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Section 1: 8-K (8-K)

8-K

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

Date of report (Date of earliest event reported):

March 15, 2018

 

 

Houlihan Lokey, Inc.

(Exact Name of Registrant as Specified in Charter)

 

 

 

Delaware   001-37537   95-2770395

(State or Other Jurisdiction

of Incorporation)

 

(Commission

File Number)

 

(IRS Employer

Identification No.)

 

10250 Constellation Blvd., 5th Floor

Los Angeles, CA

  90067
(Address of Principal Executive Offices)   (Zip Code)

Registrant’s telephone number, including area code:

310-788-5200

(Former Name or Former Address, if Changed Since Last Report)

Not Applicable

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).

Emerging growth company  ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

 

 

 


Item 8.01. Other Events.

Underwriting Agreement

On March 12, 2018, Houlihan Lokey, Inc. (“we,” “us,” “our,” or the “Company”) and certain of our former and current employees and members of management (collectively, the “Selling Stockholders”) entered into an underwriting agreement (the “Underwriting Agreement”) with Morgan Stanley & Co. LLC, as underwriter (the “Underwriter”), relating to the sale of 4,000,000 shares of Class A common stock, par value $0.001 per share (“Class A Common Stock”), of the Company at a public offering price of $47.25 per share in a registered public offering (the “Offering”). The Offering closed on March 15, 2018. The Company sold 2,000,000 shares of Class A Common Stock and the Selling Stockholders sold 2,000,000 shares of Class A Common Stock in the Offering. The Offering generated net proceeds for the Company of $93.5 million and net proceeds for the Selling Stockholders of $93.5 million, in each case, before expenses. The Company did not receive any net proceeds from the sale of the Class A Common Stock by the Selling Stockholders.

The Underwriting Agreement contains customary representations and warranties of the parties, and indemnification and contribution provisions under which the Company and the Selling Stockholders have agreed to indemnify the Underwriter against certain liabilities, including liabilities under the Securities Act of 1933, as amended (the “Securities Act”). Pursuant to the Underwriting Agreement, the Company has agreed, subject to certain exceptions, not to sell or transfer any shares of Class A Common Stock or any securities convertible into or exercisable or exchangeable for Class A Common Stock for 60 days after March 12, 2018 without first obtaining the written consent of the Underwriter. A copy of the Underwriting Agreement is attached as Exhibit 1.1 to this Current Report on Form 8-K and is incorporated herein by reference.

The offering was made pursuant to an effective shelf registration statement filed with the Securities and Exchange Commission (the “SEC”) on October 20, 2017 (File No. 333-221057), a base prospectus, dated October 20, 2017, included as part of the registration statement, and a prospectus supplement, dated March 12, 2018, filed with the SEC pursuant to Rule 424(b) under the Securities Act. We are filing as Exhibit 5.1 to this Current Report on Form 8-K an opinion of our counsel, Latham & Watkins LLP, regarding certain Delaware law issues concerning the shares of Class A Common Stock sold in the offering.

Forward Share Purchase Agreement

In connection with, and prior to, the Offering, on January 26, 2018, the Company entered into a Forward Share Purchase Agreement (the “Purchase Agreement”), with an indirect wholly owned subsidiary of ORIX USA Corporation (“ORIX USA”) pursuant to which the Company agreed to repurchase from ORIX USA on April 5, 2018 the number of shares of our Class B common stock, par value $0.001 per share, equal to the number of shares of Class A Common Stock sold by us in the Offering for a purchase price per share equal to the public offering price in the Offering, less underwriting discounts and commissions. In the event a dividend is paid on our common stock during the period between the closing of the Offering and the settlement of the Purchase Agreement on April 5, 2018, the purchase price per share under the Purchase Agreement will be reduced by the per share amount of any such dividend paid to ORIX USA on the shares of our Class B common stock subject to the Purchase Agreement. We will use the net proceeds received by us from the Offering to acquire such shares sold pursuant to the Purchase Agreement. The rights and obligations of each party under the Purchase Agreement are non-transferrable without the consent of the non-transferring party. A copy of the Purchase Agreement is filed as Exhibit 99.1 to this report.

The foregoing descriptions of the Underwriting Agreement and the Purchase Agreement are not complete and are qualified in their entirety by reference to the full texts of the Underwriting Agreement and the Purchase Agreement, which are incorporated by reference herein.

Forward-Looking Statements

This current report on 8-K contains forward-looking statements within the meaning of the federal securities laws. You can identify these statements by our use of the words “assumes,” “believes,” “estimates,” “expects,” “guidance,” “intends,” “plans,” “projects,” and similar expressions that do not relate to historical matters. You should exercise caution in interpreting and relying on forward-looking statements because they involve known and unknown risks, uncertainties, and other factors which are, in some cases, beyond the Company’s control and could materially affect actual results, performance, or achievements. For a further description of such factors, you should read the Company’s filings with the Securities and Exchange Commission. The Company does not undertake any obligation to update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise.


Item 9.01. Financial Statements and Exhibits.

(d)    Exhibits

 

Exhibit
No.
   Description
  1.1    Underwriting Agreement, dated March 12, 2018, by and between Houlihan Lokey, Inc., the selling stockholders identified therein and Morgan Stanley & Co. LLC.
99.1    Forward Share Purchase Agreement, dated January 26, 2018, by and between Houlihan Lokey, Inc. and ORIX HLHZ Holding LLC.


SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

Date: March 15, 2018     Houlihan Lokey, Inc.
    By:   /s/ J. Lindsey Alley
      Name:   J. Lindsey Alley
      Position:   Chief Financial Officer
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Section 2: EX-1.1 (EX-1.1)

EX-1.1

Exhibit 1.1

HOULIHAN LOKEY, INC.

(a Delaware corporation)

4,000,000 Shares of Class A Common Stock

UNDERWRITING AGREEMENT

Dated: March 12, 2018


HOULIHAN LOKEY, INC.

(a Delaware corporation)

4,000,000 Shares of Class A Common Stock

UNDERWRITING AGREEMENT

March 12, 2018

Morgan Stanley & Co. LLC

1585 Broadway

New York, New York 10036

Ladies and Gentlemen:

Houlihan Lokey, Inc., a Delaware corporation (the “Company”), and the persons listed on Schedule B hereto (the “Selling Stockholders”), confirm their respective agreements with Morgan Stanley & Co. LLC (the “Underwriter”), with respect to the sale by the Company and the Selling Stockholders, acting severally and not jointly, and the purchase by the Underwriter of the respective numbers of shares of Class A Common Stock, par value $0.001 per share, of the Company (“Class A Common Stock”) set forth in Schedules A and B hereto (the “Securities”).

The Company has prepared and filed with the Securities and Exchange Commission (the “Commission”) an automatic shelf registration statement on Form S-3 (File No. 333- 221057) covering the public offering and sale of certain securities, including the Securities, under the Securities Act of 1933, as amended (the “1933 Act”), and the rules and regulations promulgated thereunder (the “1933 Act Regulations”), which automatic shelf registration statement became effective under Rule 462(e) under the 1933 Act Regulations. Such registration statement, as of any time, means such registration statement as amended by any post-effective amendments thereto to such time, including any exhibits and schedules thereto at such time, the documents incorporated or deemed to be incorporated by reference therein at such time pursuant to Item 12 of Form S-3 under the 1933 Act and the documents otherwise deemed to be a part thereof as of such time pursuant to Rule 430B under the 1933 Act Regulations (“Rule 430B”), is referred to herein as the “Registration Statement;” provided, however, that the “Registration Statement” without reference to a time means such registration statement as amended by any post-effective amendments thereto as of the time of the first contract of sale for the Securities, which time shall be considered the “new effective date” of such registration statement with respect to the Securities within the meaning of paragraph (f)(2) of Rule 430B, including the exhibits and schedules thereto as of such time, the documents incorporated or deemed incorporated by reference therein at such time pursuant to Item 12 of Form S-3 under the 1933 Act and the documents otherwise deemed to be a part thereof as of such time pursuant to Rule 430B. Each preliminary prospectus used in connection with the offering of the Securities, including the documents incorporated or deemed to be incorporated by reference therein pursuant to Item 12 of Form S-3 under the 1933 Act, are


collectively referred to herein as a “preliminary prospectus.” Promptly after execution and delivery of this Agreement, the Company will prepare and file a final prospectus relating to the Securities in accordance with the provisions of Rule 424(b) under the 1933 Act Regulations (“Rule 424(b)”). The final prospectus, in the form first furnished or made available to the Underwriter for use in connection with the offering of the Securities, including the documents incorporated or deemed to be incorporated by reference therein pursuant to Item 12 of Form S-3 under the 1933 Act, are collectively referred to herein as the “Prospectus.” For purposes of this Agreement, all references to the Registration Statement, any preliminary prospectus, the Prospectus or any amendment or supplement to any of the foregoing shall be deemed to include the copy filed with the Commission pursuant to its Electronic Data Gathering, Analysis and Retrieval system (or any successor system)(“EDGAR”).

As used in this Agreement:

“Applicable Time” means 4:45 p.m., New York City time, on March 12, 2018 or such other time as agreed by the Company and the Underwriter.

“General Disclosure Package” means any Issuer General Use Free Writing Prospectuses issued at or prior to the Applicable Time, the most recent preliminary prospectus (including any documents incorporated therein by reference) that is distributed to investors prior to the Applicable Time and the information included on Schedule C-1 hereto, all considered together.

“Issuer Free Writing Prospectus” means any “issuer free writing prospectus,” as defined in Rule 433 of the 1933 Act Regulations (“Rule 433”), including without limitation any “free writing prospectus” (as defined in Rule 405 of the 1933 Act Regulations (“Rule 405”)) relating to the Securities that is (i) required to be filed with the Commission by the Company, (ii) a “road show that is a written communication” within the meaning of Rule 433(d)(8)(i), whether or not required to be filed with the Commission, or (iii) exempt from filing with the Commission pursuant to Rule 433(d)(5)(i) because it contains a description of the Securities or of the offering that does not reflect the final terms, in each case in the form filed or required to be filed with the Commission or, if not required to be filed, in the form retained in the Company’s records pursuant to Rule 433(g).

“Issuer General Use Free Writing Prospectus” means any Issuer Free Writing Prospectus that is intended for general distribution to prospective investors (other than a “bona fide electronic road show,” as defined in Rule 433), as evidenced by its being specified in Schedule C-2 hereto.

“Issuer Limited Use Free Writing Prospectus” means any Issuer Free Writing Prospectus that is not an Issuer General Use Free Writing Prospectus.

“Testing the Waters Communication” means any oral or written communication with potential investors undertaken in reliance on Section 5(d) of the 1933 Act.

All references in this Agreement to financial statements and schedules and other information which is “contained,” “included” or “stated” (or other references of like import) in the Registration Statement, any preliminary prospectus or the Prospectus shall be deemed to include all such financial statements and schedules and other information incorporated or deemed incorporated by reference in the Registration Statement, any preliminary prospectus or the Prospectus, as the case

 

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may be, prior to the execution and delivery of this Agreement; and all references in this Agreement to amendments or supplements to the Registration Statement, any preliminary prospectus or the Prospectus shall be deemed to include the filing of any document under the Securities Exchange Act of 1934, as amended and the rules and regulations promulgated thereunder (collectively, the “1934 Act”), incorporated or deemed to be incorporated by reference in the Registration Statement, such preliminary prospectus or the Prospectus, as the case may be, at or after the execution and delivery of this Agreement.

SECTION 1. Representations and Warranties.

(a) Representations and Warranties by the Company. The Company represents and warrants to the Underwriter as of the date hereof, the Applicable Time and the Closing Time (as defined below), and agrees with the Underwriter, as follows:

(i) Registration Statement and Prospectuses. The Company meets the requirements for use of Form S-3 under the Securities Act. The Registration Statement is an “automatic shelf registration statement” as defined under Rule 405 of the Securities Act and the Securities have been and remain eligible for registration by the Company on such automatic shelf registration statement. Each of the Registration Statement and any amendment thereto has become effective under the 1933 Act. No stop order suspending the effectiveness of the Registration Statement has been issued under the 1933 Act, no order preventing or suspending the use of any preliminary prospectus or the Prospectus has been issued and no proceedings for any of those purposes have been instituted or are pending or, to the Company’s knowledge, contemplated. The Company has complied with each request (if any) from the Commission for additional information.

Each of the Registration Statement and any post-effective amendment thereto, at the time of its effectiveness and at each deemed effective date with respect to the Underwriter pursuant to Rule 430B(f)(2) under the 1933 Act Regulations, complied in all material respects with the requirements of the 1933 Act and the 1933 Act Regulations. Each preliminary prospectus, the Prospectus and any amendment or supplement thereto, at the time each was filed with the Commission, complied in all material respects with the requirements of the 1933 Act Regulations. Each preliminary prospectus and the Prospectus delivered to the Underwriter for use in connection with this offering was or will be identical to the electronically transmitted copies thereof filed with the Commission pursuant to EDGAR, except to the extent permitted by Regulation S-T.

The documents incorporated or deemed to be incorporated by reference in the Registration Statement and the Prospectus, when they became effective or at the time they were or hereafter are filed with the Commission, complied and will comply in all material respects with the requirements of the 1934 Act and the rules and regulations of the Commission under the 1934 Act (the “1934 Act Regulations”).

(ii) Accurate Disclosure. Neither the Registration Statement nor any amendment thereto, at its effective time or at the Closing Time, contained, contains or will contain an untrue statement of a material fact or omitted, omits or will omit to state a material fact required to be stated therein or necessary to make the

 

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statements therein not misleading. As of the Applicable Time, neither (A) the General Disclosure Package nor (B) any individual Issuer Limited Use Free Writing Prospectus, when considered together with the General Disclosure Package, included, includes or will include an untrue statement of a material fact or omitted, omits or will omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. Neither the Prospectus nor any amendment or supplement thereto, as of its issue date, at the time of any filing with the Commission pursuant to Rule 424(b) or at the Closing Time, included, includes or will include an untrue statement of a material fact or omitted, omits or will omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. The documents incorporated or deemed to be incorporated by reference in the Registration Statement, the General Disclosure Package and the Prospectus, at the time the Registration Statement became effective or when such documents incorporated by reference were filed with the Commission, as the case may be, when read together with the other information in the Registration Statement, the General Disclosure Package or the Prospectus, as the case may be, did not and will not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading.

The representations and warranties in this subsection shall not apply to statements in or omissions from the Registration Statement (or any amendment thereto), the General Disclosure Package or the Prospectus (or any amendment or supplement thereto) made in reliance upon and in conformity with written information furnished to the Company by the Underwriter expressly for use therein. For purposes of this Agreement, the only information so furnished shall be the information in the third paragraph under the heading “Underwriting” and the information in the first, second and third paragraphs under the heading “Underwriting-Price Stabilization, Short Positions and Penalty Bids” in each case contained in the Prospectus (collectively, the “Underwriter Information”).

(iii) Issuer Free Writing Prospectuses. No Issuer Free Writing Prospectus conflicts or will conflict with the information contained in the Registration Statement or the Prospectus, including any document incorporated by reference therein, and any preliminary or other prospectus deemed to be a part thereof that has not been superseded or modified.

(iv) Testing-the-Waters Materials. The Company (A) has not alone engaged in any Testing-the-Waters Communication and (B) has not authorized any other person to engage in Testing-the-Waters Communications.

(v) Well-Known Seasoned Issuer. (A) At the original effectiveness of the Registration Statement, (B) at the time of the most recent amendment thereto for the purposes of complying with Section 10(a)(3) of the 1933 Act (whether such amendment was by post-effective amendment, incorporated report filed pursuant to Section 13 or 15(d) of the 1934 Act or form of prospectus), (C) at the time the Company or any person acting on its behalf (within the meaning, for this clause only, of Rule 163(c) under the 1933 Act) made any offer relating to the Securities

 

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in reliance on the exemption of Rule 163 under the 1933 Act, and (D) as of the Applicable Time, the Company was and is a “well-known seasoned issuer” (as defined in Rule 405).

(vi) Company Not Ineligible Issuer. At the time of filing the Registration Statement and at the date hereof, the Company was not and is not an “ineligible issuer,” as defined in Rule 405, without taking account of any determination by the Commission pursuant to Rule 405 that it is not necessary that the Company be considered an ineligible issuer.

(vii) Emerging Growth Company Status. From the time of the initial filing of the Registration Statement with the Commission (or, if earlier, the first date on which the Company engaged directly or through any Person authorized to act on its behalf in any Testing-the-Waters Communication) through the date hereof, the Company has been and is an “emerging growth company,” as defined in Section 2(a) of the 1933 Act (an “Emerging Growth Company”).

(viii) Independent Accountants. The accountants who certified the financial statements and supporting schedules included in the Registration Statement, the General Disclosure Package and the Prospectus are independent public accountants as required by the 1933 Act, the 1933 Act Regulations, the 1934 Act, the 1934 Act Regulations and the Public Company Accounting Oversight Board.

(ix) Financial Statements. The consolidated financial statements included or incorporated by reference in the Registration Statement, the General Disclosure Package and the Prospectus, together with the related schedules and notes, present fairly in all material respects the financial condition, results of operations and cash flows of the Company and its consolidated subsidiaries at the dates indicated; and said financial statements have been prepared in conformity with generally accepted accounting principles in the United States (“GAAP”) applied on a consistent basis throughout the periods involved. The selected financial data and the summary financial information included in the Registration Statement, the General Disclosure Package and the Prospectus present fairly the information shown therein and have been compiled on a basis consistent with that of the audited financial statements included therein. The interactive data in eXtensible Business Reporting Language incorporated by reference in the Registration Statement, the General Disclosure Package and the Prospectus fairly presents the information called for in all material respects and has been prepared in accordance with the Commission’s rules and guidelines applicable thereto.

(x) No Material Adverse Change in Business. Except as otherwise stated therein, since the respective dates as of which information is given in the Registration Statement, the General Disclosure Package or the Prospectus, (A) there has been no change in the capital stock or long-term debt of the Company or its subsidiaries or material adverse change in the general affairs, management, financial position, business prospects, stockholders’ equity or results of operations

 

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of the Company and its subsidiaries considered as one enterprise, whether or not arising in the ordinary course of business (a “Material Adverse Effect”), (B) there have been no transactions entered into by the Company or any of its subsidiaries, other than those in the ordinary course of business, which are material with respect to the Company and its subsidiaries considered as one enterprise, and (C) the Company and its subsidiaries have not sustained since the date of the latest audited financial statements included in the General Disclosure Package any material loss or interference with their business, taken as a whole, from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor dispute or court or governmental action, order or decree, otherwise than as set forth or contemplated in the General Disclosure Package.

(xi) Good Standing of the Company. The Company has been duly organized and is validly existing as a corporation in good standing under the laws of the State of Delaware and has corporate power and authority to own, lease and operate its properties and to conduct its business as described in the Registration Statement, the General Disclosure Package and the Prospectus and to enter into and perform its obligations under this Agreement and the Forward Sale Agreement (as defined below); and the Company is duly qualified as a foreign corporation to transact business and is in good standing in each other jurisdiction in which such qualification is required, whether by reason of the ownership or leasing of property or the conduct of business, except where the failure so to qualify or to be in good standing would not, individually or in the aggregate, be reasonably expected to have a Material Adverse Effect.

(xii) Good Standing of Subsidiaries. Each “significant subsidiary” of the Company (as such term is defined in Rule 1-02 of Regulation S-X) (each, a “Subsidiary” and, collectively, the “Subsidiaries”) has been duly organized and is validly existing in good standing under the laws of the jurisdiction of its incorporation or organization, has corporate or similar power and authority to own, lease and operate its properties and to conduct its business as described in the Registration Statement, the General Disclosure Package and the Prospectus and is duly qualified to transact business and is in good standing in each jurisdiction in which such qualification is required, whether by reason of the ownership or leasing of property or the conduct of business, except where the failure to so qualify or to be in good standing would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. Except as otherwise disclosed in the Registration Statement, the General Disclosure Package and the Prospectus, all of the issued and outstanding capital stock of each Subsidiary has been duly authorized and validly issued, is fully paid and non-assessable and is owned by the Company, directly or through subsidiaries, free and clear of any security interest, mortgage, pledge, lien, encumbrance, claim or equity. None of the outstanding shares of capital stock of any Subsidiary were issued in violation of the preemptive or similar rights of any securityholder of such Subsidiary. The only subsidiaries of the Company are (A) the subsidiaries listed on Schedule E hereto, and (B) certain other subsidiaries which, considered in the aggregate as a single subsidiary, do not constitute a “significant subsidiary” as defined in Rule 1-02 of Regulation S-X.

 

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(xiii) Capitalization. The authorized, issued and outstanding shares of capital stock of the Company are as set forth in the consolidated balance sheet of the Company contained in its Quarterly Report on Form 10-Q for the fiscal quarter ended December 31, 2017 (except for subsequent issuances or repurchases, if any, pursuant to this Agreement or the Forward Sale Agreement (as defined below), pursuant to reservations, agreements or employee benefit plans referred to in the Registration Statement, the General Disclosure Package and the Prospectus or pursuant to the exercise of convertible securities or options referred to in the Registration Statement, the General Disclosure Package and the Prospectus). The outstanding shares of capital stock of the Company, including the Securities to be purchased by the Underwriter from the Selling Stockholders, have been duly authorized and validly issued and are fully paid and non-assessable. None of the outstanding shares of capital stock of the Company, including the Securities to be purchased by the Underwriter from the Selling Stockholders, were issued in violation of the preemptive or other similar rights of any securityholder of the Company.

(xiv) Authorization of Agreement. This Agreement has been duly authorized, executed and delivered by the Company.

(xv) Authorization of Forward Sale Agreement. The Forward Sale Agreement, dated as of January 26, 2018, by and between the Company and ORIX HLHZ Holding LLC (the “Forward Sale Agreement”) has been duly authorized, executed and delivered and is a valid and binding agreement of the Company. The issuance and sale of the Securities to be purchased by the Underwriter from the Company pursuant to this Agreement (the “Primary Shares”) and the repurchase by the Company of the shares of Class B common stock, par value $0.001 per share, of the Company (together with the Class A Common Stock, the “Common Stock”) pursuant to the Forward Sale Agreement (the “Repurchase Transaction”) have been approved by the Audit Committee of the Company’s board of directors, which has been duly authorized to so act and each member of which is disinterested with respect to the Forward Sale Agreement and the transactions contemplated thereby. After giving effect to the transactions contemplated by the Forward Sale Agreement, the Company will have adequate surplus and the Repurchase Transaction will be in compliance with Section 160 of the Delaware General Corporation Law.

(xvi) Authorization and Description of Securities. The Securities to be purchased by the Underwriter from the Company have been duly authorized for issuance and sale to the Underwriter pursuant to this Agreement and, when issued and delivered by the Company pursuant to this Agreement against payment of the consideration set forth herein, will be validly issued and fully paid and non-assessable; and the issuance of the Securities is not subject to the preemptive or other similar rights of any securityholder of the Company. The Common Stock conforms in all material respects to the description of the Common Stock contained in the Registration Statement, the General Disclosure Package and the Prospectus.

 

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(xvii) Registration Rights. There are no persons with registration rights or other similar rights to have any securities registered for sale pursuant to the Registration Statement or otherwise registered for sale or sold by the Company under the 1933 Act pursuant to this Agreement, other than those rights that have been disclosed in the Registration Statement, the General Disclosure Package and the Prospectus and have been waived.

(xviii) Absence of Violations, Defaults and Conflicts. Neither the Company nor any of its subsidiaries is (A) in violation of its charter, by-laws or similar organizational document, (B) in default in the performance or observance of any obligation, agreement, covenant or condition contained in any contract, indenture, mortgage, deed of trust, loan or credit agreement, note, lease or other agreement or instrument to which the Company or any of its subsidiaries is a party or by which it or any of them may be bound or to which any of the properties or assets of the Company or any subsidiary is subject (collectively, “Agreements and Instruments”), except for such defaults that would not, singly or in the aggregate, result in a Material Adverse Effect, or (C) in violation of any law, statute, rule, regulation, judgment, order, writ or decree of any arbitrator, court, governmental body, regulatory body, administrative agency or other authority, body or agency having jurisdiction over the Company or any of its subsidiaries or any of their respective assets or operations (each, a “Governmental Entity”), except for such violations that would not, singly or in the aggregate, result in a Material Adverse Effect. The execution, delivery and performance of this Agreement and the Forward Sale Agreement and the consummation of the transactions contemplated herein and in the Forward Sale Agreement, the Registration Statement, the General Disclosure Package and the Prospectus (including the issuance and sale of the Securities and the use of the proceeds from the sale of the Primary Shares as described therein under the caption “Use of Proceeds”) and compliance by the Company with its obligations hereunder and in the Forward Sale Agreement have been duly authorized by all necessary corporate action and will not conflict with or constitute a breach of, or default or Repayment Event (as defined below) under, or result in the creation or imposition of any lien, charge or encumbrance upon any properties or assets of the Company or any subsidiary pursuant to, the Agreements and Instruments (except for such conflicts, breaches, defaults or Repayment Events or liens, charges or encumbrances that would not, singly or in the aggregate, result in a Material Adverse Effect), nor will such action result in any violation of the provisions of the charter, by-laws or similar organizational document of the Company or any statute or any rule, regulation or order of any Governmental Entity. As used herein, a “Repayment Event” means any event or condition which gives the holder of any note, debenture or other evidence of indebtedness (or any person acting on such holder’s behalf) the right to require the repurchase, redemption or repayment of all or a portion of such indebtedness by the Company or any of its subsidiaries.

(xix) Absence of Proceedings. Except as disclosed in the Registration Statement, the General Disclosure Package and the Prospectus, there is no action, suit, proceeding, inquiry or investigation before or brought by any Governmental

 

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Entity now pending or, to the knowledge of the Company, threatened, against or affecting the Company or any of its subsidiaries which would reasonably be expected to result in a Material Adverse Effect, or which might materially and adversely affect their respective properties or assets or the consummation of the transactions contemplated in this Agreement or the Forward Sale Agreement or the performance by the Company of its obligations hereunder or in the Forward Sale Agreement; and the aggregate of all pending legal or governmental proceedings to which the Company or any such subsidiary is a party or of which any of their respective properties or assets is the subject which are not described in the Registration Statement, the General Disclosure Package and the Prospectus, including ordinary routine litigation incidental to the business, would not reasonably be expected to result in a Material Adverse Effect.

(xx) Accuracy of Exhibits. There are no contracts or documents which are required to be described in the Registration Statement, the General Disclosure Package or the Prospectus or to be filed as exhibits to the Registration Statement which have not been so described and filed as required.

(xxi) Absence of Further Requirements. No authorization, approval, consent, license, order, registration or qualification of or with any Governmental Entity is required for the performance by the Company of its obligations hereunder, in connection with the offering, issuance or sale of the Securities hereunder or the consummation of the transactions contemplated by this Agreement and the Forward Sale Agreement, except (A) such as have been already obtained or as may be required under the 1933 Act, the 1933 Act Regulations, the rules of the New York Stock Exchange, state securities laws or the rules of FINRA and (B) such as have been obtained under the laws and regulations of jurisdictions outside the United States in which the Securities were offered.

(xxii) Possession of Licenses and Permits. The Company and its subsidiaries possess such permits, licenses, approvals, consents and other authorizations (collectively, “Governmental Licenses”) issued by the appropriate Governmental Entities necessary to conduct the business now operated by them, except where the failure so to possess would not, singly or in the aggregate, reasonably be expected to result in a Material Adverse Effect. The Company and its subsidiaries are in compliance with the terms and conditions of all Governmental Licenses, except where the failure so to comply would not, singly or in the aggregate, reasonably be expected to result in a Material Adverse Effect. All of the Governmental Licenses are valid and in full force and effect, except when the invalidity of such Governmental Licenses or the failure of such Governmental Licenses to be in full force and effect would not, singly or in the aggregate, reasonably be expected to result in a Material Adverse Effect. Neither the Company nor any of its subsidiaries has received any notice of proceedings relating to the revocation or modification of any Governmental Licenses which, singly or in the aggregate, if the subject of an unfavorable decision, ruling or finding, would reasonably be expected to result in a Material Adverse Effect.

 

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(xxiii) Title to Property. None of the Company or its subsidiaries owns any real property. The Company has good and marketable title to all personal property owned by it and good title to all other properties owned by it, in each case, free and clear of all liens, encumbrances or defects of any kind except such as (A) are described in the Registration Statement, the General Disclosure Package and the Prospectus or (B) do not, singly or in the aggregate, materially affect the value of such property and do not interfere with the use made and proposed to be made of such property by the Company or any of its subsidiaries; and all of the leases and subleases material to the business of the Company and its subsidiaries, considered as one enterprise, and under which the Company or any of its subsidiaries holds properties described in the Registration Statement, the General Disclosure Package or the Prospectus, are in full force and effect, and neither the Company nor any such subsidiary has any notice of any material claim of any sort that has been asserted by anyone adverse to the rights of the Company or any subsidiary under any of the leases or subleases mentioned above, or affecting or questioning the rights of the Company or such subsidiary to the continued possession of the leased or subleased premises under any such lease or sublease.

(xxiv) Possession of Intellectual Property. Except as would not, singly or in the aggregate, result in a Material Adverse Effect, (i) the Company and its subsidiaries own or possess adequate patents, patent rights, licenses, inventions, copyrights, know-how (including trade secrets and other unpatented and/or unpatentable proprietary or confidential information, systems or procedures), trademarks, service marks, trade names or other intellectual property (collectively, “Intellectual Property”) necessary to carry on the business now operated by them, and (ii) neither the Company nor any of its subsidiaries has received any notice of any infringement of asserted rights of others with respect to any Intellectual Property.

(xxv) Accounting Controls. The Company maintains effective internal control over financial reporting (as defined under Rules 13-a15 and 13d-15 under the 1934 Act Regulations) and a system of internal accounting controls sufficient to provide reasonable assurances that (A) transactions are executed in accordance with management’s general or specific authorization; (B) transactions are recorded as necessary to permit preparation of financial statements in conformity with GAAP and to maintain accountability for assets; (C) access to assets is permitted only in accordance with management’s general or specific authorization; (D) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences; and (E) the interactive data in eXtensible Business Reporting Language incorporated by reference in the Registration Statement, the General Disclosure Package and the Prospectus fairly presents the information called for in all material respects and is prepared in accordance with the Commission’s rules and guidelines applicable thereto. Except as described in the Registration Statement, the General Disclosure Package and the Prospectus, since the end of the Company’s most recent audited fiscal year, there has been (1) no material weakness in the Company’s internal control over financial reporting (whether or not remediated) and (2) no change in

 

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the Company’s internal control over financial reporting that has materially and adversely affected, or is reasonably likely to materially and adversely affect, the Company’s internal control over financial reporting. The Company and each of its subsidiaries maintain an effective system of disclosure controls and procedures (as defined in Rule 13a-15 and Rule 13d-15 under the 1934 Act Regulations) that are designed to ensure that information required to be disclosed by the Company in the reports that it files or submits under the 1934 Act is recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms, and is accumulated and communicated to the Company’s management, including its principal executive officer or officers and principal financial officer or officers, as appropriate, to allow timely decisions regarding disclosure.

(xxvi) Compliance with the Sarbanes-Oxley Act. There is and has been no failure on the part of the Company or any of the Company’s directors or officers, in their capacities as such, to comply in all material respects with any provision of the Sarbanes-Oxley Act of 2002 and the rules and regulations promulgated in connection therewith, including Section 402 related to loans and Sections 302 and 906 related to certifications.

(xxvii) Payment of Taxes. All tax returns of the Company and its subsidiaries required by law to be filed have been filed or extensions to file such returns have been timely requested (except in any case in which the failure to file would not, individually or in the aggregate, have a Material Adverse Effect) and all taxes shown by such returns or otherwise assessed, which are due and payable, have been paid, other than those being contested in good faith and for which adequate reserves have been provided or the nonpayment of which would not, individually or in the aggregate, have a Material Adverse Effect.

(xxviii) Insurance. Except as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, the Company and its subsidiaries carry or are entitled to the benefits of insurance, from insurers of recognized financial responsibility, in such amounts and covering such risks as the Company believes to be adequate for the conduct of its business.

(xxix) Investment Company Act. The Company is not required, and upon the issuance and sale of the Securities as herein contemplated and the application of the net proceeds therefrom as described in the Registration Statement, the General Disclosure Package and the Prospectus will not be required, to register as an “investment company” under the Investment Company Act of 1940, as amended (the “1940 Act”).

(xxx) Absence of Manipulation. Neither the Company nor, to the knowledge of the Company, any affiliate of the Company has taken, nor will the Company take or cause any affiliate to take, directly or indirectly, any action which is designed, or would reasonably be expected, to cause or result in, or which constitutes, the stabilization or manipulation of the price of the Securities.

 

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(xxxi) Foreign Corrupt Practices Act. None of the Company, any of its subsidiaries or, to the knowledge of the Company, any director, officer, agent, employee, controlled affiliate or other person acting on behalf of the Company or any of its subsidiaries is aware of or has taken any action, directly or indirectly, that would result in a violation by such persons of the Foreign Corrupt Practices Act of 1977, as amended, and the rules and regulations thereunder (the “FCPA”) or any similar applicable statutes or laws, including, without limitation, making use of the mails or any means or instrumentality of interstate commerce corruptly in furtherance of an offer, payment, promise to pay or authorization of the payment of any money, or other property, gift, promise to give, or authorization of the giving of anything of value to any “foreign official” (as such term is defined in the FCPA) or any foreign political party or official thereof or any candidate for foreign political office, in contravention of the FCPA or any similar applicable statutes or laws and the Company and, to the knowledge of the Company, its controlled affiliates have conducted their businesses in compliance with the FCPA and any similar applicable statutes or laws and have instituted and maintain policies and procedures designed to ensure, and which are reasonably expected to continue to ensure, continued compliance therewith.

(xxxii) Money Laundering Laws. The operations of the Company and its subsidiaries are and have been conducted at all times in compliance with applicable financial recordkeeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended, the money laundering statutes of all applicable jurisdictions, the rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any Governmental Entity (collectively, the “Money Laundering Laws”); and no action, suit or proceeding by or before any Governmental Entity involving the Company or any of its subsidiaries with respect to the Money Laundering Laws is pending or, to the best knowledge of the Company, threatened.

(xxxiii) OFAC. None of the Company, any of its subsidiaries or, to the knowledge of the Company, any director, officer, agent, employee, controlled affiliate or representative of the Company or any of its subsidiaries is an individual or entity (“Person”) currently the subject or target of any sanctions administered or enforced by the United States government, including, without limitation, the U.S. Department of the Treasury’s Office of Foreign Assets Control (“OFAC”), the United Nations Security Council, the European Union, Her Majesty’s Treasury, or other relevant sanctions authority (collectively, “Sanctions”), nor is the Company located, organized or resident in a country or territory that is the subject of Sanctions.

(xxxiv) Statistical and Market-Related Data. Any statistical and market-related data included in the Registration Statement, the General Disclosure Package or the Prospectus are based on or derived from sources that the Company believes to be reliable and accurate and, to the extent required, the Company has obtained the written consent to the use of such data from such sources.

 

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(xxxv) Broker-Dealer Representation. (i) None of the Company or any of its subsidiaries (other than Houlihan Lokey Capital, Inc.) is, or will as a result of the transactions contemplated by this Agreement or the Forward Sale Agreement be, required to register as a broker-dealer under the 1934 Act and the rules and regulations of the Commission thereunder or the securities laws of any state; (ii) to the Company’s knowledge, no officer, partner or employee of the Company or any of its subsidiaries is, or will as a result of the transactions contemplated by this Agreement or the Forward Sale Agreement be, required to register as a broker-dealer under the 1934 Act and the rules and regulations of the Commission thereunder or the securities laws of any state, other than such officers, partners and employees of the Company or any of its subsidiaries who are so registered under the 1934 Act and in such jurisdictions as of the date hereof; and (iii) Houlihan Lokey Capital, Inc. is duly registered, licensed and qualified as a broker-dealer under the 1934 Act and the rules and regulations of the Commission thereunder and the securities laws of each state where the conduct of its business requires such registration and is duly registered and is in good standing with FINRA.

(b) Representations and Warranties by the Selling Stockholders. Each Selling Stockholder severally represents and warrants to the Underwriter and the Company as of the date hereof, as of the Applicable Time and as of the Closing Time, and agrees with the Underwriter and the Company, as follows:

(i) Accurate Disclosure. Neither the General Disclosure Package nor the Prospectus or any amendments or supplements thereto includes any untrue statement of a material fact or omits to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading, provided that such representations and warranties set forth in this subsection (b)(i) apply only to statements or omissions made in reliance upon and in conformity with information relating to such Selling Stockholder furnished in writing by or on behalf of such Selling Stockholder expressly for use in the Registration Statement, the General Disclosure Package, the Prospectus or any other Issuer Free Writing Prospectus or any amendment or supplement thereto, it being understood and agreed that the only information furnished by such Selling Stockholder consists of the name of such Selling Stockholder, the number of offered shares and the address and other information with respect to such Selling Stockholder (excluding percentages) which appears in the Registration Statement, General Disclosure Package, the Prospectus, or any other Issuer Free Writing Prospectus or any amendment or supplement thereto in the table (and corresponding footnotes) under the caption “Principal and Selling Stockholders” (the “Selling Stockholder Information”); such Selling Stockholder is not prompted to sell the Securities to be sold by such Selling Stockholder hereunder by any information concerning the Company or any subsidiary of the Company which is not set forth in the General Disclosure Package or the Prospectus.

(ii) Authorization of this Agreement. This Agreement has been duly authorized, executed and delivered by or on behalf of such Selling Stockholder.

 

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(iii) Authorization of Power of Attorney and Custody Agreement. The Power of Attorney and Custody Agreement, in the form heretofore furnished to the Underwriter (the “Power of Attorney and Custody Agreement”), has been duly authorized, executed and delivered by or on behalf of such Selling Stockholder and is the valid and binding agreement of such Selling Stockholder.

(iv) Noncontravention. The execution and delivery by such Selling Stockholder of this Agreement and the Power of Attorney and Custody Agreement and the sale and delivery of the Securities to be sold by such Selling Stockholder and the consummation of the transactions contemplated herein by such Selling Stockholder and compliance by such Selling Stockholder with its obligations hereunder do not and will not, whether with or without the giving of notice or passage of time or both, conflict with or constitute a breach of, or default under, or result in the creation or imposition of any tax, lien, charge or encumbrance upon the Securities to be sold by such Selling Stockholder or any property or assets of such Selling Stockholder pursuant to any contract, indenture, mortgage, deed of trust, loan or credit agreement, note, license, lease or other agreement or instrument to which such Selling Stockholder is a party or by which such Selling Stockholder may be bound, or to which any of the property or assets of such Selling Stockholder is subject, nor will such action result in any violation of the provisions of the charter or by-laws or other organizational instrument of such Selling Stockholder, if applicable, or any applicable treaty, law, statute, rule, regulation, judgment, order, writ or decree of any government, government instrumentality or court, domestic or foreign, having jurisdiction over such Selling Stockholder or any of its properties, except for such conflicts, breaches, defaults, liens, charges, encumbrances, taxes, as would not, individually or in the aggregate, have a material adverse effect on the ability of such Selling Stockholder to consummate the transactions contemplated by this Agreement and the Power of Attorney and Custody Agreement (a “Selling Stockholder Material Adverse Effect”).

(v) Valid Title. Such Selling Stockholder has, and at the Closing Time will have, valid title to the Securities to be sold by such Selling Stockholder free and clear of all security interests, claims, liens, equities or other encumbrances and the legal right and power, and all authorization and approval required by law, to enter into this Agreement and the Power of Attorney and Custody Agreement and to sell, transfer and deliver the Securities to be sold by such Selling Stockholder or a valid security entitlement in respect of such Securities.

(vi) Delivery of Securities. Upon payment of the purchase price for the Securities to be sold by such Selling Stockholder pursuant to this Agreement, delivery of such Securities, as directed by the Underwriter, to Cede & Co. (“Cede”) or such other nominee as may be designated by The Depository Trust Company (“DTC”), registration of such Securities in the name of Cede or such other nominee, and the crediting of such Securities on the books of DTC to the securities account (within the meaning of Section 8-501(a) of the UCC (as defined below)) of the Underwriter (assuming that neither DTC nor the Underwriter has notice of any “adverse claim,” within the meaning of Section 8-105 of the Uniform Commercial

 

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Code then in effect in the State of New York (“UCC”), to such Securities), (A) under Section 8-501 of the UCC, the Underwriter will acquire a valid “security entitlement” in respect of such Securities and (B) no action (whether framed in conversion, replevin, constructive trust, equitable lien, or other theory) based on any “adverse claim,” within the meaning of Section 8-102 of the UCC, to such Securities may be successfully asserted against the Underwriter with respect to such security entitlement; for purposes of this representation, such Selling Stockholder may assume that when such payment, delivery (if necessary) and crediting occur, (I) such Securities will have been registered in the name of Cede or another nominee designated by DTC, in each case on the Company’s share registry in accordance with its certificate of incorporation, bylaws and applicable law, (II) DTC will be registered as a “clearing corporation,” within the meaning of Section 8-102 of the UCC, (III) appropriate entries to the account of the Underwriter on the records of DTC will have been made pursuant to the UCC, (IV) to the extent DTC, or any other securities intermediary which acts as “clearing corporation” with respect to the Securities, maintains any “financial asset” (as defined in Section 8-102(a)(9) of the UCC) in a clearing corporation pursuant to Section 8-111 of the UCC, the rules of such clearing corporation may affect the rights of DTC or such securities intermediaries and the ownership interest of the Underwriter, (V) claims of creditors of DTC or any other securities intermediary or clearing corporation may be given priority to the extent set forth in Section 8-511(b) and 8-511(c) of the UCC and (VI) if at any time DTC or other securities intermediary does not have sufficient Securities to satisfy claims of all of its entitlement holders with respect thereto then all holders will share pro rata in the Securities then held by DTC or such securities intermediary.

(vii) Absence of Manipulation. Such Selling Stockholder has not taken, and will not take, directly or indirectly, any action which is designed to or which constituted or would reasonably be expected to cause or result in stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of the Securities.

(viii) Absence of Further Requirements. No filing with, or consent, approval, authorization, order, registration, qualification or decree of any arbitrator, court, governmental body, regulatory body, administrative agency or other authority, body or agency, domestic or foreign, is necessary or required to be made by such Selling Stockholder for the performance by such Selling Stockholder of its obligations hereunder, in the Power of Attorney and Custody Agreement, or in connection with the sale and delivery by such Selling Stockholder of its Securities hereunder or the consummation by it of the transactions contemplated by this Agreement, except such as may be required under the 1933 Act, the 1933 Act Regulations, the rules of the New York Stock Exchange, state securities laws or the rules of FINRA, except for such consents, approvals, authorizations, orders or qualifications as would not, individually or in the aggregate, be reasonably expected to have a Selling Stockholder Material Adverse Effect.

 

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(ix) No Registration or Other Similar Rights. Except as otherwise disclosed in the Registration Statement, the General Disclosure Package and the Prospectus, such Selling Stockholder does not have any registration or other similar rights to have any equity or debt securities registered for sale by the Company under the Registration Statement or included in the offering contemplated by this Agreement.

(x) No Free Writing Prospectuses. Such Selling Stockholder has not prepared or had prepared on its behalf or used or referred to, any “free writing prospectus” (as defined in Rule 405), and has not distributed any written materials in connection with the offer or sale of the Securities.

(xi) No Association with FINRA. Except as disclosed in the Registration Statement, the General Disclosure Package and the Prospectus, and except for Houlihan Lokey Capital, Inc., neither such Selling Stockholder nor, to the knowledge of such Selling Stockholder, any of its affiliates directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with any member firm of FINRA or is a person associated with a member (within the meaning of the FINRA By-Laws) of FINRA.

(xii) ERISA. Such Selling Stockholder represents and warrants that it is not (i) an employee benefit plan subject to Title I of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), (ii) a plan or account subject to Section 4975 of the Internal Revenue Code of 1986, as amended or (iii) an entity deemed to hold “plan assets” of any such plan or account under Section 3(42) of ERISA, 29 C.F.R. 2510.3-101, or otherwise.

(c) Officer’s Certificates. Any certificate signed by any officer of the Company delivered to the Underwriter or to counsel for the Underwriter pursuant to this Agreement shall be deemed a representation and warranty by the Company to the Underwriter as to the matters covered thereby; and any certificate signed by or on behalf of any Selling Stockholder as such and delivered to the Underwriter or to counsel for the Underwriter pursuant to the terms of this Agreement shall be deemed a representation and warranty by such Selling Stockholder to the Underwriter as to the matters covered thereby.

SECTION 2. Sale and Delivery to Underwriter; Closing.

(a) Securities. On the basis of the representations and warranties herein contained and subject to the terms and conditions herein set forth, the Company and each Selling Stockholder, severally and not jointly, agree to sell to the Underwriter, and the Underwriter agrees to purchase from the Company and each Selling Stockholder, at a price per share of $46.75, that proportion of the number of Securities set forth in Schedule B opposite the name of the Company or such Selling Stockholder, as the case may be, which the number of Securities set forth in Schedule A opposite the name of the Underwriter, subject, in each case, to such adjustments as the Underwriter in its sole discretion shall make to eliminate any sales or purchases of fractional shares.

 

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(b) Payment. Payment of the purchase price for, and delivery of certificates or security entitlements for, the Securities shall be made at the offices of Skadden, Arps, Slate, Meagher & Flom LLP, Four Times Square, New York, New York 10036, or at such other place as shall be agreed upon by the Underwriter, the Company and the Attorney-In-Fact for the Selling Stockholders, at 9:00 A.M. (New York City time) on the third (fourth, if the pricing occurs after 4:30 P.M. (New York City time) on any given day) business day after the date hereof (unless postponed in accordance with the provisions of Section 10), or such other time not later than ten business days after such date as shall be agreed upon by the Underwriter, the Company and the Attorney-In-Fact for the Selling Stockholders (such time and date of payment and delivery being herein called “Closing Time”).

Payment shall be made to the Company and the Selling Stockholders by wire transfer of immediately available funds to the respective bank accounts designated by (a) the Company and (b) the Custodian pursuant to each Selling Stockholder’s Power of Attorney and Custody Agreement, as the case may be, against delivery to the Underwriter of certificates or security entitlements for the Securities to be purchased by the Underwriter.

SECTION 3. Covenants of the Company and the Selling Stockholders. The Company and, with respect to Sections 3(g), 3(j) and 3(l) only, each of the Selling Stockholders covenants with the Underwriter as follows:

(a) Compliance with Securities Regulations and Commission Requests. The Company, subject to Section 3(b), will comply with the requirements of Rule 430B, and will notify the Underwriter immediately, and confirm the notice in writing (which may be by electronic mail), (i) when any post-effective amendment to the Registration Statement shall become effective or any amendment or supplement to the Prospectus shall have been filed, (ii) of the receipt of any comments from the Commission, (iii) of any request by the Commission for any amendment to the Registration Statement or any amendment or supplement to the Prospectus, including any document incorporated by reference therein or for additional information, (iv) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or any post-effective amendment or of any order preventing or suspending the use of any preliminary prospectus or the Prospectus, or of the suspension of the qualification of the Securities for offering or sale in any jurisdiction, or of the initiation or threatening of any proceedings for any of such purposes or of any examination pursuant to Section 8(d) or 8(e) of the 1933 Act concerning the Registration Statement and (v) if the Company becomes the subject of a proceeding under Section 8A of the 1933 Act in connection with the offering of the Securities. The Company will effect all filings required under Rule 424(b), in the manner and within the time period required by Rule 424(b) (without reliance on Rule 424(b)(8)), and will take such steps as it deems necessary to ascertain promptly whether the form of prospectus transmitted for filing under Rule 424(b) was received for filing by the Commission and, in the event that it was not, it will promptly file such prospectus. The Company will make every reasonable effort to prevent the issuance of any stop order, prevention or suspension and, if any such order is issued, to obtain the lifting thereof at the earliest possible moment.

 

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(b) Continued Compliance with Securities Laws. The Company will comply with the 1933 Act, the 1933 Act Regulations, the 1934 Act and the 1934 Act Regulations so as to permit the completion of the distribution of the Securities as contemplated in this Agreement and in the Registration Statement, the General Disclosure Package and the Prospectus. If at any time when a prospectus relating to the Securities is (or, but for the exception afforded by Rule 172 of the 1933 Act Regulations (“Rule 172”), would be) required by the 1933 Act to be delivered in connection with sales of the Securities, any event shall occur or condition shall exist as a result of which it is necessary, in the opinion of counsel for the Underwriter or for the Company, to (i) amend the Registration Statement in order that the Registration Statement will not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading, (ii) amend or supplement the General Disclosure Package or the Prospectus in order that the General Disclosure Package or the Prospectus, as the case may be, will not include any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein not misleading in the light of the circumstances existing at the time it is delivered to a purchaser or (iii) amend the Registration Statement or amend or supplement the General Disclosure Package or the Prospectus, as the case may be, in order to comply with the requirements of the 1933 Act or the 1933 Act Regulations, the Company will promptly (A) give the Underwriter notice of such event, (B) prepare any amendment or supplement as may be necessary to correct such statement or omission or to make the Registration Statement, the General Disclosure Package or the Prospectus comply with such requirements and, a reasonable amount of time prior to any proposed filing or use, furnish the Underwriter with copies of any such amendment or supplement and (C) file with the Commission any such amendment or supplement; provided that the Company shall not file or use any such amendment or supplement to which the Underwriter or counsel for the Underwriter shall object. The Company will furnish to the Underwriter such number of copies of such amendment or supplement as the Underwriter may reasonably request. The Company has given the Underwriter notice of any filings made pursuant to the 1934 Act or 1934 Act Regulations within 48 hours prior to the Applicable Time; the Company will give the Underwriter notice of its intention to make any such filing from the Applicable Time to the Closing Time and will furnish the Underwriter with copies of any such documents a reasonable amount of time prior to such proposed filing, as the case may be, and will not file or use any such document to which the Underwriter or counsel for the Underwriter shall reasonably object.

(c) Delivery of Registration Statements. The Company has furnished or will deliver to the Underwriter and counsel for the Underwriter, without charge, signed copies of the Registration Statement as originally filed and each amendment thereto (including exhibits filed therewith or incorporated by reference therein and documents incorporated or deemed to be incorporated by reference therein) and signed copies of all consents and certificates of experts. The copies of the Registration Statement and each amendment thereto furnished to the Underwriter will be identical to the electronically transmitted copies thereof filed with the Commission pursuant to EDGAR, except to the extent permitted by Regulation S-T.

 

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(d) Delivery of Prospectuses. The Company has delivered to the Underwriter, without charge, as many copies of each preliminary prospectus as the Underwriter reasonably requested, and the Company hereby consents to the use of such copies for purposes permitted by the 1933 Act. The Company will furnish to the Underwriter, without charge, during the period when a prospectus relating to the Securities is (or, but for the exception afforded by Rule 172, would be) required to be delivered under the 1933 Act, such number of copies of the Prospectus (as amended or supplemented) as the Underwriter may reasonably request. The Prospectus and any amendments or supplements thereto furnished to the Underwriter will be identical to the electronically transmitted copies thereof filed with the Commission pursuant to EDGAR, except to the extent permitted by Regulation S-T.

(e) Blue Sky Qualifications. The Company will use its best efforts, in cooperation with the Underwriter, to qualify the Securities for offering and sale under the applicable securities laws of such states and other jurisdictions (domestic or foreign) as the Underwriter may designate and to maintain such qualifications in effect so long as required to complete the distribution of the Securities; provided, however, that the Company shall not be obligated to file any general consent to service of process or to qualify as a foreign corporation or as a dealer in securities in any jurisdiction in which it is not so qualified or to subject itself to taxation in respect of doing business in any jurisdiction in which it is not otherwise so subject.

(f) Rule 158. The Company will timely file such reports pursuant to the 1934 Act as are necessary in order to make generally available to its securityholders as soon as practicable an earnings statement for the purposes of, and to provide to the Underwriter the benefits contemplated by, the last paragraph of Section 11(a) of the 1933 Act.

(g) Use of Proceeds. The Company will use the net proceeds received by it from the sale of the Primary Shares to consummate the Repurchase Transaction and in the manner specified in the Registration Statement, the General Disclosure Package and the Prospectus under “Use of Proceeds.” No Selling Stockholder will use the net proceeds received by it from the sale of the respective number of shares of Class A Common Stock set forth in Schedule B hereto in violation of any Sanctions.

(h) Listing. The Company will use its best efforts to effect and maintain the listing of the Class A Common Stock (including the Securities) on the New York Stock Exchange.

(i) Restriction on Sale of Securities by Company. During the period from the date of the execution of this Agreement and continuing to and including the date 60 days from the date of the Prospectus, the Company will not, without the prior written consent of the Underwriter, (i) directly or indirectly, offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase or otherwise transfer or dispose of any shares of Class A Common Stock or any securities convertible into or exercisable or exchangeable for Class A Common Stock or file any registration statement under the 1933 Act with respect to any of the foregoing, (ii) enter into any swap or any other agreement or any transaction that

 

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transfers, in whole or in part, directly or indirectly, the economic consequence of ownership of the Class A Common Stock, whether any such swap or transaction described in clause (i) or (ii) above is to be settled by delivery of Class A Common Stock or other securities, in cash or otherwise, other than (A) upon the exercise of an option or warrant or the conversion or exchange of a security outstanding on the date hereof, (B) pursuant to the stock-based compensation plans of the Company and its subsidiaries referred to in the Registration Statement, the General Disclosure Package and the Prospectus; (C) the establishment of a trading plan pursuant to Rule 10b5-1 under the 1934 Act, provided that such plan does not provide for the transfer of shares of Common Stock during the 60-day restricted period and the establishment of such plan does not require or otherwise result in any public filing or other public announcement of such plan during the 60-day restricted period; (D) the issuance by the Company of shares of Common Stock or any security convertible into or exercisable for shares of Common Stock in connection with (1) the acquisition or license of the securities, business, property, technologies or other assets of another person or entity, including pursuant to an employee benefit plan assumed by the Company or its subsidiaries in connection with such acquisition or (2) joint ventures, commercial relationships or other strategic transactions, and in the case of each of clauses (1) and (2), the filing of a registration statement with respect thereto, provided that in the case of clause (D), the aggregate number of shares of Common Stock that the Company may sell or issue or agree to sell or issue shall not exceed 5% of the total number of shares of Common Stock issued and outstanding immediately following the completion of the transactions contemplated by this Agreement; and provided further that each recipient of shares of Common Stock or securities convertible into or exercisable for shares of Common Stock pursuant to clause (D) shall execute a lock-up agreement substantially in the form of Exhibit C hereto; (E) the filing of any registration statement on Form S-8 or a successor form thereto relating to the shares of Common Stock granted pursuant to or reserved for issuance under the stock-based compensation plans of the Company and its subsidiaries; or (F) to the extent required by any regulatory authority, law or regulation applicable to the Company or (iii) waive the requirements of any lock up or similar agreement to which the Company or any stockholder of the Company is a party.

(j) Restriction on Sale of Securities by the Selling Stockholders. The restrictions set forth in Exhibit C hereto apply mutatis mutandis to the Selling Stockholders.

(k) Reporting Requirements. The Company, during the period when a Prospectus relating to the Securities is (or, but for the exception afforded by Rule 172, would be) required to be delivered under the 1933 Act, will file all documents required to be filed with the Commission pursuant to the 1934 Act within the time periods required by the 1934 Act and 1934 Act Regulations.

(l) Issuer Free Writing Prospectuses. Each of the Company and each Selling Stockholder agrees that, unless it obtains the prior written consent of the Underwriter, it will not make any offer relating to the Securities that would constitute an Issuer Free Writing Prospectus or that would otherwise constitute a “free writing prospectus,” or a portion thereof, required to be filed by the Company with the Commission or retained by the Company under Rule 433; provided that the Underwriter will be deemed to have consented to the Issuer Free Writing Prospectuses listed on Schedule C-2 hereto and any

 

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“road show that is a written communication” within the meaning of Rule 433(d)(8)(i) that has been reviewed by the Underwriter. Each of the Company and each Selling Stockholder represents that it has treated or agrees that it will treat each such free writing prospectus consented to, or deemed consented to, by the Underwriter as an “issuer free writing prospectus,” as defined in Rule 433, and that it has complied and will comply with the applicable requirements of Rule 433 with respect thereto, including timely filing with the Commission where required, legending and record keeping. If at any time following issuance of an Issuer Free Writing Prospectus there occurred or occurs an event or development as a result of which such Issuer Free Writing Prospectus conflicted or would conflict with the information contained in the Registration Statement, any preliminary prospectus or the Prospectus or included or would include an untrue statement of a material fact or omitted or would omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances existing at that subsequent time, not misleading, the Company will promptly notify the Underwriter and will promptly amend or supplement, at its own expense, such Issuer Free Writing Prospectus to eliminate or correct such conflict, untrue statement or omission.

(m) Emerging Growth Company Status. The Company will promptly notify the Underwriter if the Company ceases to be an Emerging Growth Company at any time prior to the later of (i) completion of the distribution of the Securities within the meaning of the 1933 Act and (ii) completion of the 60-day restricted period referred to in Section 3(i).

SECTION 4. Payment of Expenses.

(a) Expenses. The Company will pay or cause to be paid all expenses incident to the performance of its obligations under this Agreement, including (i) the preparation, printing and filing of the Registration Statement (including financial statements and exhibits) as originally filed and each amendment thereto, (ii) the preparation, printing and delivery to the Underwriter of copies of each preliminary prospectus, each Issuer Free Writing Prospectus and the Prospectus and any amendments or supplements thereto and any costs associated with electronic delivery of any of the foregoing by the Underwriter to investors, (iii) the preparation, issuance and delivery of the certificates or security entitlements for the Securities to the Underwriter, including any stock or other transfer taxes and any stamp or other duties payable upon the sale, issuance or delivery of the Securities to the Underwriter, (iv) the fees and disbursements of the Company’s counsel, accountants and other advisors, (v) the qualification of the Securities under securities laws in accordance with the provisions of Section 3(e) hereof, including filing fees and the reasonable fees and disbursements of counsel for the Underwriter in connection therewith and in connection with the preparation of the Blue Sky Survey and any supplement thereto, provided that the Company’s obligation to pay such fees and expenses shall not exceed $15,000, (vi) the fees and expenses of any transfer agent or registrar for the Securities, (vii) all expenses incurred by the Company in connection with any “road show” presentation to potential investors; provided that any expenses or costs associated with any chartered plane used in connection with any “road show” presentation to potential investors will be paid 50% by the Company and 50% by the Underwriter, (viii) the filing fees incident to, and the reasonable and documented fees and disbursements of a single counsel to the Underwriter in connection with, the review by FINRA of the terms of the sale of the Securities, provided

 

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that the Company’s obligation to pay any such fees and expenses representing fees and expenses of counsel for the Underwriter shall be documented and shall not exceed $10,000, (ix) the fees and expenses incurred in connection with the listing of the Securities on the New York Stock Exchange, (x) the reasonable and documented fees and expenses of Davis Polk & Wardwell LLP, counsel to ORIX HLHZ Holding LLC and (xi) the reasonable and documented fees and expenses of Whalen LLP, counsel to the Selling Stockholders listed on Schedule B hereto. It is understood, however, that, except as provided in this Section, and Sections 4(b) and 6 hereof, the Underwriter will pay all of its own costs and expenses, including the fees of its counsel, stock transfer taxes on resale of any of the Securities by the Underwriter, and any advertising expenses connected with any offers the Underwriter may make.

(b) Expenses of the Selling Stockholders. The Selling Stockholders, severally and not jointly, will pay (i) all expenses incident to the performance of their respective obligations under, and the consummation of the transactions contemplated by, this Agreement, with respect to any stamp and other duties and stock and other transfer taxes, if any, payable upon the sale of the Securities to the Underwriter, and (ii) the fees and expenses of their counsel (other than the fees and expenses of Whalen LLP being paid for by the Company) and other advisors.

(c) Termination of Agreement. If this Agreement is terminated by the Underwriter in accordance with the provisions of Section 5, Section 9(a)(i) or (iii) or Section 11 hereof, the Company and, only in the event that any Selling Stockholder fails to tender the Securities required to be tendered for delivery at the Closing Time by such Selling Stockholder, such non-tendering Selling Stockholder, shall reimburse the Underwriter for all of its out-of-pocket expenses, including the reasonable fees and disbursements of counsel for the Underwriter.

(d) Allocation of Expenses. The provisions of this Section shall not affect any agreement that the Company and the Selling Stockholders may make for the sharing of such costs and expenses.

SECTION 5. Conditions of the Underwriter’s Obligations. The obligations of the Underwriter hereunder are subject to the accuracy of the representations and warranties of the Company and the Selling Stockholders contained herein or in certificates of any officer of the Company or any of its subsidiaries or on behalf of any Selling Stockholder delivered pursuant to the provisions hereof, to the performance by the Company and each Selling Stockholder of their respective covenants and other obligations hereunder, and to the following further conditions:

(a) Effectiveness of Registration Statement. The Registration Statement, including any Rule 462(b) Registration Statement, has become effective and, at the Closing Time, no stop order suspending the effectiveness of the Registration Statement or any post-effective amendment thereto has been issued under the 1933 Act, no order preventing or suspending the use of any preliminary prospectus or the Prospectus has been issued and no proceedings for any of those purposes have been instituted or are pending or, to the Company’s knowledge, contemplated; and the Company has complied with each request (if any) from the Commission for additional information.

 

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(b) Opinion of Counsel for Company. At the Closing Time, the Underwriter shall have received the opinion, dated the Closing Time, of Latham & Watkins LLP, counsel for the Company, in form and substance satisfactory to counsel for the Underwriter, to the effect set forth in Exhibit A-1 hereto and such counsel shall have received such papers and information as they may reasonably request to enable them to pass upon such matters.

(c) Tax Opinion. At the Closing Time, the Underwriter shall have received a tax opinion, dated the Closing Time, of Latham & Watkins LLP, counsel for the Company, in form and substance satisfactory to counsel for the Underwriter, to the effect set forth in Exhibit A-2 hereto and such counsel shall have received such papers and information as they may reasonably request to enable them to pass upon such matters.

(d) Opinion of Counsel for the Selling Stockholders. At the Closing Time, the Underwriter shall have received the opinion, dated the Closing Time, of Whalen LLP, counsel for the Selling Stockholders listed on Schedule B hereto, in form and substance satisfactory to counsel for the Underwriter, to the effect set forth in Exhibit B hereto, and such counsel shall have received such papers and information as they may reasonably request to enable them to pass upon such matters.

(e) Opinion of Counsel for the Underwriter. At the Closing Time, the Underwriter shall have received the opinion, dated the Closing Time, of Skadden, Arps, Slate, Meagher & Flom LLP, counsel for the Underwriter, in a form satisfactory to the Underwriter, with respect to such matters as the Underwriter may require. In giving such opinion such counsel may rely, as to all matters governed by the laws of jurisdictions other than the law of the State of New York, the General Corporation Law of the State of Delaware and the federal securities laws of the United States, upon the opinions of counsel satisfactory to the Underwriter. Such counsel may also state that, insofar as such opinion involves factual matters, they have relied, to the extent they deem proper, upon certificates of officers and other representatives of the Company and its subsidiaries and certificates of public officials.

(f) Certificate of Selling Stockholders. At the Closing Time, the Underwriter shall have received a certificate of an Attorney-in-Fact on behalf of each Selling Stockholder listed on Schedule B hereto, dated the Closing Time, to the effect that (i) the representations and warranties of each Selling Stockholder in this Agreement are true and correct with the same force and effect as though expressly made at and as of the Closing Time and (ii) each Selling Stockholder has complied with all agreements and all conditions on its part to be performed under this Agreement at or prior to the Closing Time.

(g) Officers’ Certificate. At the Closing Time, there shall not have been, since the date hereof or since the respective dates as of which information is given in the Registration Statement, the General Disclosure Package or the Prospectus, any Material Adverse Effect, and the Underwriter shall have received a certificate of the Chief Executive Officer or the President of the Company and of the chief financial or chief accounting officer of the Company, dated the Closing Time, to the effect that (i) there has been no such material adverse change, (ii) the representations and warranties of the Company in

 

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this Agreement are true and correct with the same force and effect as though expressly made at and as of the Closing Time, (iii) the Company has complied with all agreements and satisfied all conditions on its part to be performed or satisfied at or prior to the Closing Time, and (iv) no stop order suspending the effectiveness of the Registration Statement under the 1933 Act has been issued, no order preventing or suspending the use of any preliminary prospectus or the Prospectus has been issued and no proceedings for any of those purposes have been instituted or are pending or, to their knowledge, contemplated.

(h) Accountant’s Comfort Letter. At the time of the execution of this Agreement, the Underwriter shall have received from KPMG LLP a letter, dated such date, in form and substance satisfactory to the Underwriter containing statements and information of the type ordinarily included in accountants’ “comfort letters” to underwriters with respect to the financial statements and certain financial information contained in the Registration Statement, the General Disclosure Package and the Prospectus.

(i) Bring-down Comfort Letter. At the Closing Time, the Underwriter shall have received from KPMG LLP a letter, dated as of the Closing Time, to the effect that they reaffirm the statements made in the letter furnished pursuant to subsection (h) of this Section, except that the specified date referred to shall be a date not more than three business days prior to the Closing Time.

(j) Approval of Listing. At the Closing Time, the Securities shall have been approved for listing on the New York Stock Exchange, subject only to official notice of issuance.

(k) [Reserved]

(l) No Objection. FINRA has confirmed that it has not raised any objection with respect to the fairness and reasonableness of the underwriting terms and arrangements relating to the offering of the Securities.

(m) Lock-up Agreements. At the date of this Agreement, the Underwriter shall have received an agreement substantially in the form of Exhibit C hereto signed by the persons listed on Schedule D hereto.

(n) Maintenance of Rating. Neither the Company nor its subsidiaries have any debt securities or preferred stock that are rated by any “nationally recognized statistical rating agency” (as defined in Section 3(a)(62) of the 1934 Act).

(o) [Reserved]

(p) Forward Sale Agreement. The Forward Sale Agreement has been duly executed and delivered and, at the Closing Time, the Forward Sale Agreement shall be in full force and effect and there shall be no judgment, injunction, judicial order or decree binding upon either party thereto that would prohibit either party from consummating the Repurchase Transaction or any pending action, suit or proceeding which challenges the validity or legality of the Repurchase Transaction or seeks damages in connection therewith; provided that the condition set forth in this paragraph (p) shall apply only to the purchase and sale of the Primary Shares.

 

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(q) Additional Documents. At the Closing Time counsel for the Underwriter shall have been furnished with such documents and certificates as they may reasonably require for the purpose of enabling them to pass upon the issuance and sale of the Securities as herein contemplated, or in order to evidence the accuracy of any of the representations or warranties, or the fulfillment of any of the conditions, herein contained; and all proceedings taken by the Company and each Selling Stockholder in connection with the issuance and sale of the Securities as herein contemplated shall be reasonably satisfactory in form and substance to the Underwriter and counsel for the Underwriter.

(r) Termination of Agreement. If any condition specified in this Section shall not have been fulfilled when and as required to be fulfilled, this Agreement may be terminated by the Underwriter by notice to the Company and the Selling Stockholders at any time at or prior to Closing Time and such termination shall be without liability of any party to any other party except as provided in Section 4 and except that Sections 1, 6, 7, 8, 14, 15, 16 and 17 shall survive any such termination and remain in full force and effect.

SECTION 6. Indemnification.

(a) Indemnification of the Underwriter by the Company. The Company agrees to indemnify and hold harmless the Underwriter, its affiliates (as such term is defined in Rule 501(b) under the 1933 Act (each, an “Affiliate”)), its selling agents and each person, if any, who controls the Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act as follows:

(i) against any and all loss, liability, claim or damage, as incurred, arising out of any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement (or any amendment thereto), including any information deemed to be a part thereof pursuant to Rule 430B, or the omission or alleged omission therefrom of a material fact required to be stated therein or necessary to make the statements therein not misleading or arising out of any untrue statement or alleged untrue statement of a material fact included (A) in any preliminary prospectus, any Issuer Free Writing Prospectus, the General Disclosure Package or the Prospectus (or any amendment or supplement thereto), or (B) in any materials or information provided to investors by, or with the approval of, the Company in connection with the marketing of the offering of the Securities (“Marketing Materials”), including any roadshow or investor presentations made to investors by the Company (whether in person or electronically), or the omission or alleged omission in any preliminary prospectus, Issuer Free Writing Prospectus, Prospectus or in any Marketing Materials of a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading;

 

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(ii) against any and all loss, liability, claim, damage and expense whatsoever, as incurred, to the extent of the aggregate amount paid in settlement of any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or of any claim whatsoever based upon any such untrue statement or omission, or any such alleged untrue statement or omission; provided that (subject to Section 6(e) below) any such settlement is effected with the written consent of the Company and the Selling Stockholders;

(iii) against any and all expense, as incurred (including the fees and disbursements of counsel chosen by the Underwriter), reasonably incurred in investigating, preparing or defending against any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever based upon any such untrue statement or omission, or any such alleged untrue statement or omission, to the extent that any such expense is not paid under clauses (i) or (ii) above;

provided, however, that this indemnity agreement shall not apply to any loss, liability, claim or damage to the extent arising out of any untrue statement or omission or alleged untrue statement or omission made in the Registration Statement (or any amendment thereto), including any information deemed to be a part thereof pursuant to Rule 430B, the General Disclosure Package or the Prospectus (or any amendment or supplement thereto) in reliance upon and in conformity with the Underwriter Information.

(b) Indemnification of the Underwriter by Selling Stockholders. Each Selling Stockholder, severally and not jointly, agrees to indemnify and hold harmless the Underwriter, its Affiliates and selling agents and each person, if any, who controls the Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act to the extent and in the manner set forth in clauses (a)(i), (ii) and (iii) above; provided that each Selling Stockholder shall be liable only with respect to the Selling Stockholder Information relating to and provided by such Selling Stockholder and only to the extent that such untrue statement or alleged untrue statement or omission or alleged omission has been made in the Registration Statement, any preliminary prospectus, the General Disclosure Package, the Prospectus (or any amendment or supplement thereto) or any Issuer Free Writing Prospectus in reliance upon and in conformity with such Selling Stockholder Information; provided, further, that the aggregate liability under this subsection and the contribution provisions of Section 7 below of each Selling Stockholder shall be limited to an amount equal to the aggregate gross proceeds after underwriting commissions and discounts, but before expenses, to such Selling Stockholder from the sale of Securities sold by such Selling Stockholder hereunder (the “Selling Stockholder Proceeds”).

(c) Indemnification of Company, Directors and Officers and the Selling Stockholders. The Underwriter agrees to indemnify and hold harmless the Company, its directors, each of its officers who signed the Registration Statement, and each person, if any, who controls the Company within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act, and each Selling Stockholder and each person, if any, who controls any Selling Stockholder within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act against any and all loss, liability, claim, damage and expense described in the indemnity contained in subsection (a) of this Section, as incurred, but only

 

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with respect to untrue statements or omissions, or alleged untrue statements or omissions, made in the Registration Statement (or any amendment thereto), including any information deemed to be a part thereof pursuant to Rule 430B, any preliminary prospectus, any Issuer Free Writing Prospectus, the General Disclosure Package or the Prospectus (or any amendment or supplement thereto) or in any Marketing Materials in reliance upon and in conformity with the Underwriter Information.

(d) Actions against Parties; Notification. Each indemnified party shall give notice as promptly as reasonably practicable to each indemnifying party of any action commenced against it in respect of which indemnity may be sought hereunder, but failure to so notify an indemnifying party shall not relieve such indemnifying party from any liability hereunder to the extent it is not materially prejudiced as a result thereof and in any event shall not relieve it from any liability which it may have otherwise than on account of this indemnity agreement. In the case of parties indemnified pursuant to Sections 6(a) and 6(b) above, counsel to the indemnified parties shall be selected by the Underwriter, and, in the case of parties indemnified pursuant to Section 6(c) above, counsel to the indemnified parties shall be selected by the Company.

An indemnifying party may participate at its own expense in the defense of any such action; provided, however, that counsel to the indemnifying party shall not (except with the consent of the indemnified party) also be counsel to the indemnified party. In no event shall the indemnifying parties be liable for fees and expenses of more than one counsel (in addition to any local counsel) separate from their own counsel for all indemnified parties in connection with any one action or separate but similar or related actions arising out of the same general allegations or circumstances. No indemnifying party shall, without the prior written consent of the indemnified parties, settle or compromise or consent to the entry of any judgment with respect to any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever in respect of which indemnification or contribution could be sought under this Section 6 or Section 7 hereof (whether or not the indemnified parties are actual or potential parties thereto), unless such settlement, compromise or consent (i) includes an unconditional release of each indemnified party from all liability arising out of such litigation, investigation, proceeding or claim and (ii) does not include a statement as to or an admission of fault, culpability or a failure to act by or on behalf of any indemnified party.

(e) Settlement without Consent if Failure to Reimburse. If at any time an indemnified party shall have requested an indemnifying party to reimburse the indemnified party for fees and expenses of counsel, such indemnifying party agrees that it shall be liable for any settlement of the nature contemplated by Section 6(a)(ii) effected without its written consent if (i) such settlement is entered into more than (A) 60 days after receipt by such indemnifying party of the aforesaid request and (B) more than 60 days after receipt by such indemnifying party of the proposed terms of such settlement and (ii) such indemnifying party shall not have reimbursed such indemnified party in accordance with such request prior to the date of such settlement, unless, in each case, the amount of such fees and expenses is being actively disputed in good faith.

 

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(f) Other Agreements with Respect to Indemnification. The provisions of this Section shall not affect any agreement among the Company and the Selling Stockholders with respect to indemnification.

SECTION 7. Contribution. If the indemnification provided for in Section 6 hereof is for any reason unavailable to or insufficient to hold harmless an indemnified party in respect of any losses, liabilities, claims, damages or expenses referred to therein, then each indemnifying party shall contribute to the aggregate amount of such losses, liabilities, claims, damages and expenses incurred by such indemnified party, as incurred, (i) in such proportion as is appropriate to reflect the relative benefits received by the Company and the Selling Stockholders, on the one hand, and the Underwriter, on the other hand, from the offering of the Securities pursuant to this Agreement or (ii) if the allocation provided by clause (i) is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of the Company and the Selling Stockholders, on the one hand, and of the Underwriter, on the other hand, in connection with the statements or omissions which resulted in such losses, liabilities, claims, damages or expenses, as well as any other relevant equitable considerations.

The relative benefits received by the Company and the Selling Stockholders, on the one hand, and the Underwriter, on the other hand, in connection with the offering of the Securities pursuant to this Agreement shall be deemed to be in the same respective proportions as the total net proceeds from the offering of the Securities pursuant to this Agreement (before deducting expenses) received by the Company and the Selling Stockholders, on the one hand, and the total underwriting discount received by the Underwriter, on the other hand, in each case as set forth on the cover of the Prospectus, bear to the aggregate initial public offering price of the Securities as set forth on the cover of the Prospectus.

The relative fault of the Company and the Selling Stockholders, on the one hand, and the Underwriter, on the other hand, shall be determined by reference to, among other things, whether any such untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact relates to information supplied by the Company or the Selling Stockholders or by the Underwriter and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.

The Company, the Selling Stockholders and the Underwriter agree that it would not be just and equitable if contribution pursuant to this Section 7 were determined by pro rata allocation or by any other method of allocation which does not take account of the equitable considerations referred to above in this Section 7. The aggregate amount of losses, liabilities, claims, damages and expenses incurred by an indemnified party and referred to above in this Section 7 shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in investigating, preparing or defending against any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever based upon any such untrue or alleged untrue statement or omission or alleged omission.

Notwithstanding the provisions of this Section 7, the Underwriter shall not be required to contribute any amount in excess of the amount by which the total price at which the Securities underwritten by it and distributed to the public exceeds the amount of any damages which the

 

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Underwriter has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission; and the aggregate liability of each Selling Stockholder under the contribution provisions contained in this Section 7 and the indemnification provisions contained in Section 6(b) shall be limited to an amount equal to the Selling Stockholder Proceeds.

No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the 1933 Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation.

For purposes of this Section 7, each person, if any, who controls the Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act and the Underwriter’s Affiliates and selling agents shall have the same rights to contribution as the Underwriter, and each director of the Company, each officer of the Company who signed the Registration Statement, and each person, if any, who controls the Company or any Selling Stockholder within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act shall have the same rights to contribution as the Company or such Selling Stockholder, as the case may be. The Selling Stockholders’ respective obligations to contribute pursuant to this Section 7 are several in proportions to its Selling Stockholder Proceeds relative to the total number of Securities sold by all Selling Stockholders and the Company.

The provisions of this Section 7 shall not affect any agreement among the Company and the Selling Stockholders with respect to contribution.

Notwithstanding anything to the contrary in this Agreement, the aggregate liability of each Selling Stockholder under such Selling Stockholder’s representations and warranties contained in Section 1(b) of this Agreement, under any certificate or agreement delivered pursuant to this Agreement, under the indemnity and contribution agreements contained in this Sections 6 and 7 or otherwise pursuant to this Agreement shall be limited in the Selling Stockholder Proceeds.

SECTION 8. Representations, Warranties and Agreements to Survive. All representations, warranties and agreements contained in this Agreement or in certificates of officers of the Company or any of its subsidiaries or the Selling Stockholders submitted pursuant hereto, shall remain operative and in full force and effect regardless of (i) any investigation made by or on behalf of the Underwriter or its Affiliates or selling agents, any person controlling the Underwriter, its officers or directors or any person controlling the Company or any person controlling any Selling Stockholder and (ii) delivery of and payment for the Securities.

SECTION 9. Termination of Agreement.

(a) Termination. The Underwriter may terminate this Agreement, by notice to the Company and the Selling Stockholders, at any time at or prior to the Closing Time (i) if there has been, in the judgment of the Underwriter, since the time of execution of this Agreement or since the respective dates as of which information is given in the Registration Statement, the General Disclosure Package or the Prospectus, any material adverse change in the condition, financial or otherwise, or in the earnings, business affairs or business prospects of the Company and its subsidiaries considered as one enterprise, whether or not arising in the ordinary course of business, or (ii) if there has occurred any material adverse

 

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change in the financial markets in the United States or the international financial markets, any outbreak of hostilities or escalation thereof or other calamity or crisis or any change or development involving a prospective change in national or international political, financial or economic conditions, in each case the effect of which is such as to make it, in the judgment of the Underwriter, impracticable or inadvisable to proceed with the completion of the offering or to enforce contracts for the sale of the Securities, or (iii) if trading in any securities of the Company has been suspended or materially limited by the Commission or the New York Stock Exchange, or (iv) if trading generally on the New York Stock Exchange has been suspended or materially limited, or minimum or maximum prices for trading have been fixed, or maximum ranges for prices have been required, by any of said exchanges or by order of the Commission, FINRA or any other governmental authority, or (v) a material disruption has occurred in commercial banking or securities settlement or clearance services in the United States or with respect to Clearstream or Euroclear systems in Europe, or (vi) if a banking moratorium has been declared by either Federal or New York authorities.

(b) Liabilities. If this Agreement is terminated pursuant to this Section 9, such termination shall be without liability of any party to any other party except as provided in Section 4 hereof, and provided further that Sections 1, 6, 7, 8, 14, 15,16 and 17 shall survive such termination and remain in full force and effect.

SECTION 10. [Reserved].

SECTION 11. Default by one or more of the Selling Stockholders or the Company.

(a) If a Selling Stockholder shall fail at the Closing Time to sell and deliver the number of Securities which such Selling Stockholder or Selling Stockholders are obligated to sell hereunder, and the remaining Selling Stockholders do not exercise the right hereby granted to increase, pro rata or otherwise, the number of Securities to be sold by them hereunder to the total number to be sold by all Selling Stockholders as set forth in Schedule B hereto, then the Underwriter may, by notice to the Company and the non-defaulting Selling Stockholders, either (i) terminate this Agreement without any liability on the fault of any non-defaulting party except that the provisions of Sections 1, 4, 6, 7, 8, 15, 16 and 17 shall remain in full force and effect or (ii) elect to purchase the Securities which the non-defaulting Selling Stockholders have agreed to sell hereunder. No action taken pursuant to this Section 11 shall relieve any Selling Stockholder so defaulting from liability, if any, in respect of such default.

In the event of a default by any Selling Stockholder as referred to in this Section 11, the Underwriter, the Company and the non-defaulting Selling Stockholders shall have the right to postpone the Closing Time for a period not exceeding seven days in order to effect any required change in the Registration Statement, the General Disclosure Package or the Prospectus or in any other documents or arrangements.

(b) If the Company shall fail at the Closing Time to sell the number of Securities that it is obligated to sell hereunder, then this Agreement shall terminate without any liability on the part of any nondefaulting party; provided, however, that the provisions of Sections 1, 4, 6, 7, 8, 15, 16 and 17 shall remain in full force and effect. No action taken pursuant to this Section shall relieve the Company from liability, if any, in respect of such default.

 

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SECTION 12. Notices. All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given if mailed or transmitted by any standard form of telecommunication. Notices to the Underwriter shall be directed to Morgan Stanley & Co. LLC, Attention: Equity Syndicate Desk, with a copy to the Legal Department, 1585 Broadway, New York, NY; notices to the Company shall be directed to it at Houlihan Lokey, Inc. 10250 Constellation Blvd., 5th Floor Los Angeles, CA 90067 Attention: J. Lindsey Alley, Managing Director, with a copy to Christopher Crain, Esq., Managing Director, General Counsel; notices to the Selling Stockholders listed on Schedule B hereto shall be directed to the address of the Attorneys-in-Fact as set forth in the Power of Attorney and Custody Agreement, or in each case to such other address as the person to be notified may have requested in writing.

SECTION 13. No Advisory or Fiduciary Relationship. Each of the Company and each Selling Stockholder acknowledges and agrees that (a) the purchase and sale of the Securities pursuant to this Agreement, including the determination of the initial public offering price of the Securities and any related discounts and commissions, is an arm’s-length commercial transaction between the Company and the Selling Stockholder, on the one hand, and the Underwriter, on the other hand, (b) in connection with the offering of the Securities and the process leading thereto, the Underwriter is and has been acting solely as a principal and is not the agent or fiduciary of the Company, any of its subsidiaries or any Selling Stockholder or its respective stockholders, creditors, employees or any other party, (c) the Underwriter has not assumed and will not assume an advisory or fiduciary responsibility in favor of the Company or any Selling Stockholder with respect to the offering of the Securities or the process leading thereto (irrespective of whether the Underwriter has advised or is currently advising the Company, any of its subsidiaries or any Selling Stockholder on other matters) and the Underwriter has no obligation to the Company with respect to the offering of the Securities except the obligations expressly set forth in this Agreement, (d) the Underwriter and its affiliates may be engaged in a broad range of transactions that involve interests that differ from those of each of the Company and each Selling Stockholder, and (e) the Underwriter has not provided any legal, accounting, regulatory or tax advice with respect to the offering of the Securities and the Company and each of the Selling Stockholders has consulted its own respective legal, accounting, regulatory and tax advisors to the extent it deemed appropriate.

SECTION 14. Parties. This Agreement shall each inure to the benefit of and be binding upon the Underwriter, the Company and the Selling Stockholders and their respective successors. Nothing expressed or mentioned in this Agreement is intended or shall be construed to give any person, firm or corporation, other than the Underwriter, the Company and the Selling Stockholders and their respective successors and the controlling persons and officers and directors referred to in Sections 6 and 7 and their heirs and legal representatives, any legal or equitable right, remedy or claim under or in respect of this Agreement or any provision herein contained. This Agreement and all conditions and provisions hereof are intended to be for the sole and exclusive benefit of the Underwriter, the Company and the Selling Stockholders and their respective successors, and said controlling persons and officers and directors and their heirs and legal representatives, and for the benefit of no other person, firm or corporation. No purchaser of Securities from the Underwriter shall be deemed to be a successor by reason merely of such purchase.

 

31


SECTION 15. Trial by Jury. The Company (on its behalf and, to the extent permitted by applicable law, on behalf of its stockholders and affiliates), each of the Selling Stockholders and the Underwriter hereby irrevocably waives, to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal proceeding arising out of or relating to this Agreement or the transactions contemplated hereby.

SECTION 16. GOVERNING LAW. THIS AGREEMENT AND ANY CLAIM, CONTROVERSY OR DISPUTE ARISING UNDER OR RELATED TO THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF, THE STATE OF NEW YORK WITHOUT REGARD TO ITS CHOICE OF LAW PROVISIONS.

SECTION 17. Consent to Jurisdiction; Waiver of Immunity. Any legal suit, action or proceeding arising out of or based upon this Agreement or the transactions contemplated hereby shall be instituted in (i) the federal courts of the United States of America located in the City and County of New York, Borough of Manhattan or (ii) the courts of the State of New York located in the City and County of New York, Borough of Manhattan (collectively, the “Specified Courts”), and each party irrevocably submits to the exclusive jurisdiction (except for proceedings instituted in regard to the enforcement of a judgment of any such court, as to which such jurisdiction is non-exclusive) of such courts in any such suit, action or proceeding. Service of any process, summons, notice or document by mail to such party’s address set forth above shall be effective service of process for any suit, action or other proceeding brought in any such court. The parties irrevocably and unconditionally waive any objection to the laying of venue of any suit, action or other proceeding in the Specified Courts and irrevocably and unconditionally waive and agree not to plead or claim in any such court that any such suit, action or other proceeding brought in any such court has been brought in an inconvenient forum.

SECTION 18. TIME. TIME SHALL BE OF THE ESSENCE OF THIS AGREEMENT. EXCEPT AS OTHERWISE SET FORTH HEREIN, SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY TIME.

SECTION 19. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, but all such counterparts shall together constitute one and the same Agreement.

SECTION 20. Effect of Headings. The Section headings herein are for convenience only and shall not affect the construction hereof.

 

32


If the foregoing is in accordance with your understanding of our agreement, please sign and return to the Company and the Attorney-in-Fact for the Selling Stockholders listed on Schedule B hereto a counterpart hereof, whereupon this instrument, along with all counterparts, will become a binding agreement among the Underwriter, the Company and the Selling Stockholders in accordance with its terms.

Very truly yours,

 

HOULIHAN LOKEY, INC.
By   /s/ Christopher Crain
  Name: Christopher Crain
  Title: General Counsel

 

33


If the foregoing and the provisions of Exhibit C hereto are in accordance with your understanding of our agreement, please sign and return to the Company and the Attorney-in-Fact for the Selling Stockholders listed on Schedule B hereto a counterpart hereof, whereupon this instrument, along with all counterparts, will become a binding agreement among the Underwriter, the Company and the Selling Stockholders in accordance with its terms.

 

 

The Selling Stockholders named in Schedule B hereto
By   /s/ Charles A. Yamarone
Name:   Charles A. Yamarone
  As Attorney-in-Fact acting on behalf of the Selling Stockholders named in Schedule B hereto


CONFIRMED AND ACCEPTED,

as of the date first above written:

MORGAN STANLEY & CO. LLC
By   /s/ Kyle McDonnell
 

Authorized Signatory

 

2


SCHEDULE A

The initial public offering price per share for the Securities shall be $47.25.

The purchase price per share for the Securities to be paid by the Underwriter shall be $46.75.

 

Name of Underwriter    Number of
Securities
 

Morgan Stanley & Co. LLC

     4,000,000  

 

Sch A-1


SCHEDULE B

 

     Number of Securities to be Sold  
Houlihan Lokey, Inc.      2,000,000  
Selling Stockholders:   
The Gold Stock Trust      20,728  
The Beiser Stock Trust      14,434  
Adelson Stock Trust      13,732  
Paul Eric Siegart Revocable Trust      110,139  
Werbalowsky, Jeffrey      106,796  
Hilty, David      104,680  
Mavredakis, John      9,417  
Hotz, Robert      94,116  
Novak, Jay      27,206  
Peluchiwski, William      41,431  
Hardie, Tuck (William)      75,231  
Preiser, David      8,888  
Antenucci, Anita      72,302  
Jack Berka Stock Trust      5,698  
Zwick, Ansgar      61,129  
Burian, Saul      60,891  
The ABM-HL Stock Trust      5,536  
Francis, Mark      55,811  
Marshall, Peter      55,952  
Swanson, Joseph      52,849  
Fazio, Michael      15,934  
Lavelle, James      48,873  
The Wilson Stock Trust      23,812  
Tishman, Steven      33,558  
The Geer Stock Trust      31,851  
Turnbull, Andrew      20,632  
The Di Mauro Stock Trust      19,745  
Cleveland, Jonathan      29,436  
Niemann, Matthew      26,034  
Richardson, Scott      26,017  
Goldman, Mark      7,926  
Dunayer, Adam      16,057  
Terence Tchen, Trustee of the Tchen Stock Trust      16,093  
Hanson, John-Paul      15,154  
Lacher, Rick      7,032  
The Alley Stock Trust      22,549  
Winthrop Family Trust      21,911  

 

Sch B-1


     Number of Securities to be Sold  
Croft, Christopher      21,696  
Louv, Robert      18,146  
Martinez-Fidalgo, Manuel      14,068  
Cooper, John      17,371  
Patel, Amit      16,137  
Jordan, Bradley      14,614  
Schoenfeld, John      14,566  
Mcdonald, Brian      4,445  
The Kolbrenner Stock Trust      13,804  
Salmini, Kevin      8,828  
Levine, Jeffrey      10,310  
Dunfrund, Scott      8,129  
Stern, Jeffrey      6,291  
Spencer, Stephen      11,418  
Dunlop, Christopher      10,708  
Mcmahon, Michael      10,557  
Roberts, David      6,614  
Strassman, Todd      3,127  
Benshimon, Laurent      10,017  
Muller, Jennifer      6,360  
Silcock, Julie      9,085  
Hughes, Steve      8,866  
Kagan, Gavin      8,553  
Browne, Shaun      7,025  
Finger, Gary      2,550  
Lerche, Niklas      8,129  
Patricof, Mark      8,164  
Snellenbarger, Reid      7,952  
Altman, Jeffrey      7,749  
Newman, Gregg      7,430  
Martino, Anthony      7,316  
Giffin, Lowell      6,316  
Sanabria, Paul      7,405  
Hammer, Jeffrey      7,391  
Julian, Joseph      4,793  
Anderson, Reed      7,230  
Lowrey, Brett      6,910  
Crain, Christopher      4,599  
Brewster, Gary      5,590  
Miles, Karen      5,415  
Dippel, Thomas      4,244  
Levy, Jerome      6,509  
Kent, Ranon      6,256  
The Sheridan Family Trust      3,324  

 

Sch B-1


     Number of Securities to be Sold  

Chen, Weimin

     5,224  

Morrow, Andrew

     1,920  

Vescio, Fredrick

     5,962  

Foley, Jake

     6,036  

Sergeant, Scott

     5,782  

Deluke, Michael

     3,885  

Ryan, Noel

     5,908  

Dufilho, Mark

     3,836  

Dereuver, Gijs

     5,787  

O’Toole, Ryan

     5,634  

Soden, John

     5,744  

The Williams Stock Trust

     5,330  

William H. Sherer and Renée C. Sherer Marital Trust

     3,271  

Plantenga, Florus

     4,818  

Schade, Mark

     1,471  

Yamarone, Charles

     4,645  

Miller, Ann

     4,630  

Schindler, Graham

     1,382  

Stephens, Kevin

     1,370  

The Larsen HL Investment Trust

     4,126  

Voukadinov, Dimitar

     3,853  

Foley, Christopher

     3,839  

Pisani, Michael

     3,066  

Alford, Scott

     1,110  

Kaczmarek, Matthew

     1,850  

Treemarcki, Terry

     3,500  

Tarbell, Jeffrey

     2,248  

Winningham, Stephen

     2,737  

Steffen, Timothy

     3,200  

Pearce, Toby

     3,135  

Seward, Tom

     148  

Gunn, Stuart

     1,915  

Irvin, Bob

     2,888  

De Rose, Richard

     2,802  

The Matthew T. Bowersox Stock Trust

     858  

Krakovsky, Michael

     2,775  

Salemi, David

     1,784  

Arnesen, Jeffrey

     1,785  

Hanson, Todd

     2,659  

Boone, Michael

     2,664  

Marler, Brian

     2,194  

Preis, Phillip

     1,726  

Raskin, Alexey

     2,584  

 

Sch B-1


     Number of Securities to be Sold  

Allen, David

     2,485  

Blanco, Susan

     2,491  

Page, James

     2,459  

Swanson, Jessica

     2,347  

Johnson, Mark

     2,289  

Dannenberg, Aaron

     2,228  

Graebner, Ulrich

     2,517  

Mcelhenney, Michael

     1,974  

Dorst, Jeffrey

     1,974  

Wu, Yanson

     1,305  

Gupta, Surbhi

     589  

The Lewis Stock Trust

     1,549  

Bollerman, Jeffrey

     1,501  

Hector, Xander

     1,815  

Cartier, Eric

     1,763  

Weinberger, Jay

     1,734  

Cowan, John

     1,338  

Hoverman, Daniel

     1,618  

Morabito, Michael

     1,225  

Abramson, Michael

     1,380  

Guelfand, Nicolas

     1,485  

Zintl, Nicolas

     1,416  

Ben-Mustapha, Mohamed

     1,394  

Feintuch, Jason

     1,298  

O’Donnell, Daniel

     1,083  

Maier, Brent

     1,300  

Greenway, Adam

     1,063  

Ferrin, Brent

     1,240  

The Spencer Stock Trust

     1,259  

Maxwell, Linda

     1,258  

Coutts, Geoffrey

     1,253  

Wieshofer Stock Trust

     1,262  

Oudman, Robert Sijbrand

     1,437  

Repka, Michael

     1,220  

Hardin, Stephen

     986  

Liao, Dennis

     1,148  

Mcdonald, Bruce

     1,172  

Shah, Manisha

     1,168  

Aarts, Oscar

     1,145  

Pandya, Chintin

     1,061  

Chao, Randolph

     838  

Lee, Meissa

     320  

Monahan, Matthew

     943  

Byer, Hal

     900  

 

Sch B-1


     Number of Securities to be Sold  

Manfredi, Matteo

     1,188  

Robison, Sean

     868  

Popehn, John

     813  

Abt, Jason

     814  

Cho, Hyun Woo

     829  

Roddy, Susan

     805  

Pritti, Jonathan

     670  

Gillan, Patrick

     829  

Chastaine, Lyle

     526  

Owen, James

     822  

Kawachi, Dennis

     639  

Urbanek, Bruce

     777  

Mason, Russell

     724  

Krauskopf, Benjamin

     226  

Nelson, Hugh

     449  

Davey, Anne

     655  

Talarico, Drew

     381  

Honorowski, Mark

     586  

Tanzer, Joshua

     603  

Kimmel, Laura

     571  

Chary, Neel

     522  

Braicovich, Pietro

     746  

Pichler, Andre

     746  

Novak, Darren

     522  

Hendriks, Robbie Christiaan

     577  

Andrias, David

     467  

Timblick, David

     484  

Rieg, Tobias

     540  

Sevilla, Alejandro

     127  

Meyerguz, Alexander

     64  

Leung, Terence

     450  

Villen Marin, Jorge

     431  

Gaulier, Pierre

     418  

Hebenstreit, Cory

     411  

Hopkins, Kristopher

     380  

Humes, Thomas

     258  

Hedus, Thomas

     362  

Westhoven, Michael

     373  

Tobin, Daniel

     344  

Singer, Maria

     275  

Fredricks, Brian

     333  

Lee, Emmelene

     330  

Chakrabarti, Rittik

     96  

Martin, Mark

     287  

 

Sch B-1


     Number of Securities to be Sold  

Dayalan, Karthik

     272  

Schoennagel, Patrick Adam

     246  

Scheid, David Steven

     269  

Shaw, Theodore

     231  

Waltz, Scott

     264  

Hallahan, Kelly

     256  

Berse, Corey

     254  

Sloan, Jonathan

     153  

Lawlor, Martin

     202  

Mainetti, Andrea

     271  

Tse, Lewis

     173  

Buckner, Richard

     175  

Blackford, Catherine

     156  

Bradt, Mark

     154  

Carr, Lance

     147  

Schweizer, Eric

     104  

Colville, John Victor

     69  

Berry, Kevin

     112  

Bounds, Darren John

     45  

Nawrath, Jens

     114  

Khan, Zaman Ali

     63  

Hauser, Eric

     114  

Lazar, Ron

     95  

Cho, Paul

     95  

Schainker, Joshua E

     62  

Kesavan, Vinod

     87  

van Asselt, Laurens Cornelis

     40  

Musur, Robert Joseph

     75  

Speek, Erik Robert

     50  

Cirulli, Cristiano

     85  

Lillo, Tommaso

     85  

Frogel, Jason

     61  

van Mazijk, Rogier Maurits

     11  

Palazzo, Salvatore

     64  

Tiekink, Michaël Alexander

     16  

Laurenziello, Nunzio

     43  

Papi, Marco

     43  

Johnson, Daniel

     14  

Tillett, Bradley

     9  

Germany, Curtis

     5  

Total

     2,000,000  

 

Sch B-1


SCHEDULE C-1

Pricing Terms

 

1. The Company and the Selling Stockholders are selling 2,000,000 shares of Class A Common Stock and 2,000,000 shares of Class A Common Stock, respectively.

 

2. The initial public offering price per share for the Securities shall be $47.25.

 

Sch C-1


SCHEDULE C-2

Free Writing Prospectuses

None.

 

Sch C-2


SCHEDULE D

List of Persons and Entities Subject to Lock-up

Scott J. Adelson

J. Lindsey Alley

Scott C. Beiser

Christopher Crain

Irwin N. Gold

Jacqueline B. Kosecoff

David A. Preiser

Robert A. Schriesheim

Bennet Van de Bunt

Hideto Nishitani

Ron K. Barger

Paul E. Wilson

Robert J.B. Lenhardt

ORIX HLHZ Holding LLC

 

Sch D-1


Exhibit C

LOCK-UP AGREEMENT

March 12, 2018

Morgan Stanley & Co. LLC

1585 Broadway

New York, New York 10036

Re: Proposed Public Offering by Houlihan Lokey, Inc.

Dear Sirs:

The undersigned, a stockholder, officer and/or director of Houlihan Lokey, Inc., a Delaware corporation (the “Company”), understands that Morgan Stanley & Co. LLC (in such capacity, the “Underwriter”) proposes to enter into an Underwriting Agreement (the “Underwriting Agreement”) with the Company and the Selling Stockholders named therein providing for the public offering (the “Offering”) of shares of the Company’s Class A common stock, par value $0.001 per share (the “Class A Common Stock”) pursuant to a Registration Statement on Form S-3 filed with the Securities and Exchange Commission (the “Commission”). Capitalized terms used herein and not otherwise defined shall have the meanings set forth in the Underwriting Agreement. In recognition of the benefit that such an offering will confer upon the undersigned as a stockholder, officer and/or director of the Company, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the undersigned agrees with the Underwriter that, during the period beginning on the date hereof and ending on the date that is 60 days from the date of the Underwriting Agreement (the “Lock-Up Period”), the undersigned will not, without the prior written consent of the Underwriter, (i) directly or indirectly, offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase or otherwise transfer or dispose of any shares of the Company’s Class A Common Stock or Class B common stock, par value $0.001 per share (the “Class B Common Stock” and, together with the Class A Common Stock, the “Common Stock”), or any securities convertible into or exercisable or exchangeable for Common Stock, whether now owned or hereafter acquired by the undersigned or with respect to which the undersigned has or hereafter acquires the power of disposition (collectively, the “Lock-Up Securities”), or exercise any right with respect to the registration of any of the Lock-Up Securities, or file or cause to be filed any registration statement in connection therewith, under the 1933 Act, or (ii) enter into any swap or any other agreement or any transaction that transfers, in whole or in part, directly or indirectly, the economic consequence of ownership of the Lock-Up Securities, whether any such swap or transaction is to be settled by delivery of Common Stock or other securities, in cash or otherwise.


Notwithstanding the foregoing, and subject to the conditions below, the undersigned may transfer the Lock-Up Securities during the Lock-Up Period without the prior written consent of the Underwriter, provided that (1) in the case of clauses (ii) through (vii), the Underwriter receives a signed lock-up agreement in substantially the form hereof for the balance of the Lock-Up Period from each donee, trustee, distributee, or transferee, as the case may be, (2) in the case of clauses (ii) through (vii), any such transfer shall not involve a disposition for value, (3) in the case of clauses (ii) through (ix), such transfers are not required to be reported with the Commission on Form 4 in accordance with Section 16 of the 1934 Act, and (4) in the case of clauses (ii) through (ix), the undersigned does not otherwise voluntarily effect any public filing or report regarding such transfers:

 

  (i) to the Underwriter pursuant to the Underwriting Agreement;

 

  (ii) as a bona fide gift or gifts;

 

  (iii) to any trust or limited family partnership for the direct or indirect benefit of the undersigned or the immediate family of the undersigned (for purposes of this lock-up agreement, “immediate family” shall mean any relationship by blood, marriage or adoption, not more remote than first cousin);

 

  (iv) by will, other testamentary document or intestate succession to the legal representative, heir, beneficiary or a member of the immediate family of the undersigned;

 

  (v) if the undersigned is a corporation, partnership, limited liability company, trust or other business entity, distributions of shares of Class A Common Stock or any security convertible into or exercisable for Class A Common Stock to general partners, limited partners, limited liability company members, stockholders of the undersigned, holders of similar equity interests in the undersigned or any of the undersigned’s affiliates’ directors, officers or employees;

 

  (vi) to the undersigned’s affiliates or to any corporation, partnership, limited liability company, investment fund or other entity which controls or manages, or is controlled by or managed by, or is under common control or management with the undersigned or its affiliates;

 

  (vii) to a nominee or custodian of a person or entity to whom a disposition or transfer would be permissible under clauses (i) through (vi);

 

  (viii) in the case of dispositions of shares of Common Stock, solely in an amount necessary to satisfy tax obligations (withholding or otherwise) in connection with the exercise of options to purchase Common Stock, the vesting of restricted shares of Common Stock, or the settling of restricted shares of Common Stock;

 

  (ix) in the case of dispositions of shares of Common Stock, if acquired by the undersigned in open market transactions after completion of the Offering;


  (x) pursuant to any contractual arrangement that provides for the repurchase of the undersigned’s securities by the Company in connection with the termination of the undersigned’s employment or other service relationship with the Company or the undersigned’s failure to meet certain conditions set out upon receipt of such securities;

 

  (xi) in response to a bona fide third-party tender offer, merger, consolidation or other similar transaction made to all holders of the Common Stock, after the completion of the Offering involving a change of control of the Company (for purposes of this lock-up agreement, “change of control” shall mean the consummation of any bona fide third-party tender offer, merger, consolidation or other similar transaction the result of which is that any “person” (as defined in Section 13(d)(3) of the 1934 Act), or group of persons, other than the Company, becomes the beneficial owner (as defined in Rules 13d-3 and 13d-5 of the 1934 Act) of 50% of total voting power of the outstanding voting stock of the Company); provided, that in the event that the tender offer, merger, consolidation or other such transaction is not completed, the undersigned’s Lock-Up Securities shall remain subject to the restrictions contained in this lock-up agreement; or

 

  (xii) pursuant to an order of a court or regulatory agency.

In addition, the foregoing restrictions shall not apply to (A) the conversion or exchange of any shares of Class B Common Stock into shares of Class A Common Stock, provided that the restrictions in this lock-up agreement shall apply to such shares of Class A Common Stock, (B) in the case of the exercise of stock options or similar rights granted pursuant to the Company’s equity incentive plans, transfers in connection with (1) the “net” or “cashless” exercise of such options in accordance with their terms, (2) the surrender of Common Stock in lieu of payment in cash of the exercise price thereof or (3) the satisfaction of the payment of the exercise price thereof, provided that following any such transfer, the foregoing restrictions shall apply to any securities issued to and retained by the undersigned upon such exercise, provided that, in the case of each of clause (1) through (3), (i) if the undersigned reports any such transaction on a Form 4 filed with the Commission pursuant to Section 16 of the 1934 Act, the undersigned shall take the steps the undersigned deems necessary to cause such Form 4 to reflect the transaction code(s) required by General Instruction 8 to Form 4, and (ii) the undersigned does not otherwise voluntarily effect any public filing or report regarding such transfers, or (C) the establishment of any contract, instruction or plan (a “Plan”) that satisfies all of the requirements of Rule 10b5-1(c)(1)(i)(B) under the 1934 Act, provided further that (i) no sales of the Lock-Up Securities shall be made pursuant to such a Plan prior to the expiration of the Lock-Up Period, and (ii) no public announcement or filing under the 1934 Act regarding the establishment of such Plan shall be required or voluntarily made on behalf of the undersigned or the Company during the Lock-Up Period.

The undersigned also agrees and consents to the entry of stop transfer instructions with the Company and the Company’s transfer agent and registrar against the transfer of the Lock-Up Securities except in compliance with the foregoing restrictions.


Notwithstanding anything to the contrary contained herein, this lock-up agreement will automatically terminate and the undersigned will be released from all of his, her or its obligations hereunder upon the earliest to occur, if any, of the following: (i) prior to the execution of the Underwriting Agreement, the Company advises the Underwriter in writing, that it has determined not to proceed with the Offering, (ii) the Company files an application with the Commission to withdraw the Registration Statement related to the Offering, or (iii) the Underwriting Agreement is executed but is terminated (other than with respect to the provisions thereof which survive termination) prior to payment for and delivery of the Securities to be sold thereunder or (iv) April 30, 2018, in the event that the Underwriting Agreement has not been executed by such date.

This lock-up agreement and any claim, controversy or dispute arising hereunder shall be governed by, and construed in accordance with, the laws of the State of New York, without regard to the conflict of laws principles thereof.

 

Very truly yours,
Signature:    
Print Name:    


Form of Lock-up for ORIX HLHZ Holding LLC

LOCK-UP AGREEMENT

March 12, 2018

Morgan Stanley & Co. LLC

1585 Broadway

New York, New York 10036

Re: Proposed Public Offering by Houlihan Lokey, Inc.

Dear Sirs:

The undersigned, a stockholder of Houlihan Lokey, Inc., a Delaware corporation (the “Company”), understands that Morgan Stanley & Co. LLC (in such capacity, the “Underwriter”) proposes to enter into an Underwriting Agreement (the “Underwriting Agreement”) with the Company and the Selling Stockholders named therein providing for the public offering (the “Offering”) of shares of the Company’s Class A common stock, par value $0.001 per share (the “Class A Common Stock”) pursuant to a Registration Statement on Form S-3 filed with the Securities and Exchange Commission (the “Commission”). Capitalized terms used herein and not otherwise defined shall have the meanings set forth in the Underwriting Agreement. In recognition of the benefit that such an offering will confer upon the undersigned as a stockholder, officer and/or director of the Company, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the undersigned agrees with the Underwriter that, during the period beginning on the date hereof and ending on the date that is 60 days from the date of the Underwriting Agreement (the “Lock-Up Period”), the undersigned will not, without the prior written consent of the Underwriter, (i) directly or indirectly, offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase or otherwise transfer or dispose of any shares of the Company’s Class A Common Stock or Class B common stock, par value $0.001 per share (the “Class B Common Stock” and, together with the Class A Common Stock, the “Common Stock”), or any securities convertible into or exercisable or exchangeable for Common Stock, whether now owned or hereafter acquired by the undersigned or with respect to which the undersigned has or hereafter acquires the power of disposition (collectively, the “Lock-Up Securities”), or exercise any right with respect to the registration of any of the Lock-Up Securities (unless, with respect to such exercise, no public announcement or filing (including any filing of a registration statement under the 1933 Act) is required or voluntarily made on behalf of the undersigned or the Company during the Lock-Up Period), or file or cause to be filed any registration statement in connection therewith, under the 1933 Act, or (ii) enter into any swap or any other agreement or any transaction that transfers, in whole or in part, directly or indirectly, the economic consequence of ownership of the Lock-Up Securities, whether any such swap or transaction is to be settled by delivery of Common Stock or other securities, in cash or otherwise.


Notwithstanding the foregoing, and subject to the conditions below, the undersigned may transfer the Lock-Up Securities during the Lock-Up Period without the prior written consent of the Underwriter, provided that (1) in the case of clauses (ii) through (vii), the Underwriter receives a signed lock-up agreement in substantially the form hereof for the balance of the Lock-Up Period from each donee, trustee, distributee, or transferee, as the case may be, (2) in the case of clauses (ii) through (v) and clause (vii), any such transfer shall not involve a disposition for value, (3) in the case of clauses (ii) through (v) and clauses (vii) through (ix), such transfers are not required to be reported with the Commission on Form 4 in accordance with Section 16 of the 1934 Act, and (4) in the case of clauses (ii) through (ix), the undersigned does not otherwise voluntarily effect any public filing or report regarding such transfers:

 

  (i) to the Underwriter pursuant to the Underwriting Agreement;

 

  (ii) as a bona fide gift or gifts;

 

  (iii) to any trust or limited family partnership for the direct or indirect benefit of the undersigned or the immediate family of the undersigned (for purposes of this lock-up agreement, “immediate family” shall mean any relationship by blood, marriage or adoption, not more remote than first cousin);

 

  (iv) by will, other testamentary document or intestate succession to the legal representative, heir, beneficiary or a member of the immediate family of the undersigned;

 

  (v) if the undersigned is a corporation, partnership, limited liability company, trust or other business entity, distributions of shares of Class A Common Stock or any security convertible into or exercisable for Class A Common Stock to general partners, limited partners, limited liability company members, stockholders of the undersigned, holders of similar equity interests in the undersigned or any of the undersigned’s affiliates’ directors, officers or employees;

 

  (vi) to the undersigned’s affiliates or to any corporation, partnership, limited liability company, investment fund or other entity which controls or manages, or is controlled by or managed by, or is under common control or management with the undersigned or its affiliates; provided that if such transfer occurs prior to the 61st day after the date of the Underwriting Agreement, such transfer is not required to be reported with the Commission on Form 4 in accordance with Section 16 of the 1934 Act;

 

  (vii) to a nominee or custodian of a person or entity to whom a disposition or transfer would be permissible under clauses (i) through (vi);

 

  (viii) in the case of dispositions of shares of Common Stock, solely in an amount necessary to satisfy tax obligations (withholding or otherwise) in connection with the exercise of options to purchase Common Stock, the vesting of restricted shares of Common Stock, or the settling of restricted shares of Common Stock;


  (ix) in the case of dispositions of shares of Common Stock, if acquired by the undersigned in open market transactions after completion of the Offering;

 

  (x) pursuant to any contractual arrangement that provides for the repurchase of the undersigned’s securities by the Company in connection with the termination of the undersigned’s employment or other service relationship with the Company or the undersigned’s failure to meet certain conditions set out upon receipt of such securities;

 

  (xi) in response to a bona fide third-party tender offer, merger, consolidation or other similar transaction made to all holders of the Common Stock, after the completion of the Offering involving a change of control of the Company (for purposes of this lock-up agreement, “change of control” shall mean the consummation of any bona fide third-party tender offer, merger, consolidation or other similar transaction the result of which is that any “person” (as defined in Section 13(d)(3) of the 1934 Act), or group of persons, other than the Company, becomes the beneficial owner (as defined in Rules 13d-3 and 13d-5 of the 1934 Act) of 50% of total voting power of the outstanding voting stock of the Company); provided, that in the event that the tender offer, merger, consolidation or other such transaction is not completed, the undersigned’s Lock-Up Securities shall remain subject to the restrictions contained in this lock-up agreement; or

 

  (xii) pursuant to an order of a court or regulatory agency.

In addition, the foregoing restrictions shall not apply to (A) the conversion or exchange of any shares of Class B Common Stock into shares of Class A Common Stock, provided that the restrictions in this lock-up agreement shall apply to such shares of Class A Common Stock, (B) in the case of the exercise of stock options or similar rights granted pursuant to the Company’s equity incentive plans, transfers in connection with (1) the “net” or “cashless” exercise of such options in accordance with their terms, (2) the surrender of Common Stock in lieu of payment in cash of the exercise price thereof or (3) the satisfaction of the payment of the exercise price thereof, provided that following any such transfer, the foregoing restrictions shall apply to any securities issued to and retained by the undersigned upon such exercise, provided that, in the case of each of clause (1) through (3), (i) if the undersigned reports any such transaction on a Form 4 filed with the Commission pursuant to Section 16 of the 1934 Act, the undersigned shall take the steps the undersigned deems necessary to cause such Form 4 to reflect the transaction code(s) required by General Instruction 8 to Form 4, and (ii) the undersigned does not otherwise voluntarily effect any public filing or report regarding such transfers or (C) the establishment of any contract, instruction or plan (a “Plan”) that satisfies all of the requirements of Rule 10b5-1(c)(1)(i)(B) under the 1934 Act, provided further that (i) no sales of the Lock-Up Securities shall be made pursuant to such a Plan prior to the expiration of the Lock-Up Period, and (ii) no public announcement or filing under the 1934 Act regarding the establishment of such Plan shall be required or voluntarily made on behalf of the undersigned or the Company during the Lock-Up Period.


The undersigned also agrees and consents to the entry of stop transfer instructions with the Company and the Company’s transfer agent and registrar against the transfer of the Lock-Up Securities except in compliance with the foregoing restrictions.

Notwithstanding anything to the contrary contained herein, this lock-up agreement will automatically terminate and the undersigned will be released from all of his, her or its obligations hereunder upon the earliest to occur, if any, of the following: (i) prior to the execution of the Underwriting Agreement, the Company advises the Underwriter in writing, that it has determined not to proceed with the Offering, (ii) the Company files an application with the Commission to withdraw the Registration Statement related to the Offering, (iii) the Underwriting Agreement is executed but is terminated (other than with respect to the provisions thereof which survive termination) prior to payment for and delivery of the Securities to be sold thereunder or (iv) April 30, 2018, in the event that the Underwriting Agreement has not been executed by such date.

This lock-up agreement and any claim, controversy or dispute arising hereunder shall be governed by, and construed in accordance with, the laws of the State of New York, without regard to the conflict of laws principles thereof.

 

Very truly yours,
Signature:    
Print Name:    


IN WITNESS WHEREOF, the undersigned has executed this certificate as of the date first written above.

 

HOULIHAN LOKEY, INC.
By:    
  Name:   J. Lindsey Alley
  Title:   Chief Financial Officer
(Back To Top)

Section 3: EX-99.1 (EX-99.1)

EX-99.1

Exhibit 99.1

 

 

 

FORWARD SHARE PURCHASE AGREEMENT

dated as of January 26, 2018

between

HOULIHAN LOKEY, INC.

and

ORIX HLHZ HOLDING LLC

 

 

 


TABLE OF CONTENTS

 

          Page  
   Article 1   
   SALE AND PURCHASE   
1.1    Sale and Purchase      1  
1.2    Purchase Price and Dividend Amount      2  
1.3    Transfer of Purchased Shares; Escrow      2  
1.4    Greenshoe Exercise      3  
1.5    Settlement      3  
1.6    Conditions to Settlement      3  
   Article 2   
   REPRESENTATIONS AND WARRANTIES OF ORIX   
2.1    Existence      3  
2.2    Power and Authority      3  
2.3    Authorization      4  
2.4    Consents      4  
2.5    No Conflicts      4  
2.6    Title      4  
   Article 3   
   REPRESENTATIONS AND WARRANTIES OF THE COMPANY   
3.1    Existence      5  
3.2    Power and Authority      5  
3.3    Authorization      5  
3.4    Consents      5  
3.5    No Conflicts      5  
   Article 4   
   MISCELLANEOUS   
4.1    Termination      6  
4.2    Further Assurances      6  
4.3    Survival      6  
4.4    Amendments and Waivers      6  
4.5    Binding Effect      6  
4.6    Entire Agreement      6  
4.7    Severability      7  
4.8    Counterparts      7  
4.9    GOVERNING LAW      7  
4.10    Consent to Jurisdiction      7  
4.11    Notices      8  
4.12    Certain Rules of Construction      8  

 

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FORWARD SHARE PURCHASE AGREEMENT

This Forward Share Purchase Agreement, dated as of January 26, 2018 (this “Agreement”), is made between Houlihan Lokey, Inc., a Delaware Corporation (the “Company”), and ORIX HLHZ Holding LLC, a Delaware limited liability company (“ORIX”).

WHEREAS, the Company intends to offer and sell shares of Class A common stock of the Company, par value $0.001 (the “Class A Common Stock”), in an underwritten registered offering (the “Follow-on Offering”) pursuant to the Company’s shelf registration statement (No. 333- 221057) on Form S-3, filed with the U.S. Securities and Exchange Commission on October 20, 2017;

WHEREAS, the parties hereto acknowledge that the Follow-on Offering shall be an “Underwritten Offering” at ORIX’s request pursuant to the Registration Rights Agreement, dated as of August 18, 2015, between the Company and ORIX;

WHEREAS, as a consequence of such Underwritten Offering, pursuant to the Registration Rights Agreement, dated as of August 18, 2015 between the Company and the HL Management Stockholders (as defined therein), the HL Management Stockholders have the right to and will participate in the Underwritten Offering; and

WHEREAS, ORIX wishes to sell to the Company, and the Company wishes to purchase from ORIX, on the terms and subject to the conditions set forth in this Agreement, shares of Class B Common Stock of the Company held by ORIX (the “Forward Transaction”).

NOW, THEREFORE, in consideration of the mutual promises and covenants set forth herein and for good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties agree as follows:

Article 1

SALE AND PURCHASE

1.1 Sale and Purchase. On the terms and subject to the conditions set forth in this Agreement, at Settlement (as defined below), ORIX shall sell and transfer to the Company, and the Company shall purchase from ORIX, a number of shares of Class B Common Stock (the “Purchased Shares”) corresponding to the total number of shares of Class A Common Stock sold by the Company pursuant to the underwriting agreement to be entered into by and among the Company, certain selling stockholders party thereto and each of the underwriters party thereto in connection with the Follow-on Offering (the “Underwriting Agreement”). For the avoidance of doubt, the number of Purchased Shares shall include the number of shares of Class A Common Stock sold by the Company pursuant to the base Follow-On Offering (such shares the “Base Purchased Shares”), as well as the number of any shares of Class A Common Stock sold by the Company upon the underwriters’ exercise of a “greenshoe” option (if any such option is granted) to purchase additional shares (a “Greenshoe Exercise,” and any such shares “Greenshoe Purchased Shares”).


1.2 Purchase Price and Dividend Amount.

(a) The price for each Purchased Share shall be the per share price to be paid by the underwriters to the Company pursuant to the Underwriting Agreement for each share of Class A Common Stock net of all underwriting compensation, discounts, fees and commissions payable by the Company to the underwriters in connection with the Follow-on Offering, if any (the “Per Share Purchase Price”), subject to adjustments in accordance with Section 1.2(b) below;

(b) The Per Share Purchase Price shall be reduced by the amount (the “Dividend Amount”) equal to 100% of the gross cash dividend per Purchased Share (if any) paid by the Company to the holders of record of Purchased Shares on any record date during the period from, and including, the closing of the Follow-on Offering, and ending on, and excluding, the Settlement Date (such period, the “Dividend Period”) for the Dividend Period. The amount of the ‘gross cash dividend’ shall be determined without reduction on account of withholding or deduction of any taxes. Such reduction shall occur on the earlier of the payment date of such dividend or the Settlement Date.

(c) The aggregate purchase price (the “Purchase Price”) for the Purchased Shares shall equal to the Per Share Purchase Price, adjusted in accordance with Section 1.2(b), times the number of Purchased Shares delivered on the Settlement Date.

1.3 Transfer of Purchased Shares; Escrow. Concurrently with the execution and delivery of the Underwriting Agreement, the Company, ORIX and Comerica Bank (the “Escrow Agent”) shall enter into an escrow agreement, substantially in the form attached hereto as Exhibit A (the “Escrow Agreement”), pursuant to which:

(a) (i) On the closing date of the Follow-on Offering, ORIX shall deliver to the Escrow Agent one or more certificates representing the Base Purchased Shares along with duly executed stock powers related thereto, and (ii) on any Greenshoe Closing Date (as defined below), ORIX shall deliver to the Escrow Agent one or more certificates representing the Greenshoe Purchased Shares related to such Greenshoe Exercise, along with duly executed stock powers related thereto and (iii) at Settlement, the Escrow Agent shall deliver any such certificates representing the Purchased Shares to the Company, all in accordance with the Escrow Agreement; and

(b) (i) On the closing date of the Follow-on Offering, the Company shall deposit an amount of the Purchase Price equal to the product of the Per Share Purchase Price and the number of Base Purchased Shares into an escrow account under the name of the Company with ORIX as a beneficiary (the “Company Escrow Account”), (ii) on any Greenshoe Closing Date, the Company shall transfer an amount of the Purchase Price equal to product of the Per Share Purchase Price and the number of Greenshoe Purchased Shares related to such Greenshoe Exercise, into the Company Escrow Account, (iii) during the Dividend Period, upon delivery of a Dividend Adjustment Notice (as such term is defined in the Escrow Agreement) jointly by ORIX and the Company, the Escrow Agent shall transfer the amount equal to the Dividend Amount from the Company Escrow Account to an account designated by the Company, and (iv) at Settlement, the Escrow Agent shall transfer the Purchase Price, adjusted in accordance with

Section 1.2(b), from the Company Escrow Account to an account designated by ORIX, all in accordance with the Escrow Agreement.

 

2


1.4 Greenshoe Exercise. The Company shall notify ORIX of any Greenshoe Exercise, the number of Greenshoe Purchased Shares related to such Greenshoe Exercise, and the scheduled settlement date for such Greenshoe Exercise (a “Greenshoe Closing Date”) as soon as reasonably practicable.

1.5 Settlement. The Settlement of the Forward Transaction (the “Settlement”) shall be held at the offices of Davis Polk & Wardwell LLP, 450 Lexington Avenue New York, NY 10017 on April 5, 2018, subject to the satisfaction or waiver of the conditions set forth in Section 1.6 below (the date on which the Settlement actually occurs is referred to herein as the “Settlement Date”). At Settlement:

(a) the Escrow Agent shall release to the Company the certificates representing the Purchased Shares, free and clear of all liens, claims, security interests and other encumbrances (collectively, “Encumbrances”), together with all documentation reasonably necessary to transfer to the Company the right, title and interest in such Purchased Shares; and

(b) the Escrow Agent shall release to ORIX by wire transfer of immediately available funds an amount in U.S. dollars corresponding to the aggregate Purchase Price, adjusted in accordance with Section 1.2(b), for the Purchased Shares delivered at Settlement.

1.6 Conditions to Settlement.

(a) The obligation of ORIX to sell the Purchased Shares to the Company and the obligation of the Company to purchase and pay for the Purchased Shares on the Settlement Date are subject to the consummation of the Follow-on Offering, with ORIX having approved in writing the number of shares of Class A Common Stock sold by the Company to the underwriters and the price per share of such sale, in each case in the Follow-on Offering, such approval to be evidenced by the execution and delivery by ORIX of the Escrow Agreement.

Article 2

REPRESENTATIONS AND WARRANTIES OF ORIX

ORIX hereby makes the following representations and warranties to the Company:

2.1 Existence and Solvency. ORIX has been duly formed and is validly existing as a limited liability company in good standing under the laws of the State of Delaware. ORIX is solvent and has no assets or operations other than holding the common stock of the Company. ORIX USA Corporation, a Delaware corporation and the indirect parent company of ORIX, is solvent.

2.2 Power and Authority. ORIX has the full right, power and authority to execute and deliver this Agreement and to perform its obligations hereunder; and all action required to be taken for the due and proper authorization, execution and delivery by it of this Agreement and the consummation of the transaction contemplated hereby has been duly and validly taken.

 

3


2.3 Authorization. This Agreement has been duly authorized, executed and delivered by or on behalf of ORIX and constitutes a valid and binding agreement of ORIX enforceable in accordance with its terms, except to the extent enforcement thereof may be limited by bankruptcy, insolvency, reorganization or other laws affecting enforcement of creditors’ rights or by general equitable principles.

2.4 Consents. All governmental and other consents that are required to have been obtained by it with respect to this Agreement have been obtained and are in full force and effect and all conditions of any such consents have been complied with.

2.5 No Conflicts. The execution, delivery and performance by ORIX of this Agreement will not (a) conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which ORIX is a party or by which ORIX is bound, (b) result in any violation of the provisions of the organizational documents of ORIX or

(c) result in the violation of any law or statute or any judgment, order, rule or regulation of any court or arbitrator or governmental or regulatory authority, except, in the case of clauses (a) and

(c) above, for any such conflict, breach, violation or default that would not materially and adversely affect the sale of the Purchased Shares and the consummation of any other transaction herein contemplated.

2.6 Title and Delivery.

(a) As of the date hereof and immediately prior to the delivery of the Purchased Shares at the Settlement, ORIX is, and will be, the sole legal and beneficial owner of, and holds, and will hold, good and valid title to the Purchased Shares, free and clear of all Encumbrances except as described or incorporated by reference into the prospectus for the Follow-On Offering.

(b) ORIX agrees that it will convey the Purchased Shares, and on any date that it delivers such Purchased Shares, represents that it has conveyed, good title to the Purchased Shares it is required to deliver, free from (i) any lien, charge, claim or other encumbrance (other than, if applicable, a lien routinely imposed on all securities by the relevant clearance system) and any other restrictions whatsoever, including any restrictions under applicable securities laws (other than any such restrictions arising as a result of the fact that (A) the Company is the issuer of the Purchased Shares or (B) ORIX may be considered an “affiliate”, as such term is used in Rule 144, of the Company), (ii) any and all restrictions that any sale, assignment or other transfer of such Purchased Shares be consented to or approved by any person or entity, including without limitation any obligor thereon, (iii) any limitation on the type or status, financial or otherwise, of any purchaser, pledgee, assignee or transferee of the Purchased Shares, (iv) any requirement of the delivery of any certificate, approval, consent, agreement, opinion of counsel, notice or any other document of any person or entity to any obligor on or any registrar or transfer agent for, the Purchased Shares, prior to the sale, pledge, assignment or other transfer of the Purchased Shares, and (v) any registration or qualification requirement or prospectus

 

4


delivery requirement for the Purchased Shares pursuant to applicable securities laws (other than any such restrictions arising as a result of the fact that (A) the Company is the issuer of the Purchased Shares or (B) ORIX may be considered an “affiliate”, as such term is used in Rule 144, of the Company), all except as described or incorporated by reference into the prospectus for the Follow-On Offering.

(c) In furtherance and not in limitation of the foregoing, ORIX represents and warrants to, and agrees with, the Company that it has, or will have at the time of delivery of the Purchased Shares to the Company, the right to transfer the Purchased Shares as provided herein, and that upon the payment by the Company of the Purchase Price for the Purchased Shares and the delivery of the certificates representing the Purchased Shares re-registered in the name of the Company, and assuming the Company has no notice of any adverse claim to the Purchased Shares, the Company will be a “protected purchaser” (within the meaning of Section 8-303 of the of the New York Uniform Commercial Code) of the Purchased Shares.

Article 3

REPRESENTATIONS AND WARRANTIES OF THE

COMPANY

The Company hereby makes the following representations and warranties to ORIX:

3.1 Existence. The Company has been duly organized and is validly existing and in good standing under the laws of the State of Delaware.

3.2 Power and Authority. The Company has the full right, power and authority to execute and deliver this Agreement and to perform its obligations hereunder; and all action required to be taken for the due and proper authorization, execution and delivery by it of this Agreement and the consummation of the transaction contemplated hereby has been duly and validly taken.

3.3 Authorization. This Agreement has been duly authorized, executed and delivered by or on behalf of the Company, including authorization by a committee of the board of directors of the Company consisting of independent directors who are not affiliated with ORIX, and constitutes a valid and binding agreement of the Company enforceable in accordance with its terms, except to the extent enforcement thereof may be limited by bankruptcy, insolvency, reorganization or other laws affecting enforcement of creditors’ rights or by general equitable principles.

3.4 Consents. All governmental and other consents that are required to have been obtained by it with respect to this Agreement have been obtained and are in full force and effect and all conditions of any such consents have been complied with.

3.5 No Conflicts. The execution, delivery and performance by the Company of this Agreement will not (a) conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which the Company or any of its subsidiaries is a party or by which the Company or any of its subsidiaries is bound, (b) result in any violation

 

5


of the provisions of the organizational documents of the Company or any of its subsidiaries or

(c) result in the violation of any law or statute or any judgment, order, rule or regulation of any court or arbitrator or governmental or regulatory authority, except, in the case of clauses (a) and

(c) above, for any such conflict, breach violation or default that would not materially and adversely affect the purchase of the Purchased Shares and the consummation of any other transaction herein contemplated.

Article 4

MISCELLANEOUS

4.1 Termination. This Agreement may be terminated prior to the Settlement by either Party if the Follow-On Offering has not closed by March 31, 2018.

4.2 Further Assurances. Each of the parties hereto does hereby covenant and agree on behalf of itself, its successors, and its assigns, without further consideration, to prepare, execute, acknowledge, file, record, publish, and deliver such other instruments, documents and statements, and to take such other action as may be required by law or reasonably necessary to effectively carry out the purposes of this Agreement.

4.3 Survival. All representations and warranties contained herein or made in writing by any party in connection herewith shall survive the termination of this Agreement.

4.4 Amendments and Waivers. No provision of this Agreement may be amended or waived unless such amendment or waiver is in writing and signed, in the case of an amendment, by the parties hereto, or in the case of a waiver, by the party against whom the waiver is to be effective. No failure or delay by any party in exercising any right, power or privilege hereunder shall operate as waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege. The rights and remedies herein provided shall be cumulative and not exclusive of any rights or remedies provided by law.

4.5 Binding Effect. Except as otherwise expressly provided herein, this Agreement shall be binding on and inure to the benefit of the parties hereto, their heirs, executors, administrators, successors and all other persons hereafter that become a party hereto. No rights or obligations hereunder may be assigned by any party hereto without the written consent of the other party. Any attempted transfer or assignment by either party of its rights and obligations under this Agreement, without the consent of the other party, shall be null and void.

4.6 Entire Agreement. This Agreement, including the Exhibits hereto, constitutes the entire agreement between the parties hereto pertaining to the subject matter hereof and fully supersedes any and all prior or contemporaneous agreements or understandings between the parties hereto pertaining to the subject matter hereof. This Agreement is not intended to confer upon any person, other than the parties hereto, any rights or remedies hereunder.

 

6


4.7 Severability. In the event that any provision of this Agreement as applied to any party or to any circumstance, shall be adjudged by a court to be void, unenforceable or inoperative as a matter of law, then the same shall in no way affect any other provision in this Agreement, the application of such provision in any other circumstance or with respect to any other party, or the validity or enforceability of this Agreement as a whole.

4.8 Counterparts. This Agreement may be executed in any number of multiple counterparts, each of which shall be deemed to be an original (including signatures delivered via facsimile or electronic mail) and all of which shall constitute one agreement, binding on all parties hereto. The parties hereto may deliver this Agreement by facsimile or by electronic mail and each party shall be permitted to rely on the signatures so transmitted to the same extent and effect as if they were original signatures.

4.9 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK (WITHOUT GIVING EFFECT TO CONFLICT OF LAWS PRINCIPLES THEREOF).

4.10 Consent to Jurisdiction. With respect to any demand, action, suit, countersuit, arbitration, inquiry, proceeding or investigation by or before any governmental authority or any federal, state, local, foreign or international arbitration or mediation tribunal (the “Action”) arising out of or relating to this Agreement or any transaction contemplated hereby each of the parties hereto hereby irrevocably (i) submits to the exclusive jurisdiction of the United States District Court for the Southern District of New York (the “Selected Courts”) and waives any objection to venue being laid in the Selected Courts whether based on the grounds of forum non conveniens or otherwise and hereby agrees not to commence any such Actions other than before the Selected Court; provided, however, that a party may commence any Action in a court other than a Selected Courts solely for the purpose of enforcing an order or judgment issued by one of the Selected Courts; (ii) consents to service of process in any Action by the mailing of copies thereof by registered or certified mail, postage prepaid, or by recognized international express carrier or delivery service, to the Company at its address referred to in Section 4.11; provided, however, that nothing herein shall affect the right of any party hereto to serve process in any other manner permitted by law; and (iii) TO THE EXTENT NOT PROHIBITED BY APPLICABLE LAW THAT CANNOT BE WAIVED, WAIVES, AND COVENANTS THAT IT WILL NOT ASSERT (WHETHER AS PLAINTIFF, DEFENDANT OR OTHERWISE) ANY RIGHT TO TRIAL BY JURY IN ANY ACTION ARISING IN WHOLE OR IN PART UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY OF THE CONTEMPLATED TRANSACTIONS, WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE, AND AGREES THAT ANY OF THEM MAY FILE A COPY OF THIS PARAGRAPH WITH ANY COURT AS WRITTEN EVIDENCE OF THE KNOWING, VOLUNTARY AND BARGAINED-FOR AGREEMENT AMONG THE PARTIES IRREVOCABLY TO WAIVE ITS RIGHT TO TRIAL BY JURY IN ANY ACTION WHATSOEVER BETWEEN THEM RELATING TO THIS AGREEMENT OR ANY OF THE CONTEMPLATED TRANSACTIONS WILL INSTEAD BE TRIED IN A COURT OF COMPETENT JURISDICTION BY A JUDGE SITTING WITHOUT A JURY.

 

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4.11 Notices. Any notice, consent, payment, demand, or communication required or permitted to be given by any provision of this Agreement shall be in writing and shall be (a) delivered personally to the party or to an officer of the party to whom the same is directed, or (b) sent by facsimile or other electronic or digital transmission method (including e-mail), or registered or certified mail, return receipt requested, postage prepaid, addressed as follows:

If to ORIX, to:

ORIX USA Corporation

1717 Main Street – Suite 10100

Dallas, TX 75201

Attention: Ron Barger, General Counsel

E-mail: Ron.Barger@orix.com

If to the Company:

Houlihan Lokey, Inc.

10250 Constellation Blvd

Los Angeles, CA 90067

Attention: J. Lindsey Alley, Chief Financial Officer

Christopher Crain, General Counsel

E-mail: LAlley@HL.com / CCrain@HL.com

or to such other address as such party may from time to time specify in writing to the other party hereto. Any such notice shall be deemed to be delivered, given and received for all purposes as of: (i) the date so delivered, if delivered personally, (ii) upon receipt, if sent by facsimile or other electronic or digital transmission method (including e-mail), or (iii) on the date of receipt or refusal indicated on the return receipt, if sent by registered or certified mail, return receipt requested, postage and charges prepaid and properly addressed.

4.12 Certain Rules of Construction. To the fullest extent permitted by law, the parties hereto intend that any ambiguities shall be resolved without reference to which party may have drafted this Agreement. All Section or subsection titles or other captions in this Agreement are for convenience only, and they shall not be deemed part of this Agreement and in no way define, limit, extend or describe the scope or intent of any provisions hereof. Unless the context otherwise requires: (a) a term has the meaning assigned to it; (b) “or” is not exclusive; (c) words in the singular include the plural, and words in the plural include the singular; (d) provisions apply to successive events and transactions; (e) “herein,” “hereof” and other words of similar import refer to this Agreement as a whole and not to any particular Section, subsection or other subdivision; (f) “include” or “including” shall be deemed to be followed by “without limitation” or “but not limited to” whether or not they are followed by such phrases or words of like import; (g) all references to “Sections” or “subsections” refer to Sections or subsections of this Agreement; and (h) any pronoun used in this Agreement shall include the corresponding masculine, feminine or neuter forms.

[Signature Page Follows]

 

8


In witness whereof, the parties have caused this Forward Share Purchase Agreement to be executed and delivered as of the date first above written.

 

HOULIHAN LOKEY, INC.
By   /s/ Christopher Crain
  Name: Christopher Crain
  Title: General Counsel


ORIX HLHZ HOLDING LLC
By   /s/ Paul Wilson
  Name: Paul Wilson
  Title:   Chief Financial Officer


In witness hereof, ORIX USA Corporation hereby acknowledges this Forward Share Purchase Agreement and agrees to cause ORIX to perform its obligations hereunder.

 

ORIX USA Corporation
By   /s/ Paul Wilson
  Name: Paul Wilson
  Title:  Chief Financial Officer
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