Common use of Capitalization; Indebtedness Clause in Contracts

Capitalization; Indebtedness. (a) The authorized capital stock of Xerox consists of 1,750,000,000 shares of Xerox Common Stock, 600,000 shares of Class B Stock, par value $1.00 per share, and 22,043,067 shares of Cumulative Preferred Stock, par value $1.00 per share, of which 300,000 shares of Xerox Series A Preferred Stock are authorized and 180,000 shares of Xerox Series B Preferred Stock will be authorized as of the Closing. As of the close of business on September 30, 2016, (i) 1,013,776,524 shares of Xerox Common Stock were issued and outstanding (and no Xerox Restricted Shares were issued and outstanding), (ii) 101,171,373 shares of Xerox Common Stock were reserved and available for issuance pursuant to the Xerox Stock Plans, (iii) 34,678,712 shares of Xerox Common Stock were subject to outstanding awards under the Xerox Stock Plans, (iv) 300,000 shares of Xerox Series A Preferred Stock were issued and outstanding, (v) 26,966,280 shares of Xerox Common Stock were reserved and available for issuance upon conversion of the Xerox Series A Preferred Stock and (vi) approximately 835,000 shares of Xerox Common Stock were reserved and available for issuance pursuant to the historical convertible indebtedness and other instruments. (b) Except as described in this Section 3.02, as of the close of business on September 30, 2016, there were (i) no outstanding shares of capital stock of, or other equity or voting interests in, Xerox, (ii) no outstanding securities of Xerox convertible into or exchangeable for shares of capital stock of, or other equity or voting interests in, Xerox, (iii) no outstanding options, warrants, rights or other commitments or agreements to acquire from Xerox, or that obligate Xerox to issue, any capital stock of, or other equity or voting interests (or voting debt) in, or any securities convertible into or exchangeable for shares of capital stock of, or other equity or voting interests in, Xerox other than obligations under Xerox Plans in the ordinary course of business, (iv) no obligations of Xerox to grant, extend or enter into any subscription, warrant, right, convertible or exchangeable security or other similar agreement or commitment relating to any capital stock of, or other equity or voting interests in, Xerox (the items in clauses (i), (ii), (iii) and (iv) being referred to collectively as “Xerox Securities”) and (v) no other obligations by Xerox or any of its Subsidiaries to make any payments based on the price or value of any Xerox Securities. (c) As of as of the close of business on September 30, 2016, the principal amount of outstanding indebtedness for borrowed money of Xerox and its Subsidiaries (not including intercompany indebtedness or operating leases) was approximately $7,400 million inclusive of net unamortized discounts and fair value adjustments, which do not exceed $25 million in the aggregate.

Capitalization; Indebtedness. (a) The authorized capital stock of Xerox BHI consists of 1,750,000,000 (i) 750,000,000 shares of Xerox BHI Common Stock, 600,000 Stock and (ii) 15,000,000 shares of Class B Stockpreferred stock, par value $1.00 per share, and 22,043,067 shares of Cumulative share (the “BHI Preferred Stock, par value $1.00 per share, of which 300,000 shares of Xerox Series A Preferred Stock are authorized and 180,000 shares of Xerox Series B Preferred Stock will be authorized as of the Closing. ”). (b) As of the close of business on September 30, 2016, (i) 1,013,776,524 422,753,256 shares of Xerox BHI Common Stock were outstanding, of which 63,594 were shares of BHI Restricted Stock, and (ii) 477,625 shares of BHI Common Stock were held by BHI in treasury. As of the date of this Agreement, there are no shares of BHI Preferred Stock issued and outstanding or held in treasury. As of September 30, 2016, (i) 16,427,074 shares of BHI Common Stock are reserved for issuance in respect of future grants under the BHI Stock Plans and no Xerox Restricted Shares were issued and outstanding), (ii) 101,171,373 3,424,745 shares of Xerox BHI Common Stock were are reserved and available for issuance pursuant in respect of the ESPP. Since September 30, 2016 through the date of this Agreement, BHI has not declared or paid any dividend, or declared or made any distribution on, or authorized the creation of, or authorized or effected any split-up or any other recapitalization of, any of its capital stock, or directly or indirectly redeemed, purchased or otherwise acquired any of its outstanding capital stock (other than in connection with BHI’s previously announced share repurchase program). BHI has not heretofore agreed to the Xerox Stock Planstake any such action, (iii) 34,678,712 and there are no outstanding contractual obligations of BHI of any kind to redeem, purchase or otherwise acquire any outstanding shares of Xerox Common Stock were subject to outstanding awards under the Xerox Stock Plans, (iv) 300,000 shares capital stock of Xerox Series A Preferred Stock were issued and outstanding, (v) 26,966,280 shares BHI. As of Xerox Common Stock were reserved and available for issuance upon conversion of the Xerox Series A Preferred Stock and (vi) approximately 835,000 shares of Xerox Common Stock were reserved and available for issuance pursuant to the historical convertible indebtedness and other instruments. (b) Except as described in this Section 3.02, as of the close of business on September 30, 2016, there were outstanding BHI Options to purchase an aggregate of 7,820,642 shares of BHI Common Stock and 4,435,459 shares of BHI Common Stock subject to BHI Restricted Stock Units and BHI Performance Units. Since September 30, 2016 through the date of this Agreement (i) no shares of BHI Common Stock have been issued, except pursuant to BHI Options, BHI Performance Unit awards or BHI Restricted Stock Units granted under the BHI Stock Plans, in each case outstanding on September 30, 2016, and (ii) no BHI Incentive Awards have been granted under the BHI Stock Plans. There are no outstanding bonds, debentures, notes or other indebtedness or warrants or other securities of BHI having the right to vote (or, other than any outstanding options to purchase BHI Common Stock, convertible into, or exchangeable for, securities having the right to vote) on any matters on which stockholders of BHI may vote. (c) All issued and outstanding shares of BHI’s capital stock are, and all shares that may be issued or granted pursuant to the exercise of BHI Options or options granted under the ESPP, or pursuant to the vesting of BHI Restricted Stock Unit awards, BHI Performance Unit awards or BHI Restricted Stock awards granted under the BHI Stock Plans, will be, when issued in accordance with the terms thereof, duly authorized, validly issued, fully paid and non-assessable and free of preemptive rights. The issuance and sale of all of the shares of capital stock ofdescribed in this ‎Section 4.02 have been in material compliance with United States federal and state securities Laws. Neither BHI nor any of the BHI Subsidiaries has agreed to register any securities under the Securities Act, or other equity under any state securities Law or voting interests ingranted registration rights to any individual or entity. (d) Except for the BHI Options, Xeroxoptions granted under the ESPP, (ii) BHI Restricted Stock Unit awards, BHI Restricted Stock awards and BHI Performance Unit awards granted under the BHI Stock Plans, as of the date of this Agreement, there are no outstanding or authorized (i) options, warrants, preemptive rights, subscriptions, calls or other rights, convertible securities or agreements obligating BHI or any of Xerox convertible into its Subsidiaries to issue, transfer or exchangeable for sell any shares of capital stock of, or other equity or voting interests in, Xerox, (iii) no outstanding options, warrants, rights or other commitments or agreements to acquire from Xerox, or that obligate Xerox to issue, any capital stock of, or other equity or voting interests (or voting debt) in, interest in BHI or any of the BHI Subsidiaries or securities convertible into or exchangeable for such shares or other equity interest, (ii) contractual obligations of BHI or any of the BHI Subsidiaries to repurchase, redeem or otherwise acquire any capital stock ofof BHI or any of the BHI Subsidiaries or any such securities or agreements listed in clause (i) of this sentence, or (iii) voting trusts or similar agreements to which BHI or any of the BHI Subsidiaries is a party with respect to the voting of the capital stock of BHI or any of the BHI Subsidiaries. Immediately after the consummation of the Transactions, except as contemplated by ‎Section 2.04, there will not be any outstanding subscriptions, options, warrants, calls, preemptive rights, subscriptions, or other equity or voting interests in, Xerox other than obligations under Xerox Plans in the ordinary course of business, (iv) no obligations of Xerox to grant, extend or enter into any subscription, warrant, rightrights, convertible or exchangeable security agreements, obligating BHI or other similar agreement any of the BHI Subsidiaries calling for the purchase or commitment relating to issuance of any shares of the capital stock of, or other equity or voting interests in, Xerox (the items interest in clauses (i), (ii), (iii) and (iv) being referred to collectively as “Xerox Securities”) and (v) no other obligations by Xerox BHI or any of its the BHI Subsidiaries to make any payments based on the price or value of any Xerox Securitiessecurities convertible into or exchangeable for such shares or other such securities. (ce) As of as All of the close issued and outstanding shares of Newco’s and Merger Sub’s capital stock are, and at the Closing will be, owned by BHI and Newco, respectively. Newco and Merger Sub have not conducted any business on September 30prior to the date of this Agreement and have no, 2016and prior to the Closing will have no, assets, liabilities or obligations of any nature other than those incident to their incorporation and pursuant to this Agreement and the principal amount of outstanding indebtedness for borrowed money of Xerox and its Subsidiaries (not including intercompany indebtedness or operating leases) was approximately $7,400 million inclusive of net unamortized discounts and fair value adjustments, which do not exceed $25 million in the aggregatetransactions contemplated hereby.

Capitalization; Indebtedness. (a) The authorized capital stock of Xerox BHI consists of 1,750,000,000 (i) 750,000,000 shares of Xerox BHI Common Stock, 600,000 Stock and (ii) 15,000,000 shares of Class B Stockpreferred stock, par value $1.00 per share, and 22,043,067 shares of Cumulative share (the “BHI Preferred Stock, par value $1.00 per share, of which 300,000 shares of Xerox Series A Preferred Stock are authorized and 180,000 shares of Xerox Series B Preferred Stock will be authorized as of the Closing. ”). (b) As of the close of business on September 30, 2016, (i) 1,013,776,524 422,753,256 shares of Xerox BHI Common Stock were outstanding, of which 63,594 were shares of BHI Restricted Stock, and (ii) 477,625 shares of BHI Common Stock were held by BHI in treasury. As of the date of this Agreement, there are no shares of BHI Preferred Stock issued and outstanding or held in treasury. As of September 30, 2016, (i) 16,427,074 shares of BHI Common Stock are reserved for issuance in respect of future grants under the BHI Stock Plans and no Xerox Restricted Shares were issued and outstanding), (ii) 101,171,373 3,424,745 shares of Xerox BHI Common Stock were are reserved and available for issuance pursuant in respect of the ESPP. Since September 30, 2016 through the date of this Agreement, BHI has not declared or paid any dividend, or declared or made any distribution on, or authorized the creation of, or authorized or effected any split-up or any other recapitalization of, any of its capital stock, or directly or indirectly redeemed, purchased or otherwise acquired any of its outstanding capital stock (other than in connection with BHI’s previously announced share repurchase program). BHI has not heretofore agreed to the Xerox Stock Planstake any such action, (iii) 34,678,712 and there are no outstanding contractual obligations of BHI of any kind to redeem, purchase or otherwise acquire any outstanding shares of Xerox Common Stock were subject to outstanding awards under the Xerox Stock Plans, (iv) 300,000 shares capital stock of Xerox Series A Preferred Stock were issued and outstanding, (v) 26,966,280 shares BHI. As of Xerox Common Stock were reserved and available for issuance upon conversion of the Xerox Series A Preferred Stock and (vi) approximately 835,000 shares of Xerox Common Stock were reserved and available for issuance pursuant to the historical convertible indebtedness and other instruments. (b) Except as described in this Section 3.02, as of the close of business on September 30, 2016, there were outstanding BHI Options to purchase an aggregate of 7,820,642 shares of BHI Common Stock and 4,435,459 shares of BHI Common Stock subject to BHI Restricted Stock Units and BHI Performance Units. Since September 30, 2016 through the date of this Agreement (i) no shares of BHI Common Stock have been issued, except pursuant to BHI Options, BHI Performance Unit awards or BHI Restricted Stock Units granted under the BHI Stock Plans, in each case outstanding on September 30, 2016, and (ii) no BHI Incentive Awards have been granted under the BHI Stock Plans. There are no outstanding bonds, debentures, notes or other indebtedness or warrants or other securities of BHI having the right to vote (or, other than any outstanding options to purchase BHI Common Stock, convertible into, or exchangeable for, securities having the right to vote) on any matters on which stockholders of BHI may vote. (c) All issued and outstanding shares of BHI’s capital stock are, and all shares that may be issued or granted pursuant to the exercise of BHI Options or options granted under the ESPP, or pursuant to the vesting of BHI Restricted Stock Unit awards, BHI Performance Unit awards or BHI Restricted Stock awards granted under the BHI Stock Plans, will be, when issued in accordance with the terms thereof, duly authorized, validly issued, fully paid and non-assessable and free of preemptive rights. The issuance and sale of all of the shares of capital stock ofdescribed in this Section 4.02 have been in material compliance with United States federal and state securities Laws. Neither BHI nor any of the BHI Subsidiaries has agreed to register any securities under the Securities Act, or other equity under any state securities Law or voting interests ingranted registration rights to any individual or entity. (d) Except for the BHI Options, Xeroxoptions granted under the ESPP, (ii) BHI Restricted Stock Unit awards, BHI Restricted Stock awards and BHI Performance Unit awards granted under the BHI Stock Plans, as of the date of this Agreement, there are no outstanding or authorized (i) options, warrants, preemptive rights, subscriptions, calls or other rights, convertible securities or agreements obligating BHI or any of Xerox convertible into its Subsidiaries to issue, transfer or exchangeable for sell any shares of capital stock of, or other equity or voting interests in, Xerox, (iii) no outstanding options, warrants, rights or other commitments or agreements to acquire from Xerox, or that obligate Xerox to issue, any capital stock of, or other equity or voting interests (or voting debt) in, interest in BHI or any of the BHI Subsidiaries or securities convertible into or exchangeable for such shares or other equity interest, (ii) contractual obligations of BHI or any of the BHI Subsidiaries to repurchase, redeem or otherwise acquire any capital stock ofof BHI or any of the BHI Subsidiaries or any such securities or agreements listed in clause (i) of this sentence, or (iii) voting trusts or similar agreements to which BHI or any of the BHI Subsidiaries is a party with respect to the voting of the capital stock of BHI or any of the BHI Subsidiaries. Immediately after the consummation of the Merger, except as contemplated by Section 2.04, there will not be any outstanding subscriptions, options, warrants, calls, preemptive rights, subscriptions, or other equity or voting interests in, Xerox other than obligations under Xerox Plans in the ordinary course of business, (iv) no obligations of Xerox to grant, extend or enter into any subscription, warrant, rightrights, convertible or exchangeable security agreements, obligating BHI or other similar agreement any of the BHI Subsidiaries calling for the purchase or commitment relating to issuance of any shares of the capital stock of, or other equity or voting interests in, Xerox (the items interest in clauses (i), (ii), (iii) and (iv) being referred to collectively as “Xerox Securities”) and (v) no other obligations by Xerox BHI or any of its the BHI Subsidiaries to make any payments based on the price or value of any Xerox Securitiessecurities convertible into or exchangeable for such shares or other such securities. (ce) As of as All of the close issued and outstanding shares of Newco’s and Merger Sub’s capital stock are, and at the Closing will be, owned by BHI and Newco, respectively. Newco and Merger Sub have not conducted any business on September 30prior to the date of this Agreement and have no, 2016and prior to the Closing will have no, assets, liabilities or obligations of any nature other than those incident to their incorporation and pursuant to this Agreement and the principal amount of outstanding indebtedness for borrowed money of Xerox and its Subsidiaries (not including intercompany indebtedness or operating leases) was approximately $7,400 million inclusive of net unamortized discounts and fair value adjustments, which do not exceed $25 million in the aggregatetransactions contemplated hereby.