, dated March 4, 2009, between Macro International Inc., Opinion Research Corporation and Gregory N. Mahnke.

“ Final Working Capital ” shall mean Current Assets minus Total Liabilities, as calculated in accordance with the provisions of Section 2.4.

“ GAAP ” shall mean United States generally accepted accounting principles, applied on a consistent basis in accordance with past practice.

“ Government Contract or Grant ” shall mean any Company Engagement that is pursuant to: (i) a prime contract or purchase with any Governmental Entity or a Contract with a prime contractor or higher-tier subcontractor under a prime contract with a Governmental Entity, in the case of any such contracts, including all task orders thereunder; or (ii) a grant or other non-procurement program from or with any Governmental Entity, at any tier.

“ Governmental Entity ” shall mean any nation or government, including the United States Government and any foreign government, or supranational or international body (including the United Nations, World Bank, World Health Organization, The Global Fund to Fight AIDS, Tuberculosis and Malaria, UNICEF, and any similar or related organizations), or quasi-governmental body, any state, local or political subdivision thereof, any court and any administrative agency or other regulatory body, instrumentality, authority or other entity or official thereof exercising executive, legislative, judicial, regulatory or administrative functions thereof.

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

“ Indemnity Escrow ” shall mean an amount equal to Ten Million Dollars ($10,000,000).

 

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“ Intellectual Property ” shall mean all: (i) Patent Rights and statutory invention registrations, (ii) Trademarks, (iii) Copyrights, (iv) Software, (v) websites, domains and domain names, (vi) business and trade names, logos and designs, (vii) trade secrets and know-how, and (viii) Contracts, licenses, sublicenses and assignments which relate or pertain to any of the foregoing.

“ knowledge ”, “ to the knowledge of ” and similar phrases shall mean the knowledge of those individuals listed on Exhibit A , including the knowledge such persons would have had if such persons had made due inquiry with respect to the matters in question.

“ Laws ” shall mean all laws of any nation or political subdivision thereof, including, without limitation, all federal, state, provincial, local, or foreign statutes, regulations, ordinances, orders, decrees, bylaws, and all policies, guidelines, notices and protocols of any Governmental Entity (to the extent that they have force of law), and any other laws or principles of common law, including, without limitation, those now or at any time hereafter in effect.

“ Liabilities ” shall mean any and all debts, liabilities and obligations, whether accrued or unaccrued, known or unknown, or contingent or liquidated.

“ Licensed Intellectual Property ” shall mean all Third Party Software or Intellectual Property licensed to the Company or any Subsidiary thereof.

“ Management Incentive Plan ” shall mean all bonus arrangements, bonus agreements (including without limitation the Executive Compensation Agreements and any agreement providing for the payment of any stay bonus, success bonus, retention bonus or other similar amount), management incentive plans, award incentive compensation, recognition awards, and other forms of bonus or incentive compensation maintained by the Company or any Subsidiary, under which the Company or any Subsidiary may incur Liability or which covers any employee or former employee of the Company or any Subsidiary.

“ Material Adverse Change ” shall mean any adverse change in the financial condition, assets, liabilities, business or results of operation of the Company or its Subsidiaries which is material to the Company and its Subsidiaries taken as a whole, or which will have a material adverse effect on Seller’s or Parent’s ability to perform its obligations under this Agreement, excluding, however, changes resulting from changes in general economic conditions in the industry or industries in which the Company or its Subsidiaries operate, provided such changes do not affect the Company and its Subsidiaries, taken as a whole, disproportionately relative to other similarly situated participants in such industry or industries.

“ ORC ” shall mean ORC Telecommunications Ltd.

“ Owned Intellectual Property ” shall mean all Intellectual Property owned by the Company or any Subsidiary thereof.

 

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“ Parent Control Proposal ” shall mean any inquiry, proposal or offer directed to the Board of Directors of Parent or tender offer from any Person relating to, or that is reasonably expected to lead to, any direct or indirect acquisition or purchase, in one transaction or a series of transaction, of substantially all of the assets or businesses of Parent and its Subsidiaries, taken as a whole, or 15% or more of any class of equity securities of Parent, any tender offer or exchange offer that if consummated would result in any Person beneficially owning 15% or more of any class of equity securities of Parent, or any merger, consolidation, business combination, recapitalization, liquidation, dissolution, joint venture, binding share exchange or similar transaction involving Parent pursuant to which any Person or the stockholders of any Person would own 15% or more of any class of equity securities of Parent or any resulting parent company of Parent.

“ Patent Rights ” shall mean United States and foreign patents, patent applications, continuations, continuations-in-part, divisions and reissues.

“ Permits ” shall mean all franchises, permits, licenses, qualifications, municipal and other approvals, authorizations, orders, consents and other rights from, and filings with, any Governmental Entity of any jurisdiction worldwide relating to the conduct of the Company’s and its Subsidiaries’ business.

“ Permitted Encumbrances ” shall mean:

 

(i)

any Encumbrance for Taxes, fees, assessments or other charges or levies by any Governmental Entity, either (x) not due, payable or delinquent (or which may be paid without interest or penalties) or (y) being contested in good faith; and

 

(ii)

mechanics’, workers’, repairers’, landlords’, warehousemen’s and other Encumbrances arising or imposed by Law and incurred in the ordinary course of business for amounts not yet due and payable.

“ Person ” shall mean and include an individual, a partnership, a joint venture, a corporation, a limited or unlimited liability company, a trust, an unincorporated organization, any other form of entity, a group and a Governmental Entity.

“ Post-Closing Period ” shall mean, with respect to the Company and the Subsidiaries, any Tax period commencing after the Closing Date, including that portion of any Straddle Period ending after the Closing Date.

“ Pre-Closing Period ” shall mean, with respect to the Company and the Subsidiaries, any Tax period ending on or before the Closing Date, including that portion of any Straddle Period ending on the Closing Date.

“ Representatives ” shall mean any officer, director, principal, shareholder, partner, attorney, accountant, advisor, agent, trustee, employee or other representative of a party.

“ Restricted Area ” shall mean worldwide.

 

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“ SEC ” shall mean the United States Securities and Exchange Commission.

“ Software ” shall mean any computer program, operating system, applications system, firmware or software of any nature, whether operational, or under development, including all object code, source code, data files, rules, databases, compilations, tool sets, compilers, higher level or “proprietary” languages, definitions or methodology derived from the foregoing and any derivations, updates, enhancements and customization of any of the foregoing, operating procedures, technical manuals, user manuals and other documentation and materials related thereto, whether in machine-readable form, programming language or any other language or symbols and whether stored, encoded, recorded or written on disk, tape, film, memory device, paper or other media of any nature, but excluding all commercially available or off-the-shelf software, or software subject to click-through or shrink wrap agreements.

“ Straddle Period” shall mean any taxable year or period beginning on or before the Closing Date and ending after the Closing Date.

“ Subsidiaries ” shall mean, with respect to any Person, any corporation, entity or other organization, whether incorporated or unincorporated, of which (i) such first Person directly or indirectly owns or controls at least a majority of the securities or other interests having by their terms voting power to elect a majority of the board of directors or others performing similar functions or (ii) such first Person is, in the case of a partnership, a general partner or, in the case of a limited liability company, a manager or managing member.

“ SunTrust ” shall mean SunTrust Bank, a Georgia banking corporation.

“ SunTrust Escrow Agreement ” shall mean that certain agreement between SunTrust, Parent, Seller, ICF and Purchaser in the form attached hereto as Exhibit C .

“ SunTrust Escrow Amount ” shall mean an amount equal to Five Million Dollars ($5,000,000).

“ Tax(es) ” shall mean all taxes, charges, fees, duties (including customs duties), levies or other assessments of any kind whatsoever imposed by and required to be paid to any federal, state, provincial, local or foreign taxing authority, including, without limitation, income, gross receipts, net proceeds, alternative or add-on minimum taxes, profits, capital, occupation, premium, excise, user, customs, withholding, escheat, gains, stamp, documentary, filing recordation, sales, use, goods and services, real and personal property (tangible and intangible), transfer (including real property transfer on gains), import, export, ad valorem, turnover, value added, payroll, unemployment and employment insurance contributions, workers’ compensation, employer health, leasing, fuel, excess profits, windfall profits, severance, license, environmental (including taxes under Code Section 59A), capital stock, employment, unemployment, social security and franchise taxes (including any interest, penalties or additions attributable to or imposed on or with respect to any such assessment) and any estimated payments or estimated taxes whether disputed or not and including any obligations to indemnify or otherwise pay, assume or succeed to the Tax Liability of any other Person and any Liability under Treas. Reg. Section 1.1502-6 or equivalent provisions of federal, state, provincial, local or foreign Law.

 

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“ Tax Authority ” shall mean, with respect to any Tax, the Governmental Entity or political subdivision thereof that imposes such Tax, and the agency (if any) charged with the collection of such Taxes for such entity or subdivision.

“ Tax Return ” shall mean any statement, estimate, designation, election, return, report, information return or other document (including any related or supporting information) filed or required to be filed with any Tax Authority or other authority in connection with the determination, assessment or collection of any Tax or the administration of any Laws, regulations or administrative requirements relating to any Tax and all claims for refunds of Taxes and including any amendment of any such Tax Return.

“ TD Bank ” shall mean TD Bank, National Association.

“ TD Escrow Agreement ” shall mean that certain agreement between TD Bank, Parent, Seller, ICF and Purchaser in the form attached hereto as Exhibit D .

“ TD Escrow Amount ” shall mean an amount equal to Eight Million Dollars ($8,000,000).

“ Third Party Software ” shall mean all Software owned by third parties that is licensed to the Company or its Subsidiaries.

“ Total Liabilities ” shall mean all current and non-current liabilities of the Company and its Subsidiaries as of Closing, excluding the Excluded Liabilities.

“ Trademarks ” shall mean United States and foreign registered trademarks, service marks and trademark rights, including all associated goodwill, and pending applications to register the foregoing.

“ Transfer Taxes ” shall mean any Taxes (other than Taxes imposed on net income or gains) imposed on the sale of the Shares or as a result of the election under Section 338(h)(10) for the Company and its Subsidiaries pursuant to or in connection with the transactions contemplated in this Agreement.

“ Transition Services Agreement ” shall mean that certain agreement between Purchaser, ICF, Parent and Seller in the form attached hereto as Exhibit E .

“ United States Government ” shall mean the government of the United States of America or any agency, department, division, subdivision or office thereof.

“ Working Capital Escrow ” shall mean an amount equal to Three Million Dollars ($3,000,000).

 

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1.2 Other Defined Terms . The following capitalized terms shall have the meanings given to them in the Sections set forth below:

 

 

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ARTICLE 2

PURCHASE AND SALE OF THE SHARES

2.1 Purchase and Sale of the Shares . On the terms and subject to the conditions of this Agreement, at the Closing, Purchaser shall purchase from Seller, and Seller shall sell to Purchaser, all of the Shares, free and clear of all Encumbrances.

2.2 Purchase Price . The purchase price for the Shares (the “ Purchase Price ”) shall be an amount equal to (a) One Hundred Fifty-Four Million Nine Hundred Ninety-Two Thousand Dollars ($154,992,000) (the “ Base Amount ”), less (b) the amount, if any, by which Final Working Capital is less than Twenty Million Dollars ($20,000,000) (the “ Shortfall Amount ”), or plus (c) the amount, if any, by which Final Working Capital is more than Twenty Million Dollars ($20,000,000) (the “ Excess Amount ”).

2.3 Payment of Purchase Price . Purchaser shall pay the Purchase Price, by wire transfer, as follows:

 

(a)

at Closing, to Seller or its designees, the Base Amount less the Escrow Amount (the “ Closing Payment ”);

 

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(b)

at Closing, to TD Bank, the TD Escrow Amount to be held and disbursed pursuant to the terms of the TD Escrow Agreement;

 

(c)

at Closing, to SunTrust, the SunTrust Escrow Amount to be held and disbursed pursuant to the terms of the SunTrust Escrow Agreement; and

 

(d)

the remainder of the Purchase Price shall be paid pursuant to the terms of Section 2.4 and the Escrow Agreements.

2.4 Post-Closing Adjustment .

2.4.1 Within thirty (30) calendar days after the date ICF receives the Interim Financial Statements from Parent, Purchaser shall deliver to Seller a statement setting forth Purchaser’s calculation of the Final Working Capital as of the Closing Date (the “ Settlement Statement ”). For purposes of this statement, Final Working Capital shall be determined and prepared in accordance with GAAP, subject to Section 5.8(k) regarding the 2009 MIP Accrual.

2.4.2 Unless Seller notifies Purchaser in writing, within thirty (30) calendar days after receipt of the Settlement Statement, that Seller objects to the computation contained therein, specifying in detail the basis for such objection (the “ Objection Notice ”), Purchaser’s calculations set forth in the Settlement Statement shall be binding upon the parties. The calculation set forth in the Settlement Statement shall not be disputed as to accounting principles, procedures or methodologies so long as the principles, procedures and methodologies used to compute it are consistent with GAAP, subject to Section 5.8(k) regarding the 2009 MIP Accrual. For thirty (30) calendar days following Purchaser’s receipt of any Objection Notice, the parties shall, in good faith, negotiate to resolve all objections set forth in the Objection Notice, and any such resolutions shall be incorporated by Purchaser into the Settlement Statement. If Purchaser and Seller are unable to resolve all objections set forth in the Objection Notice within thirty (30) calendar days following Purchaser’s receipt of the Objection Notice (or within such extended time period as is mutually agreed to by the parties), unresolved objections shall be referred for a final determination of such unresolved objections (but only such matters) to an accounting firm mutually acceptable to Purchaser and Seller, in each case acting reasonably (the “ Accounting Firm ”). Purchaser and Seller shall instruct the Accounting Firm to make final determination of the disputed items in accordance with the guidelines and procedures set forth in this Agreement. Purchaser and Seller shall cooperate with the Accounting Firm during the term of its engagement (including by executing an engagement letter in customary form with the Accounting Firm reflecting the terms of this Agreement and any other customary provisions mutually agreed upon by Purchaser and Seller). Purchaser and Seller shall instruct the Accounting Firm not to, and the Accounting Firm shall not, assign a value to any item in dispute greater than the greatest value for such item assigned by Purchaser, on the one hand, or Seller, on the other hand, or less than the smallest value for such item assigned by Purchaser, on the one hand, or Seller on the other hand. Purchaser and Seller shall also instruct the Accounting Firm to make its determination based solely on presentations by Purchaser and Seller which are in accordance with the guidelines and procedures set forth in this Agreement (i.e., not on the basis

 

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of an independent review). The Settlement Statement and the resulting calculation of Final Working Capital shall become final and binding on the parties hereto on the date the Accounting Firm delivers its final resolution in writing to Purchaser and Seller (which final resolution shall be requested by the parties to be delivered not more than forty-five (45) calendar days following submission of such disputed matters), and such resolution by the Accounting Firm shall not be subject to court review or otherwise appealable. The fees and expenses of the Accounting Firm shall be paid by Seller, on the one hand, and Purchaser on the other hand, based on the ratio of the disputed amount not awarded to such Person to the total amount actually disputed by Seller and Purchaser. For example, if the aggregate amount disputed by Seller is $1,000, and if Purchaser contests only $500 of the amount disputed by Seller, and if the Accounting Firm ultimately resolves the dispute by finding that Seller properly disputed $300 of the $500, then the fees and expenses of the Accounting Firm will be paid 60% (i.e., 300 divided by 500) by Purchaser and 40% (i.e., 200 divided by 500) by Seller. The parties agree that, from and after the Closing, the provisions of this Section 2.4.2 and the arbitration provisions contemplated hereby shall be the exclusive remedy and exclusive forum of the parties with respect to the determination of Final Working Capital.

2.4.3 Seller and Purchaser shall provide the other and their Representatives with reasonable access during normal working hours to the employees, books, records and other supporting information and documents as reasonably requested in connection with the preparation and review of the Settlement Statement and any objections thereto.

2.4.4 In the event an Excess Amount exists, Purchaser shall remit the Excess Amount to Seller pursuant to Section 2.4.5, and Purchaser and Seller shall promptly (but in any event within three (3) Business Days) direct TD Bank, in accordance with the terms of the TD Escrow Agreement, to remit to Seller the entire Working Capital Escrow. In the event a Shortfall Amount exists and is less than the Working Capital Escrow, Purchaser and Seller shall promptly (but in any event within three (3) Business Days) direct TD Bank, in accordance with the terms of the TD Escrow Agreement, to remit (i) an amount equal to the Shortfall Amount from the Working Capital Escrow to Purchaser, and (ii) the remainder of the Working Capital Escrow to Seller. In the event a Shortfall Amount exists and exceeds the Working Capital Escrow, Purchaser and Seller shall promptly (but in any event within three (3) Business Days) direct TD Bank, in accordance with the terms of the TD Escrow Agreement, to remit the entire Working Capital Escrow to Purchaser, and Seller shall remit to Purchaser an amount equal to such difference pursuant to Section 2.4.5.

2.4.5 Any payment required to be made by Purchaser or Seller under Section 2.4.4 shall be paid in accordance with the instructions of the appropriate recipient (i) within the lesser of thirty-five (35) calendar days after delivery by Purchaser of the Settlement Statement, or five (5) calendar days after Seller notifies Purchaser that it does not object to the amounts set forth on the Settlement Statement; or (ii) if Seller shall have delivered an Objection Notice to Purchaser, within five (5) calendar days following final determination of the disputed items pursuant to Section 2.4.2.

 

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2.5 Closing . The closing of the sale and purchase of the Shares (the “ Closing ”) shall be held at a mutually acceptable location, at 9:00 a.m. local time on March 31, 2009, or, if later, promptly following the satisfaction or waiver of the conditions to Closing set forth in Articles 6 and 7. The date on which the Closing occurs is referred to herein as the “ Closing Date .” The time at which the Closing shall be deemed to occur is 11:59 p.m. local time on the Closing Date.

2.5.1 Purchaser’s and ICF’s Obligations at Closing . At the Closing, Purchaser and ICF shall:

 

(a)

Closing Payment . Deliver or cause to be delivered to Seller the Closing Payment in accordance with Section 2.3 hereof.

 

(b)

Certificate . Deliver to Seller the certificate contemplated in Section 7.3.

 

(c)

Transition Services Agreement . Execute and deliver to Seller the Transition Services Agreement.

 

(d)

Escrow Agreements . Execute and deliver to Seller the Escrow Agreements.

 

(e)

Form 8023 . Execute and deliver to Seller properly completed counterparts of Form 8023 (and of each and every state, provincial, local and foreign equivalent election form, if any) in form reasonably satisfactory to Seller.

2.5.2 Seller’s and Parent’s Obligations at Closing . At the Closing, Seller and Parent shall:

 

(a)

Share Certificates . Deliver or cause to be delivered to Purchaser stock certificates representing all of the Shares, duly endorsed in blank or accompanied by stock powers duly endorsed in blank.

 

(b)

Certificates . Deliver to Purchaser the certificates contemplated in Section 6.4.

 

(c)

Resignations . Deliver to Purchaser written letters of resignation, effective as of the Closing, resigning their respective title, from each of the officers and directors of Company and each Subsidiary.

 

(d)

Transition Services Agreement . Execute and deliver to Purchaser the Transition Services Agreement.

 

(e)

Escrow Agreements . Execute and deliver to Purchaser the Escrow Agreements.

 

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(f)

Good Standing Certificates . Deliver to Purchaser a certificate of the Secretary of State of the State of Delaware as to the legal existence and good standing of the Company and certificates of the Secretary of State of the respective states of incorporation as to the legal existence and good standing of each of the Company’s Subsidiaries.

 

(g)

Certificate of Non-Foreign Status . Deliver to Purchaser a certificate in the form required by Treas. Reg. §1.1445-2(b)(3)(iii)(B) executed by Seller.

 

(h)

Legal Opinion . Deliver to Purchaser the executed legal opinion of Kutak Rock LLP, Seller’s and Parent’s counsel, in the form attached hereto as Exhibit F .

 

(i)

Bank Agreement . Deliver to Purchaser documentation pursuant to which Bank of America terminates any cash sweep arrangements with respect to the account described on Exhibit G as of Closing.

 

(j)

Encumbrances and Guarantees . Deliver to Purchaser documentation reasonably satisfactory to Purchaser evidencing the termination and release at or before Closing of (i) all Encumbrances (including, without limitation, all Encumbrances arising under the Credit Facility) relating to the Shares or to the capital stock of any Company Subsidiary, (ii) all other Encumbrances, other than Permitted Encumbrances, relating to the Company, its Subsidiaries or any of their respective assets or properties, and (iii) each Guaranty, other than the Guaranty described on Exhibit L .

 

(k)

Form 8023 . Execute and deliver to Purchaser properly completed counterparts of Form 8023 (and of each and every state, provincial, local and foreign equivalent election form, if any) in form reasonably satisfactory to Purchaser.

 

(l)

Certification . Deliver to Purchaser a certification from Parent that, upon payment by Purchaser of the Purchase Price in accordance with Section 2.3, all conditions set forth in Section 8 of the Fifth Amendment shall have been fulfilled.

 

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ARTICLE 3

REPRESENTATIONS AND WARRANTIES OF SELLER AND PARENT

Seller and Parent hereby jointly and severally represent and warrant to Purchaser and ICF as of the date of this Agreement and, if the Closing occurs, as of the Closing Date as follows:

3.1 Organization and Existence . The Company is a corporation, duly incorporated, validly existing and in good standing under the laws of the State of Delaware. The Company has the requisite power and authority to own its properties and operate its business as presently conducted. The Company is qualified to do business in each jurisdiction in which the conduct of its business or the ownership or leasing of its properties makes such qualification necessary, except where the failure to be so qualified, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Change. Schedule 3.1 sets forth the jurisdictions in which the Company is qualified to do business and each jurisdiction in which the Company operates an office, including without limitation any branch office or representative office. True and complete copies of the Certificate of Incorporation and Bylaws (or other charter documents) of the Company have been delivered to Purchaser.

3.2 Authorization . The execution, delivery and performance of this Agreement and the Ancillary Agreements have been duly authorized by all necessary action required to be taken by Seller and Parent. Seller and Parent have the requisite power and authority to enter into this Agreement and the Ancillary Agreements, to perform their respective obligations hereunder and thereunder and to consummate the transactions contemplated hereby and thereby.

3.3 Due Execution; Binding Obligations . This Agreement has been duly executed and delivered by Seller and Parent. This Agreement constitutes a legal, valid and binding agreement of Seller and Parent, enforceable against Seller and Parent in accordance with its terms, except to the extent that enforceability may be limited by applicable bankruptcy, reorganization, insolvency, moratorium or other laws affecting the enforcement of creditors’ rights generally and by general principles, of equity, regardless of whether such enforcement is considered a proceeding at law or in equity.

3.4 Books and Records . The Books and Records are (a) except as disclosed on Schedule 3.4 , maintained by the Company at office locations leased by the Company, and (b) complete and correct in all material respects. The Company and each Subsidiary maintains accounting controls sufficient to insure that its transactions are (a) in all material respects executed in accordance with its management’s general or specific authorization, and (b) recorded as necessary to permit the preparation of financial statements in conformity with GAAP. The Books and Records have been made available to Purchaser. The Corporate Records are complete and accurate and all corporate proceedings and actions reflected in the Corporate Records have been conducted or taken in compliance with all applicable Laws and with the certificate of incorporation and by-laws of the Company, except to the extent that any failure to be or do so would not reasonably be expected to result in a Material Adverse Change.

 

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3.5 Capital Stock . The authorized capital of the Company consists of 500 shares of common stock, par value $.01 per share, of which 355 shares of common stock have been issued and are outstanding as fully paid and non-assessable. Seller owns, beneficially and of record, all of the Shares, free and clear of all Encumbrances, other than any Encumbrances arising under the Credit Facility. The Shares were issued in compliance with all applicable Laws and are not subject to, nor were they issued in violation of, any preemptive rights. No shares of capital stock of the Company are reserved for issuance and there are no outstanding or authorized options, warrants, rights, subscriptions, claims of any character, agreements, obligations, convertible or exchangeable securities, or other commitments, contingent or otherwise, relating to the capital of the Company, pursuant to which the Company is or may become obligated to issue any shares or any securities convertible into, exchangeable for, or evidencing the right to subscribe for, any shares of its capital. There are no voting trusts, proxies or other agreements or understandings to which the Company, Parent or Seller is a party with respect to the voting of the Shares. Except for Purchaser’s right under this Agreement, no Person has any written or oral agreement, option or warrant or any right or privilege (whether by Law, pre-emptive or contractual) capable of becoming such for (i) the purchase or acquisition from Seller or Parent of any of the Shares, or (ii) the purchase, subscription, allotment or issuance of any of the unissued shares or other securities of the Company.

3.6 Subsidiaries . The Company does not directly or indirectly own any equity or similar interest in, or any interest convertible into or exchangeable or exercisable for any equity or similar interest in, any Person other than the Subsidiaries set forth on Schedule 3.6 . Each of the Subsidiaries is an entity duly organized, validly existing and in good standing under the Laws of its jurisdiction of incorporation or organization. Each Subsidiary has all necessary corporate power and authority to own its respective properties and to carry on its respective businesses as presently conducted and is duly qualified or licensed to do business in good standing in all jurisdictions in which the nature of its businesses requires licensing or qualification, except where the failure to be so qualified or licensed would not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Change. Schedule 3.6 sets forth the jurisdictions in which each of the Subsidiaries is qualified to do business. All the outstanding shares of capital stock of, or other ownership interests in, each of the Subsidiaries are validly issued, fully paid and non-assessable and are owned beneficially and of record by the Company, free and clear of all Encumbrances, other than any Encumbrances arising under the Credit Facility. Schedule 3.6 sets forth the authorized, issued and outstanding capital stock of, or other ownership interests in, each of the Subsidiaries and each jurisdiction in which a Subsidiary operates an office, including without limitation, any branch office or representative office. Seller has delivered to Purchaser complete and correct copies of the certificate of incorporation, certificate of formation, operating agreements, and bylaws or other organizational documents of each of the Subsidiaries. None of the Subsidiaries directly or indirectly own any equity or similar interest in, or any interest convertible into or exchangeable or exercisable for any equity or similar interest in, any Person. There is no outstanding subscription, option, warrant, call, right, or other agreement or commitment obligating any Subsidiary to issue, sell, deliver, or transfer (including any right of conversion or exchange under any outstanding security or other instrument) any security or other evidence of any ownership interest such Subsidiary.

3.7 No Conflict or Violation . Except as set forth on Schedule 3.7 , neither the execution and delivery of this Agreement or the Ancillary Agreements, nor the consummation of the transactions contemplated hereby or thereby will result in (a) a material violation of, or a

 

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material conflict with, the charter documents of Seller, Parent, the Company or any Subsidiary or any subscription, stockholders or similar agreements or understandings to which Seller, Parent, the Company or any Subsidiary is a party; (b) a material breach of, or a material default under (or an event which, with notice or lapse of time or both would constitute a material default under, or result in the termination of, or accelerate the performance required by, or create a right of termination, acceleration, or payment under) any Material Contract (other than any Government Contract or Grant), Encumbrance or Permit to which Seller, Parent, the Company or any Subsidiary is party or by which Seller, Parent, the Company or any Subsidiary is bound; (c) the payment by, or the creation of any obligation (absolute or contingent) to pay on behalf of, the Company or its Subsidiaries of any severance, termination, change of control, “golden parachute,” or other similar payment pursuant to any employment agreement or other Contract or the triggering of any severance notice obligation with respect to any of the employees of the Company or its Subsidiaries; (d) a material violation by the Company or any Subsidiary of any applicable Law; (e) a material violation of any order, judgment, writ, injunction decree, or award to which Seller, Parent, the Company or any Subsidiary is a party or subject; or (f) an imposition of any Encumbrance on the Shares or any property or asset of the Company or any Subsidiary. Seller has previously provided to Purchaser a true and correct copy of that certain Fifth Amendment to Second Amended and Restated Credit Agreement dated as of March 23, 2009 by and among Parent, Lenders (as defined therein), Syndication Agents (as defined therein), Documentation Agent (as defined therein) and Administrative Agent (as defined therein) (the “ Fifth Amendment ”). The Fifth Amendment has been duly executed and is valid and binding and has not been amended or modified.

3.8 Consents and Approvals . Except for the matters disclosed on Schedule 3.8 , and except for compliance with the HSR Act, no consent, Permit, approval or authorization of, or declaration, filing, application, transfer or registration with, any Governmental Entity or regulatory authority or any other Person is required to be made or obtained by Seller, Parent, the Company or any Subsidiary (a) by virtue of the execution, delivery or performance of this Agreement; (b) to avoid the loss of any Permit or the material breach of any Contract or the creation of an Encumbrance on any of the assets or properties of the Company or any Subsidiary as a result of the transactions contemplated hereunder; (c) to enable Purchaser to own the Shares; or (d) to enable Purchaser to continue the operations of the Company and its Subsidiaries following the Closing Date as presently conducted; provided, however, that with respect to any Contracts, the representation and warranty set forth in subparts (a), (b) and (d) above is made only with respect to the Material Contracts (excluding any Government Contract or Grant).

3.9 Litigation . Except as disclosed on Schedule 3.9 , there is no pending or, to Parent’s and Seller’s knowledge, threatened, Action, (i) to which the Company or any of its Subsidiaries is a party, or (ii) affecting Seller, Parent, the Company or any Subsidiary which could affect the enforceability of this Agreement or which could adversely affect any of the assets or properties of the Company or any Subsidiary or the ability of Seller or Parent to consummate the sale of the Shares contemplated by, or perform their respective obligations under, this Agreement. None of the Actions set forth in Schedule 3.9 could reasonably be expected to result in any Material Adverse Change. With respect to each such Action, insofar as such Action relates to the Company and/or any of its Subsidiaries, copies of all pleadings, filings, correspondence with opposing parties and their counsel, results of studies, judgments, orders,

 

18

attachments, impositions of or recordings of Encumbrances and other documents have been made available to Purchaser. Neither the Company nor any Subsidiary is subject to any outstanding injunction, judgment, order, decree or ruling. To Parent’s and Seller’s knowledge, there is no existing state of facts, circumstances or contemplated event that is reasonably likely to give rise to an Action against the Company or any Subsidiary.

3.10 Financial Statements . Attached hereto as Schedule 3.10 are copies of (i) balance sheets of the Company and its Subsidiaries as of December 31, 2008, and December 31, 2007 (the December 31, 2008 balance sheet referred to herein as the “ Balance Sheet ”), (ii) income statements for the years then ended, and (iii) monthly financial statements in respect to the period January 1, 2009 through February 28, 2009 (collectively, the “ Financial Statements ”). The Financial Statements have been prepared from the Books and Records and present fairly, in all material respects, the financial position of the Company and its Subsidiaries as of the respective dates thereof and the results of operations of the Company and its Subsidiaries for the respective periods then ended in conformity with GAAP, except (a) for the effect of Parent or Seller transactions that have not been separately allocated to the Company, and (b) that any unaudited Financial Statements are subject to normal year-end adjustments (none of which are material, individually or in the aggregate) and lack footnotes and other presentation items. Seller has provided to Purchaser true and correct copies of all internal audit reports for the past two (2) years relating to the Company and its Subsidiaries, including, without limitation, reports on internal controls. To Parent’s and Seller’s knowledge, there are no, and, during the past two (2) years there have been no, “material weaknesses” or “significant deficiencies” as defined in SEC Regulation S-X, in the Company’s internal controls. None of the contracts which generated revenue reflected in the Financial Statements are in the name of Parent, Seller or any of their Affiliates, other than the Company and its Subsidiaries.

3.11 Undisclosed Liabilities . Except as set forth on Schedule 3.11 , the Company and its Subsidiaries have no Liabilities or commitments (absolute, accrued, contingent or otherwise) except (a) liabilities reflected on the Balance Sheet, (b) liabilities incurred in the ordinary course of business consistent with past practices of the Company and the Subsidiaries since the date of the Balance Sheet, and which are in nature and amount consistent with those reflected in the Balance Sheet, (c) executory obligations to provide services under Contracts entered into by the Company or its Subsidiaries in the ordinary course of business that are not in respect of any breach, violation or default by the Company or any Subsidiary thereunder, and (d) liabilities and obligations not required by GAAP to be disclosed on the Balance Sheet. As of Closing, the Company and its Subsidiaries will have no Liability for borrowed money or under any capital lease. To Parent’s and Seller’s knowledge, the Company and its Subsidiaries have no material Liabilities (whether or not required to be accrued on the financial statements of the Company) other than those described in subparts (a), (b), and (c) above and any Guaranty disclosed on Schedule 3.16.1 pursuant to Section 3.16.1(t).

3.12 Absence of Certain Changes or Events . Except as set forth on Schedule 3.12 , since December 31, 2008, the business and affairs of the Company and its Subsidiaries have been conducted only in the ordinary course of business consistent with past practice and (i) there has been no Material Adverse Change, and (ii) no fact or condition exists or, to Parent’s and Seller’s knowledge, is contemplated or threatened which could reasonably be anticipated to result in a Material Adverse Change. Without limiting the foregoing, except as set forth on Schedule 3.12 , since December 31, 2008:

 

19

(a) Neither the Company nor any Subsidiary has borrowed any amount (or increased any borrowing) or created, assumed, guaranteed or incurred any material expenses, Liabilities or obligations of any kind (whether contingent or otherwise), except in the ordinary course of business consistent with past practice;

(b) Neither the Company nor any of its Subsidiaries has (i) entered into any new Material Contract (except as disclosed on Schedule 3.16 ), (ii) waived any material rights, or (iii) entered into any transactions or agreements other than in the ordinary course of business consistent with past practice;

(c) Neither the Company nor any of its Subsidiaries has, other than immaterial increases in benefits or salaries arising in the ordinary course of business consistent with past practice (i) increased the level of benefits under any Employee Benefit Plan, the salary or other compensation (including severance) payable or to become payable to any of the officers, directors or employees of the Company or its Subsidiaries or (ii) obligated itself to pay any bonus or other additional salary or compensation to any such officers, directors or employees or (iii) terminated any officer or other senior employee;

(d) Neither the Company nor any Subsidiary has amended, waived, rescinded or terminated (or not renewed) any existing Material Contract and no such Material Contract has accelerated, expired or terminated (and not been renewed) by its terms;

(e) Neither the Company nor any Subsidiary has made or committed to make any capital expenditure (or series of related capital expenditures) that exceeds $25,000;

(f) Neither the Company nor any Subsidiary has made any capital investment in, any loan to, or any acquisition of the securities or assets of, any other Person (or series of related capital investments, loans and acquisitions), other than pursuant to the Computer Loan Program;

(g) Neither the Company nor any Subsidiary has sold, transferred, disposed of, or agreed to sell, transfer, or dispose of, any of its assets, properties, Intellectual Property, material know-how, invention or trade secret or other rights, other than the disposal of obsolete assets in the ordinary course of business in a value not exceeding $50,000 (individually or in the aggregate);

(h) Neither the Company nor any Subsidiary has created, permitted or incurred any Encumbrance upon any of the assets or properties of the Company or its Subsidiaries, other than any Encumbrances arising under the Credit Facility and any Permitted Encumbrances;

 

20

(i) Neither the Company nor any Subsidiary has made any material change in the manner of conducting its business or changed any method of Tax practice, accounting or accounting practices whether for general financial or Tax purposes, or any change in depreciation or amortization policies or rates adopted therein, other than changes required by applicable Law or GAAP;

(j) Neither the Company nor any Subsidiary has experienced any damage, destruction or loss to its property or assets in excess of $25,000;

(k) Neither the Company nor any Subsidiary has failed to repay any material obligation when due, except any obligations being disputed in good faith;

(l) There has been no material revaluation by the Company or any Subsidiary of any of its assets or liabilities, including without limitation, any material write-offs or material increases or decreases in any reserves, nor has there been any material write-up of the value of property, plant, equipment or any other asset by the Company or any Subsidiary;

(m) The Company has not declared, set aside or paid any dividend or other distribution or similar payment, other than in cash;

(n) Neither the Company nor any Subsidiary has issued or committed to issue, any shares or other equity securities or obligations or any securities convertible into or exchangeable or exercisable for shares or other equity interests;

(o) None of Seller, Parent, the Company or any Subsidiary has amended, revised or changed any of the charter documents, bylaws or other organizational documents of the Company or its Subsidiaries, other than any such change which may result or have resulted from the merger of ORC with and into the Company;

(p) Neither the Company nor any Subsidiary has accelerated the collection of any Accounts Receivable or delayed the payment of any accounts payables, except in the ordinary course of business consistent with past practices;

(q) Neither the Company nor any Subsidiary has suffered any strike, walkout, work stoppage or slowdown or any other new or continued event, development or condition of similar character;

(r) Neither the Company nor any Subsidiary has, to Parent’s and Seller’s knowledge, suffered any adverse change or any threat of any adverse change in the Company’s or its Subsidiaries’ relations with, or any loss or threat of loss of, any customer which is a party to any Material Contract; and

(s) Neither Seller, the Company nor any Subsidiary has entered into any commitment (contingent or otherwise) to do any of the foregoing.

3.13 Properties . Except as set forth on Schedule 3.13 , the Company and its Subsidiaries have good, valid and marketable title to all of the personal or mixed property, tangible or intangible, reflected in their Books and Records as being owned, in each case free and

 

21

clear of all Encumbrances, other than any Encumbrances arising under the Credit Facility and any Permitted Encumbrances. Except as set forth on Schedule 3.13 , the properties and assets of the Company and its Subsidiaries comprise all properties and assets used in and/or necessary for the continued conduct of the business of the Company and its Subsidiaries as now being conducted, are adequate for the purposes for which such properties and assets are currently used or held for use and are in reasonably good repair and operating condition (subject to normal wear and tear). Except as set forth on Schedule 3.13 , there are no assets or properties used in the conduct of the business of the Company and its Subsidiaries and owned by any Person other than the Company or its Subsidiaries that will not continue to be leased or licensed to the Company or its Subsidiaries under valid, current leases or licenses following the Closing or provided to the Company and its Subsidiaries following the Closing pursuant to the Transition Services Agreement. Schedule 3.13 contains a complete and correct list of all Governmental Entity-owned property or Governmental Entity-furnished equipment provided under, necessary to perform the obligation under, or for which the Company or its Subsidiaries could be held accountable under, the Government Contracts or Grants, and such Governmental Entity-owned property and Governmental Entity-furnished equipment are maintained by the Company in accordance with a property management system approved by the appropriate Governmental Entity. No Person has any written or oral agreement, option, understanding or commitment, or any right or privilege capable of becoming such for the purchase or other acquisition from the Company or any Subsidiary of any of its assets or properties, other than in the ordinary course of business with respect to immaterial and de minimus (individually and in the aggregate) assets or properties.

3.14 Unclaimed Property . To Parent’s and Seller’s knowledge, and except to the extent included in the $70,938 accrual for unclaimed property reflected in the Balance Sheet and to be reflected in Final Working Capital, the Company and its Subsidiaries have no material assets that may constitute unclaimed property under applicable Laws. Without limiting the generality of the foregoing, the Company and its Subsidiaries have established and followed procedures to identify any unclaimed property and, to the extent required by applicable Laws, remit such unclaimed property to the respective Governmental Entity. The Company’s and its Subsidiaries’ records are reasonably adequate to permit Governmental Entities or outside auditors to confirm the representations and warranties contained in this Section 3.14.

3.15 Receivables . There has been no material change in the outstanding amount of accounts receivable of the Company and its Subsidiaries since December 31, 2008. All accounts receivable of the Company and its Subsidiaries, including without limitation billed invoices and work-in-progress (both negative and positive amounts), that are reflected on the most recent Balance Sheet represent, and those that will be reflected on the Settlement Statement (the “ Accounts Receivable ”) will represent, valid, bona fide obligations arising from sales actually made or services actually performed in the ordinary course of business. The Accounts Receivable will be collectible in full subject to any reserves therefore as set forth on the Settlement Statement. Except to the extent of any reserves set forth on the Settlement Statement, the Accounts Receivable are not subject to any defenses, contests, set-offs, counterclaims or rights of return. Except to the extent of any reserves set forth on the Settlement Statement, the Company and each Subsidiary has fully performed all obligations with respect to the Accounts Receivable which it was obligated to perform to the date hereof. Schedule 3.15 contains a

 

22

complete and accurate list of all accounts receivable of the Company and its Subsidiaries as of February 28, 2009, including a list of the accounts receivable that are billed, a list of the accounts receivable that are unbilled and information regarding the aging of such accounts receivable. The parties hereto acknowledge and agree that the disclosures in Schedule 3.15 are not, and are not intended to be, an exception to, or qualification of, the representations or warranties contained in this Section 3.15 and constitute solely the disclosures required by the immediately preceding sentence. For purposes of this Section 3.15, any Accounts Receivable which remains uncollected as of December 31, 2009 shall be deemed to be uncollectible.

3.16 Contracts .

3.16.1 Schedule 3.16.1 lists each of the following Contracts to which the Company or any of its Subsidiaries are a party:

(a) any Customer Contract with any customer, client or partner which (i) accounted for revenues in excess of $1,000,000 during the year ended December 31, 2008 or (ii) is reasonably expected to account for revenues in excess of $1,000,000 during the year ending December 31, 2009, other than Customer Contracts which (y) did not individually account for revenues in excess of $125,000 during the year ended December 31, 2008 and (z) are not reasonably expected to individually account for revenues in excess of $125,000 during the year ending December 31, 2009;

(b) other than pursuant to Customer Contracts, any agreements, contracts or commitments that provide for the sale, licensing or distribution of any of the Intellectual Property of the Company or any of its Subsidiaries;

(c) any consulting, independent contractor or similar agreement, contract or commitment pursuant to which the Company and its Subsidiaries (i) made payments in excess of $10,000 during the year ended December 31, 2008, or (ii) reasonably expect to make payments in excess of $10,000 during the year ending December 31, 2009, and, in either case, that is not terminable on sixty (60) days notice or less without penalty, Liability or premium of any type, including, without limitation, severance or termination pay;

(d) any collective bargaining or union agreements, contracts or similar commitments with respect to the employees of the Company or its Subsidiaries;

(e) any guarantees or similar undertaking of any obligations of other Persons or any agreements to acquire or guarantee any obligations of other Persons, other than those identified in subparagraph (t) below;

(f) any loan, line of credit, standby financing, revolving credit or other similar financing arrangement of any sort, other than trade accounts payable, from any Person;

(g) any advance, loan or other similar arrangement to any Person in excess of $1,000, other than pursuant to the Computer Loan Program;

 

23

(h) any contract or commitment for the purchase of materials, supplies, goods, services, equipment or other assets pursuant to which the Company and its Subsidiaries reasonably expect to make payments in excess of $50,000 during the year ending December 31, 2009;

(i) any contract or agreement, other than Government Contracts or Grants, providing for notice, the payment of compensation or other benefits, or creating or triggering any rights of acceleration, consent, termination, modification, cancellation, loss of rights or other rights or obligations in the event of a sale or change in control of the Company or any Subsidiary;

(j) any lease of real estate;

(k) any lease of personal property with remaining lease payments in excess of $10,000 per annum;

(l) any agreement concerning a partnership or joint venture;

(m) any agreement concerning confidentiality, except for any such agreements with customers or vendors entered into in the ordinary course of business;

(n) any profit sharing, stock option, stock purchase, stock appreciation, deferred compensation, severance, or other material plan or arrangement for the benefit of its current or former directors, officers, and employees;

(o) any agreement for the employment of any individual, whether on a full-time, part-time or other basis;

(p) any agreement to be performed relating to capital expenditures in excess of $25,000, in the aggregate;

(q) any agreements relating to the sale, transfer or disposition of any assets of the Company or its Subsidiaries, other than the disposal of obsolete assets in the ordinary course of business in a value not exceeding $25,000;

(r) any warranty, guaranty, performance bond, letter of credit or other similar undertaking with respect to a contractual performance extended by Seller, Parent, the Company, any Subsidiary or any of Seller’s Affiliates with respect to the Company or its Subsidiaries;

(s) any agreement, contract or commitment requiring the Company or its Subsidiaries to indemnify or hold harmless any Person other than any Customer Contract entered into in the ordinary course of business consistent with past practices;

 

24

(t) any guaranty or similar undertaking extended by the Company or any Subsidiary with respect to Parent, Seller or their Affiliates (other than the Company and its Subsidiaries) or any Contracts, obligations and Liabilities thereof (a “ Guaranty ”);

(u) any non-competition, non-solicitation or exclusive dealing agreement, or any other agreement or obligation which purports to limit or restrict in any respect (i) the ability of the Company or its Subsidiaries to solicit customers or employees, or (ii) the manner in which, or the localities of which, all or any portion of the business of the Company and its Subsidiaries is or could be conducted;

(v) any power of attorney or other grant of authority by the Company or its Subsidiaries that is effective and outstanding and which vests in any Person decision-making authority or the power to bind the Company or its Subsidiaries; and

(w) any other material agreement entered into outside of the ordinary course of the business of the Company or its Subsidiaries.

The foregoing agreements, documents and contracts are referred to herein as “ Material Contracts ”. True and correct copies of each Material Contract have been made available to Purchaser by Seller.

3.16.2 Except as set forth in the Schedule 3.16.2 , all of the Material Contracts are valid, binding, in full force and effect, and enforceable by the Company and its Subsidiaries in accordance with their respective terms, except to the extent that enforceability may be limited by applicable bankruptcy, reorganization, insolvency, moratorium or other laws affecting the enforcement of creditors’ rights generally and by general principles, of equity, regardless of whether such enforcement is considered a proceeding at law or in equity. Except as set forth on Schedule 3.16.2 , neither the Company, its Subsidiaries nor any other party are in default under or in breach or violation of any Material Contract, except for such defaults, breaches or violations which would not reasonably be expected to result in a Material Adverse Change. Except as set forth on Schedule 3.16.2 , to Parent’s and Seller’s knowledge, neither the Company, its Subsidiaries nor any other party are in default under or in breach or violation of any Material Contract.

3.17 Environmental Matters .

(a) Each of the Company and its Subsidiaries has complied and is in compliance with all Environmental, Health, and Safety Requirements, except for such non-compliance which would not reasonably be expected to result in a Material Adverse Change. To Parent’s and Seller’s knowledge, each of the Company and its Subsidiaries has complied and is in compliance with all Environmental, Health and Safety Requirements. Neither the Company nor its Subsidiaries has been required by any Governmental Entity to (i) alter any of the Real Property to be in compliance with Environmental, Health, and Safety Requirements, or (ii) perform any environmental closure, decommissioning, rehabilitation, restoration or post-remedial investigations on, about or in connection with any of the Real Property.

 

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(b) Each of the Company and its Subsidiaries has obtained and complied with, and is in compliance with, all Permits that are required pursuant to Environmental, Health, and Safety Requirements for the occupation of its facilities and the operation of its business, except where such failure to obtain or comply would not reasonably be expected to result in a Material Adverse Change. To Parent’s and Seller’s knowledge, each of the Company and its Subsidiaries has obtained and complied with, and is in compliance with, all Permits that are required pursuant to Environmental, Health and Safety Requirements for the occupation of its facilities and the operation of its business. All such Permits are in full force and effect.

(c) There is no Action pending or, to Parent’s and Seller’s knowledge, threatened against or involving the Company or its Subsidiaries in respect to any environmental matter, including any Environmental, Health, and Safety Requirement. Neither the Company nor its Subsidiaries has retained or assumed, or provided any indemnification or guarantee with respect to, either contractually or, to Parent’s and Seller’s knowledge, by operation of law, any Liability or Contract of any other Person relating to any environmental matter, including any Environmental, Health, and Safety Requirement.

(d) None of the Company or its Subsidiaries has received any written or material oral notice, demand, report or other information regarding any actual or alleged violation of Environmental, Health, and Safety Requirements, or any Liabilities or potential Liabilities, including any investigatory, remedial or corrective obligations, relating to it or its facilities arising under Environmental, Health, and Safety Requirements.

(e) To Parent’s and Seller’s knowledge, no facts, events or conditions relating to the past or present facilities, properties or operations of the Company or any of its Subsidiaries will prevent, hinder or limit continued compliance with Environmental, Health, and Safety Requirements, give rise to any investigatory, remedial or corrective obligations pursuant to Environmental, Health, and Safety Requirements, or give rise to any other Liabilities pursuant to Environmental, Health, and Safety Requirements, including without limitation any relating to onsite or offsite releases or threatened releases of hazardous materials, substances or wastes, personal injury, property damage or natural resources damage.

(f) Seller has made available to Purchaser all environmental investigations, studies, audits, tests, reviews and other analyses pertaining to the Company, its Subsidiaries or any property or facility now or previously owned, leased or operated by the Company or its Subsidiaries that are in the possession, custody, or control of Parent, Seller, the Company, its Subsidiaries or their Representatives.

3.18 Intellectual Property .

(a) Schedule 3.18(a) sets forth a true and complete list of all Patent Rights, Trademarks, Copyrights, and domain names that are now owned by the Company or any of its Subsidiaries.

 

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(b) Schedule 3.18(b) sets forth a true and complete list of all Company Software, Third Party Software and Licensed Intellectual Property. Seller has made available to Purchaser true and complete copies of all licenses, sublicenses or other agreements relating to the Licensed Intellectual Property. All such licenses, sublicenses or other agreements relating to the Licensed Intellectual Property are in full force and effect, and enforceable by the Company and its Subsidiaries in accordance with their respective terms, except to the extent that enforceability may be limited by applicable bankruptcy, reorganization, insolvency, moratorium or other laws affecting the enforcement of creditors’ rights generally and by general principles of equity, regardless of whether such enforceability is considered in a proceeding at law or in equity. None of the Company, any Subsidiary or, to Parent’s and Seller’s knowledge, any other party to any such license, sublicense or agreement is in material breach or default thereof, and no event has occurred which, with notice or lapse of time, would constitute a material breach or default or permit termination, modification, or acceleration thereunder.

(c) Schedule 3.18(c) identifies all licenses, sublicenses and other agreements (as licensee or licensor) that the Company or any of its Subsidiaries is a party to relating to the Owned Intellectual Property, other than Government Contracts or Grants entered into in the ordinary course of business.

(d) Except as set forth on Schedule 3.18(d) , the Company or a Subsidiary thereof owns each item of Owned Intellectual Property free and clear of all Encumbrances other than licenses or sublicenses of Owned Intellectual Property described in Section 3.18(c) above and other than any Encumbrances arising under the Credit Facility, and has full right or license to use the Owned Intellectual Property and Licensed Intellectual Property in the conduct of its business as presently conducted and there are no Intellectual Property Rights used by the Company or its Subsidiaries which are owned or licensed by Seller, Parent or their Affiliates (other than the Company and its Subsidiaries).

(e) The Owned Intellectual Property and Licensed Intellectual Property include all of the Intellectual Property necessary for the conduct of the business of the Company and its Subsidiaries as presently conducted.

(f) (i) All registrations for Owned Intellectual Property are in force without challenge, and all applications to register any Owned Intellectual Property are pending and in good standing, except for such issuances, registrations or applications that the Company has permitted to expire or has cancelled or abandoned in its reasonable business judgment; (ii) all necessary annuities, filing, registration, maintenance and renewal fees in conjunction with any Owned Intellectual Property which are due and payable have been paid; (iii) the Company or its Subsidiaries have the sole and exclusive right to bring actions for infringement or unauthorized use of the Owned Intellectual Property; and (iv) to Parent’s and Seller’s knowledge, no Owned Intellectual Property Rights are presently being infringed. Upon Closing, the Company and its Subsidiaries will maintain all of their right, title and interest in and to the Owned Intellectual Property, including all rights, claims and damages regarding past infringements of the Owned Intellectual Property by any third party (and the Company’s right to seek enforcement of all such rights to prevent the infringement or misappropriation thereof), free and clear of all Encumbrances.

 

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(g) Each item of Owned Intellectual Property and Licensed Intellectual Property immediately prior to the Closing will be owned or available for use by the Company and its Subsidiaries on identical terms and conditions immediately subsequent to the Closing hereunder.

(h) There are no pending or, to Parent’s and Seller’s knowledge, threatened (i) interferences, re-examinations, oppositions or cancellation proceedings involving any Owned Intellectual Property, or (ii) claims or litigation contesting the validity or the Company’s and its Subsidiaries’ ownership or right to use, sell, license, distribute or dispose of the Owned Intellectual Property.

(i) The operations and activities of the Company and its Subsidiaries do not infringe on any Intellectual Property of any other Person.

(j) In each case where the Company or any Subsidiary thereof has acquired any material Owned Intellectual Property from any Person, or jointly developed material Owned Intellectual Property with any Person, the Company or the Subsidiary, as applicable, has obtained a valid, enforceable, and irrevocable transfer of all right, title, and interest to such Owned Intellectual Property.

(k) No Action is pending or, to Parent’s and Seller’s knowledge, is threatened which challenges the legality, validity, enforceability, use, or ownership of any Owned Intellectual Property.

(l) Neither the Company nor any Subsidiary thereof has agreed to indemnify any Person for or against any interference, infringement, misappropriation, or other conflict with respect to any Owned Intellectual Property, other than any Government Contract or Grant entered into in the ordinary course of business.

(m) The Company and its Subsidiaries, together with Seller and its Affiliates, have taken commercially reasonable actions to maintain the secrecy of all material confidential information of the Company and its Subsidiaries.

3.19 Employment Matters . Seller has delivered to Purchaser a complete and accurate list, by employer (e.g., the Company, specific Subsidiary of the Company), of all the employees of the Company or its Subsidiaries (excluding temporary and on-call workers), whether full-time or part-time, setting forth for each employee (i) title, (ii) location of employment, (iii) original hire date, (iv) current annual base salary, (v) two (2) year salary history, (vi) current bonus targets, and (vii) bonuses received over the past two (2) years. Except as specified on Schedule 3.19 , none of the employees of the Company or its Subsidiaries includes any Person who is not a United States citizen. None of Purchaser, the Company or any Subsidiary will incur any Liability for the improper classification by the Company or any Subsidiary of such employees as independent contractors or leased employees prior to the Closing or as being exempt from overtime pay. There are no collective bargaining agreements with any union or other bargaining group for any employees of the Company or any Subsidiary and Seller has no knowledge of any union organizational efforts involving such employees.

 

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Except as specified on Schedule 3.19 , no employee described in Exhibit H (a “ Key Employee ”) has left the Company or any Subsidiary since January 1, 2007. No current Key Employee has indicated any present or future intention or, to Parent’s and Seller’s knowledge, intends to terminate his or her employment with the Company or any Subsidiary or not to engage in employment with Purchaser. With respect to all current and former employees, each of the Company and each Subsidiary is and has been in compliance with all provisions of Law pertaining to the employment and terminating of employees, including without limitation all Laws relating to labor relations, equal employment practices, fair employment practices, pay equity, entitlements, prohibited discrimination, terms and conditions of employment, occupational health and safety, wages and hours, withholding requirements, or other similar employment or hiring practices or acts, and neither the Company nor any Subsidiary is or has been engaged in any unfair labor practice, except where such noncompliance would not reasonably be expected to result in a Material Adverse Change. To Parent’s and Seller’s knowledge, with respect to all current and former employees, each of the Company and each Subsidiary is and has been in compliance with all provisions of Law pertaining to the employment and terminating of employees, including without limitation all Laws relating to labor relations, equal employment practices, fair employment practices, pay equity, entitlements, prohibited discrimination, terms and conditions of employment, occupational health and safety, wages and hours, withholding requirements, or other similar employment or hiring practices or acts, and neither the Company nor any Subsidiary is or has been engaged in any unfair labor practice. Neither the Company nor any Subsidiary is a party to any Action involving a violation or alleged violation of any of the Laws referred to in the preceding sentence. Without limiting the generality of the foregoing, with respect to all United States employees, (A) the Company and the Subsidiaries are and have at all times in the past been in compliance with the WARN Act, the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“ COBRA ”), the Immigration and Nationality Act, as amended, the Uniformed Services Employment and Reemployment Rights Act of 1994 (“ USERRA ”), and the Immigration Reform and Control Act of 1986, except where the failure to do so would not reasonably be expected to result in a Material Adverse Change, and (B) to Parent’s and Seller’s knowledge, the Company and the Subsidiaries are and have at all times in the past been in compliance with the WARN Act, COBRA, the Immigration and Nationality Act, as amended, USERRA, and the Immigration Reform and Control Act of 1986. Except as set forth on Schedule 3.19 , the consummation of the transactions contemplated by this Agreement will not (either alone or in conjunction with another event, such as a termination of employment or other services or continuation of employment) entitle any employee or other Person to receive severance, any stay or retention bonus or other compensation which would not otherwise be payable absent the consummation of the transactions contemplated by this Agreement or cause the vesting or acceleration of the time of payment of any award or entitlement under any Employee Benefit Plan. All amounts due or accrued for all salary, wages, bonuses, commissions, vacation with pay, and benefits under Employee Benefit Plans have either been paid or are accurately reflected in the Books and Records. The Company and its Subsidiaries have no outstanding assessments, penalties, fines, liens, charges, surcharges or other amounts due or owing pursuant to any applicable workplace safety or insurance Laws, and neither the Company nor any Subsidiary has been reassessed under such Laws during the past three years, and to the knowledge of Parent and Seller, no audit of the Company or any Subsidiary is currently being performed with respect to any applicable workplace safety and insurance Laws.

 

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3.20 Employee Benefit Plans .

(a) Schedule 3.20(a) hereto sets forth a list of all Employee Benefit Plans for the benefit of any employee, retiree or former employee of, or consultant to, the Company or any Subsidiary (or beneficiary, survivor or dependent of any such individual), indicating the sponsor of such plan (i.e., the Company or any Subsidiary). Seller has provided to Purchaser a true and complete copy of each such Employee Benefit Plan and each relevant brochure or summary plan description provided to employees.

(b) Except as set forth on Schedule 3.20(b) , none of Purchaser, Parent, Seller, the Company or its Subsidiaries is a party to, bound by, or will incur any Liability under, any severance agreement, deferred compensation agreement, employment agreement, similar agreement, or Employee Benefit Plan as a result of the consummation of the transactions contemplated by this Agreement, either alone or together with another event.

(c) Except as set forth on Schedule 3.20(c) , the execution of, and performance of the transactions contemplated in, this Agreement will not constitute an event under any Employee Benefit Plan that will or may result in any payment (whether of severance pay or otherwise), acceleration, forgiveness of indebtedness, vesting, distribution, increase in benefits or obligation to fund benefits with respect to any employees, officers or directors.

(d) Except as set forth on Schedule 3.20(d) , each Employee Benefit Plan that is an “employee pension benefit plan” (as defined in Section 3(2) of ERISA) that is intended to be a qualified plan meets the requirements of Section 401(a) of the Code; the trust, if any, forming part of such plan is exempt from U.S. federal income tax under Section 501(a) of the Code; a favorable determination letter has been issued by the Internal Revenue Service (“ IRS ”) after January 1, 2002, and takes into account the series of legislation commonly referred to as “GUST” (or, if the plan is documented on a prototype, such prototype is currently approved by the IRS and takes “GUST” into account), or has been submitted for a favorable determination letter under the Economic Growth and Tax Relief Reconciliation Act of 2001 (“ EGTRRA ”), or is still within the EGTRRA remedial amendment period provided by Code Section 401(b) with respect to each plan and trust and each amendment thereto or such plan and trust and/or amendment; and since the date of such determination letter there are no circumstances that are likely to adversely affect the qualification of such plans. Except as set forth on Schedule 3.20(d) , any employee pension benefit plan intended to meet the requirements of Section 401(a) has been amended in good faith to comply with any provisions of EGTRRA and, to the extent required, the Pension Protection Act of 2006 (“ PPA ”) that are instituted voluntarily by the end of the plan year in which such changed provision is effective. Except as set forth on Schedule 3.20(d) , none of Parent, Seller, the Company or its Subsidiaries has received any correspondence or written or verbal notice from the IRS, the U.S. Department of the Treasury, the Employee Benefits Security Administration, any participant in, or beneficiary of, an Employee Benefit Plan, or any agent representing any of the foregoing that brings into question the compliance referred to in this Section 3.20.

 

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(e) No Tax Liabilities have arisen and are currently unpaid in relation to a violation of any applicable Employee Benefit Plan of Section 409A of the Code, nor is any Tax Liability expected to arise in connection with any payment as a result of the transaction contemplated in this Agreement. All Employee Benefit Plans subject to Section 409A of the Code have been documented to conform to such Section.

(f) Neither the Company nor its Subsidiaries has any “leased employees” within the meaning of Section 414(n) of the Code.

(g) No Employee Benefit Plan is a “voluntary employees beneficiary association” (within the meaning of Section 501(c)(9) of the Code), and since January 1, 1988, there have been no other “welfare benefit funds” relating to employees or former employees within the meaning of Section 419 of the Code.

(h) No event or condition exists with respect to any Employee Benefit Plan that could subject Purchaser, the Company or its Subsidiaries to any material Tax under Section 4980B of the Code.

(i) With respect to each Employee Benefit Plan, Seller has heretofore delivered to Purchaser complete and correct copies of the following documents, where applicable: (i) the most recent annual report (Form 5500), together with schedules, as required, filed with the Department of Labor (“ DOL ”), and any financial statements and opinions required by Section 103(a)(3) of ERISA or, for each top-hat plan, a copy of all filings with the DOL, (ii) the most recent determination letter issued by the IRS, (iii) the most recent summary plan description and all modifications, (iv) the text of the Employee Benefit Plan and of any trust, insurance, or annuity contracts maintained in connection therewith including any and all amendments thereto, (v) the most recent actuarial report, if any, relating to the Employee Benefit Plan, and (vi) the most recent actuarial valuation, study, or estimate of any retiree medical and life insurance benefits plan or supplemental retirement benefits plan.

(j) Except as set forth on Schedule 3.20(j) , all required reports and descriptions (including but not limited to Form 5500 annual reports and required attachments (including but not limited to any required independent audit), Forms 1099-R, summary annual reports, Forms PBGC-1, and summary plan descriptions) have been filed or distributed appropriately with respect to each Employee Benefit Plan. All required Tax filings with respect to each Employee Benefit Plan have been made, including but not limited to IRS Forms 990-T and 5330, and any Taxes due in connection with such filings have been paid.

(k) None of the Employee Benefit Plans is a “multiemployer plan” (within the meaning of Section 3(37) or 4001(a)(3) of ERISA) or a single employer pension plan (within the meaning of Section 4001(a)(15) of ERISA), including a single employer plan for which the Company or any of its Subsidiaries could incur Liability under Section 4063 or 4064 of ERISA. Neither the Company nor its Subsidiaries maintain or contribute to or in any way directly or indirectly have any Liability (whether contingent or otherwise) with respect to any “multi-employer plan.”

 

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