STOCK PURCHASE AGREEMENT

Exhibit 2.1

 

STOCK PURCHASE AGREEMENT

by and among

BARCLAYS BANK PLC,

BARCLAYS PLC (solely for the purposes of Section 6.16, Section 6.18 and Section 6.24)

and

BLACKROCK, INC.

Dated as of June 16, 2009

Table of Contents

Page

 

EXHIBITS AND ANNEXES

EXHIBITS

ANNEXES

This STOCK PURCHASE AGREEMENT, dated as of June 16, 2009 (this “ Agreement ”), by and among BARCLAYS PLC, a public limited company organized under the Laws of England and Wales (“ Parent ”) (solely for the purposes of Section 6.16, Section 6.18 and Section 6.24), BARCLAYS BANK PLC, a public limited company organized under the Laws of England and Wales and a Subsidiary of Parent (“ Seller ”), and BLACKROCK, INC., a corporation organized under the Laws of Delaware (“ Buyer ”).

W I T N E S S E T H :

WHEREAS, Seller directly or indirectly owns all of the Transferred Equity Interests;

WHEREAS, upon the terms and subject to the conditions set forth in this Agreement, Seller desires to cause the Transferred Equity Interests to be sold to Buyer and Buyer desires to purchase the Transferred Equity Interests from Seller, in accordance with Section 6.26 of the Seller’s Disclosure Schedules;

WHEREAS, as of the date hereof, the Majority Stockholders hold shares of Buyer Common Stock that in the aggregate represent not less than a majority of the total voting power of the capital stock of Buyer;

WHEREAS, as a condition and an inducement to the willingness of Seller to enter into this Agreement, the Majority Stockholders have, in their capacity as stockholders of Buyer, concurrently with the execution of this Agreement, delivered, in their capacity as the holders of shares of Buyer Common Stock that in the aggregate represent not less than a majority of the total voting power of the capital stock of Buyer, Written Consents containing their consent to the Share Issuance, pursuant to and in accordance with the applicable provisions of the Delaware General Corporation Law, the rules and regulations of the NYSE and the Organizational Documents of Buyer;

WHEREAS, Seller (solely for the purpose of Section 9.16 of the MSA), UK Holdings and Blue Sparkle, L.P. entered into the MSA, dated as of April 9, 2009;

WHEREAS, the MSA provided that Seller and its Affiliates were permitted to conduct certain solicitation activities during the time period and on the terms and conditions set forth therein, and Seller and Buyer entered into discussions in respect of the terms and conditions of this Agreement and the transactions contemplated hereunder;

WHEREAS, prior to or concurrently with the execution and delivery of this Agreement, the MSA was terminated in accordance with the terms thereof; and

WHEREAS, Seller and Buyer desire to make certain representations, warranties, covenants and agreements in connection with this Agreement.

NOW, THEREFORE, in consideration of the premises and the mutual representations, warranties, covenants and undertakings contained in this Agreement, and for

other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties to this Agreement, intending to be legally bound, agree as follows:

ARTICLE I

DEFINITIONS AND TERMS

Section 1.1   Certain Definitions .  As used in this Agreement, the following terms have the meanings set forth below:

“ 2008 Unaudited Financial Statements ” has the meaning set forth in Section 4.5(a).

“ 2009 Year End Financial Statements ” has the meaning set forth in Section 6.28(c).

“ 481 Adjustment ” shall have the meaning set forth in Section 6.5(k)(i).

“ AAA ” has the meaning set forth in Section 8.13(a).

“ Acquisition Proposal ” means any inquiry, proposal or offer with respect to (i) a merger, joint venture, partnership, consolidation, dissolution, liquidation, tender offer, recapitalization, reorganization, share exchange, business combination or similar transaction in relation directly or indirectly to all or any portion of the BGI Business or the Transferred Entities, or (ii) any other direct or indirect acquisition of assets or interests in the BGI Business or any of the Transferred Entities; but shall not include any transaction involving an acquisition of Parent or its securities, except to the extent that any such transaction impedes or materially delays the consummation of the transactions contemplated herein.

“ Actual Cash ” means the difference between (i) the consolidated cash and liquid investments of the Transferred Entities as of the Closing and (ii) the consolidated Indebtedness of the Transferred Entities as of the Closing.

“ Adjusted Assets Under Management ” as of any date means the sum, for all Client accounts in question as of such date, of the amount, expressed in U.S. dollars, of assets under management by each of the Transferred Entities for each such account as of such date valued (a) for purposes of calculating the Base Revenue Run-Rate as of the Base Date, in the same manner as provided for the calculation of base investment management fees payable to such Person in respect of such account by the terms of the Investment Advisory Arrangements applicable to such account, and for purposes of calculating the Base ETF Revenue Run-Rate as of the Base Date, by reference to the unitary fee rate, the total expense ratio or the contractual fee rate, as applicable, payable to such Person in respect of such account by the terms of the Investment Advisory Arrangements applicable to such account, and (b) for purposes of calculating the Closing Adjustment Revenue Run-Rate and Closing Adjustment ETF Revenue Run-Rate as of the Closing Measurement Date, at the amount calculated pursuant to subsection (a) above, (i) increased by a positive amount equal to additions, contributions and reinvestments (other than reinvestments of distributions to the extent that they would result in double-counting

of assets) actually funded to such account after the Base Date and on or prior to the Closing Measurement Date, (ii) increased with respect to any new accounts opened after the Base Date and on or prior to the Closing Measurement Date and any additions to existing accounts prior to the Closing Measurement Date, by the amount of additions, contributions (net of terminations, withdrawals, redemptions and repurchases) and reinvestments (other than reinvestments of distributions to the extent that they would result in double-counting of assets) actually funded to such account after the Base Date and on or prior to the Closing Measurement Date, (iii) increased by new accounts and additions to existing accounts that have not actually funded on or prior to the Closing Measurement Date, but have provided a written indication that they plan to fund within 60 days after the Closing Measurement Date, (iv) decreased by terminations, withdrawals, redemptions and repurchases actually funded out of such account after the Base Date and prior to the Closing Measurement Date, and (v) decreased by the portion of any account as to which an effective notice of termination has been received (unless such notice has been revoked prior to the Closing Measurement Date) and by the entire amount of any Contingent Account; provided , however , in each case that:

“ Advisory Client ” means an advisory client of one or more Transferred Entities other than a Fund.

“ Affiliate ” means, with respect to any Person, any other Person directly or indirectly Controlling, Controlled by, or under common Control with, such Person as of the date

on which, or at any time during the period for which, the determination of affiliation is being made.

“ Agreement ” shall have the meaning set forth in the Preamble.

“ Allocation ” has the meaning set forth in Section 6.5(g)(i).

“ Alternative Termination Fee ” has the meaning set forth in Section 9.3(b).

“ Ancillary Agreement ” means each of the Transition Services Agreement, the Cash Fund Support Agreements, the Stockholder Agreement and the Registration Rights Agreement.

“ Antitrust Laws ” mean all Laws that are designed or intended to prohibit, restrict or regulate actions having the purpose or effect of monopolization or restraint of trade.

“ Applicable Date ” has the meaning set forth in Section 5.8(a).

“ Applicable Local Law ” has the meaning set forth in Section 4.8(c).

“ Applicable Rate ” means from time to time the 30 day London Interbank Offered Rate plus 200 basis points.

“ Assignment Requirements ” means, with respect to any Existing Advisory Contract, the necessary consents and approvals under applicable Law and under such Existing Advisory Contract to effect (A) the assignment or continuation of such Existing Advisory Contract or the replacement of such Existing Advisory Contract with a New Advisory Contract (and shall not include an “interim contract” pursuant to Rule 15a-4 under the Investment Company Act), in connection with the transactions contemplated by this Agreement or (B) a change of control of the advisor, subadvisor, investment manager, trustee or similar such party in connection with the transactions contemplated by this Agreement.

“ Assumed Benefit and Compensation Arrangement ” shall have the meaning set forth in Section 4.8(a).

“ Audited Balance Sheets ” has the meaning set forth in Section 6.28(a).

“ Audited Closing Balance Sheet ” has the meaning set forth in Section 6.28(d).

“ Audited Financial Statements ” has the meaning set forth in Section 6.28(a).

“ Australia Company ” means Barclays Global Investors Australia Limited, a company limited by shares organized under the Laws of Australia.

“ Australia Holdings ” means Barclays Global Investors Australia Holdings Pty Limited, a proprietary limited company organized under the Laws of Australia.

“ Australia Services ” means Barclays Global Investors Australia Services Limited, a company limited by shares organized under the Laws of Australia.

“ Australian Entity ” means each of Australia Company, Australia Holdings, Australia Services and each other Transferred Entity which is (a) incorporated in any jurisdiction within Australia, (b) resident for any Tax purpose in Australia and (c) trading in Australia through a permanent establishment in Australia.

“ Bank UK Retirement Fund ” means the Barclays Bank UK Retirement Fund.

“ Base Date ” means April 30, 2009.

“ Base ETF Revenue Run-Rate ” means the Revenue Run-Rate for ETFs calculated as of the Base Date, as set forth in the Base Revenue Schedule as of the Base Date.

“ Base Revenue Run-Rate ” means the Revenue Run-Rate calculated as of the Base Date, as set forth on the Base Revenue Schedule prepared as of the Base Date.

“ Base Revenue Schedule ” has the meaning set forth in Section 4.16(a).

“ Benefit and Compensation Arrangements ” has the meaning set forth in Section 4.8(a).

“ BGI Affiliate Arrangement ” has the meaning set forth in Section 4.27(a).

“ BGI Business ” means together (a) the business of managing investment assets and providing investment management products and services, including securities lending, and any promotional, marketing, distribution or investor servicing services relating thereto and any administrative, custodial, transfer agency or other ancillary services, relating to any such products and services, as conducted by Parent and its Affiliates, the assets, liabilities and results of operations of which constitute the Unaudited Financial Statements, during the period reflected in the Unaudited Financial Statements and thereafter through the Closing and (b) the ETF business of Banco Barclays S.A. in Brazil.

“ BGI Marks ” has the meaning set forth in Section 6.23(e).

“ Books and Records ” means (i) such portion of the books and records of Seller and its Affiliates (or true and complete copies thereof) to the extent they relate to the Transferred Entities or the BGI Business, including the minute books, Tax Returns, corporate charters and by laws or comparable constitutive documents, records of share issuances, and related corporate records of the Transferred Entities, manuals, financial records, documents, files, notes, materials and other information in paper, electronic or other form in which they are maintained by the Transferred Entities or Seller, as applicable, (ii) any Employee records and (iii) all files primarily relating to any Litigation with respect to which the Transferred Entities may be subject to liability.

“ Brazil Company ” means a Person that Seller shall form, incorporate or otherwise establish, or cause to be formed, incorporated or otherwise established, prior to the Closing under applicable Laws in Brazil in accordance with Section 6.26(a).

“ Broker-Dealers ” means collectively US Global Investors Services and US Global Investors Fund Distribution Company.

“ Business Day ” means any day other than a Saturday, a Sunday or a day on which banks in London or New York City are authorized or obligated by Law or executive order to close.

“ Buyer ” has the meaning set forth in the Preamble.

“ Buyer Balance Sheet ” has the meaning set forth in Section 5.9.

“ Buyer Common Stock ” means the common stock, par value $0.01 per share, of Buyer.

“ Buyer Common Stock Consideration ” means that number of shares of Buyer Common Stock (rounded down to the next whole share) obtained by multiplying the Buyer Common Stock Primary Amount by 0.0515.

“ Buyer Common Stock Primary Amount ” means the number of shares of Buyer Common Stock issued and outstanding on a primary basis on the day immediately prior to the Closing; provided , however , that for purposes of determining the Buyer Common Stock Primary Amount, shares of Buyer Common Stock to be issued contemporaneously with the Closing  (excluding any shares issued to Seller or one of its designees pursuant to this Agreement) shall be deemed to be outstanding for purposes of calculating this amount; provided , however , that the Buyer Common Stock Primary Amount shall be reduced by a number equal to the number of shares of Buyer Common Stock that are subject to forfeiture to Buyer pursuant to the terms of the Quellos Agreement.

“ Buyer Financial Statements ” has the meaning set forth in Section 5.8(d).

“ Buyer Fundamental Representations ” has the meaning set forth in Section 8.3(a)(i).

“ Buyer Limit ” has the meaning set forth in Section 8.3(b).

“ Buyer Indemnified Party ” has the meaning set forth in Section 8.2(a).

“ Buyer Material Adverse Effect ” means an event, circumstance, fact, change, development, condition or effect that has a material adverse effect on the business, assets, properties, results of operations or condition (financial or otherwise) of Buyer and its Subsidiaries, taken as a whole; provided that none of the following (or the results thereof) shall contribute to or be a Buyer Material Adverse Effect:   (i) any change in Law or accounting standards, but only to the extent that Buyer and its Subsidiaries, taken as a whole, are not materially disproportionately adversely affected compared to other asset managers and providers of investment management products and services generally; (ii) any change in economic or business conditions locally or globally generally, but only to the extent that Buyer and its Subsidiaries, taken as a whole, are not materially disproportionately adversely affected compared to other asset managers and providers of investment management products and services generally;

(iii) any events, conditions or trends in economic, business or financial conditions generally affecting the investment management industry, including changes in prevailing interest rates, currency exchange rates and price levels or trading volumes in the United States or foreign securities markets; (iv) any change resulting from or arising out of hurricanes, earthquakes, floods or other natural disasters; (v) any change in assets under management resulting from changes in asset valuation or market price fluctuations; (vi) the effects of the actions that are (A) expressly required by this Agreement, (B) taken by Buyer or its Subsidiaries with the prior written consent of Seller or (C) not taken by Buyer or its Subsidiaries at the written request of Seller or due to Seller’s refusal to provide its consent therefor and (vii) in and of themselves, any changes in the trading price or trading volume of Buyer Common Stock or the failure of Buyer to meet estimates, projections, forecasts or earnings predictions; provided that the exception in this clause (vii) shall not include the underlying causes thereof.

“ Buyer Preferred Stock ” means the preferred stock, par value $0.01 per share, of Buyer.

“ Buyer Preferred Stock Consideration ” means the Buyer Series B Preferred Stock Consideration and, if applicable, the Buyer Series D Preferred Stock Consideration.

“ Buyer Preferred Stock Primary Amount ” means the number of shares of Buyer Preferred Stock issued and outstanding on a primary basis on the day immediately prior to the Closing; provided , however , that for purposes of determining the Buyer Preferred Stock Primary Amount, shares of Buyer Preferred Stock to be issued contemporaneously with the Closing (excluding any shares issued to Seller or one of its designees pursuant to this Agreement) shall be deemed to be outstanding and shares of Buyer Preferred Stock that will be converted into or exchanged for Buyer Common Stock contemporaneously with the Closing shall be deemed to be not outstanding; provided , however , that the Buyer Preferred Stock Primary Amount shall be reduced by a number equal to the number of shares of Buyer Common Stock that are subject to forfeiture to Buyer pursuant to the terms of the Quellos Agreement.

“ Buyer Regulatory Impediments ” means (i) conditions, limitations, restrictions or requirements, including any sales, divestitures, hold separates or other disposals, imposed upon Buyer or any of its Affiliates in connection with obtaining or failing to obtain the approval of any Government Entity to the transactions contemplated hereby, or (ii) prohibitions under any applicable Law that would, in each case of (i) and (ii) individually or in the aggregate, reasonably be expected to be materially adverse to the business, assets, results of operations or condition (financial or otherwise) of (a) US Bank and its Subsidiaries, taken as a whole, (b) the Transferred Entities, taken as a whole (other than US Bank and its Subsidiaries, taken as a whole), or (c) Buyer and its Controlled Affiliates, taken as a whole.

“ Buyer SEC Reports ” has the meaning set forth in Section 5.8(a).

“ Buyer Series A Preferred Stock ” means Series A Convertible Participating Preferred Stock, par value $0.01 per share, of Buyer.

“ Buyer Series B Preferred Stock ” means Series B Convertible Participating Preferred Stock, par value $0.01 per share, of Buyer.

“ Buyer Series B Preferred Stock Consideration ” means that number of shares (rounded down to the nearest whole number) of Buyer Series B Preferred Stock equal to (a) the product of (i) the Buyer Common Stock Primary Amount multiplied by (ii) 0.1475, plus (b) the product of (i) the Buyer Preferred Stock Primary Amount multiplied by (ii) 0.1990; provided , however , in no event will the sum of the Buyer Common Stock Consideration and the Buyer Series B Preferred Stock Consideration exceed the Total Share Amount.

“ Buyer Series C Preferred Stock ” means Series C Convertible Participating Preferred Stock, par value $0.01 per share, of Buyer.

“ Buyer Series D Preferred Stock ” means the Series D Participating Preferred Stock, par value $0.01 per share, of Buyer.

“ Buyer Series D Preferred Stock Consideration ” means that number of shares of Buyer Series D Preferred Stock equal to the excess, if any, of (i) the Total Share Amount over (ii) the sum of (x) the Buyer Common Stock Consideration plus (y) the Buyer Series B Preferred Stock Consideration.

“ Buyer Threshold ” has the meaning set forth in Section 8.3(b).

“ Buyer’s Disclosure Schedules ” means the disclosure schedules delivered by Buyer to Seller immediately prior to the execution of this Agreement.

“ Buyer’s i-Marks ” has the meaning set forth in Section 6.23(d).

“ Buyer’s Required Approvals ” has the meaning set forth in Section 5.4.

“ California Corporation ” means Barclays California Corporation, a corporation organized under the Laws of the State of California, or any successor thereof.

“ California NOL ” has the meaning set forth in Section 6.5(k)(i).

“ Canada Company ” means Barclays Global Investors Canada Limited, a corporation organized under the Laws of Ontario.

“ Canada Holdings ” means Barclays Global Investors Holdings Canada Limited, a corporation organized under the Laws of Ontario.

“ Canada Services ” means Barclays Global Investors Services Canada Limited, a corporation organized under the Laws of Ontario.

 “ Canadian Tax Act ” has the meaning set forth in Section 2.9.

“ Capital Amount ” means the sum of (i) the Regulatory Amount, (ii) the Unregulated Entity Net Working Capital and (iii) the Cash Adjustment.

“ Capital Amount Statement ” has the meaning set forth in Section 2.3(a)(i).

“ Capital Statements ” has the meaning set forth in Section 2.3(a)(i).

“ Cash Adjustment ” means the amount equal to the difference between the Actual Cash and the Target Cash (which may be a negative number).

“ Cash Adjustment Statement ” has the meaning set forth in Section 2.3(a)(i).

“ Cash Fund Support Agreements ” means the Cash Fund Support Agreements in the forms attached hereto as Exhibit C.

“ Cash Purchase Price ” means $6,600,000,000.

“ Certificate of Designations ” means the certificate of designations that sets forth the designations, powers, preferences and rights of the Buyer Series D Preferred Stock in the form attached as Exhibit H.

“ Change in Recommendation ” has the meaning set forth in Section 6.16(b)(i).

“ Chile Company ” means a Person that Seller shall form, incorporate or otherwise establish, or cause to be formed, incorporated or otherwise established, prior to the Closing under applicable Laws in Chile in accordance with Section 6.26(a).

“ Chile Holdings ” means a Person that Seller shall form, incorporate or otherwise establish, or cause to be formed, incorporated or otherwise established, prior to the Closing under applicable Laws in Chile in accordance with Section 6.26(a).

“ Circular ” has the meaning set forth in Section 6.16(a).

“ Claim Notice ” has the meaning set forth in Section 8.4(a).

“ Client ” of a Person means any other Person, including a Fund, to which such first Person or any of its Affiliates provides investment management services, trustee services or investment advisory services, including any sub-advisory services, relating to securities or other financial instruments, commodities, real estate or any other type of asset, pursuant to an Investment Advisory Arrangement.

“ Closing ” has the meaning set forth in Section 2.4.

“ Closing Actual Capital ” means, with respect to each Regulated Entity, the amount of its capital immediately preceding the Closing that is counted toward Required Regulatory Capital maintained by such Regulated Entity.

“ Closing Adjustment ETF Revenue Run-Rate ” means the Revenue Run-Rate for all ETFs calculated in accordance with clause (b) of the definition of Adjusted Assets Under Management as of the Closing Measurement Date.

“ Closing Adjustment Revenue Run-Rate ” means the Revenue Run-Rate for all Clients calculated in accordance with clause (b) of the definition of Adjusted Assets Under Management as of the Closing Measurement Date.

“ Closing Date ” means the date upon which the Closing occurs, provided , that for the purposes of Section 4.7, Section 6.5, Annex 6.5 and the defined terms set forth therein, “ Closing Date ” in relation to UK Holdings and Japan Company and any other Person in which equity interests are directly or indirectly transferred to Buyer as part of the Next Day Transfer means the date on which the Next Day Transfer occurs.

“ Closing Date Financial Statements ” has the meaning set forth in Section 2.3(a)(i).

“ Closing Financial Statements ” has the meaning set forth in Section 5.8(d).

“ Closing Measurement Date ” means such Business Day as close as practicable but in any event not more than five Business Days prior to the date of the Closing.

“ Closing Regulated Entity Regulatory Capital Statement ” has the meaning set forth in Section 2.3(a)(i).

“ Closing Required Cash ” means, with respect to each Regulated Entity, 110% of the Required Regulatory Cash of such Person immediately prior to the Closing.

“ Closing Required Regulatory Capital ” means, with respect to each Regulated Entity, 110% of the Required Regulatory Capital of such entity on the Business Day immediately preceding the Closing.

“ Closing Unregulated Entity Working Capital Statement ” has the meaning set forth in Section 2.3(a)(i).

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

“ Comfort Letter ” has the meaning set forth in Section 2.9(b).

“ Commodity Exchange Act ” means the United States Commodity Exchange Act of 1936, as amended, and the rules and regulations thereunder.

“ Competing Activity ” has the meaning set forth in Section 6.24.

“ Confidentiality Agreement ” means the confidentiality agreement, dated April 21, 2009, between Seller and Buyer, as amended and supplemented.

“ Contingent Account ” means, in respect of any Client account of any Transferred Entity as of the Closing Measurement Date, (i) the portion (which may be 100%) of such account as to which the Client or any authorized representative of the Client has indicated orally or in writing to Seller or any of its Controlled Affiliates (if any Assignment Requirement applies to such Client account) or in writing (if no Assignment Requirement is applicable to such Client account) through any statement, notice or other communication on or prior to the Closing Measurement Date that it intends to withdraw and such indication has not been revoked or that such portion is or will be under review for possible withdrawal, redemption or termination and as to which the Client or such representative has not withdrawn such indication and (ii) any Client

account of such Person which has not satisfied any Assignment Requirements applicable to such account.

“ Contract ” means, any agreement, undertaking, lease, sublease, license, sublicense, contract, note, mortgage, indenture, power of attorney, guarantee, arrangement, commitment or other binding obligation, whether oral or written, express or implied, in each case as amended, supplemented, waived or otherwise modified.

“ Control ” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ownership of voting securities, by contract or otherwise (and “ Controlled ” and “ Controlling ” shall have a correlative meaning).  For purposes of this definition, a general partner or managing member of a Person shall always be considered to Control such Person; provided , however , that a Person shall not be treated as having control over any Fund to which it provides services unless it has a direct or indirect proprietary economic interest exceeding 25% of the equity interest in such Fund.

“ Controlled Affiliate ” means, with respect to any Person, an Affiliate thereof that is directly or indirectly Controlled by such Person.

“ Copyrights ” has the meaning set forth in the “Intellectual Property” definition.

“ CPA Firm ” has the meaning set forth in Section 2.3(a)(iv).

“ CRA ” has the meaning set forth in Section 2.9(b).

“ CTA ” has the meaning set forth in Section 4.15(b).

“ Deferred Comp ” has the meaning set forth in Section 6.5(k)(i).

“ Delaware Holdings ” means a Person that Seller shall form, incorporate or otherwise establish, or cause to be formed, incorporated or otherwise established, prior to the Closing under applicable Laws of the State of Delaware in accordance with Section 6.26.

“ Delaware LLC ” means a limited liability company to be organized under Delaware law for the purpose of serving as sponsor and commodity pool operator of iShares Diversified Alternatives Trust.

“ Deficit Price ” has the meaning set forth in Section 2.2(b)(iii).

“ Deficit Shares ” has the meaning set forth in Section 2.2(b)(i).

“ Dispute ” has the meaning set forth in Section 8.13(a).

“ Dispute Notice ” has the meaning set forth in Section 2.3(a)(iii).

“ EC Merger Regulation ” means the Council Regulation 139/2004 on the control of concentrations between undertakings.

“ Employee ” means, as of any date, any employee of any Transferred Entity or any Transferred Employee.

“ Encumbrance ” means any lien, pledge, debt, charge, claim, encumbrance, security interest, option, mortgage, assessment, easement or any other similar restriction or limitation of any kind.

“ Environmental Law ” means any Law (including the Comprehensive Environmental Response, Compensation and Liability Act of 1980 or any other equivalent Law of applicable jurisdiction) or any Permit concerning (x) the protection, preservation or restoration of the environment (namely, air, surface water, vapor, groundwater, drinking water supply and surface or subsurface land or structures) or (y) the exposure to, or the use, storage, recycling, treatment, generation, transportation, processing, handling, management, release or disposal of, any hazardous substance or waste material.

“ EOP Option ” means an option to acquire shares in UK Holdings pursuant to the Equity Ownership Plan.

“ Equity Consideration ” means (i) the shares of Buyer Common Stock Consideration and the Buyer Preferred Stock Consideration minus (ii) the Total Adjustment Amount Shares.

“ Equity Ownership Plan ” means the Barclays Global Investors Equity Ownership Plan.

“ Equity Rights ” has the meaning set forth in Section 4.2.

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

“ ERISA Affiliate ” has the meaning set forth in Section 4.8(e).

“ ETF ” means a pooled investment vehicle, unit investment trust, investment company, commodity pool or other collective or commingled investment vehicle that has each of the following characteristics: (A) such vehicle issues and redeems blocks of shares, units or similar interests that are commonly referred to as “creation units” or “basket amounts” and (B) the shares, units or similar interests in such vehicle are listed and traded on one or more exchanges and includes all investment vehicles included by the Transferred Entities in ETF business segment data.

“ Exchange Act ” means the United States Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder.

“ Existing Advisory Contract ” means any existing investment advisory, sub-advisory, investment management, trust or similar Contract that any Transferred Entity has with any Fund or Advisory Client as of the Closing or the date of this Agreement, as applicable.

“ Existing Reimbursement Agreements ” has the meaning set forth in Section 6.26(k).

“ Existing Stockholder Agreements ” means (i) the Second Amended and Restated Stockholder Agreement, dated February 27, 2009, among Buyer, Merrill Lynch & Co., Inc. and Merrill Lynch Group, Inc., as such agreement is amended as of immediately prior to the execution of this Agreement, and (ii) the Amended and Restated Implementation and Stockholder Agreement, dated February 27, 2009, between Buyer and The PNC Financial Services Group, Inc., as such agreement is amended as of immediately prior to the execution of this Agreement.

“ Expense Amount ” has the meaning set forth in Section 9.3(b).

“ Fiduciary Requirement ” means any fiduciary requirement imposed by applicable Law or an Investment Advisory Arrangement with respect to the services performed for a Client pursuant to such Investment Advisory Arrangement, including but not limited to such fiduciary requirements with respect to compliance with investment guidelines.

“ Final Capital Amount ” has the meaning set forth in Section 2.3(a)(iv).

“ Finance Limited ” means Barclays Global Investors Finance Limited, a private company limited by shares incorporated under the Laws of England and Wales.

“ FINRA ” means the Financial Industry Regulatory Authority created in July 2007 through the consolidation of the National Association of Securities Dealers, Inc. and the member regulation, enforcement and arbitration functions of the NYSE.

“ Foreign Benefit Plan ” has the meaning set forth in Section 4.8(i).

“ Foreign Transferred Entity ” means a Transferred Entity organized or formed under the Laws of a jurisdiction other than the United States or any political subdivision thereof.

“ Form 7-R ” has the meaning set forth in Section 4.15(b).

“ Form ADV ” has the meaning set forth in Section 4.15(a).

“ Form BD ” has the meaning set forth in Section 4.15(d).

“ Fund ” means, as of any date, any pooled investment vehicle, investment trust, investment company, collective fund, collective trust, commodity pool or other collective or commingled investment vehicle, unit-linked life insurance fund, unit trust, German KAG or commingled investment vehicle or, where applicable, the corporation or trust of which it is a series, for which one of the Transferred Entities acts or will, after a date prior to the Closing, act (i) as investment advisor, subadvisor, trustee, manager or sponsor or (ii) in a similar capacity under applicable Law, in each case, as of such date.  Notwithstanding anything in this Agreement to the contrary, representations, warranties, covenants and other agreements made in this Agreement with respect to Funds shall always be deemed to be made only with respect to, and

only to the extent that, such Funds are under the Control of a Transferred Entity in respect of the subject matter of such representation, warranty, covenant or other agreement.

“ Fund Financial Statements ” has the meaning set forth in Section 4.17(d).

“ Fund Limited ” means Lakeville Fund Limited, an exempted company incorporated in the Cayman Islands with limited liability.

“ GAAP ” shall mean United States generally accepted accounting principles.

“ Gap Amount ” has the meaning set forth in Section 6.5(k)(ii).

“ Germany Company ” means Barclays Global Investors (Deutschland) AG, a corporation organized under the Laws of Germany registered with the commercial register at the local court of Munich under HRB 134527.

“ Germany Holdings ” means Barclays Global Investors Holdings Deutschland GmbH, a limited liability company organized under the Laws of Germany registered with the commercial register at the local court of Munich under HRB 168820.

“ Germany Investment ” means iShares (DE) I Investmentaktiengesellschaft mit Teilgesellschaftsvermögen, a corporation organized under the Laws of Germany registered with the commercial register at the local court of Munich under HRB 176566.

“ Government Entity ” means any foreign or domestic, federal, state, provincial, county, city or local legislative, administrative or regulatory authority, agency, court, body or other governmental or quasi-governmental entity with competent jurisdiction, including any Self-Regulatory Organization and any such supranational body (including the European Commission and the European Court of Justice).

“ Guarantee ” has the meaning set forth in Section 6.30.

“ Guernsey Company ” means Barclays Global Investors Guernsey Limited, a company limited by shares organized under the Laws of the Bailiwick of Guernsey.

“ Half Year Financial Statements ” has the meaning set forth in Section 6.28(f).

“ HK Company ” means Barclays Global Investors North Asia Limited, a company limited by shares organized under the Laws of the Hong Kong Special Administrative Region of the People’s Republic of China.

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

“ ICTA ” has the meaning set forth in Section 4.7(s).

“ Identified Third Party ” has the meaning set forth in Section 6.25(a).

“ IFRS ” means the International Financial Reporting Standards adopted by the European Union.

“ Indebtedness ” means, with respect to any Person, without duplication, any of the following liabilities, whether secured (with or without limited recourse) or unsecured, contingent or otherwise:   (i) all liabilities for borrowed money; (ii) all liabilities evidenced by bonds, debentures, notes or other similar instruments or under financing or capital leases; (iii) all liabilities for guarantees of another Person in respect of liabilities of the type set forth in clauses (i) and (ii); and (iv) all liabilities for accrued but unpaid interest expense and unpaid penalties, fees, charges and prepayment premiums that are payable, in each case, with respect to any of the obligations of a type described in clauses (i) through (iii) above.  Notwithstanding anything in this Agreement to the contrary, obligations owed to insurance and reinsurance policyholders owning unit-linked insurance policies issued by Pensions Management shall not be deemed Indebtedness for any purpose under this Agreement.

“ Indemnified Parties ” has the meaning set forth in Section 8.3(a).

“ Indemnifying Party ” has the meaning set forth in Section 8.4(a).

“ Indirect Taxes ” means all sales, employment, VAT, property, duty, excise, stamp and similar Taxes.

“ Information Statement ” has the meaning set forth in Section 6.17(a).

“ Input Tax ” means “deductible VAT” as such term is used in the European Community VAT Directive 2006/112/EC.

“ Intellectual Property ” means all:   (i) trademarks, service marks, domain names, logos, trade dress, trade names, and other indicia of origin, all applications and registrations for the foregoing, and all goodwill associated therewith and symbolized thereby, including all renewals of same (collectively, “ Trademarks ”); (ii) patents, registrations and applications therefor, and divisionals, continuations, continuations-in-part, extensions and reissues relating thereto (collectively, “ Patents ”); (iii) trade secrets, confidential proprietary information, inventions and know-how (collectively, “ Trade Secrets ”); (iv) works of authorship and copyrights therein and thereto (including in software), registrations and applications therefor, and all renewals, extensions, restorations and reversions thereof (collectively, “ Copyrights ”); and (v) other intellectual property rights to the extent entitled to legal protection as such.

“ Intercompany Payables ” means all account, note or loan payables and all advances (cash or otherwise) or any other extensions of credit that are payable by Parent or any of its Subsidiaries (including the Transferred Entities) to a Transferred Entity; provided, that Intercompany Payables shall not include any such account, note or loan payable or any advance (cash or otherwise) or any other extension of credit that (i) is entered into or otherwise created in the ordinary course of business within three months prior to the Closing Date and (ii) is due or is expected to be otherwise terminated or extinguished within three months following the Closing Date, or (iii) is of an amount that is less than $1,000,000.

“ Intercompany Receivables ” means all account, note or loan payables and all advances (cash or otherwise) or any other extensions of credit that are receivable by Parent or any of its Subsidiaries (including the Transferred Entities) from a Transferred Entity; provided, that Intercompany Receivables shall not include any such account, note or loan payable or any advance (cash or otherwise) or any other extension of credit that (i) is entered into or otherwise created in the ordinary course of business within three months prior to the Closing Date and (ii) is due or is expected to be otherwise terminated or extinguished within three months following the Closing Date, or (iii) is of an amount that is less than $1,000,000.

“ Investment Advisers Act ” means the United States Investment Advisers Act of 1940, as amended, and the rules and regulations promulgated thereunder.

“ Investment Advisory Arrangement ” means a Contract under which a Person acts as a trustee, an investment adviser or a sub-adviser to, or manages any investment or trading account of, any Client.

“ Investment Company Act ” means the United States Investment Company Act of 1940, as amended, and the rules and regulations promulgated thereunder.

“ Ireland Company ” means Barclays Global Investors Ireland Limited, a corporation organized under the Laws of Ireland.

“ IRS ” means the Internal Revenue Service of the United States of America.

“ Japan Company ” means Barclays Global Investors Japan Limited, a stock company organized under the Laws of Japan.

“ Knowledge ” or any similar phrase means (i) the actual knowledge of the Persons referenced in Annex 1.1(a) with respect to Seller and (ii) the actual knowledge of the Persons referenced in Annex 1.1(b) with respect to Buyer.

“ Law ” means any law, statute, ordinance, rule, regulation, code, order, ordinance, judgment, injunction, writ, decree, decision, directive, or other requirement or rule of law enacted, issued, promulgated, enforced or entered by a Government Entity, including listing rules made under Part VI of the UK Financial Services and Markets Act 2000 (as set out in the FSA Handbook).

“ Litigation ” means any claim, action, suit, complaint, demand, litigation, arbitration, prosecution, contest, hearing, inquiry, investigation, inquest, audit or other proceeding of any nature, civil, criminal, regulatory or otherwise, in law or in equity, pending or threatened, by or before any court, tribunal, arbitrator or other Government Entity.

“ Losses ” has the meaning set forth in Section 8.2(a).

“ Majority Stockholders ” means PNC and Merrill Lynch.

“ Material Adverse Effect ” means an event, circumstance, fact, change, development, condition or effect that has a material adverse effect on the business, assets,

properties, results of operations or condition (financial or otherwise) of the Transferred Entities, taken as a whole; provided that none of the following (or the results thereof) shall contribute to or be a Material Adverse Effect:   (i) any change in Law or accounting standards, but only to the extent that the Transferred Entities, taken as a whole, are not materially disproportionately adversely affected compared to other asset managers and providers of investment management products and services generally; (ii) any change in economic or business conditions locally or globally generally, but only to the extent that the Transferred Entities, taken as a whole, are not materially disproportionately adversely affected compared to other asset managers and providers of investment management products and services generally; (iii) any events, conditions or trends in economic, business or financial conditions generally affecting the financial services industry, including changes in prevailing interest rates, currency exchange rates and price levels or trading volumes in the United States or foreign securities markets; (iv) any change resulting from or arising out of hurricanes, earthquakes, floods or other natural disasters; (v) any change in assets under management resulting from changes in asset valuation or market price fluctuations; (vi) the effects of the actions that are (A) expressly required by this Agreement or the MSA, (B) taken by Seller or any of the Transferred Entities with the prior written consent of Buyer or (C) not taken by Seller or any of the Transferred Entities at the written request of Buyer or due to Buyer’s refusal to provide its consent therefor; and (vii) any change, including the loss of business of any of the Transferred Entities, resulting from the announcement of (x) this Agreement and the transactions contemplated by this Agreement or (y) the MSA and the transactions contemplated by the MSA.

“ Material Leases ” has the meaning set forth in Section 4.21.

“ Maximum Share Amount ” has the meaning set forth in Section 2.2(b)(i)

“ Merrill Lynch ” means Merrill Lynch & Co., Inc., a Delaware corporation.

“ Mexico Company ” means Impulsora y Promotora BGI México S.A. de C.V., a Sociedad Anónima de Captial Variable organized under the Laws of Mexico.

“ Mexico Services ” means a Person that Seller shall form, incorporate or otherwise establish, or cause to be formed, incorporated or otherwise established, prior to the Closing under applicable Laws in Mexico in accordance with Section 6.26(a).

“ MSA ” means the Master Sale Agreement, dated as of April 9, 2009, by and among Seller (solely for the purpose of Section 9.16 of the MSA), UK Holdings and Blue Sparkle, L.P., as amended.

“ Negative Consent Notice ” has the meaning set forth in Section 6.10.

“ Net Assets ” means, with respect to a Fund, the sum of the assets of such Fund minus its liabilities.

“ Net Regulatory Amount ” means, with respect to each Regulated Entity, the lower amount of its (i) Regulatory Capital Difference and (ii) Regulated Entity Net Working Capital as of the day preceding the Closing (which may be a negative number).

“ New Advisory Contract ” means, if required under applicable Law or the terms of the Investment Advisory Arrangement applicable thereto, with respect to a Fund or an Advisory Client, a new investment advisory, investment management, trust or similar agreement with the Fund or the Advisory Client to be entered into as a result of the transactions contemplated by this Agreement pursuant to the Assignment Requirements.  For a Fund registered under the Investment Company Act, the term “New Advisory Contract” means a New Advisory Contract (either advisory or sub-advisory) approved in accordance with the requirements of Section 15 of the Investment Company Act excluding any “interim” new advisory contract (either advisory or sub-advisory) approved in reliance on Rule 15a-4 under the Investment Company Act.

“ New Transferred Entities ” means Brazil Company, Chile Company, Chile Holdings, Delaware LLC, Delaware Holdings and Mexico Services.

“ New York Court ” has the meaning set forth in Section 10.9(b).

“ Next Day Transfer ” has the meaning set forth in Section 2.1(e).

“ Notice ” has the meaning set forth in Section 6.9.

“ Notice Period ” has the meaning set forth in Section 8.4(a).

“ NYSE ” means the New York Stock Exchange.

“ Ordinary Items ” has the meaning set forth in Section 6.5(k)(i).

“ Organizational Documents ” means, with respect to any Person that is a corporation, its articles or certificate of incorporation or memorandum and articles of association, as the case may be, and bylaws; with respect to any Person that is a partnership, its certificate of partnership and partnership agreement; with respect to any Person that is a limited liability company, its certificate of formation and limited liability company or operating agreement; with respect to any Person that is a trust or other entity, its declaration or agreement of trust or other constituent document; and with respect to any other Person, its comparable organizational documents, in each case, as has been amended or restated.

 “ Parent ” has the meaning set forth in the Preamble.

“ Parent Group ” means Parent and its direct and indirect Subsidiaries, excluding the Transferred Entities.

“ Parent Ordinary Shares ” has the meaning set forth in Section 3.3.

“ Parent Public Report ” means the Annual Report on Form 20-F filed by Parent on March 24, 2009 with the SEC.

“ Parent Requisite Vote ” has the meaning set forth in Section 3.3.

“ Parent Shareholders Meeting ” has the meaning set forth in Section 6.16(b).

“ Patents ” has the meaning set forth in the “Intellectual Property” definition.

“ Pension Management ” means Barclays Global Investors Pensions Management Limited, a corporation incorporated under the Laws of England and Wales.

“ Permits ” means all licenses, franchises, permits, certificates, registrations, orders, concessions, declarations, and other authorizations and approvals that are issued by or obtained from any Government Entity.

“ Permitted Encumbrances ” means:   (i) Encumbrances specifically reflected or reserved against or otherwise specifically disclosed in the Unaudited Financial Statements; (ii) mechanics’, materialmen’s, warehousemen’s, carriers’, workers’, or repairmen’s liens or other similar common law or statutory Encumbrances arising or incurred in the ordinary course of business that are not, in the aggregate, material to the Transferred Entities, taken as a whole; (iii) statutory liens for Taxes, assessments and other governmental charges not yet due and payable or being contested in good faith by appropriate proceedings and for which adequate reserves have been established on the financial statements of the relevant Transferred Entity in accordance with GAAP, IFRS, or other applicable accounting principles; and (iv) other Encumbrances incurred in the ordinary course of business since the date of the Unaudited Financial Statements that are not, in the aggregate, material to the Transferred Entities, taken as a whole.

“ Person ” means an individual, a corporation, a partnership, an association, a limited liability company, a Government Entity, a trust or any other entity, body or organization.

“ PNC ” means The PNC Financial Services Group, Inc., a Pennsylvania corporation.

“ Proposed Allocation ” has the meaning set forth in Section 6.5(g)(ii).

“ Prospectus ” has the meaning set forth in Section 4.17(e).

“ Providing Party ” has the meaning set forth in Section 6.1(a).

“ PTE 84-14 ” has the meaning set forth in Section 4.16(d).

“ Purchase ” has the meaning set forth in Section 2.1(e).

“ Purchase Price ” means (i) the Cash Purchase Price and (ii) the Equity Consideration.

“ Quellos Agreement ” means the Asset Purchase Agreement, dated June 26, 2007, by and among BAA Holdings, LLC, Quellos Holdings, LLC and Buyer.

“ QPAM ” has the meaning set forth in Section 4.16(d).

“ Recurring Errors ” has the meaning set forth in Section 8.2(c).

“ Reference Price ” means $163.74, as the same may be adjusted pursuant to Section 2.8.

“ Refund Payment ” means any payment (including, without limitation, interest) made by a VAT Authority, whether by way of refund, credit or repayment or otherwise, in respect of, arising out of or resulting from, or otherwise in connection with, an amount of, or purporting to be, VAT having been accounted for to a VAT Authority on a Relevant Supply.

“ Registered ” means issued by, registered with, renewed by or the subject of a pending application before any Government Entity or domain name registrar.

“ Registration Rights Agreement ” means the Registration Rights Agreement between Buyer and Seller to be entered into in connection with the transactions contemplated by this Agreement.

“ Regulated Entities ” means means Australia Company, Canada Company, Canada Services, Germany Company, Guernsey Company, HK Company, Ireland Company, Japan Company, Pension Management, Singapore Company, US Bank, UK Company, US Global Investors Fund Distribution Company and US Global Investors Services.

“ Regulated Entity Net Working Capital ” means, with respect to each Regulated Entity, the amount equal to its (i) current assets, excluding cash and liquid investments, but including fee and other receivables (excluding receivables that are more than 180 days past due as of the Closing to the extent an allowance is taken therefore), accruals and prepayments, minus (ii) current liabilities (other than Taxes, but including Indirect Taxes and any deferred compensation liabilities) due within 12 months.  In no event will the same item be included in both the Unregulated Entity Net Working Capital and the Regulated Entity Net Working Capital.

“ Regulatory Amount ” means an amount equal to the sum of the Net Regulatory Amount for each of the Regulated Entities.

“ Regulatory Capital Difference ” means, with respect to each Regulated Entity, the amount equal to its Closing Actual Capital minus its Closing Required Regulatory Capital (which amount may be a negative number).

“ Regulatory Requirement ” means any Law to the extent it regulates the business, products, services, operation, financial condition, ownership, supervision or regulation of brokers, dealers, commodity pool operators, commodity trading advisors, investment companies, banks, investment advisers, trust companies, insurance companies or agencies or securities lending agents or Persons engaged in any such business, but not to the extent that it regulates other types of businesses or Persons, in a manner unrelated to the regulated activities described above.

“ Relevant Documentation ” means the following documents of the Parent Group or any Transferred Entity created prior to the Closing Date:  (a) any documents which refer to or relate to the Parent Group’s or the Transferred Entities’ compliance with OFAC or other government sanctions; and (b) all customer documentation (including, for the avoidance of doubt but not limited to, customer payment records and instructions in any currency, customer cheques (in whichever format they are retained), customer payment transaction records, customer anti

money laundering files (where such files exist), any customer files or folders, KYC/KYB documentation, customer ledgers or statements and all SWIFT messages), and for the purposes of this definition references to documents and documentation shall include all types of electronic and printed communications, including encompassing memoranda, letters, reports, presentations, spreadsheets, overheads, charts, cheques, ledgers, calendars, presentations, invoices, minutes, video tapes, audio tapes, compact discs, e-mails and floppy discs.

“ Relevant Supply ” means any supply made (or which would, had the relevant Transferred Entity been registered for VAT otherwise than as part of a VAT Group, have been treated as made) by a Transferred Entity for VAT purposes on or prior to the Closing Date to a Person which was not, at the time the supply was made, treated by the Transferred Entity or any Affiliate of Seller or Parent (acting in accordance with the guidance and practice at that time of, or the interpretation of Law then applied by, the relevant VAT Authority) as a “special investment fund” within the meaning of Article 13B(d)(6) of the Sixth Council Directive 77/388/EEC of 17 May 1977 (as amended and recast by the European Community VAT Directive 2006/112/EC) but which, as a consequence of any judicial ruling or other judicial determination by any relevant Government Entity on the interpretation of “special investment fund” for the purposes of the said Article 13B(d)(6), should have been treated by the Transferred Entity or such Affiliate of Seller or Parent as a “special investment fund”.

“ Relief ” means any loss, relief, allowance, exemption, set off, deduction, right to repayment or credit or other relief of a similar nature granted by or available in relation to Tax pursuant to any legislation or otherwise.

“ Reports ” has the meaning set forth in Section 4.17(e).

“ Representatives ” means, with respect to any Person, its directors, officers, employees, investment bankers, attorneys, accountants, advisors and other representatives.

“ Required Regulatory Capital ” means, with respect to each Regulated Entity, the amount of regulatory capital required under applicable Law or agreement with any applicable Government Entity to be maintained by such Regulated Entity immediately prior to the Closing.

“ Required Regulatory Cash ” means, with respect to each of the Regulated Entities, the amount of cash and liquid investments required under applicable Law or agreement with any applicable Government Entity to be maintained by such Regulated Entity immediately prior to the Closing.

“ Resolution Period ” has the meaning set forth in Section 2.3(a)(iii).

“ Resolutions ” has the meaning set forth in Section 6.16(b).

“ Resolved Items ” has the meaning set forth in Section 2.3(a)(iii).

“ Restructuring ” has the meaning set forth in Section 6.26(d).

“ Revenue Run-Rate ” means, as of any specified date, the aggregate amount, without duplication, of all investment management fees for each investment management

account (or for ETFs, the unitary fee rate or the total expense ratio or the contractual fee rate, as applicable) of each applicable Client of the Transferred Entities payable to the Transferred Entities pursuant to the relevant Investment Advisory Arrangement, determined by multiplying the Adjusted Assets Under Management for each such account at such date by the applicable annual fee rate for all such fees for such account in effect on such date (or for ETFs, the unitary fee rate or the total expense ratio or the contractual fee rate, as applicable) (or, in the case of the Closing Adjustment Revenue Run-Rate and Closing ETF Adjustment Revenue Run-Rate, as will be in effect as of immediately following the Closing Date or such later date within six months after the Closing Date on which a revised fee rate will take effect).  The calculation of the Revenue Run-Rate shall (a) exclude from revenue any performance-based, incentive or similar fees, securities lending fees, transition revenues and fees generated in respect of Fund Limited or the iPath business and (b) include only net revenues to the Transferred Entities after giving effect to, and taking into account, any fee or expense waiver, rebate or cap, reimbursement obligation or similar offset, distribution or sales charge or fee (including any mutual fund supermarket fee) or any revenue sharing arrangement (including any such amount deducted directly by or on behalf of a Client from the fee otherwise payable by such Client to a Transferred Entity under the applicable Investment Advisory Arrangement).

“ Revenue Run-Rate Adjustment Amount ” means the product of (i) 4.25, multiplied by (ii) the excess, if any, of (x) the product of (1) 0.9 multiplied by (2) the Base Revenue Run-Rate over (y) the Closing Adjustment Revenue Run-Rate.  For purposes of calculating the Revenue Run-Rate Adjustment Amount in respect of the Closing, the revenue corresponding to Base Revenue Run-Rate for all Contingent Accounts shall be excluded from the calculation.  Notwithstanding anything in this Agreement to the contrary, in the event that the Revenue Run-Rate Adjustment Amount exceeds $1.4 billion, the Revenue Run-Rate Adjustment shall be deemed to be $1.4 billion.

“ Rules ” has the meaning set forth in Section 8.13(a).

“ SEC ” means the United States Securities and Exchange Commission.

“ Securities Act ” means the United States Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.

“ Securities Lending Client ” has the meaning set forth in Section 6.30.

“ Self-Regulatory Organization ” means (i) any “self-regulatory organization” as defined in Section 3(a)(26) of the Exchange Act, (ii) any other US or foreign securities exchange, futures exchange, commodities exchange or contract market and (iii) any other exchange or corporation or similar self-regulatory body or organization.

“ Seller ” has the meaning set forth in the Preamble.

“ Seller Indemnified Party ” has the meaning set forth in Section 8.3(a).

“ Seller Limit ” has the meaning set forth in Section 8.2(b).

“ Seller Regulatory Impediments ” means (i) conditions, limitations, restrictions or requirements, including any sales, divestitures, hold separates or other disposals, imposed upon Seller or any of its Affiliates in connection with obtaining or failing to obtain the approval of any Government Entity to the transactions contemplated hereby, or (ii) prohibitions under any applicable Law that would, in each case of (i) and(ii), individually or in the aggregate, reasonably be expected to be materially adverse to Seller in comparison to the benefits that Seller expects to obtain from the transactions contemplated hereby.

“ Seller Threshold ” has the meaning set forth in Section 8.2(b).

“ Seller’s Disclosure Schedules ” means the disclosure schedules delivered by Seller to Buyer immediately prior to the execution of this Agreement.

“ Seller’s i-Marks ” has the meaning set forth in Section 6.23(d).

“ Seller’s Names and Marks ” has the meaning set forth in Section 6.23(a).

“ Seller’s Required Approvals ” has the meaning set forth in Section 3.5.

“ Share Issuance ” means the issuance of the Buyer Series B Preferred Stock in accordance with the terms of the Buyer Series D Preferred Stock issued in connection with and pursuant to the terms of this Agreement.

“ Significant Contract ” has the meaning set forth in Section 4.13(b).

“ Singapore Company ” means Barclays Global Investors Southeast Asia Limited, a public company limited by shares organized under the Laws of Singapore.

“ Singapore Services ” means Barclays Global Investors Southeast Asia Services Pte. Ltd, a public limited company organized under the Laws of Singapore.

“ Specified Contracts ” has the meaning set forth in Section 4.13(a).

“ Specified Controlled Affiliate ” means, with respect to any Person, a Subsidiary of such Person and any Affiliate of such Person whose Competing Activities may be restricted by one or more members of the Parent Group.

“ Stockholder Agreement ” means the Stockholder Agreement in the form attached hereto as Exhibit A.

“ Stub Period ” has the meaning set forth in Annex 6.5.

“ Subsidiary ” means, with respect to any Person, as of the date of determination, any other Person of which at least a majority of the securities or ownership interests having by their terms ordinary voting power to elect a majority of the board of directors or other persons performing similar functions (including general partners or managing members) is directly or indirectly owned or controlled by such Person and/or by one or more of its Subsidiaries.

Notwithstanding anything in this Agreement, in no event shall any Fund of any Person be considered to be a Subsidiary of such Person.

“ Switzerland Company ” means Barclays Global Investors (Schweiz) AG, a corporation organized under the Laws of Switzerland.

“ Target Cash ” means an amount equal to the sum of (i) with respect to each Regulated Entity, its Closing Required Cash plus (ii) $100 million.

“ Tax Indemnity Payments ” has the meaning set forth in Section 6.5(a)(viii).

“ Tax Returns ” means all reports, returns, information returns, elections, agreements, declarations, or other documents of any nature or kind (including any attached schedules, supplements and additional or supporting material) filed or required to be filed with respect to Taxes, including any claim for refund, amended return or declaration of estimated Taxes (and including any amendments with respect thereto).

“ Taxes ” means (i) all federal, state or local and all provincial or foreign taxes, including income, gross receipts, capital gains, non-resident withholding tax, windfall profits, VAT, severance, property, social security, national insurance contributions, production, sales, use, duty, license, excise, franchise, employment, withholding, rent or similar taxes, levies, charges, surcharges or imposts together with any interest, fines, additions or penalties with respect thereto, and any interest in respect of such fines, additions or penalties, whether disputed or not, and (ii) any transferee or other secondary or non-primary liability or other obligation with respect to any item in clause (i) above, whether such liability or obligation arises by assumption, operation of law, Contract, indemnity, guarantee, as a successor or otherwise.

“ Termination Date ” has the meaning set forth in Section 9.1(b).

“ Termination Fee ” has the meaning set forth in Section 9.3(a).

“ Third Party Claim ” has the meaning set forth in Section 8.4(a).

“ Third Party Claim Notice ” has the meaning set forth in Section 8.4(a).

“ Total Adjustment Amount Shares ” means that number of shares of Buyer Series D Preferred Stock (and if such number would exceed the Buyer Series D Preferred Stock Consideration such additional number of Buyer Series B Preferred Stock) equal to the quotient obtained by dividing (i) the Revenue Run-Rate Adjustment Amount by (ii) the Reference Price.

“ Total Share Amount ” means an aggregate number of shares of Buyer Common Stock, Buyer Series B Preferred Stock and Buyer Series D Preferred Stock equal to 37,784,000, subject to adjustment pursuant to Section 2.7.

“ Trade Secrets ” has the meaning set forth in the “Intellectual Property” definition.

“ Trademarks ” has the meaning set forth in the “Intellectual Property” definition.

“ Transfer of Undertakings ” means the United Kingdom’s Transfer of Undertakings (Protection of Employment) Regulations 2006 (SI 2006 No. 246).

“ Transfer Taxes ” has the meaning set forth in Section 6.5(e)(i).

“ Transferred Employee ” has the meaning set forth in Section 4.12(b).

“ Transferred Entities ” means UK Company, Ireland Company, Pension Management, Guernsey Company, Germany Holdings, Germany Company, Germany Investment, UK Services, Switzerland Company, HK Company, Japan Company, Singapore Company, Singapore Services, Australia Company, Australia Holdings, Australia Services, Canada Company, Canada Holdings, Canada Services, Mexico Company, California Corporation, US International, US Global Investors Fund Distribution Company, US Growth Partners, US Bank, US Global Investors Services, US Fund Advisors, US Company, Brazil Company, Chile Company, Chile Holdings, Mexico Services, Delaware Holdings, Delaware LLC, UK Trust Manager and UK Holdings and any other entity created in connection with any transaction undertaken pursuant to Section 6.26 in which equity interests are directly or indirectly transferred to Buyer in connection with the transactions contemplated by this Agreement.

“ Transferred Entities’ Required Approvals ” has the meaning set forth in Section 4.3.

“ Transferred Equity Interests ” means all of the issued and outstanding equity interests in the Transferred Entities.

“ Transition Period ” has the meaning set forth in Section 6.12(a).

“ Transition Services Agreement ” means the transition services agreement between Buyer and Seller and certain of their Affiliates, that the parties intend to enter into prior to the Closing Date, pursuant to Section 6.13.

“ True-Up Period ” has the meaning set forth in Section 2.3(c).

“ UK Company ” means Barclays Global Investors Limited, a company incorporated under the Laws of England and Wales.

“ UK Entity ” means UK Company, UK Holdings, Pension Management, UK Services, UK Trust Manager and each other Transferred Entity which is (a) incorporated in any jurisdiction within the United Kingdom, (b) resident for any Tax purpose in the United Kingdom or (c) trading in the United Kingdom through a permanent establishment in the United Kingdom.

“ UK Fund ” has the meaning set forth in Section 4.17(k).

“ UK Holdings ” means Barclays Global Investors UK Holdings Limited, a company incorporated under the Laws of England and Wales.

“ UK Holdings Directly Transferred Entities ” means UK Company, UK Trust Manager, Ireland Company, Pension Management, Guernsey Company, Germany Holdings, UK Services, Switzerland Company, HK Company, Singapore Company, Singapore Services, Australia Company, Australia Holdings and Canada Holdings.

“ UK Holdings Directly Transferred Equity Interests ” means all of the issued and outstanding equity interests in the UK Holdings Directly Transferred Entities.

“ UK Services ” means Barclays Global Investors Services Limited, a corporation incorporated under the Laws of England and Wales.

“ UK Trust Manager ” means Barclays Global Investors Unit Trust Manager Limited, a company incorporated under the Laws of England and Wales.

“ UKLA ” has the meaning set forth in Section 6.16(a).

“ Unaudited Balance Sheet ” has the meaning set forth in Section 4.5(a).

“ Unaudited Financial Statements ” has the meaning set forth in Section 4.5(a).

“ Unpaid Receivables ” has the meaning set forth in Section 2.3(a)(vi).

“ Unregulated Entities ” means the Transferred Entities that are not Regulated Entities.

“ Unregulated Entity Net Working Capital ” means with respect to the Transferred Entities (other than the Regulated Entities) on a combined basis, the amount equal to their (i) current assets, excluding cash and liquid investments but including fee and other receivables (excluding receivables that are more than 180 days past-due as of the Closing to the extent an allowance has been taken therefore), accruals and prepayments, minus (ii) current liabilities (other than Taxes, but including Indirect Taxes and any deferred compensation liabilities) due within 12 months.  In no event shall the same item be included in both the Unregulated Entity Net Working Capital and the Regulated Entity Net Working Capital.

“ Unresolved Items ” has the meaning set forth in Section 2.3(a)(iii).

“ US Bank ” means Barclays Global Investors, N.A., a bank organized as a national association under the Laws of the United States.

“ U.S. Benefit and Compensation Arrangements ” shall mean Benefit and Compensation Arrangements governed by the Laws of the United States and maintained in the United States primarily for the benefit of the Employees residing or working in the United States.

“ US Company ” means Barclays Global Investors USA Inc., a corporation organized under the Laws of the State of California.

“ US Fund ” means a Fund organized under the Laws of any state of the United States.

“ US Fund Advisors ” means Barclays Global Fund Advisors, a corporation organized under the Laws of the State of California.

“ US Global Investors Fund Distribution Company ” means Barclays Global Investors Fund Distribution Company, a corporation organized under the Laws of the State of California.

“ US Global Investors Services ” means Barclays Global Investors Services, a corporation organized under the Laws of the State of California.

“ US Growth Partners ” means Barclays Global Investors Growth Partners, Inc., a corporation organized under the Laws of the State of Delaware.

“ US International ” means Barclays Global Investors International Inc., a corporation organized under the Laws of the State of Delaware.

“ VAT ” means any value added tax, consumption tax and goods and services tax and includes any other Tax of a similar nature imposed (instead of or in addition to such tax) from time to time, together with any interest and penalties thereon.

“ VAT Authority ” in relation to any jurisdiction, means any governmental, local, state, federal, fiscal, revenue, customs, excise or other authority, body, agency or official whatsoever responsible for the management, administration and collection of VAT in that jurisdiction.

“ VAT Group ” has the meaning set forth in Section 6.5(h)(ii).

“ VAT Indemnity Payments ” has the meaning set forth in Section 6.5(a)(ix).

“ Willful Breach ” means an action or failure to act by one of the parties to this Agreement that constitutes a material breach of this Agreement, and such action was taken or such failure occurred with such party’s knowledge or intention that such action or failure to act would constitute a material breach of this Agreement.

“ Withheld Amount ” has the meaning set forth in Section 2.9(a).

“ Written Consents ” means the written consents of the Majority Stockholders, executed in their capacity as the holders of shares of Buyer Common Stock that in the aggregate represent not less than a majority of the total voting power of the capital stock of Buyer and delivered to Buyer concurrently with the execution of this Agreement, to irrevocably approve of the Share Issuance.

“ Written Plan ” has the meaning set forth in Section 4.17(e).

Section 1.2   Other Terms .  Other terms may be defined elsewhere in the text of this Agreement and, unless otherwise indicated, shall have such meaning throughout this Agreement.

Section 1.3    Other Definitional Provisions .  Unless the express context otherwise requires:

(a)           the words “hereof”, “herein”, and “hereunder” and words of similar import, when used in this Agreement, shall refer to this Agreement as a whole and not to any particular provision of this Agreement;

(b)           the terms defined in the singular have a comparable meaning when used in the plural and vice versa;

(c)           the terms “ Dollars ” and “ $ ” mean United States Dollars;

(d)           references in this Agreement to a specific Section, Clause or Annex shall refer, respectively, to Sections, Clauses or Annexes of this Agreement;

(e)           wherever the word “include,” “includes,” or “including” is used in this Agreement, it shall be deemed to be followed by the words “without limitation”; and

(f)           references in this Agreement to either gender includes the other gender.

ARTICLE II

PURCHASE AND SALE OF THE TRANSFERRED EQUITY INTERESTS

Section 2.1    Purchase and Sale .  Upon the terms and subject to the conditions set forth in this Agreement, at the Closing, in respect of clauses (a), (b), (c) and (d) below, or within 24 hours following the Closing, in respect of clause (e) below, Seller and Buyer agree that the following transactions shall occur in the specified order:

(a)           Seller shall, or shall cause UK Holdings to, sell and transfer the UK Holdings Directly Transferred Equity Interests to Buyer, and Buyer shall purchase and receive the UK Holdings Directly Transferred Equity Interests from Seller or UK Holdings, free and clear of any Encumbrances (it being understood and agreed that, upon the completion of such sale and transfer, Buyer shall become the indirect beneficial owner of all of the issued and outstanding equity interests in Germany Company, Germany Investment, Australia Services, Canada Company and Canada Services, free and clear of any Encumbrances);

(b)           Seller shall, or shall cause Finance Limited to, sell and transfer all of the issued and outstanding equity interests in Delaware Holdings to Buyer, and Buyer shall purchase and receive all of the issued and outstanding equity interests in Delaware Holdings from Seller or Finance Limited, free and clear of any Encumbrances (it being understood and agreed that, upon the completion of such sale and transfer, Buyer shall become the indirect beneficial owner of all of the issued and outstanding equity securities in California Corporation, Delaware LLC, US International, US Global Investors Fund Distribution Company, US Growth Partners, US Bank, US Global Investors Services, US Fund Advisors and US Company, free and clear of any Encumbrances);

(c)           Seller shall, or shall cause Finance Limited and UK Holdings to, sell and transfer all of the issued and outstanding equity interests in Mexico Company, Brazil Company and Chile Holdings to Buyer, and Buyer shall purchase and receive all of the issued and outstanding equity interests in Mexico Company, Brazil Company and Chile Holdings from Seller or Finance Limited and UK Holdings, free and clear of any Encumbrances (it being understood and agreed that, upon the completion of such sale and transfer, Buyer shall become the indirect beneficial owner of all of the issued and outstanding equity securities in Chile Company and Mexico Services, free and clear of any Encumbrances);

(d)           Seller shall cause to be transferred to or at the direction of Buyer such nominee shares in any of the Transferred Entities held by Seller or any of its Affiliates; and

(e)           As soon as reasonably practicable following the Closing, but in any event within 24 hours following the Closing, Seller and Buyer shall cause all of the issued and outstanding equity interests in UK Holdings to be transferred from Seller to Buyer, free and clear of any Encumbrances (it being understood and agreed that, upon the completion of such transfer, Buyer shall, taking into account the transactions effected at the Closing, become the indirect beneficial owner of all of the issued and outstanding equity securities in Japan Company, free and clear of any Encumbrances) (such transfer, the “ Next Day Transfer ,” and all of the transactions described in this Section 2.1, the “ Purchase ”).

Section 2.2     Purchase Price .

(a)           Upon the terms and subject to the conditions of this Agreement, at the Closing, in consideration of the Purchase, subject to adjustment as provided in this Agreement, Buyer shall (i) pay Seller (or any Affiliates of Seller designated by Seller in writing) the Cash Purchase Price, by wire transfers of immediately available U.S. dollar funds to one or more accounts to be designated in writing by Seller to Buyer not less than five Business Days prior to the Closing Date, and (ii) issue to Seller (or any Affiliates of Seller designated by Seller in writing) the Equity Consideration, in each case of (i) and (ii), as among Seller, UK Holdings and Finance Limited (or such other Affiliates of Seller as Seller may designate in writing), pursuant to the Allocation and to Section 6.5(g) of the Seller’s Disclosure Schedules as agreed by Buyer and Seller pursuant to Section 6.5(g).

(b)           Notwithstanding anything in this Agreement to the contrary:

immediately following the Closing (taking into the adjustments provided for in clause (v) below) (the “ Maximum Share Amount ,” and the difference between the Total Share Amount and the Maximum Share Amount, the “ Deficit Shares ”) .  If the Total Share Amount is required to be reduced pursuant to the first sentence of this Section 2.2(d), such reduction shall be applied first by reducing Buyer Preferred Stock otherwise issuable.

Section 2.3     Post-Closing Purchase Price Adjustment .

(a)            Preparation of Final Regulatory and Working Capital.

Buyer calculations of the Regulatory Amount for the Regulated Entities (the “ Closing Regulated Entity Regulatory Capital Statement ”), the amount of the Unregulated Entity Net Working Capital for all Unregulated Entities (the “ Closing Unregulated Entity Working Capital Statement ”), the Cash Adjustment (the “ Cash Adjustment Statement ”) and the Capital Amount (the “ Capital Amount Statement ” and, together with the Closing Regulated Entity Regulatory Capital Statement, the Closing Unregulated Entity Working Capital Statement and the Cash Adjustment Statement, the “ Capital Statements ”), in each case prepared in good faith in accordance with IFRS consistently applied and on a basis consistent with the accounting policies, practices, procedures, valuation methods and principles used in preparing the Unaudited Financial Statements in respect of the Transferred Entities.

provide the CPA Firm such work papers and other documents and information related to the Unresolved Items as the CPA Firm may reasonably request if available to such party or, in the case of Buyer, its Subsidiaries, or, in the case of Seller, its Affiliates (or their accountants or auditors).  The CPA Firm shall act as an arbitrator and not as an expert, to determine, based on the provisions of this Section 2.3(a), only the Unresolved Items; provided , however , that the CPA Firm shall have authority to determine, and the term “Unresolved Items” as used in this Section 2.3(a) shall mean, only the amount(s) contained in such Capital Statements and no other matter whatsoever, absent a written agreement to the contrary by Buyer and Seller; provided, further, that the determination of the Unresolved Items provided by the CPA Firm must be made in accordance with the standards and definitions in this Agreement, and must be limited to the range between and including the amounts proposed by Seller and Buyer for the resolution of the specific Unresolved Item.  Seller and Buyer shall request that the CPA Firm provide, within 30 days after the submission of the Unresolved Items to the CPA Firm, a written statement setting forth (x) its determination of the Unresolved Items and (y) its calculation of the Capital Amount based upon (A) the amount of Resolved Items and (B) its determination of the Unresolved Items (such amount, the “ Final Capital Amount ”).  Such written statement shall be delivered to Buyer and Seller and absent manifest error shall be final, binding and conclusive on and with respect to Buyer and Seller and may be entered in any court having jurisdiction.

(b)            Post-Closing Purchase Price Adjustment Payments .  Any cash payments made pursuant to Section 2.3(a) shall be made by wire transfer of immediately available U.S. Dollar funds to an account indicated by the party to receive such funds and shall be accompanied by interest at the Applicable Rate calculated on the basis of a year of 365 days for the actual number of days elapsed, accrued from the Closing Date up to and including the date of payment.  Any payments made in respect of Section 2.3(a) (other than interest) shall be deemed to be adjustments to the Purchase Price pursuant to Section 2.2(a) for all Tax purposes.

(c)            Contingent Account True-Up .  If any Contingent Account exists at the Closing Measurement Date and either (i) if such Contingent Account is required by applicable Law or the terms of the Investment Advisory Arrangement applicable thereto to provide consent to the transactions contemplated hereby to enter into a New Advisory Contract or to obtain investor approval of a New Advisory Contract in order for such New Advisory Contract to remain in effect beyond the True-Up Period or become effective in order for the Transferred Entities to continue providing investment advisory services to such account after the Closing, and such Contingent Account has on the date that is 150 days following the Closing (the 150 day period, the “ True-Up Period ”), not previously granted such consent (including by way of negative consents), not entered into a New Advisory Contract or not obtained such investor approval, as the case may be, or (ii) if such Contingent Account (other than any Contingent Account covered in clause (i) above) has terminated the applicable Existing Advisory Contract prior to the end of the True-Up Period or has provided to Buyer or one of its Affiliates (including the Transferred Entities) effective notice of termination of the applicable Existing Advisory Contract, then Seller shall promptly following the end of the True-Up Period (x) return to Buyer such number of shares of, at Seller’s election, the Buyer Series B Preferred Stock or the Buyer Series D Preferred Stock equal to the quotient obtained by dividing (i) the amount by which the Revenue Run-Rate Adjustment Amount would have increased, if any, if any such remaining Contingent Accounts were treated as Contingent Accounts for purposes of calculating Adjusted Assets Under Management and the Revenue Run-Rate Adjustment Amount in respect of the Closing by (ii) the Reference Price or (y) pay to Buyer an amount in cash equal to the amount calculated by clause (x)(i).

(d)           The parties agree that if the post-closing purchase price adjustment provisions and procedures set forth in Section 2.3 (and the related defined terms) and the other provisions set forth in Article VI relating to the amount of cash and capital to be held by one or more of the Transferred Entities do not accord with the Statement of Working Capital Principles attached to this Agreement, then the parties shall cooperate and work in good faith to, by no later than the 30 ^th day after the date hereof, to determine the appropriate provisions related to such matters.

Section 2.4     Closing .  The closing of the Purchase (other than in respect of the Next Day Transfer) (the “ Closing ”) shall take place at the offices of Skadden Arps Slate Meagher & Flom LLP, Four Times Square, New York, New York, at 10:00 A.M., New York City time:  (i) on the first Business Day of the first calendar month that begins more than five Business Days following the satisfaction or waiver of the conditions set forth in Article VII with respect to the Closing (other than those conditions that by their terms are to be satisfied at the Closing, but subject to the satisfaction or waiver of such conditions); or (ii) at such other place, time and date as the parties to this Agreement may agree in writing.  

Section 2.5     Deliveries by Buyer .  At the Closing, Buyer shall pay or deliver to Seller or its designee, the following:

(a)           The Cash Purchase Price as provided pursuant to Section 2.2;

(b)           The stock certificates or, if uncertificated, other evidence of ownership representing the Equity Consideration (or, if applicable, other similar documentation evidencing the Equity Consideration), registered in the name of Seller or its designee, free and clear of any Encumbrances (other than those arising under the Stockholder Agreement);

(c)           The certificate to be delivered pursuant to Section 7.3(c); and

(d)           Such other documents and instruments necessary to consummate the transactions contemplated by this Agreement on the terms and subject to the conditions set forth in this Agreement, all of which, together with the documents and instruments referred to above, shall be in form and substance reasonably satisfactory to Seller.

Section 2.6     Deliveries by Seller .  At the Closing, Seller shall deliver, or cause to be delivered, to Buyer the following:

(a)           Certificates, or other documentation or evidence reasonably acceptable to Buyer, representing all of the issued and outstanding equity interests in Delaware Holdings, the UK Holdings Directly Transferred Entities, Mexico Company, Mexico Services, Brazil Company and Chile Holdings duly registered in the name of Buyer or its designee, free and clear of any Encumbrances (other than restrictions on transfer which arise under applicable securities Laws and other than Encumbrances created in or by Buyer or any of its Affiliates), in each case accompanied by duly executed instruments of transfer, duly notarized where legally required, in such name as Buyer shall direct;

(b)           Certificates, or other documentation or evidence reasonably acceptable to Buyer, duly notarized where legally required, representing (x) all of the issued and outstanding equity interests in Germany Company, Australia Services, Canada Company and Canada Services, in the name of the applicable UK Holdings Directly Transferred Entity, and all of the issued and outstanding enterprise shares in Germany Investment, in the name of Germany Company, (y) all of the issued and outstanding equity securities in California Corporation, in the name of Delaware Holdings, all of the issued and outstanding equity securities in US International, US Global Investors Fund Distribution Company, US Growth Partners, US Bank, US Global Investors Services, US Fund Advisors and US Company, in the name of California Corporation, and all of the issued and outstanding equity securities of Delaware LLC, in the name of US

International; and (z) all of the issued and outstanding equity securities in Chile Company, in the name of Chile Holdings, in the case of each of (x), (y) and (z), free and clear of any Encumbrances;

(c)           The certificate to be delivered pursuant to Section 7.2(c);

(d)           If requested in writing by Buyer not less than 20 days prior to the Closing Date, written resignations, effective as of the Closing, of such directors and/or members of the supervisory boards of each of the Transferred Entities as specified by Buyer, if any (it being understood and agreed that Buyer and Seller shall cooperate to ensure that all resignations and the replacement of directors and/or members of the supervisory boards from the Transferred Entities shall be effected in accordance with applicable Law and that Seller shall have no obligation under this Agreement to deliver to Buyer the written resignation of any director and/or members of the supervisory boards of any Transferred Entity whose resignation under the circumstances contemplated by this Agreement would violate any applicable Law);

(e)           A receipt acknowledging payment of the Equity Consideration and the Cash Purchase Price by Buyer in full satisfaction of Buyer’s obligations under Section 2.2(a) (but subject to any further obligations contained in this Agreement);

(f)           Certificates on which each of Delaware Holdings, the UK Holdings Directly Transferred Entities, Mexico Company, Mexico Services, Brazil Company and Chile Holdings certifies (in the form and manner required under section 1.1445-2(c)(3) of the Treasury Regulations) under penalties of perjury that such Person does not constitute a United States real property holding corporation (as defined in section 897(c) of the Code and the Treasury Regulations promulgated thereunder), and such other documents as Buyer may reasonably request to mitigate any obligation relevant to the withholding or collection of Tax in respect of the Transferred Entities; and

(g)           Such other documents and instruments necessary to consummate the transactions contemplated by this Agreement in respect of the Closing on the terms and subject to the conditions set forth in this Agreement, all of which, together with the documents and instruments referred to above, shall be in form and substance reasonably satisfactory to Buyer.

Section 2.7     Deliveries by Seller at Next Day Transfer .  (a)  Upon the effectiveness of the Next Day Transfer, Seller shall deliver, or cause to be delivered, to Buyer a duly executed instrument of transfer in such name as Buyer shall direct.

(b)           Certificates on which UK Holdings (or other relevant Affiliates) certifies (in the form and manner required under section 1.1445-2(c)(3) of the Treasury Regulations) under penalties of perjury that such Person does not constitute a United States real property holding corporation (as defined in section 897(c) of the Code and the Treasury Regulations promulgated thereunder) and such other documents as Buyer may reasonably request to mitigate any obligation relevant to the withholding or collection of Tax in respect of the Transferred Entities.

Section 2.8     Certain Adjustments .  In the event that at or prior to the Closing Buyer changes the number of Buyer Common Stock or securities convertible or exchangeable into or exercisable for Buyer Common Stock (including Buyer Series A Preferred Stock, Buyer Series B

Preferred Stock and Buyer Series C Preferred Stock) issued and outstanding prior to the Closing as a result of a reclassification, stock split (including a reverse split), stock dividend (including a distribution of securities convertible or exchangeable into or exercisable for shares of Buyer Common Stock) or other similar change with respect to the capital stock of Buyer, the Equity Consideration and the Reference Price shall be adjusted appropriately to reflect the appropriate effect of such reclassification, stock split, stock dividend or other similar change having a record date occurring on or after the date hereof and prior to the Closing.

Section 2.9     Section 116 of the Canadian Tax Act .  At the Closing UK Holdings shall deliver to Buyer a certificate issued pursuant to section 116 of the Income Tax Act (Canada) (the “ Canadian Tax Act ”) in respect of the sale and purchase of the equity interests in Canada Holdings, provided that:

(a)           Unless a certificate is issued by the Minister of National Revenue (Canada) pursuant to subsection 116(2) of the Canadian Tax Act in respect of the disposition of the equity interests in Canada Holdings to Buyer specifying a certificate limit in an amount that is not less than the portion of the Purchase Price (adjusted in accordance with Section 2.3) allocated to the equity interests in Canada Holdings, Buyer will be entitled to withhold from the portion of the Cash Purchase Price payable to UK Holdings the amount that Buyer may be required to remit pursuant to subsection 116(5) of the Canadian Tax Act in connection with its acquisition of the equity interests in Canada Holdings (the “ Withheld Amount ”), and amount so withheld will be credited to Buyer as payment on account of the Purchase Price.

(b)           If, prior to the 28th day after the end of the month in which the Closing Date occurs (or such later time before which the Canada Revenue Agency (the “ CRA ”) confirms in writing that the CRA will not enforce the remittance of funds as required by subsection 116(5) of the Canadian Tax Act and that Buyer will not be liable for interest and penalties in respect of the late remittance of the funds withheld (the “ Comfort Letter ”)), UK Holdings delivers to Buyer:

(c)           If Buyer continues to hold all or a portion of the Withheld Amount on the later of the 28th day after the end of the month in which the Closing Date occurs and the time when (if the CRA has provided the Comfort Letter) Buyer is obliged to remit funds to the CRA, Buyer

will remit to the Receiver General of Canada the amount required to be remitted pursuant to subsection 116(5) of the Canadian Tax Act and Buyer will pay to UK Holdings, prior to such remittance, any remaining portion of the Withheld Amount, together with interest at the Applicable Rate thereon, accrued from the Closing Date to the date of such payment.

(d)           Where any amount is remitted to the CRA pursuant to this Section 2.9, Buyer shall furnish UK Holdings with confirmation that such remittance has been made.  Any such remittance will be deemed to have been paid by Buyer to UK Holdings on account of the Purchase Price.

ARTICLE III

REPRESENTATIONS AND WARRANTIES RELATING TO SELLER

Except as set forth in the Seller’s Disclosure Schedules, Seller represents and warrants to Buyer as of the date of this Agreement as follows:

Section 3.1     Organization and Qualification .  Each of Parent and Seller is a company duly incorporated and validly existing under the Laws of England and Wales.

Section 3.2     Ownership .  Seller or one of its Subsidiaries is, and as of the Closing Date will be, the legal and beneficial owner of the Transferred Equity Interests (other than with respect to the New Transferred Entities) and has, and as of the Closing Date will have, good and valid title to the Transferred Equity Interests (other than with respect to the New Transferred Entities), free and clear of any Encumbrances.  Seller or one of its Subsidiaries as of the Closing Date will be the legal and beneficial owner of the Transferred Equity Interests (with respect to the New Transferred Entities) and as of the Closing Date will have good and valid title to the Transferred Equity Interests (with respect to the New Transferred Entities) free and clear of any Encumbrance.  The Transferred Entities are the only Affiliates of Seller by or through which the BGI Business is operated or conducted.

Section 3.3     Corporate Authority .  Each of Parent and Seller has full corporate power and authority to  execute and deliver this Agreement and each of the Ancillary Agreements to which it is a party and, subject only to the prior approval by the simple majority of eligible votes by holders of  Parent’s ordinary shares of 25 pence each (the “ Parent Ordinary  Shares ”), present in person or by proxy or (being a corporation) by duly authorized representative, who are entitled to vote at the  general meeting of Parent, of any resolutions necessary to approve the transactions contemplated by this Agreement (or any postponement or adjournment thereof) (the “ Parent Requisite Vote ”), to perform its obligations hereunder and thereunder and to consummate the transactions contemplated hereunder and thereunder.  The execution, delivery and performance by each of Parent and Seller of this Agreement and each of the Ancillary Agreements to which it is a party, and each of the transactions contemplated hereunder or thereunder, have been duly and validly authorized, and, except for the Parent Requisite Vote, no additional corporate or shareholder authorization or consent is required in connection with the execution, delivery and performance by Parent or Seller of this Agreement and each of the Ancillary Agreements to which it is a party or any of the transactions contemplated hereunder or thereunder.

Section 3.4     Binding Effect .  This Agreement, when executed and delivered by Buyer, and each of the Ancillary Agreements to which either Parent or Seller is a party, when executed and delivered by the applicable counterparties thereto, will constitute a valid and legally binding obligation of either Parent or Seller, as applicable, enforceable against Seller in accordance with its terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar Laws of general applicability relating to or affecting creditors’ rights and to general equity principles.

Section 3.5     Consents and Approvals .  Other than in connection with (a) the HSR Act, the EC Merger Regulation (to the extent required) or any other Antitrust Law, (b) any rule, regulation or order of the Office of the Comptroller of the Currency, (c) any applicable banking, securities or other financial services Law of any banking commission or any securities or other financial services regulator, (d) the provisions of the Transfer of Undertakings or any other similar Law of any competent jurisdiction or (e) such other Law, in each case, that is set forth on Section 3.5 of the Seller’s Disclosure Schedules (the matters covered under (a) through (e) above, collectively, the “ Seller’s Required Approvals ”), neither Parent nor Seller (and for purposes of Section 3.5(d) only, any Affiliate) is required to obtain any authorization, waiver, consent or approval of, or make any filing or registration with, or give any notice to, any Government Entity or to obtain any Permit in connection with the execution, delivery and performance by either Parent or Seller of this Agreement or each of the Ancillary Agreements to which it is a party or any of the transactions contemplated hereunder or thereunder, other than any authorization, waiver, consent, approval, filing, registration, notice or Permit, the failure of which to obtain, make or give would not, individually or in the aggregate, be reasonably expected to impair or delay materially the ability of either Parent or Seller to perform its obligations hereunder or thereunder or subject any Transferred Entity to criminal liability or any other adverse action by any Government Entity that is significant to the Transferred Entities, taken as a whole.

Section 3.6     Non-Contravention .

(a)           The execution, delivery and performance by each of Parent and Seller of this Agreement and each of the Ancillary Agreements to which Parent or Seller is a party, and the consummation by Parent and Seller of the transactions contemplated hereunder and thereunder, do not and will not, with or without the giving of notice, the lapse of time or both, (i) conflict with or violate any provision of the Organizational Documents of either Parent or Seller, (ii) assuming the receipt of all consents, approvals, waivers and authorizations and the making of the notices and filings (x) referred to in Section 3.5 or (y) required to be received or made by any of the Transferred Entities, as contemplated by Section 4.3 and Section 4.4, conflict with, or result in the breach of, or constitute a default under, or result in the termination, Encumbrance, vesting, cancellation, modification or acceleration of any right or obligation of either Parent or Seller under, or result in a loss of any benefit to which either Parent or Seller is entitled under, any Contract, Benefit and Compensation Arrangement or other agreement or instrument binding upon Parent or Seller or to which the property of either Parent or Seller is subject, (iii) assuming the receipt of all consents, approvals, waivers and authorizations and the making of notices and filings (A) referred to in Section 3.5 or (B) required to be received or made by any of the Transferred Entities or by Buyer or any of its Affiliates, violate or result in a breach of or constitute a default under any Law to which either Parent or Seller is subject or under any Permit of either Parent or Seller that is related to the BGI Business, other than, in the case of clauses (ii)

and (iii), any conflict, breach, default, termination, Encumbrance, vesting, cancellation, modification, acceleration or loss that would not, individually or in the aggregate, reasonably be expected to impair or delay materially the ability of Parent or Seller to perform its obligations hereunder or thereunder.

(b)           The MSA has been terminated in accordance with its terms prior to the execution of this Agreement by Parent; and the “Seller Termination Fee” (as defined in the MSA) payable under the MSA will be paid in full on or after July 2, 2009 and prior to the Closing and neither Buyer nor any of its Affiliates, including the Transferred Entities (after payment of such Seller Termination Fee), shall have any liability, debts or other obligations (other than certain limited obligations of confidentiality in relation to information, knowledge or data regarding Blue Sparkle, L.P. and its Affiliates) to any Person in connection therewith or the transactions contemplated thereby.

Section 3.7     Investment Purpose .  Seller is acquiring the Equity Consideration for its own account, solely for the purpose of investment and not with a view to, or for sale in connection with, any distribution thereof in violation of the Securities Act or state securities or “blue sky” Law, or with any present intention of distributing or selling such Equity Consideration in violation of any such Law.  Seller acknowledges that the shares constituting the Equity Consideration are not registered under the Securities Act or any other applicable Law, and that such shares may not be transferred, sold or otherwise disposed of except pursuant to the registration provisions of the Securities Act or pursuant to an applicable exemption therefrom and pursuant to Laws and regulations of other jurisdictions as applicable.

Section 3.8     Finders’ Fees .  There is no investment banker, broker, finder or other intermediary that has been retained by or is authorized to act on behalf of either Parent or Seller who would be entitled to any fee or commission from either Parent or Seller in connection with this Agreement, any of the Ancillary Agreements or the transactions contemplated hereunder and thereunder.

Section 3.9     Litigation .  As of the date of this Agreement, there is no Litigation pending and served or threatened in writing or, to the Knowledge of Seller, pending and not served or otherwise threatened against or affecting Parent or any of its Affiliates that challenges the validity or enforceability of this Agreement or seeks to enjoin or prohibit consummation of, or seek other material equitable relief with respect to, the transactions contemplated by this Agreement or that would, individually or in the aggregate, reasonably be expected to impair or delay materially the ability of Parent or Seller to perform its obligations hereunder.

Section 3.10   No Other Representations or Warranties .  Except for representations and warranties contained in this Agreement (including any certificates or other instrument delivered in connection therewith), none of Parent, Seller or any other Person makes any other express or implied representation or warranty on behalf of Parent or Seller relating to Seller.  BUYER ACKNOWLEDGES AND AGREES THAT, EXCEPT IN THE CASE OF FRAUD, PARENT, SELLER AND THEIR AFFILIATES WILL NOT HAVE OR BE SUBJECT TO ANY LIABILITY OR INDEMNIFICATION OBLIGATION TO BUYER OR ANY OF ITS AFFILIATES OR ANY OTHER PERSON RESULTING FROM THE MAKING AVAILABLE OR FAILING TO MAKE AVAILABLE TO BUYER OR ANY OF ITS AFFILIATES, OR

ANY USE BY BUYER OR ANY OF ITS AFFILIATES OF, ANY INFORMATION, INCLUDING ANY INFORMATION, DOCUMENTS, PROJECTIONS, FORECASTS OR OTHER MATERIAL MADE AVAILABLE TO BUYER OR ANY OF ITS AFFILIATES IN CERTAIN “DATA ROOMS” OR MANAGEMENT PRESENTATIONS IN EXPECTATION OF THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT, EXCEPT TO THE EXTENT ANY SUCH INFORMATION IS EXPRESSLY INCLUDED IN A REPRESENTATION OR WARRANTY CONTAINED IN THIS AGREEMENT.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES RELATING TO THE

TRANSFERRED ENTITIES AND THE BGI BUSINESS

Except as set forth in the Seller’s Disclosure Schedules, Seller represents and warrants to Buyer solely in respect of the Transferred Entities and the BGI Business, as of the date of this Agreement, as follows:

Section 4.1     Organization and Qualification .  Each Transferred Entity (other than a New Transferred Entity) is as of the date of this Agreement, and each Transferred Entity will be as of the Closing, a legal entity duly organized or incorporated, validly existing and, to the extent such concept is applicable under any applicable local Law, in good standing under the Laws of its jurisdiction of organization.  Each Transferred Entity (other than a New Transferred Entity) has as of the date of this Agreement and each Transferred Entity will have as of the Closing, all requisite corporate or other similar power and authority to own, lease and operate all of its properties and assets and to carry on its businesses in all material respects as conducted, owned, leased or operated as of the date of this Agreement.  Each Transferred Entity (other than a New Transferred Entity) is as of the date of this Agreement, and each Transferred Entity will be as of the Closing, duly qualified to do business in each jurisdiction where the ownership or operation of its properties and assets or the conduct of its businesses requires such Transferred Entity to be so qualified, except for any failure to be so qualified that would not, individually or in the aggregate, reasonably be expected to be material to the Transferred Entities, taken as a whole.  Seller has made available to Buyer, prior to the date of this Agreement, complete and correct copies of the Organizational Documents of each of the Transferred Entities, in each case, as in effect on the date of this Agreement.  Each Organizational Document of each Transferred Entity (other than a New Transferred Entity) is as of the date of this Agreement and will be as of the Closing, and of each New Transferred Entity will be as of the Closing, in full force and effect and there has been, or will be, no material violation thereof.

Section 4.2     Capitalization .

(a)           Section 4.2 of the Seller’s Disclosure Schedules sets forth, for each Transferred Entity (other than a New Transferred Entity), as of the date of this Agreement and as of the Closing, (A) the name and jurisdiction of organization of such Transferred Entity, (B) the number of shares of authorized and outstanding capital stock or other equity interests of such Transferred Entity and the names of the holders thereof and (C) the number of shares of authorized and outstanding capital stock or other equity interests of such Transferred Entity that

are held in treasury by such Transferred Entity; provided , however that Section 4.2 of the Seller’s Disclosure Schedules will be updated prior to the Closing to reflect the organization of the New Transferred Entities.  As of the date of this Agreement, all of the outstanding shares of capital stock and other equity interests of the Transferred Entities (other than the New Transferred Entities) have been, and as of the Closing, all of the outstanding shares of capital stock and other equity interests of the Transferred Entities will be, duly authorized and are validly issued, fully paid and non-assessable and not issued in violation of any Equity Rights.  As of the date of this Agreement and as of the Closing, there are no securities, preemptive or other outstanding rights, rights of first refusal, options, warrants, calls, conversion rights, stock appreciation rights, redemption rights, repurchase rights, agreements, plans, “tag along” or “drag along” rights, agreements, arrangements, undertakings or commitments of any character (collectively, “ Equity Rights ”) (i) under which any Transferred Entity is or may become obligated to issue, deliver, redeem, purchase or sell, or cause to be issued, delivered, redeemed, purchased or sold, or in any way dispose of, any shares of the capital stock or other equity interests, or any securities or obligations that are exercisable or exchangeable for, or convertible into, any shares of the capital stock or other equity interests, of such Transferred Entity, and no securities or obligations evidencing such rights are authorized, issued or outstanding, (ii) giving any Person a right to subscribe for or acquire any Transferred Equity Interests or (iii) obligating any of the Transferred Entities to issue, grant, adopt or enter into any such Equity Right in respect of any Transferred Entity.  As of the date of this Agreement and as of the Closing, none of the Transferred Entities has any (x) outstanding Indebtedness that could convey to any Person the right to vote, or that is convertible into or exercisable for Transferred Equity Interests or equity of any Transferred Entity or (y) Equity Rights that entitle or convey to any Person the right to vote with the holders of Transferred Equity Interests or equity of any Transferred Entity on any matter.  As of the date of this Agreement and as of the Closing, the outstanding capital stock and other equity interests of the Transferred Entities are not subject to any voting trust agreement or other Contract restricting or otherwise relating to the voting, dividend rights or disposition of such capital stock or other equity interests.  As of the date of this Agreement and as of the Closing, there are no outstanding or authorized phantom stock, profit participation or similar rights providing economic benefits based, directly or indirectly, on the value or price of the capital stock or other equity interests of the Transferred Entities.  As of the date of this Agreement and as of the Closing, no Transferred Entity has any proprietary investment with a fair market or book value in excess of $5,000,000 or which represents five percent (5%) or more of the voting securities of any such Person other than another Transferred Entity.

(b)           Immediately prior to the Next Day Transfer, UK Holdings will have no material assets or material liabilities other than 100% of the issued and outstanding equity securities of Japan Company.

Section 4.3     Consents and Approvals .  Other than the Seller’s Required Approvals or as set forth on Section 4.3 of the Seller’s Disclosure Schedules (the “ Transferred Entities’ Required Approvals ”), no Transferred Entity is required to obtain any authorization, waiver, consent or approval of, or make any filing or registration with, or give any notice to, any Government Entity or to obtain any Permit in connection with the execution, delivery and performance by Seller of this Agreement or any of the transactions contemplated by this Agreement, other than any authorization, waiver, consent, approval, filing, registration, notice or Permit the failure of which to obtain, make or give would not, individually or in the aggregate,

be reasonably expected to materially impair or delay the ability of Seller to perform its obligations hereunder or subject any Transferred Entity to any criminal liability or any other adverse action by any Government Entity that is significant to the Transferred Entities, taken as a whole.

Section 4.4     Non-Contravention .  The execution, delivery and performance by Seller of this Agreement and each of the Ancillary Agreements to which it is a party, and the consummation by Seller of the transactions contemplated by this Agreement and each of the Ancillary Agreements to which it is a party, do not and will not, with or without the giving of notice, the lapse of time or both, (a) conflict with or violate any provision of the Organizational Documents of any Transferred Entity, (b) assuming the receipt of all consents, approvals, waivers and authorizations and the making of the notices and filings (i) referred to in Section 4.3 or (ii) required to be received or made by Seller, as contemplated by Section 3.5 and Section 3.6, conflict with, or result in the breach of, or constitute a default under, or result in the termination, Encumbrance, vesting, cancellation, modification or acceleration of any right or obligation of any Transferred Entity under, or result in a loss of any benefit to which any Transferred Entity, any Fund or the BGI Business is entitled under, any Contract, Benefit and Compensation Arrangement or other agreement or instrument binding upon any Transferred Entity or to which the property of any Transferred Entity is subject, (c) assuming the receipt of all consents, approvals, waivers and authorizations and the making of notices and filings (i) referred to in Section 4.3 or (ii) required to be received or made by Seller or by Buyer or any of its Affiliates, violate or result in a breach of or constitute a default under any Law to which any Transferred Entity or any Fund is subject or under any Permit of any Transferred Entity that is primarily related to the BGI Business, other than, in the case of clauses (b) and (c), any conflict, breach, default, termination, Encumbrance, vesting, cancellation, modification, acceleration or loss that would not, individually or in the aggregate, reasonably be expected to impair or delay materially the ability of Seller to perform its obligations hereunder or thereunder or subject any Transferred Entity, Fund or Buyer or any of its Affiliates to criminal liability or any other adverse action by any Government Entity that is significant to the Transferred Entities, taken as a whole.

Section 4.5     Financial Information .

(a)           Set forth on Section 4.5 of the Seller’s Disclosure Schedules are complete and correct copies of the unaudited combined balance sheet of the Transferred Entities as of December 31, 2008, December 31, 2007 and December 31, 2006 (the “ Unaudited Balance Sheet ”) and the unaudited combined statement of income for the Transferred Entities for the years ended December 31, 2008 (such statement of income for 2008, together with the Unaudited Balance Sheet as of December 31, 2008, the “ 2008 Unaudited Financial Statements ”, December 31, 2007 and December 31, 2006 (together with the Unaudited Balance Sheet, the “ Unaudited Financial Statements ”). The Unaudited Financial Statements have been derived from the accounting books and records of the Transferred Entities and present fairly, in all material respects, the combined financial position and results of operations of the Transferred Entities as of and for the dates and periods thereof, and each of such Unaudited Financial Statements has been prepared in accordance with IFRS applied on a basis consistent with past practice, except as expressly provided in the Unaudited Financial Statements.

(b)           The books and records of the Transferred Entities have been maintained in all material respects in accordance with reasonable business practices.  The Unaudited Balance Sheet does not reflect any material asset that is not intended to constitute a part of the BGI Business after giving effect to the transactions contemplated hereunder (excluding routine dispositions of assets in the ordinary course of business consistent with past practice), and the income statement for the year ended December 31, 2008 included in the Unaudited Financial Statements does not reflect the results of any material operations of any Person that are not intended to constitute a part of the BGI Business after giving effect to the transactions contemplated hereunder.  Such income statement reflects all material costs that historically have been incurred in connection with the operation of the BGI Business.

(c)           The Transferred Entities maintain in all material respects internal control over financial reporting to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with IFRS, including policies and procedures that (i) pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the Transferred Entities, (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with IFRS, and that receipts and expenditures of the Transferred Entities are being made only in accordance with authorizations of management and directors of the Transferred Entities and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the assets of the Transferred Entities that could have a material effect on the financial statements.

(d)           Section 4.5(d) of the Seller’s Disclosure Schedules correctly sets forth all Indebtedness of the Transferred Entities to third parties (which, for the avoidance of doubt, does not include Seller and its Affiliates) as of the date hereof, and for each item of such Indebtedness set forth thereon, identifies the debtor, the principal amount as of the date of this Agreement, the creditor, the maturity date and the collateral, if any, securing the Indebtedness.

Section 4.6     Litigation and Claims .

(a)           Other than with respect to Taxes (the sole representations with respect to which are set forth in Section 4.7 and 4.17(j) through (n)), Section 4.6(a) of the Seller’s Disclosure Schedules contains as of the date hereof a complete and correct list of all material pending and served and or threatened in writing or, to the Knowledge of Seller, any other material unserved or orally threatened Litigation and governmental investigations concerning the Transferred Entities or the BGI Business.  Other than with respect to Taxes (the sole representations with respect to which are set forth in Section 4.7 and Section 4.17(j) through (n)), there is no civil, criminal, administrative or regulatory action or Litigation by any Person pending, or to the Knowledge of Seller, threatened against or relating to any of the Transferred Entities, or any of their properties, assets or rights or the BGI Business, that, individually or in the aggregate, have had or would reasonably be expected to be material to the Transferred Entities, taken as a whole.

(b)           Other than with respect to Taxes (the sole representations with respect to which are set forth in Section 4.7 and Section 4.17(j) through (n)) or as set forth on Section 4.6(b) of the Seller’s Disclosure Schedules, no Transferred Entity nor the BGI Business is subject to any order, writ, judgment, award, injunction or decree of any Government Entity or any arbitrator that

would, individually or in the aggregate, reasonably be expected to be material to the Transferred Entities, taken as a whole.

Section 4.7     Taxes .  As of the date of this Agreement and as of the Closing Date with respect to a Transferred Entity:

(a)           All material Tax Returns with respect to the Transferred Entities required to be filed have been duly and timely filed with the appropriate Government Entity, and all such Tax Returns are true, correct and complete in all material respects, and the Transferred Entities have timely paid all Taxes shown as due on such Tax Returns.  All other material Taxes of the Transferred Entities have been paid, or an adequate provision has been made therefor on the appropriate financial statements in accordance with GAAP, IFRS, or other relevant applicable accounting principles.

(b)           Each of the Transferred Entities has withheld from its employees, independent contractors or Affiliates, and other third parties all amounts required to be withheld with respect to any amounts paid or benefits furnished to any such Person and timely paid such amounts withheld to the appropriate Government Entity (or other authority) or set aside in an account for such purpose such amounts for all periods, in each case, in material compliance with all Tax withholding provisions (including income, social security, Indirect Taxes and employment Tax withholding for all types of compensation) under applicable Laws, and is in compliance with all applicable Laws regarding the filing, solicitation, collection and maintenance of any forms, certifications and other information required in connection with federal, state, local or foreign Tax reporting requirements.

(c)           There are no material audits, examinations, investigations or other proceedings pending or threatened in writing in respect of Taxes with respect to any of the Transferred Entities, no material issues that have been raised by a Government Entity in connection with any examination of the Tax Returns referred to in Section 4.7(a) are currently pending, and all material deficiencies asserted or material assessments made, if any, as a result of such examinations have been paid in full, or an adequate provision has been made therefor on the appropriate financial statements in accordance with GAAP, IFRS, or other relevant applicable accounting principles.  None of the Transferred Entities (x) is the subject of any material agreement, ruling or arrangement in respect of Taxes with any Government Entity, and no such agreement, ruling or arrangement is pending or (y) is or has been entitled to any Tax holiday, Tax credit, or other similar Tax incentive or benefit from any jurisdiction (other than such benefits as are generally available to all Persons engaged in business and subject to tax as a resident in such jurisdiction), which would be subject to forfeiture, recapture, or other recovery by the Government Entity granting such benefit in connection with the transactions contemplated hereby or in connection with any dissolution, or cessation of business in, or withdrawal of assets from or a reduction of the number of employees in the relevant jurisdiction.

(d)           None of the Transferred Entities has any material liability for the Taxes of any Person under Treasury Regulation Section 1.1502-6 (or any similar provision of state, local, or foreign law), as a transferee or successor, by contract, or otherwise.

(e)           There are no Encumbrances for Taxes, other than Permitted Encumbrances, upon any of the assets of any Transferred Entity.

(f)           No (A) waiver of any statute of limitations in respect of material Taxes, (B) agreement for any extension of time with respect to a Tax assessment or deficiency or (C) power of attorney has been granted with respect to material Taxes, in each case, relating to any Transferred Entity or the assets thereof.  None of the Transferred Entities is a party to, bound by, or has any obligation or liability under, any Tax allocation or sharing agreement or arrangement.

(g)           None of the Transferred Entities will be required to include any item of income in or exclude any item of deduction from, taxable income for any period ending after the Closing as a result of any (i) request for a ruling, advance pricing agreement, or “closing agreement” as defined in Section 7121 of the Code (or any corresponding or similar provision of U.S. state or local or foreign Tax law); (ii) material installment sale or open transaction disposition made on or before the Closing Date; (iii) adjustment pursuant to Section 481(a) of the Code or any similar provision of U.S. state or local Tax law; or (iv) material deferred intercompany item; (v) excess loss account as described in Treasury Regulations under Section 1504 or any similar provision of U.S. state or local Tax law.

(h)           No Foreign Transferred Entity has any investment in United States property within the meaning of Section 956(c) of the Code.

(i)           Each of the Transferred Entities is, and has at all times during its existence been, classified for U.S. income Tax purposes as the type of entity set forth in Section 4.7(i) of the Seller’s Disclosure Schedules hereto.

(j)           None of the Transferred Entities is or has been a member of any consolidated, combined, connected, unitary affiliated or similar group of corporations that filed or was required to file consolidated, combined or unitary Tax Returns (or any Tax Returns of a similar nature or statues under the provisions of U.S. federal, state, local or foreign Law) other than a group which includes only Transferred Entities.

(k)           None of the Transferred Entities has constituted either a “distributing corporation” or “controlled corporation” (within the meaning of Section 355(e)(1)(A) of the Code) in a distribution of stock qualifying for tax-free treatment under Section 355 of the Code (A) in the two (2) years prior to the date of this Agreement or (B) in a distribution which could otherwise constitute a “plan” or “series of related transactions” (within the meaning of Section 355 of the Code) with the transactions contemplated by this Agreement.

(l)           There has been made available to Buyer correct and complete copies of the relevant portion of all federal and other material Tax Returns of the Transferred Entities for the taxable periods ending within the last three calendar years before the Closing Date, which have been filed.

(m)           Section 4.7(m) of the Seller’s Disclosure Schedules lists all foreign, state and local jurisdictions in which any Transferred Entities file Tax Returns.  No claim or inquiry has been made by any Government Entity in a jurisdiction in which a Transferred Entity does not file

Tax Returns that it is or may be subject to taxation or any requirement to file Tax Returns in such jurisdiction.

(n)           No Transferred Entity has (i) participated in any “listed transaction” within the meaning of Treasury Regulation Section 1.6011-4(c)(3)(i)(A), (ii) promoted, marketed, offered to sell, sold or advised in respect of any such “listed transaction.”

(o)           As at immediately following the closing of the Next Day Transfer, UK Holdings will have distributable reserves of not less than £1.

(p)           Each UK Entity has (or Seller and its Affiliates, on behalf of each UK Entity, have) preserved all material records required by law to be preserved and all other material records required for the delivery of correct and complete Tax Returns or the computation of any Tax.

(q)           Each UK Entity has made and submitted each claim, disclaimer, election, notice and consent relating to Taxes assumed to have been made for the purposes of its statutory accounts.

(r)           No UK Entity is under an obligation to pay, nor has any UK Entity paid or agreed to pay at any time in the last 6 months, any compensation for loss of office not deductible in computing its income for the purposes of UK corporation tax.

(s)           No UK Entity is, and no UK Entity has been at any time within the last seven years, a close company as defined in s414 Income and Corporation Taxes Act 1988 (“ ICTA ”).

(t)           Each UK Entity is and has, throughout the past three years, been resident solely in the United Kingdom for all Tax purposes and is not and has not been treated as resident or subject to Tax in any other jurisdiction for any Tax purpose. No UK Entity has, nor has any UK Entity had, a branch, agency or permanent establishment outside the United Kingdom.

(u)           No UK Entity is and no UK Entity has been treated as a branch, agency or permanent establishment in the UK or as a UK representative of any other person for UK Tax purposes in the past three years.

(v)           No UK Entity has carried out or caused or permitted to be carried out any transaction (i) specified at the relevant time in s765(1) ICTA otherwise than with the prior consent of HM Treasury which (for the avoidance of doubt) includes consent pursuant to the Treasury General Consents (ii) specified at the relevant time in s765A ICTA without having duly provided the required information to HM Revenue & Customs.

(w)           All documents in the enforcement of which any UK Entity may be interested have been duly stamped (to the extent liable for ad valorem duty) and so far as Seller is aware no document in the enforcement of which any UK Entity may be interested has not been stamped by reason of it being executed and retained abroad.

(x)           No UK Entity has any unpaid liability to stamp duty reserve tax and no conditional agreement has been entered into prior to the Closing which could lead to any UK

Entity incurring such a liability or becoming accountable for stamp duty reserve tax at any time after the Closing.

(y)           Each UK Entity has duly filed all land transaction returns required by law to be filed and has paid all stamp duty land tax properly due in respect of such land transactions.

(z)           Each UK Entity is duly registered for VAT purposes or a member of a VAT Group and its registration is not and has not in the last four years been subject to any conditions or to any requirement to provide security.

(aa)           To the extent that any UK Entity has been a member of a VAT Group in the last four years, the names of such UK Entities, the name(s) of the representative member(s) of the relevant VAT Group(s) and the VAT registration number(s) of such VAT Group(s) are set out in the Seller's Disclosure Schedules.

(bb)           No UK Entity is or has been involved in, or is or has been involved in promoting, any arrangement, scheme, transaction or series of transactions disclosure of which was or would be (if entered into on Closing) required pursuant to Part 7 Finance Act 2004,Schedule 11A Value Added Tax Act 1994 or regulations made under s132A Social Security Administration Act 1992.

Section 4.8     Employee Benefits .

(a)           All employment (or form of employment), benefit and compensation agreements, plans, contracts, programs, policies or arrangements covering one or more Employees or former employees of a Transferred Entity (to the extent there is a current or future obligation to such former employee under any Assumed Benefit and Compensation Arrangement), including any trust instruments and insurance contracts forming a part thereof, any deferred compensation, stock option, stock purchase, stock appreciation rights, stock based or other incentive, bonus, consulting, post-retirement insurance, workers’ compensation, disability, fringe or other benefit, vacation and severance plans and all severance and change in control agreements, plans, contracts, programs, policies or arrangements, including without limitation any “employee benefit plans” within the meaning of Section 3(3) of ERISA and all amendments thereto (the “ Benefit and Compensation Arrangements ”), are listed on Section 4.8(a) of the Seller’s Disclosure Schedules.  Each Benefit and Compensation Arrangement or portion thereof sponsored solely by any Transferred Entity or one of its Subsidiaries (except as otherwise set forth in Section 4.8(a) of the Seller’s Disclosure Schedule) is separately identified on Section 4.8(a) of the Seller’s Disclosure Schedules and is referred to herein as an “ Assumed Benefit and Compensation Arrangement .”  Each Assumed Benefit and Compensation Arrangement that provides only health, welfare, retirement and other employee benefits shall be referred to herein as an “Assumed Benefit Arrangement.”  Seller has delivered to Buyer (A) a copy of each Assumed Benefit and Compensation Arrangement and a summary of each material Benefit and Compensation Arrangement that is not an Assumed Benefit and Compensation Arrangement, and (B) with respect to each Assumed Benefit and Compensation Arrangement (where applicable), (i) the most recent summary plan description, (ii) the most recent determination letter received from the Internal Revenue Service with respect to such plan, (iii) the most recent Form 5500 Annual Report, (iv) the most recent audited financial statement and actuarial valuation report, and (v) the version effective as of the date of this Agreement of all

related agreements (including trust agreements), insurance Contracts and other Contracts which implement such plan.

(b)           In relation to the Bank UK Retirement Fund, Seller has made available to Buyer prior to the date of this Agreement complete and correct copies of the most recent trust deed and rules governing such scheme and all subsequent explanatory booklets and member announcements related to the sections of the Bank UK Retirement Fund in which Employees participate.

(c)           All Benefit and Compensation Arrangements are and have been operated in compliance in all material respects with all applicable Laws of the relevant jurisdiction (including any local regulatory or Tax approval requirements) and, to the extent relevant, the governing provisions of the relevant Benefit and Compensation Arrangement (such Laws and provisions hereinafter referred to as “ Applicable Local Law ”).  No material Litigation is pending or, to the Knowledge of Seller, threatened with respect to any Benefit and Compensation Arrangement.

(d)           Each Assumed Benefit and Compensation Arrangement that is a U.S. Benefit and Compensation Arrangement and that is intended to be qualified under Section 401(a) of the Code has received a favorable determination letter from the U.S. Internal Revenue stating that the plan is so qualified and to the Knowledge of Seller no event exists that is reasonably likely to result in the loss of such qualification.

(e)           None of Parent, Seller nor any of the Transferred Entities nor any ERISA Affiliate has, within the six year period prior to the date of this Agreement, ever maintained, established, sponsored, participated in, or contributed to, any U.S. Benefit and Compensation Arrangement that is an “employee pension benefit plan,” within the meaning of Section 3(2) of ERISA subject to Title IV of ERISA or Section 412 of the Code.  The term “ ERISA Affiliate ” means any Person that, together with Seller or any of its Subsidiaries, would be deemed a “single employer” within the meaning of Section 414(b), Section 414(c), Section 414(m) or Section 414(o) of the Code.  No direct, contingent or secondary liability has been incurred or is expected to be incurred by any Transferred Entity under Title IV of ERISA to any party with respect to any U.S. Benefit and Compensation Arrangement or “multiemployer plan” within the meaning of Section 3(37) of ERISA, or with respect to any other U.S. Benefit and Compensation Arrangement presently or heretofore maintained or contributed to by any ERISA Affiliate.

(f)           All material contributions, reserves or premium payments required to be made with respect to any Employee under the terms of any Assumed Benefit and Compensation Arrangement have been made or have been accrued or otherwise adequately reserved for in the Unaudited Financial Statements or will otherwise be timely made prior to the Closing Date.

(g)           There has been no amendment to, or announcement by Seller or any of its Affiliates in respect of the Employees relating to, or change in employee participation or coverage under, any Assumed Benefit and Compensation Arrangement which would increase materially the expense of maintaining such Assumed Benefit and Compensation Arrangement above the level of the expense incurred therefor for the year ended December 31, 2008.

(h)           Neither the execution of this Agreement nor the consummation of the transactions contemplated by this Agreement will (i) entitle any Employees to severance pay or benefits or any increase in severance pay, benefits or would result in an increase in the applicable notice period upon any termination of employment on or after the date of this Agreement, (ii) accelerate the time of payment or vesting or result in any payment or funding (through a grantor trust or otherwise) of compensation or benefits under, increase the amount payable or result in any other material obligation pursuant to any of the Benefit and Compensation Arrangements to any Employees, (iii) limit or restrict the right of Buyer or any of its Affiliates in respect of the Employees to merge, amend or terminate any of the Assumed Benefit and Compensation Arrangements, (iv) cause Seller or any of its Affiliates in respect of the Employees to record additional compensation expense on its income statement with respect to any outstanding stock option or other equity-based award or (v) result in payments under any of the Assumed Benefit and Compensation Arrangements which would not be deductible under Section 280G of the Code or any Applicable Local Law.

(i)           No Benefit and Compensation Arrangement is maintained outside the jurisdiction of the United States, or covers any employee residing or working outside the United States (any such Benefit and Compensation Arrangement, a “ Foreign Benefit Plan ”).  To the Knowledge of Seller, all Foreign Benefit Plans (i) have been established, maintained and administered in compliance in all material respects with their terms and all applicable Laws of any controlling Government Entity and (ii) that are subject to a funding requirement under Applicable Local Law are in material compliance with such requirement.

(j)           Each Assumed Benefit and Compensation Arrangement that is a “nonqualified deferred compensation plan” (as defined for purposes of Section 409A(d)(1) of the Code) has been maintained and operated since January 1, 2005 in good faith compliance with Section 409A of the Code and all applicable IRS guidance promulgated thereunder so as to avoid any Tax, penalty or interest under Section 409A and, as to any such plan in existence prior to January 1, 2005, has not been “materially modified” (within the meaning of IRS Notice 2005-1) at any time after October 3, 2004, and (ii) since January 1, 2009, been in documentary and operational compliance with Section 409A of the Code and all applicable IRS guidance promulgated thereunder.

(k)           No U.S. Benefit and Compensation Arrangement that is an Assumed Benefit and Compensation Arrangement provides, or reflects or represents any liability to provide, material retiree health or life benefits (including, without limitation, death or medical benefits), whether or not insured, with respect to any Employee, or any spouse or dependent of any such Employee, beyond such Employee’s retirement or other termination of employment with Seller and its Subsidiaries other than (i) coverage mandated by Part 6 of Title I of ERISA or Section 4980B of the Code, (ii) retirement or death benefits under any plan intended to be qualified under Section 401(a) of the Code, (iii) disability benefits that have been fully provided for by insurance under a Benefit and Compensation Arrangement that constitutes an “employee welfare benefit plan” within the meaning of Section (3)(1) of ERISA, or (iv) benefits with respect to one or more of the employment contracts set forth on Section 4.8(k) of the Seller’s Disclosure Schedules.

(l)           No Transferred Entity is a party to any agreement or arrangement as to which payments of compensation would constitute “non-qualified deferred compensation” of a “non-qualified entity” (each within the meaning of Section 457A of the Code).

Section 4.9     Permits .  The Transferred Entities (excluding UK Trust Manager which does not as of the date of this Agreement conduct any business) hold, and the New Transferred Entities will hold as of immediately prior to the Closing, all Permits required in order to permit the Transferred Entities and the New Transferred Entities to own or lease their properties and assets and to conduct the BGI Business under and pursuant to all applicable Laws, in each case, other than any failure to hold any Permit that would not, individually or in the aggregate, reasonably be expected to be material to the Transferred Entities, taken as a whole.  All such Permits are valid and in full force and effect, except for those the failure of which to be valid or to be in full force and effect would not, individually or in the aggregate, reasonably be expected to be material to the Transferred Entities, taken as a whole.  No violations with respect to such Permits have occurred that would, individually or in the aggregate, reasonably be expected to be material to the Transferred Entities, taken as a whole, and no Litigation is pending and served or threatened in writing or, to the Knowledge of Seller, pending and not served or otherwise threatened to suspend, cancel, modify, revoke or materially limit any such Permits, which Litigation would, individually or in the aggregate, reasonably be expected to be material to the Transferred Entities, taken as a whole.  Each Employee who is required to be registered or licensed as a registered representative, investment adviser representative, sales person or an equivalent person with any Government Entity is duly registered as such and such registration is in full force and effect, except for such failures to be so registered or for such registration to remain in full force and effective that, individually or in the aggregate, would not reasonably be expected to be material to the Transferred Entities, taken as a whole.

Section 4.10   Environmental Matters .  (i)  To the Knowledge of Seller, the Transferred Entities are in compliance in all material respects with all Environmental Laws applicable to the conduct and operation of their businesses or pertaining to any properties or assets of the Transferred Entities (including any real property now or previously owned by a Transferred Entity during the past five years from the date of this Agreement); (ii) the Transferred Entities have not received in the last 12 months any written notice, demand, letter, claim or request for information alleging that they are materially in violation of or liable under any material Environmental Law applicable to the conduct and operation of their businesses, or pertaining to any properties or assets of the Transferred Entities and which remains outstanding as of the date of this Agreement; (iii) no Transferred Entity is subject to any order, decree or injunction with any Government Entity concerning liability under any Environmental Law that would, individually or in the aggregate, reasonably be expected to be material to the Transferred Entities, taken as a whole; (iv) to the Knowledge of Seller, there are no material events, circumstances or conditions at or relating to any real property now or previously owned during the past five years from the date of this Agreement or now leased in connection with the businesses of the Transferred Entities or the BGI Business that would reasonably be expected to result in a material liability to the Transferred Entities under any Environmental Law; and (v) Seller has provided or made available to Buyer all material environmental reports, assessments, investigations or other analyses in Seller’s possession or control relating to property now or previously owned during the past five years from the date of this Agreement or now leased in connection with the businesses of the Transferred Entities.

Section 4.11   Intellectual Property .

(a)           The Transferred Entities either exclusively own free and clear of all Encumbrances, other than Permitted Encumbrances, or have the right pursuant to written Contracts to use, all material Intellectual Property that is used in the conduct of the BGI Business or by a Transferred Entity.

(b)           Section 4.11(b) of the Seller’s Disclosure Schedules includes a complete and accurate list of all United States, foreign and multinational: (i) Patents and Patent applications; (ii) Trademarks and Trademark applications; (iii) Internet domain names and (iv) Copyright registrations and applications that are owned by one or more of the Transferred Entities.

(c)           Section 4.11(c) of the Seller’s Disclosure Schedules includes a complete and accurate list of all material software programs that are owned by one or more of the Transferred Entities.

(d)           The conduct of the businesses of the Transferred Entities as conducted as of the date of this Agreement does not materially infringe, misappropriate or otherwise violate the Intellectual Property of any other Person or constitute unfair competition or trade practices under the Laws of any jurisdiction that would, individually or in the aggregate, reasonably be expected to be material to the BGI Business as a whole.  Neither Seller nor any of the Transferred Entities has within the past two years received any written notice or written claim asserting any of the foregoing.  To the Knowledge of Seller, none of the material Intellectual Property owned by any of the Transferred Entities is being infringed, misappropriated or otherwise violated by any other Person.  Neither Seller nor any of the Transferred Entities has entered into any Contract granting any other Person the right to bring infringement actions with respect to, or otherwise to enforce rights with respect to, any of the material Intellectual Property owned by any of the Transferred Entities.

(e)           The Transferred Entities have taken commercially reasonable steps to protect their rights in the material Trade Secrets owned by any of them, excluding any information that any Transferred Entity, in the exercise of its business judgment, determined was of insufficient value to protect as a Trade Secret.

(f)           Except as set forth on Section 4.11(f) of the Seller’s Disclosure Schedules, neither Seller nor any of the Transferred Entities has conveyed, pledged or otherwise transferred ownership of, or granted or agreed to grant any exclusive license of or right to use, or granted joint ownership of, any material Intellectual Property owned by any of the Transferred Entities to any other Person.  None of the material Intellectual Property owned by any of the Transferred Entities is subject to any proceeding or any outstanding decree, order or judgment that restricts in any material respect the relevant Transferred Entity’s use, transfer or licensing of such material Intellectual Property.

(g)           The Transferred Entities use commercially reasonable efforts to protect, in all material respects, (i) personally identifiable information provided by the Transferred Entities’ customers and website users from unauthorized disclosure or use and (ii) the security of their information technology systems, and none of the Transferred Entities has, as of the date hereof,

received, within the past 24 months, any written claim pending against them alleging any material breach, violation, misuse or unauthorized disclosure of any of the foregoing.  The Transferred Entities have not experienced, within the past 24 months, any data loss, breach of security, or other unauthorized access, in any such case, material to the BGI Business, taken as a whole, to its information technology systems or databases by any Person.

(h)           From and after the Closing, the Transferred Entities will own or have the right to use pursuant to written Contracts, or as otherwise provided pursuant to this Agreement or any Ancillary Agreement, all Intellectual Property necessary to conduct the BGI Business in all material respects as conducted on the date of this Agreement and immediately prior to the Closing.

Section 4.12   Labor .

(a)           None of the Transferred Entities is a party to or bound by any labor agreement, union contract or collective bargaining agreement, and there are no labor unions or other organizations representing any Employee, works councils or employee representative bodies within the Transferred Entities or affecting the Transferred Employees, other than omnibus agreements covering substantially all Employees in a foreign jurisdiction pursuant to the Laws or customary practice of that jurisdiction respecting employees.  Each Transferred Entity and Seller and any other Seller Affiliate (in respect of the employment of any of the Employees) which employs any Employee is or has been in compliance in all material respects with all applicable Laws in respect of employment and employment practices including, without limitation, all Laws in respect of terms and conditions of employment, health and safety, employee independent contractor classifications, wages and hours of work, child labor, immigration, employment discrimination, disability rights or benefits, equal opportunity, plant closures and layoffs, affirmative action, workers’ compensation, labor relations, employee leave issues, unemployment insurance and the collection and payment of withholding or social security Taxes and any similar Tax. Since January 1, 2008, there has not been, and there is not now pending or, to the Knowledge of Seller, threatened (a) any material strike, lockout, slowdown, picketing or work stoppage with respect to the Employees or (b) any unfair labor practice charge against the Transferred Entities, in the case of (b), that have had or resulted in or would, individually or in the aggregate, reasonably be expected to be material to the Transferred Entities, taken as a whole.

(b)           Each person who primarily provides services to a Transferred Entity is an Employee.  Section 4.12(b) of Seller’s Disclosure Schedules lists or describes (i) each Contract, and each outsourcing, agency or other arrangement (whether with third parties or with Seller or any Affiliate of Seller and whether formal or informal), pertaining to the provision of the services of employees (whether on a full time or part time basis) to any Transferred Entity, and (ii) each person who is employed by Seller or an Affiliate (other than a Transferred Entity) who primarily provides services to a Transferred Entity (each such person, unless otherwise noted in Section 4.12(b) of Seller’s Disclosure Schedules, a “ Transferred Employee ”).

Section 4.13   Contracts .

(a)           Section 4.13(a) of the Seller’s Disclosure Schedules contains a complete and correct list of all of the following Contracts, in effect as of the date of this Agreement, to which a

Transferred Entity is a party, is bound by or subject to, or pursuant to which the BGI Business is conducted (the “ Specified Contracts ”):

(b)           Seller has made available to Buyer prior to the date of this Agreement a complete and correct copy of each written Specified Contract (except in certain instances such Specified Contracts or portions thereof have been withheld as described in Seller’s Disclosure Schedules or redacted) and accurate and complete descriptions of all material terms of each oral Specified Contract, including all material amendments, modifications and supplements thereto as in effect on the date of this Agreement.  Each (i) Specified Contract, (ii) Investment Advisory Arrangement which accounts for more than $1,000,000 of revenue to the BGI Business on an annualized basis and (iii) Contract that is reasonably expected to provide for payments to a Transferred Entity in excess of $1,000,000 in 2009 that contains key person provisions pertaining to employees of a Transferred Entity ((i), (ii) and (iii) being the “ Significant Contracts ”) is in full force and effect, and is valid and binding on the Transferred Entity that is a party thereto, and, to the Knowledge of Seller, on each other party thereto.  There exists no breach or default of any Significant Contract on the part of any Transferred Entity which (with or without notice or lapse of time or both) would, individually or in the aggregate, reasonably be expected to be material to the Transferred Entities, taken as a whole.  No Transferred Entity has received any written notice of an intention to terminate, not to renew or to challenge the validity or enforceability of any Significant Contract, the termination, failure to renew or challenge of which would, individually or in the aggregate, reasonably be expected to be material to the Transferred Entities, taken as a whole.

(c)           As of the date hereof, no Transferred Entity has entered into and is bound by or subject to any of the following:

invest in any investment product, in each case in an amount in excess of $5,000,000 individually.

(d)           Notwithstanding anything to the contrary contained in this Agreement, in no event shall Specified Contracts include any Investment Advisory Arrangement.

(e)           Attached as Section 4.13(e) of the Seller’s Disclosure Schedules is a description of any “most favored nation” provision in any Investment Advisory Arrangement which provided revenue to Seller and its Affiliates in excess of (i) $1,000,000 in 2008 for Investment Advisory Arrangement with U.S.-based clients and (ii) $5,000,000 in 2008 for all other Investment Advisory Arrangements.

(f)            Attached as Section 4.13(f) of the Seller’s Disclosure Schedules is a description of any “key person” provision pertaining to employees of a Transferred Entity in any Contract that is reasonably expected to provide for payments to a Transferred Entity in excess of $10,000,000 in 2009.

(g)           Seller has made available to Buyer a true and complete copy of its form of counterparty security lending (borrower default) indemnity Contract and its forms of cash fund capital support Contracts, in each case provided to certain funds and clients of the securities lending or short-term cash businesses of the BGI Business, and none of the Contracts used by the Transferred Entities for such purposes materially deviates from such standard forms.

Section 4.14   Absence of Changes .  During the period between December 31, 2008 and the date of this Agreement, except for any actions taken in connection with (a) any transactions contemplated by this Agreement or any Ancillary Agreement or the MSA or (b) any efforts to sell the Transferred Entities or any business thereof, (x) each Transferred Entity and each Fund  has conducted its business in the ordinary course consistent with past practices of such Transferred Entity or such Fund, except for any actions by a Fund that are directed or recommended by a Transferred Entity, or are otherwise approved or effected by the relevant Fund board or trustee, in the ordinary course of the Transferred Entity’s or the Fund’s business, and (y) no Transferred Entity has and, in connection with the BGI Business, Seller has not taken any action that would be prohibited by the terms of Section 6.2(A), Section 6.2(B), Section 6.2(F), Section 6.2(G)(iv) and Section 6.2(H), had such terms been applicable during such period.  During the period between December 31, 2008 and the date of this Agreement, there has not occurred a Material Adverse Effect.  Except as set forth on Section 6.2 of the Seller’s Disclosure Schedule, from June 11, 2009 through the date of this Agreement, no Transferred Entity has, and Seller has not in connection with the BGI Business, taken any action that would be prohibited by Sections 6.2(A) through (R), had such terms been applicable during such period (assuming that Seller requested Buyer’s consent in each case therefor).

Section 4.15   Compliance .

(a)           Seller has made available to Buyer prior to the date of this Agreement correct and complete composite copies of (i) each Uniform Application for Investment Adviser Registration on Form ADV as on file with the SEC as of the date of this Agreement relating to any of the Transferred Entities and including Part II thereof (or a brochure in lieu thereof), reflecting all

amendments thereto to the date of this Agreement (each, a “ Form ADV ”), and (ii) any other similar applications, forms and filings that are material to the BGI Business and required to be made by any Transferred Entity under any applicable Law in connection with its business as an investment adviser.  Such applications, forms and filings are in compliance in all material respects with the applicable requirements of the Investment Advisers Act and such other applicable Laws, and Seller, its Affiliates and the Transferred Entities have conducted their respective businesses in compliance in all material respects with applicable requirements of the Investment Advisers Act and such other applicable Laws.

(b)           Seller has made available to Buyer prior to the date of this Agreement correct and complete copies of each application on Form 7-R filed since January 1, 2007 relating to any of the Transferred Entities, reflecting all amendments thereto to the date of this Agreement (each, a “ Form 7-R ”).  The Forms 7-R are in material compliance with the applicable requirements of the Commodity Exchange Act and the rules of the National Futures Association, and the Transferred Entities have conducted their respective businesses in compliance in all material respects with applicable requirements of the Commodity Exchange Act and the rules of the National Futures Association.  Each Fund (or the operator thereof) that is exempt from registration (as a commodity pool operator under the Commodity Exchange Act) has filed an appropriate claim of exclusion or exemption to the extent required, and each Fund (or the operator thereof) (x) has filed all applicable documentation with the National Futures Association except to the extent the failure of which to file documentation would not, individually or in the aggregate, be reasonably expected to materially impair the Fund’s ability to conduct its business, and (y) has conducted its business in compliance in all material respects with applicable requirements of the Commodity Exchange Act and the rules of the National Futures Association.  Each Transferred Entity that falls within the definition of commodity trading advisor (“ CTA ”) as defined in the Commodity Exchange Act has either filed an appropriate claim of exemption or has registered as a CTA and has filed all applicable documentation and has conducted (to the extent required to comply with an exemption) its business in compliance in all material respects with applicable requirements of the Commodity Exchange Act and the rules of the National Futures Association.

(c)           Each Broker-Dealer is duly registered under the Exchange Act as a broker-dealer with the SEC, and is in compliance in all material respects with the applicable provisions of the Exchange Act, including the net capital requirements and customer protection requirements thereof.  Each Broker-Dealer is a member in good standing with FINRA and in compliance in all material respects with all applicable rules and regulations of FINRA.  Each Broker-Dealer is duly registered as a broker-dealer under, and in compliance in all material respects with, the Laws of all jurisdictions in which it is required to be so registered and each non-U.S. broker dealer has all material Permits and memberships, and operates in compliance in all material respects with all applicable Laws.

(d)           Seller has made available to Buyer prior to the date of this Agreement correct and complete copies of each Broker-Dealer’s Uniform Application for Broker-Dealer Registration on Form BD filed since January 1, 2007 and through the date of this Agreement, reflecting all amendments thereto filed with the SEC prior to the date of this Agreement (a “ Form BD ”).  The Form BD of each Broker-Dealer is in compliance in all material respects with the applicable requirements of the Exchange Act.

(e)           No Broker-Dealer or any “associated person” of any Broker-Dealer is subject to a “statutory disqualification” as such terms are defined in the Exchange Act (or its equivalent under any applicable state or foreign Law), and there is no investigation pending or, to the Knowledge of Seller threatened against any Transferred Entity, whether formal or informal, that is reasonably likely to result in a statutory disqualification (or its equivalent under any applicable state or foreign Law).

(f)           No Seller, Transferred Entity or any of their respective “affiliated persons” (as that term is defined under applicable provisions of the Investment Company Act as interpreted by the SEC or its equivalent under any applicable state or foreign Law) has any express or implied understanding or arrangement that would reasonably be expected to impose an unfair burden on any of the Funds as a result of the transactions contemplated by this Agreement or would in any way make unavailable the benefits of Section 15(f) of the Investment Company Act for those Funds registered under the Investment Company Act for purposes of Section 15(f) of the Investment Company Act, or any similar safe harbors provided by any applicable state or foreign Law, to Seller.

(g)           Each Broker-Dealer and any Transferred Entity that is an investment adviser or an entity required to be registered with any Government Entity, has, where required by applicable Law, adopted written policies and procedures that, in each case, are reasonably designed to detect and prevent any material violations under applicable securities Laws.  There has been no material non-compliance by such Persons with respect to the foregoing requirements or their own internal procedures and policies related to the foregoing, other than those which have been satisfactorily remedied or would not, individually or in the aggregate, reasonably be expected to be material to the Transferred Entities, taken as a whole.

(h)           US Bank has adopted written policies and procedures that are reasonably designed to detect and prevent any material violations under applicable state and federal banking Laws.  There has been no material non-compliance by US Bank with respect to the foregoing requirements or its own internal procedures and policies related to the foregoing, other than those which have been satisfactorily remedied or are not material to the BGI Business.

(i)           Seller and each of the Transferred Entities have filed all regulatory reports, schedules, forms, registrations and other documents that relate to Seller and the Transferred Entities, as applicable, and are material to Seller and the Transferred Entities, as applicable, together with any amendments required to be made with respect thereto, that they were required to file with (i) any applicable domestic or foreign Self-Regulatory Organization, and (ii) all other applicable Government Entities, and have paid all fees and assessments due and payable in connection therewith.

(j)           With respect to each Fund for which US Bank acts as a fiduciary under Part 9 of the rules of the Office of the Comptroller of the Currency, US Bank is in compliance in all material respects with Part 9 of the rules of the Office of the Comptroller of the Currency.

(k)           US Bank is not subject to, and has not been advised that it is reasonably likely to become subject to, any written order, decree, agreement, memorandum of understanding or similar arrangement with, or a commitment letter or similar submission to, or extraordinary

supervisory letter from, or adopted any extraordinary board resolutions at the request of, any Government Entity charged with the supervision or regulation of banks and other trust and depository institutions or otherwise involved with the supervision or regulation of US Bank. 

(l)           All interest rate swaps, caps, floors, option agreements, futures and forward Contracts and other similar risk management arrangements and derivative financial instruments, other than arrangements and instruments of a de minimis value, entered into for the account of any Transferred Entity, or for the account of one or more of the Clients, were entered into (i) in accordance with applicable Client guidelines, prospectuses or offering memoranda to the extent entered into for Clients, (ii) in accordance in all material respects with all applicable Laws and (iii) with counterparties as directed by the applicable Client (where the Client so directs), in all cases except where failure to do so would not, individually or in the aggregate, reasonably be expected to be material to the Transferred Entities, taken as a whole.  None of Parent, its Affiliates or, to the Knowledge of Seller, any other party thereto is in material breach of any of its obligations under any such Contract.

(m)           As of the date hereof, none of the Transferred Entities which is required to maintain a certain amount of regulatory capital in accordance with applicable Law has any agreement, arrangement or understanding with any Government Entity to increase its regulatory capital above the amount required to be maintained as of the date of this Agreement.

Section 4.16   Assets Under Management; Investment Advisory Activities .

(a)           Prior to the execution of this Agreement, Seller has delivered to Buyer a draft, subject to completion and revision, of a list, as of the Base Date (the “ Base Revenue Schedule ”), with respect to each Client of the Transferred Entities of:

(b)           Each Existing Advisory Contract and any amendment, continuance or renewal thereof, in each case, in effect as of the date of this Agreement, (i) has been duly authorized, executed and delivered by a Transferred Entity and (ii) is a valid and legally binding agreement, enforceable against the applicable Transferred Entity and, to the Knowledge of Seller, each other party thereto, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar Laws of general applicability relating to or affecting creditors’ rights and to general equity principles.

(c)           None of the Transferred Entities, Seller or any other person “associated” (as defined under the Investment Advisers Act or its equivalent under any applicable state or foreign Law) with any Transferred Entity or Seller has been subject to disqualification pursuant to Section 203 of the Investment Advisers Act (or its equivalent under any applicable state or foreign Laws) to serve as an investment adviser or as an associated person of a registered

investment adviser, or subject to disqualification to serve as a broker-dealer under any applicable Law unless, in each case, Seller or any such Transferred Entity or associated person has received exemptive relief from the SEC or any other applicable Government Entity, with respect to any such disqualification.  Seller has made available to Buyer, prior to the date of this Agreement, a copy of any exemptive order in respect of any such disqualification.  As of the date of this Agreement, there is no material Litigation pending and served or, to the Knowledge of Seller, threatened against any of the Transferred Entities that would result in any such disqualification.  None of Seller or any of the Transferred Entities or any “affiliated person” (as defined under the Investment Company Act or its equivalent under any applicable state or foreign Law) thereof has been subject to disqualification as an investment adviser or subject to disqualification to serve in any other capacity contemplated by the Investment Company Act (or its equivalent under any applicable state or foreign Law) for any investment company under Sections 9(a) and 9(b) of the Investment Company Act (or its equivalent under any applicable state or foreign Law), unless, in each case, such Person, as applicable, has received, to the Knowledge of Seller, exemptive relief from the SEC or any other applicable Government Entity with respect to any such disqualification.  Seller has made available to Buyer, prior to the date of this Agreement, a copy of any exemptive order or other relief issued by the SEC in respect of any such disqualification.  There is no Litigation pending and served or, to the Knowledge of Seller, threatened against any of the Transferred Entities that would result in any such disqualification.

(d)           No Transferred Entity acting as a qualified professional asset manager (a “ QPAM ”) as defined in Department of Labor Class Exemp