BrightSphere Investment Group Inc. (Form: 10-Q, Received: 08/09/2019 06:01:42)

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Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2019

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-36683



		BRIGHTSPHERE Investment Group Inc.

(Exact name of registrant as specified in its charter)



Delaware		47-1121020
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

200 Clarendon Street, 53rd Floor		02116
Boston,	Massachusetts
(Address of principal executive offices)		(Zip Code)

(617)-369-7300

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:



Title of each class	Ticker Symbol	Name of each exchange on which registered
Common stock, par value $0.001 per share	BSIG	New York Stock Exchange
4.800% Notes due 2026	BSIG 26	New York Stock Exchange
5.125% Notes due 2031	BSA	New York Stock Exchange

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ý No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definition of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):



Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		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. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ý

The number of shares of the registrant’s common stock, nominal value $0.001 per share, outstanding as of August 5, 2019 was 91,592,320.

Table of Contents

TABLE OF CONTENTS



		Page

	Explanatory Note	3

Part I	Financial Information	4

Item 1.	Financial Statements	4

	Condensed Consolidated Balance Sheets as of June 30, 2019 and December 31, 2018	4

	Condensed Consolidated Statements of Operations for the three and six months ended June 30, 2019 and 2018	5

	Condensed Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2019 and 2018	6

	Condensed Consolidated Statements of Changes in Shareholders’ Equity for the three and six months ended June 30, 2019 and 2018	7

	Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2019 and 2018	9

	Notes to Condensed Consolidated Financial Statements	11

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	32

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	71

Item 4.	Controls and Procedures	73

Part II	Other Information	74

Item 1.	Legal Proceedings	74

Item 1A.	Risk Factors	74

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	74

Item 6.	Exhibits	74

Table of Contents

EXPLANATORY NOTE

On July 12, 2019, the BrightSphere corporate group, which consisted of BrightSphere Investment Group plc, a public company limited by shares incorporated under the laws of England and Wales and its operating subsidiaries (such operating subsidiaries and the holding company collectively, the “BrightSphere Group”), completed a redomestication, resulting in BrightSphere Investment Group Inc., a Delaware corporation, becoming the publicly traded parent company of the BrightSphere Group (the “Redomestication”). As part of the Redomestication, which was approved by the shareholders of BrightSphere Investment Group plc, existing shares of BrightSphere Investment Group plc were exchanged on a one-for-one basis for newly issued shares of common stock of BrightSphere Investment Group Inc. immediately prior to the effective time of the Redomestication. As a result, all outstanding shareholders of BrightSphere Investment Group plc became common stockholders of BrightSphere Investment Group Inc. Throughout this Form 10-Q, references to “BrightSphere,” “the Company,” “we” and “us” (i) for periods until the completion of the Redomestication, refer to BrightSphere Investment Group plc and (ii) for periods after the completion of the Redomestication, refer to BrightSphere Investment Group Inc. Also throughout this Form 10-Q, we refer to our equity securities (i) for periods until the completion of the Redomestication, as Ordinary Shares and (ii) for periods after the completion of the Redomestication, as shares of Common Stock.

Table of Contents

PART I — FINANCIAL INFORMATION

Item 1. Financial Statements.

BrightSphere Investment Group Inc.

Condensed Consolidated Balance Sheets

(in millions, unaudited)



	June 30, 2019			December 31, 2018
Assets
Cash and cash equivalents	$	95.9		$	340.6
Investment advisory fees receivable	156.6			159.1
Income taxes receivable	11.3			3.9
Fixed assets, net	58.3			49.0
Investments (includes balances reported at fair value of $204.1 and $196.6)	206.1			198.5
Acquired intangibles, net	68.4			71.7
Goodwill	274.6			274.6
Other assets	98.0			41.6
Deferred tax assets	263.5			270.1
Assets of consolidated Funds:
Cash and cash equivalents, restricted	7.4			4.9
Investments (includes balances reported at fair value of $128.1 and $124.8)	175.5			124.8
Other assets	9.5			14.9
Total assets	$	1,425.1		$	1,553.7
Liabilities and shareholders’ equity
Accounts payable and accrued expenses	$	38.7		$	54.3
Accrued incentive compensation	98.4			171.0
Due to OM plc	5.2			33.0
Other compensation liabilities	432.5			649.2
Accrued income taxes	55.6			53.6
Non-recourse borrowings	25.0			—
Third party borrowings	603.5			393.3
Other liabilities	52.0			8.3
Liabilities of consolidated Funds:
Accounts payable and accrued expenses	9.0			13.1
Securities sold, not yet purchased, at fair value	1.6			1.7
Other liabilities	—			0.1
Total liabilities	1,321.5			1,377.6
Commitments and contingencies
Redeemable non-controlling interests in consolidated Funds	81.8			41.9
Equity:
Ordinary shares (nominal value $0.001; 91,592,320 and 105,160,021 shares, respectively, issued)	0.1			0.1
Shareholders’ equity	7.0			124.1
Accumulated other comprehensive loss	(19.8		)	(20.9		)
Non-controlling interests	1.8			1.6
Non-controlling interests in consolidated Funds	32.7			29.3
Total equity and redeemable non-controlling interests in consolidated Funds	103.6			176.1
Total liabilities and equity	$	1,425.1		$	1,553.7

See Notes to Condensed Consolidated Financial Statements

Table of Contents

BrightSphere Investment Group Inc.

Condensed Consolidated Statements of Operations

(in millions except for per share data, unaudited)



	Three Months Ended June 30,						Six Months Ended June 30,
	2019			2018			2019			2018
Revenue:
Management fees	$	205.9		$	226.4		$	413.4		$	471.4
Performance fees	(2.2		)	3.0			(5.0		)	5.0
Other revenue	1.5			3.3			2.9			5.8
Consolidated Funds’ revenue	1.9			1.2			3.0			1.4
Total revenue	207.1			233.9			414.3			483.6
Operating expenses:
Compensation and benefits	123.7			183.4			224.8			372.6
General and administrative expense	31.1			29.8			63.6			59.3
Amortization of acquired intangibles	1.7			1.7			3.3			3.3
Depreciation and amortization	4.0			3.5			7.8			6.9
Consolidated Funds’ expense	—			0.2			0.2			0.6
Total operating expenses	160.5			218.6			299.7			442.7
Operating income	46.6			15.3			114.6			40.9
Non-operating income and (expense):
Investment income	2.1			(0.4		)	9.1			65.7
Interest income	0.3			0.6			1.4			1.1
Interest expense	(8.8		)	(6.1		)	(15.8		)	(12.4		)
Net consolidated Funds’ investment gains (losses)	(4.5		)	(3.3		)	9.1			(5.7		)
Total non-operating income (loss)	(10.9		)	(9.2		)	3.8			48.7
Income from continuing operations before taxes	35.7			6.1			118.4			89.6
Income tax expense	14.1			3.6			35.7			32.3
Income from continuing operations	21.6			2.5			82.7			57.3
Gain (loss) on disposal of discontinued operations, net of tax	—			—			—			—
Net income	21.6			2.5			82.7			57.3
Net income (loss) attributable to non-controlling interests in consolidated Funds	(6.4		)	0.4			2.0			(2.1		)
Net income attributable to controlling interests	$	28.0		$	2.1		$	80.7		$	59.4

Earnings per share (basic) attributable to controlling interests	$	0.31		$	0.02		$	0.85		$	0.54
Earnings per share (diluted) attributable to controlling interests	0.31			0.02			0.85			0.54
Continuing operations earnings per share (basic) attributable to controlling interests	0.31			0.02			0.85			0.54
Continuing operations earnings per share (diluted) attributable to controlling interests	0.31			0.02			0.85			0.54
Weighted average ordinary shares outstanding	91.5			108.4			94.6			108.9
Weighted average diluted ordinary shares outstanding	91.5			108.6			94.7			109.1

See Notes to Condensed Consolidated Financial Statements

Table of Contents

BrightSphere Investment Group Inc.

Condensed Consolidated Statements of Comprehensive Income

(in millions, unaudited)



	Three Months Ended June 30,						Six Months Ended June 30,
	2019			2018			2019			2018
Net income	$	21.6		$	2.5		$	82.7		$	57.3
Other comprehensive income (loss):
Amortization related to derivative securities, net of tax	0.6			0.6			1.2			1.2
Foreign currency translation adjustment	(0.6		)	(1.6		)	(0.1		)	(0.8		)
Total other comprehensive income (loss)	—			(1.0		)	1.1			0.4
Comprehensive income (loss) attributable to non-controlling interests in consolidated Funds	(6.4		)	0.4			2.0			(2.1		)
Total comprehensive income attributable to controlling interests	$	28.0		$	1.1		$	81.8		$	59.8

See Notes to Condensed Consolidated Financial Statements

Table of Contents

BrightSphere Investment Group Inc.

Condensed Consolidated Statements of Changes in Shareholders’ Equity

For the three months ended June 30, 2019 and 2018

($ in millions except share data, unaudited)



	Ordinary shares (millions)		Ordinary shares, nominal value		Shareholders’ equity			Accumulated other comprehensive income (loss)			Total shareholders’ equity			Non- controlling interests		Non-controlling interests in consolidated Funds			Total equity			Redeemable non-controlling interests in consolidated Funds			Total equity and redeemable non-controlling interests in consolidated Funds
March 31, 2018	110.5		$	0.1	$	142.8		$	(20.2	)	122.7			$	1.4	$	47.9		$	172.0		$	37.2		$	209.2
Repurchase of ordinary shares	(1.6	)	—		(24.8		)	—			(24.8		)	—		—			(24.8		)	—			(24.8		)
Capital contribution (redemptions)	—		—		—			—			—			—		9.3			9.3			3.7			13.0
Equity-based compensation	—		—		1.6			—			1.6			—		—			1.6			—			1.6
Foreign currency translation adjustment	—		—		—			(1.6		)	(1.6		)	—		—			(1.6		)	—			(1.6		)
Amortization related to derivatives securities, net of tax	—		—		—			0.6			0.6			—		—			0.6			—			0.6
Net de-consolidation of Funds	—		—		—			—			—			—		—			—			(34.4		)	(34.4		)
Dividends ($0.10 per share)	—		—		(11.0		)	—			(11.0		)	—		—			(11.0		)	—			(11.0		)
Net income (loss)	—		—		2.1			—			2.1			—		0.9			3.0			(0.5		)	2.5
June 30, 2018	108.9		$	0.1	$	110.7		$	(21.2	)	$	89.6		$	1.4	$	58.1		$	149.1		$	6.0		$	155.1

March 31, 2019	91.9		$	0.1	$	(9.7	)	$	(19.8	)	$	(29.4	)	$	1.8	$	36.0		$	8.4		$	43.2		$	51.6
Repurchase of ordinary shares	(0.3	)	—		(3.3		)	—			(3.3		)	—		—			(3.3		)	—			(3.3		)
Capital contributions (redemptions)	—		—		—			—			—			—		4.0			4.0			37.7			41.7
Equity-based compensation	—		—		1.2			—			1.2			—		—			1.2			—			1.2
Foreign currency translation adjustment	—		—		—			(0.6		)	(0.6		)	—		—			(0.6		)	—			(0.6		)
Amortization related to derivative securities, net of tax	—		—		—			0.6			0.6			—		—			0.6			—			0.6
Dividends ($0.10 per share)	—		—		(9.2		)	—			(9.2		)	—		—			(9.2		)	—			(9.2		)
Net income	—		—		28.0			—			28.0			—		(7.3		)	20.7			0.9			21.6
June 30, 2019	91.6		$	0.1	$	7.0		$	(19.8	)	$	(12.7	)	$	1.8	$	32.7		$	21.8		$	81.8		$	103.6

See Notes to Condensed Consolidated Financial Statements

Table of Contents

BrightSphere Investment Group Inc.

Condensed Consolidated Statements of Changes in Shareholders’ Equity

For the six months ended June 30, 2019 and 2018

($ in millions except share data, unaudited)



	Ordinary shares (millions)		Ordinary shares, nominal value		Shareholders’ equity			Accumulated other comprehensive income (loss)			Total shareholders’ equity			Non- controlling interests		Non-controlling interests in consolidated Funds			Total equity			Redeemable non-controlling interests in consolidated Funds			Total equity and redeemable non-controlling interests in consolidated Funds
December 31, 2017	109.7		$	0.1	$	96.9		$	(21.6	)	75.4			$	1.3	$	50.6		$	127.3		$	44.0		$	171.3
Issuance of ordinary shares	1.0		—		—			—			—			—		—			—			—			—
Repurchase of ordinary shares	(1.8	)	—		(27.4		)	—			(27.4		)	—		—			(27.4		)	—			(27.4		)
Capital contribution (redemptions)	—		—		(0.1		)	—			(0.1		)	—		9.3			9.2			3.8			13.0
Equity-based compensation	—		—		2.9			—			2.9			—		—			2.9			—			2.9
Foreign currency translation adjustment	—		—		—			(0.8		)	(0.8		)	—		—			(0.8		)	—			(0.8		)
Amortization related to derivatives securities, net of tax	—		—		—			1.2			1.2			—		—			1.2			—			1.2
Business acquisition	—		—		—			—			—			0.1		—			0.1			—			0.1
Net de-consolidation of Funds	—		—		—			—			—			—		—			—			(41.5		)	(41.5		)
Dividends ($0.19 per share)	—		—		(21.0		)	—			(21.0		)	—		—			(21.0		)	—			(21.0		)
Net income (loss)	—		—		59.4			—			59.4			—		(1.8		)	57.6			(0.3		)	57.3
June 30, 2018	108.9		$	0.1	$	110.7		$	(21.2	)	$	89.6		$	1.4	$	58.1		$	149.1		$	6.0		$	155.1

December 31, 2018	105.2		$	0.1	124.1			$	(20.9	)	$	103.3		$	1.6	$	29.3		$	134.2		$	41.9		$	176.1
Issuance of ordinary shares	0.2		—		—			—			—			—		—			—			—			—
Repurchase of ordinary shares	(13.8	)	—		(183.8		)	—			(183.8		)	—		—			(183.8		)	—			(183.8		)
Capital contributions (redemptions)	—		—		—			—			—			—		4.0			4.0			37.3			41.3
Equity-based compensation	—		—		4.4			—			4.4			—		—			4.4			—			4.4
Foreign currency translation adjustment	—		—		—			(0.1		)	(0.1		)	—		—			(0.1		)	—			(0.1		)
Amortization related to derivative securities, net of tax	—		—		—			1.2			1.2			—		—			1.2			—			1.2
Business acquisition	—		—		—			—			—			0.2		—			0.2			—			0.2
Dividends ($0.20 per share)	—		—		(18.4		)	—			(18.4		)	—		—			(18.4		)	—			(18.4		)
Net income	—		—		80.7			—			80.7			—		(0.6		)	80.1			2.6			82.7
June 30, 2019	91.6		$	0.1	$	7.0		$	(19.8	)	$	(12.7	)	$	1.8	$	32.7		$	21.8		$	81.8		$	103.6

See Notes to Condensed Consolidated Financial Statements

Table of Contents



BrightSphere Investment Group Inc. Condensed Consolidated Statements of Cash Flows (in millions, unaudited)
	Six Months Ended June 30,
	2019			2018
Cash flows from operating activities:
Net income	$	82.7		$	57.3
Less: Net (income) loss attributable to non-controlling interests in consolidated Funds	(2.0		)	2.1
Adjustments to reconcile net income to net cash flows from operating activities from continuing operations:
(Gain) loss on disposal of discontinued operations, excluding consolidated Funds	—			—
Amortization of acquired intangibles	3.3			3.3
Depreciation and other amortization	7.8			6.9
Amortization of debt-related costs	1.7			1.6
Amortization and revaluation of non-cash compensation awards	1.2			109.0
Net earnings from Affiliate accounted for using the equity method	(1.3		)	(1.3		)
Distributions received from equity method Affiliate	1.1			1.0
Gain on sale of investment in Affiliate	—			(65.7		)
Deferred income taxes	5.7			(20.8		)
(Gains) losses on other investments	(22.9		)	2.7
Changes in operating assets and liabilities (excluding discontinued operations):
(Increase) decrease in investment advisory fees receivable	2.3			9.9
(Increase) decrease in other receivables, prepayments, deposits and other assets	(12.1		)	27.0
Increase (decrease) in accrued incentive compensation, amounts due to OM plc and other liabilities	(286.9		)	(62.2		)
Increase (decrease) in accounts payable, accrued expenses and accrued income taxes	(10.1		)	(0.2		)
Net cash flows from operating activities of continuing operations, excluding consolidated Funds	(229.5		)	70.6
Net income (loss) attributable to non-controlling interests in consolidated Funds	2.0			(2.1		)
Adjustments to reconcile net income (loss) attributable to non-controlling interests in consolidated Funds to net cash flows from operating activities from continuing operations of consolidated Funds:
(Gains) losses on other investments	6.9			2.9
Purchase of investments	(126.4		)	(72.1		)
Sale of investments	87.3			78.6
Earnings from equity method investees	(6.1		)	—
(Increase) decrease in receivables and other assets	5.4			(1.3		)
Increase (decrease) in accounts payable and other liabilities	(4.2		)	13.8
Net cash flows from operating activities of continuing operations of consolidated Funds	(35.1		)	19.8
Net cash flows from operating activities of continuing operations	(264.6		)	90.4
Net cash flows from operating activities of discontinued operations	—			—
Total net cash flows from operating activities	(264.6		)	90.4
Cash flows from investing activities:
Additions of fixed assets	(17.1		)	(8.0		)
Proceeds from sale of investment in Affiliate	—			100.0
Purchase of investment securities	(12.4		)	(72.3		)
Sale of investment securities	22.7			30.3
Cash flows from investing activities of consolidated Funds
Contributions in equity method investees	(6.9		)	—
Distributions received from equity method investees	3.4			—
Net cash flows from investing activities of continuing operations	(10.3		)	50.0
Net cash flows from investing activities of discontinued operations	—			—
Total net cash flows from investing activities	(10.3		)	50.0

See Notes to Condensed Consolidated Financial Statements

Table of Contents



BrightSphere Investment Group Inc. Condensed Consolidated Statements of Cash Flows (in millions, unaudited)
	Six Months Ended June 30,
	2019			2018

Cash flows from financing activities:
Proceeds from third party and non-recourse borrowings	265.0			15.0
Repayment of third party and non-recourse borrowings	(30.0		)	(33.5		)
Payment to OM plc for DTA Deed	(32.7		)	—
Payment to OM plc for co-investment redemptions	(5.1		)	(0.6		)
Dividends paid to shareholders	(13.8		)	(16.1		)
Dividends paid to related parties	(4.8		)	(5.2		)
Payment to OM plc for promissory notes	—			(4.5		)
Repurchases of ordinary shares	(187.2		)	(27.5		)
Cash flows from financing activities of consolidated Funds
Non-controlling interest capital raised	7.0			13.2
Non-controlling interest capital redeemed	(3.0		)	—
Redeemable non-controlling interest capital raised	37.8			—
Redeemable non-controlling interest capital redeemed	(0.5		)	—
Net cash flows from financing activities of continuing operations	32.7			(59.2		)
Net cash flows from financing activities of discontinued operations	—			—
Total net cash flows from financing activities	32.7			(59.2		)
Effect of foreign exchange rate changes on cash and cash equivalents	—			—
Net increase (decrease) in cash and cash equivalents	(242.2		)	81.2
Cash and cash equivalents at beginning of period	345.5			200.4
Cash and cash equivalents at end of period (including cash at consolidated Funds classified as restricted)	$	103.3		$	281.6

Supplemental disclosure of cash flow information:
Interest paid (excluding consolidated Funds)	$	14.0		$	11.4
Income taxes paid	31.8			15.5

Supplemental disclosure of non-cash investing and financing transactions:
De-consolidation of Funds	$	—		$	(41.5	)

See Notes to Condensed Consolidated Financial Statements

Table of Contents

BrightSphere Investment Group Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

1) Organization and Description of the Business

BrightSphere Investment Group Inc. (“BrightSphere”, “BSIG” or the “Company”), through its subsidiaries, is a global asset management business with interests in a diverse group of boutique investment management firms (the “Affiliates”) individually headquartered in the United States. The Company provides investment management services globally to predominantly institutional investors, in asset classes that include U.S. and global equities, fixed income, alternative assets, timber and secondary Funds focused in real estate and private equity. Fees for services are largely asset-based and, as a result, the Company’s revenue fluctuates based on the performance of financial markets and investors’ asset flows in and out of the Company’s products.

The Company’s Affiliates are organized as limited liability companies. The Company generally utilizes a profit-sharing model in structuring its compensation and ownership arrangements with its Affiliates. The Affiliates’ variable compensation is generally based on each firm’s profitability. BSIG and Affiliate key employees share in profits after variable compensation according to their respective ownership interests. The profit-sharing model results in the alignment of BSIG and Affiliate key employee economic interests, which is critical to the Company’s talent management strategy and long-term growth of the business. The Company operates in one business segment.

Prior to 2014, the Company was a wholly-owned subsidiary of Old Mutual plc (“OM plc”), an international long-term savings, protection and investment group, listed on the London Stock Exchange. On October 15, 2014, the Company completed the initial public offering (the “Offering”) by OM plc pursuant to the Securities Act of 1933, as amended. Additionally, between the Offering and February 25, 2019, the Company, OM plc and/or HNA Capital US (“HNA”) completed a series of transactions in the Company’s shares, including a two-step transaction announced on March 25, 2017 for a sale by OM plc of a 24.95% shareholding in the Company to HNA and a two-step transaction announced on November 19, 2018 for a sale of the substantial majority of the ordinary shares held by HNA of the Company to Paulson & Co. (“Paulson”). On February 25, 2019, this transaction was completed, resulting in Paulson holding approximately 21.7% of the ordinary shares of the Company. The remaining shares held by HNA were bought back by the Company in the first quarter of 2019.

On July 12, 2019, the Company completed a redomestication process to change its publicly traded parent company from a company incorporated under the laws of England and Wales to a Delaware corporation. The scheme of arrangement pursuant to which the redomestication was effected was approved by the Company’s shareholders and the High Court of Justice of England and Wales. Effective as of the close of business on July 12, 2019, all issued ordinary shares of BrightSphere Investment Group plc were exchanged on a one-for-one basis for newly issued shares of common stock of BrightSphere Investment Group Inc. The common stock of BrightSphere Investment Group Inc. began trading on July 15, 2019, and the Company’s trading symbol on the NYSE remained unchanged as “BSIG.”

For the six months ended June 30, 2019, the Company repurchased 13,801,591 ordinary shares at an average price of $13.23 per share, or approximately $182.6 million in total. For the three months ended June 30, 2019, the Company repurchased 303,513 ordinary shares at an average price of $10.87 per share, or approximately $3.3 million in total.

Table of Contents

BrightSphere Investment Group Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

2) Basis of Presentation and Significant Accounting Policies

The Company’s significant accounting policies are as follows:

Basis of presentation

These unaudited Condensed Consolidated Financial Statements reflect the historical balance sheets, statements of operations and of comprehensive income, statements of changes in shareholders’ equity and statements of cash flows of the Company.

The Condensed Consolidated Financial Statements are prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”). All dollar amounts, except per-share data in the text and tables herein, are stated in millions unless otherwise indicated. Material intercompany balances and transactions among the Company and its consolidated Affiliates are eliminated in consolidation.

The Company has revised certain amounts in prior-period financial statements to conform to the current period’s presentation. The Company changed the presentation of the purchase and sale of investments by its consolidated Funds within cash flows from investing activities in the prior period’s Condensed Consolidated Statement of Cash Flows to conform to the current period’s presentation of showing such purchase and sale of investments within cash flows from operating activities. The change had no impact on the total cash provided by or used in operating, investing or financing activities within the Condensed Consolidated Statement of Cash Flows or any impact on the other Condensed Consolidated Financial Statements.

Certain disclosures included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 (annual report or Form 10-K) are not required to be included on an interim basis in the Company’s quarterly reports on Forms 10-Q. The Company has condensed or omitted these disclosures. These unaudited Condensed Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements and notes thereto for the year ended December 31, 2018 included in the Company’s Annual Report on Form 10-K as filed with the Securities and Exchange Commission (“SEC”) on February 28, 2019. The Company’s significant accounting policies, which have been consistently applied, are summarized in those financial statements.

Recently adopted accounting standards

In February 2016, the FASB issued Accounting Standards Update (“ASU”) 2016-02, “Leases” (“Topic 842”). Topic 842 requires that lessees recognize right-of-use (“ROU”) assets and lease liabilities on the balance sheet for all leases with a lease term greater than 12 months. The Company adopted the standard on January 1, 2019 using the modified retrospective approach, without restating prior comparative periods. Most prominent among the changes in the standard is the recognition of ROU assets and lease liabilities by lessees for those leases classified as operating leases.

The Company recorded a ROU asset of approximately $44.2 million and a lease liability of approximately $49.9 million, primarily related to real estate operating leases on January 1, 2019, with no cumulative-effect adjustment to opening retained earnings. The initial recognition of ROU asset and lease liability represented a non-cash activity. The adoption of the new standard had a material impact on the Company’s Condensed Consolidated Balance Sheet, but did not have an impact on our Condensed Consolidated Statement of Operations.

The package of three practical expedients applicable to the Company have been elected which resulted in the Company not having to reassess whether expired or existing contracts upon adoption contained a lease. It also allowed the Company to retain the historical classifications of our leases and initial direct costs. The Company has also made an accounting policy election to apply short-term exemption to leases that meet the definition of short-term leases under the new standard.

On January 1, 2019, the Company early adopted ASU 2018-15, Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract, which aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements

Table of Contents

BrightSphere Investment Group Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

2) Basis of Presentation and Significant Accounting Policies (cont.)

for capitalizing implementation costs incurred to develop or obtain internal-use software. The capitalized implementation costs will be expensed over the term of the hosting arrangement. The adoption of this ASU did not have a material impact on the Company’s Condensed Consolidated Financial Statements and related disclosures.

Summary of Significant Accounting Policies

Leases

The Company determines if an arrangement is a lease at inception. The Company’s leases qualify as operating leases and consist primarily of corporate offices, data centers, vehicles and certain equipment. Operating lease liabilities are included in Other liabilities and ROU assets are included in Other assets on the Condensed Consolidated Balance Sheet.

Operating lease ROU assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. As the leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The Company uses the implicit rate when readily determinable.

The operating lease ROU asset also includes any lease payments made and excludes lease incentives and initial direct costs incurred. The lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term.

The Company elected both at transition and on an ongoing basis, to combine lease and non-lease components in calculating the lease liability and ROU asset for all operating leases.

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BrightSphere Investment Group Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

3) Investments

Investments are comprised of the following as of the dates indicated (in millions):



	June 30, 2019		December 31, 2018
Investments of consolidated Funds held at fair value	$	128.1	$	124.8
Other investments held at fair value	104.3		104.8
Investments related to long-term incentive compensation plans held at fair value	99.8		91.8
Total investments held at fair value	332.2		321.4
Equity-accounted investments in Affiliates and consolidated Funds⁽¹⁾	49.4		1.9
Total investments per Condensed Consolidated Balance Sheets	$	381.6	$	323.3


(1)	Equity-accounted investments in consolidated Funds is comprised of Investments in partnership interests where a portion of return includes carried interest. These investments are accounted for within the scope of ASC 323, Investments - Equity Method and Joint Ventures because the Company has determined it has significant influence.

In August 2017, the Company executed a non-binding term sheet to sell its stake in Heitman LLC to Heitman’s management for cash consideration totaling $110 million. Pursuant to this term sheet, BSIG entered into a redemption agreement on November 17, 2017 and the Company reclassified its investment in Heitman to a cost method investment. The transaction closed on January 5, 2018 and resulted in a gain of $65.7 million included in the table below.

Investment income is comprised of the following for the three and six months ended June 30 (in millions):



	Three Months Ended June 30,					Six Months Ended June 30,
	2019		2018			2019		2018
Realized and unrealized gains (losses) on other investments held at fair value	$	1.4	$	(1.1	)	$	7.8	$	(1.3	)
Investment return of equity-accounted investments in Affiliates	0.7		0.7			1.3		1.3
Gain on sale of Affiliate carried at cost	—		—			—		65.7
Total investment income per Condensed Consolidated Statements of Operations	$	2.1	$	(0.4	)	$	9.1	$	65.7

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BrightSphere Investment Group Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

3) Investments (cont.)

Investment gains (losses) on net consolidated funds is comprised of the following for the three and six months ended June 30 (in millions):



	Three Months Ended June 30,						Six Months Ended June 30,
	2019			2018			2019		2018
Realized and unrealized gains (losses) on consolidated Funds held at fair value	$	0.1		$	(3.3	)	$	3.0	$	(5.7	)
Investment return of equity-accounted investments	(4.6		)	—			6.1		—
Total net consolidated Funds’ investment gains (losses) per Condensed Consolidated Statements of Operations	$	(4.5	)	$	(3.3	)	$	9.1	$	(5.7	)

Table of Contents

BrightSphere Investment Group Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

4) Fair Value Measurements

The following table summarizes the Company’s assets and liabilities that are measured at fair value on a recurring basis at June 30, 2019 (in millions):



	Quoted prices in active markets (Level I)			Significant other observable inputs (Level II)			Significant unobservable inputs (Level III)		Uncategorized		Total value, June 30, 2019
Assets of BSIG and consolidated Funds⁽¹⁾
Common and preferred stock	$	14.3		$	—		$	—	$	—	$	14.3
Short-term investment funds	2.9			—			—		—		2.9
Bank loans	—			104.8			—		—		104.8
Other investments	4.3			1.0			—		—		5.3
Derivatives	0.7			0.1			—		—		0.8
Consolidated Funds total	22.2			105.9			—		—		128.1
Investments in separate accounts⁽²⁾	35.9			10.6			—		—		46.5
Investments related to long-term incentive compensation plans⁽³⁾	99.8			—			—		—		99.8
Investments in unconsolidated Funds⁽⁴⁾	—			—			3.0		54.8		57.8
BSIG total	135.7			10.6			3.0		54.8		204.1
Total fair value assets	$	157.9		$	116.5		$	3.0	$	54.8	$	332.2
Liabilities of consolidated Funds⁽¹⁾
Derivatives	(1.4		)	(0.2		)	—		—		(1.6		)
Consolidated Funds total	(1.4		)	(0.2		)	—		—		(1.6		)
Total fair value liabilities	$	(1.4	)	$	(0.2	)	$	—	$	—	$	(1.6	)

Table of Contents

BrightSphere Investment Group Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

4) Fair Value Measurements (cont.)

The following table summarizes the Company’s assets and liabilities that are measured at fair value on a recurring basis at December 31, 2018 (in millions):



	Quoted prices in active markets (Level I)			Significant other observable inputs (Level II)			Significant unobservable inputs (Level III)		Uncategorized		Total value December 31, 2018
Assets of BSIG and consolidated Funds⁽¹⁾
Common and preferred stock	$	13.8		$	—		$	—	$	—	$	13.8
Short-term investment funds	2.2			—			—		—		2.2
Bank loans	—			63.9			—		—		63.9
Other investments	3.7			—			—		38.8		42.5
Derivatives	2.2			0.2			—		—		2.4
Consolidated Funds total	21.9			64.1			—		38.8		124.8
Investments in separate accounts⁽²⁾	35.0			8.2			—		—		43.2
Investments related to long-term incentive compensation plans⁽³⁾	91.8			—			—		—		91.8
Investments in unconsolidated Funds⁽⁴⁾	—			—			3.0		58.6		61.6
BSIG total	126.8			8.2			3.0		58.6		196.6
Total fair value assets	$	148.7		$	72.3		$	3.0	$	97.4	$	321.4
Liabilities of consolidated Funds⁽¹⁾
Common stock	$	(0.8	)	$	—		$	—	$	—	$	(0.8	)
Derivatives	(0.8		)	(0.1		)	—		—		(0.9		)
Consolidated Funds total	(1.6		)	(0.1		)	—		—		(1.7		)
Total fair value liabilities	$	(1.6	)	$	(0.1	)	$	—	$	—	$	(1.7	)


(1)	Assets and liabilities measured at fair value are comprised of financial investments managed by the Company's Affiliates.

Equity securities, including common and preferred stock, short-term investment funds, other investments and derivatives which are traded on a national securities exchange are stated at the last reported sales price on the day of valuation. To the extent these securities are actively traded and valuation adjustments are not applied, they are classified as Level I. These securities that trade in markets that are not considered to be active but are valued based on quoted market prices, dealer quotations or alternative pricing sources supported by observable inputs obtained by the Company from independent pricing services are classified as Level II.

The Company obtains prices from independent pricing services that may utilize broker quotes, but generally the independent pricing services will use various other pricing techniques which take into account appropriate factors such as yield, quality, coupon rate, maturity, type of issue, trading characteristics and other data. The Company has not made adjustments to the prices provided. Assets of consolidated Funds also include investments in bank loans. Interests in senior floating-rate loans for which reliable market participant quotations are readily available are valued at the average mid-point of bid and ask quotations obtained from a third-party pricing service. These assets are classified as Level II.

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BrightSphere Investment Group Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

4) Fair Value Measurements (cont.)

If the pricing services are only able to (a) obtain a single broker quote or (b) utilize a pricing model, such securities are classified as Level III. If the pricing services are unable to provide prices, the Company attempts to obtain one or more broker quotes directly from a dealer or values such securities at the last bid price obtained. In either case, such securities are classified as Level III. The Company performs due diligence procedures over third party pricing vendors to understand their methodology and controls to support their use in the valuation process to ensure compliance with required accounting disclosures.

The uncategorized amount of $0.0 million and $38.8 million at June 30, 2019 and December 31, 2018, respectively, represents investments made by consolidated Funds and are valued using NAV which the Company relies on to determine their fair value as a practical expedient and has therefore not classified these investments in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to amounts presented in the Condensed Consolidated Balance Sheets. These consolidated Funds consist of real estate and private equity investment Funds. The NAVs that have been provided by investees have been derived from the fair values of the underlying investments as of the measurement dates.

(2)

Investments in separate accounts of $46.5 million at June 30, 2019 consist of approximately 8% of cash equivalents and 92% of equity securities, fixed income securities, and other investments. Investments in separate accounts of $43.2 million at December 31, 2018 consist of approximately 11% of cash equivalents and 89% of equity securities, fixed income securities, and other investments. The Company values these using the published price of the underlying securities (classified as Level I) or quoted price supported by observable inputs as of the measurement date (classified as Level II).

(3)

Investments related to long term compensation plans of $99.8 million and $91.8 million at June 30, 2019 and December 31, 2018, respectively, are investments in publicly registered daily redeemable funds (some managed by Affiliates), which the Company has classified as trading securities and valued using the published price as of the measurement dates. Accordingly, the Company has classified these investments as Level I.

(4)

The uncategorized amounts of $54.8 million and $58.6 million at June 30, 2019 and December 31, 2018, respectively, relate to investments in unconsolidated Funds which consist primarily of investments in Funds advised by Affiliates and are valued using NAV which the Company relies on to determine their fair value as a practical expedient and has therefore not classified these investments in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to amounts presented in the Condensed Consolidated Balance Sheets. These unconsolidated Funds consist primarily of real estate investment Funds, UCITS and other investment vehicles. The NAVs that have been provided by investees have been derived from the fair values of the underlying investments as of the measurement dates.

Table of Contents

BrightSphere Investment Group Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

4) Fair Value Measurements (cont.)

The real estate investment Funds of $9.3 million and $12.3 million at June 30, 2019 and December 31, 2018, respectively, are subject to longer than quarterly redemption restrictions, and due to their nature, distributions are received only as cash flows are generated from underlying assets over the life of the Funds. The range of time over which the underlying assets are expected to be liquidated by the investees is approximately one year to eleven years from June 30, 2019. The valuation process for the underlying real estate investments held by the real estate investment Funds begins with each property or loan being valued by the investment teams. The valuations are then reviewed and approved by the valuation committee, which consists of senior members of the portfolio management, acquisitions, and research teams. For certain properties and loans, the valuation process may also include a valuation by independent appraisers. In connection with this process, changes in fair-value measurements from period to period are evaluated for reasonableness, considering items such as market rents, capitalization and discount rates, and general economic and market conditions.

Investments in unconsolidated Funds categorized as Level III of $3.0 million at June 30, 2019 relates to investments in Timber Funds advised by Affiliates and are valued by the general partner of those Funds. Determination of estimated fair value involves subjective judgment because the actual fair value can be determined only through negotiation between parties in a sale transaction, and amounts ultimately realized may vary significantly from their fair value presented.

The following table reconciles the opening balances of Level III financial assets to closing balances at the end of the period (in millions):



	Consolidated Funds other investments
	Three Months Ended June 30,				Six Months Ended June 30,
	2019		2018		2019		2018
Level III financial assets
At beginning of the period	$	—	$	—	$	—	$	—
Transfers into Level III	—		26.5		—		26.5
Change in recognition based on adoption of ASU 2016-01	—		—		—		—
Total net fair value losses recognized in net income	—		—		—		—
Total Level III financial assets	$	—	$	26.5	$	—	$	26.5



	Investments in unconsolidated Funds
	Three Months Ended June 30,					Six Months Ended June 30,
	2019		2018			2019		2018
Level III financial assets
At beginning of the period	$	3.0	$	6.3		$	3.0	$	—
Transfers into Level III	—		—			—		—
Change in recognition based on adoption of ASU 2016-01	—		—			—		6.4
Total net fair value losses recognized in net income	—		(1.1		)	—		(1.2		)
Total Level III financial assets	$	3.0	$	5.2		$	3.0	$	5.2

Table of Contents

BrightSphere Investment Group Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

4) Fair Value Measurements (cont.)

There were no significant transfers of financial assets or liabilities among Levels I, II or III during the three and six months ended June 30, 2019. During the three and six months ended June 30, 2018, the Company transferred $26.5 million of Consolidated Funds other investments into Level III. These investments were not previously classified on the fair value hierarchy.

Table of Contents

BrightSphere Investment Group Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

5) Variable Interest Entities

The Company, through its Affiliates, sponsors the formation of various entities considered to be variable interest entities (“VIEs”). These VIEs are primarily Funds managed by Affiliates and other partnership interests typically owned entirely by third-party investors. Certain Funds may be capitalized with seed capital investments from the Company and may be owned partially by Affiliate key employees and/or individuals that own minority interests in an Affiliate.

The Company’s determination of whether it is the primary beneficiary of a Fund that is a VIE is based in part on an

assessment of whether or not the Company and its related parties are exposed to absorb more than an insignificant

amount of the risks and rewards of the entity. Typically the Fund’s investors are entitled to substantially all of the

economics of these VIEs with the exception of the management fees and performance fees, if any, earned by the

Company or any investment the Company has made into the Funds. The Company generally is not the primary

beneficiary of Fund VIEs created to manage assets for clients unless the Company’s ownership interest, including

interests of related parties, is substantial.

The following table presents the assets and liabilities of Funds that are VIEs and consolidated by the Company (in millions):



	6/30/2019		12/31/2018
Assets
Investments at fair value	$	128.1	$	124.8
Other assets of consolidated Funds	64.3		19.8
Total Assets	$	192.4	$	144.6
Liabilities
Liabilities of consolidated Funds	$	10.6	$	14.9
Total Liabilities	$	10.6	$	14.9

“Investments at fair value” consist of investments in bank loans, common and preferred stock, and other securities. To the extent the Company also has consolidated Funds that are not VIEs, the assets and liabilities of those Funds are not included in the table above.

The assets of consolidated VIEs presented in the table above belong to the investors in those Funds, are available for use only by the Fund to which they belong, and are not available for use by the Company to the extent they are held by non-controlling interests. Any debt or liabilities held by consolidated Funds have no recourse to the Company's general credit.

The Company’s involvement with Funds that are VIEs and not consolidated by the Company is generally limited to that of an investment manager and its investment in the unconsolidated VIE, if any. The Company’s investment in any unconsolidated VIE generally represents an insignificant interest of the Fund’s net assets and assets under management, such that the majority of the VIE’s results are attributable to third parties. The Company’s exposure to risk in these entities is generally limited to any capital contribution it has made or is required to make and any earned but uncollected management fees. The Company has not issued any investment performance guarantees to these VIEs or their investors.

Table of Contents

BrightSphere Investment Group Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

5) Variable Interest Entities (cont.)

The following information pertains to unconsolidated VIEs for which the Company holds a variable interest (in millions):



	June 30, 2019		December 31, 2018
Unconsolidated VIE assets	$	7,178.1	$	4,814.9
Unconsolidated VIE liabilities	$	4,591.9	$	2,115.1
Equity interests on the Condensed Consolidated Balance Sheets	$	18.9	$	22.5
Maximum risk of loss⁽¹⁾	$	29.1	$	31.0


(1)	Includes equity investments the Company has made or is required to make and any earned but uncollected management and incentive fees. The Company does not record performance or incentive allocations until the respective measurement period has ended.

Table of Contents

BrightSphere Investment Group Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

6) Borrowings and Debt

The Company’s borrowings and long-term debt was comprised of the following as of the dates indicated (in millions):



	June 30, 2019					December 31, 2018
	Carrying value⁽¹⁾		Fair Value		Fair Value Level	Carrying value⁽¹⁾		Fair Value		Fair Value Level
$350 million revolving credit facility expiring October 15, 2019⁽²⁾	$	210.0	$	210.0	2	$	—	$	—	2
Non-recourse seed capital facility expiring July 17, 2020⁽²⁾	$	25.0	$	25.0	2	$	—	$	—
Long-term bonds:
$275 million 4.80% Senior Notes Due July 27, 2026	$	272.3	$	278.3	2	$	272.2	$	266.0	2000000
$125 million 5.125% Senior Notes Due August 1, 2031	$	121.2	$	123.0	2	$	121.1	$	102.3	2000000
Total borrowings and long-term debt	$	628.5	$	636.3		$	393.3	$	368.3


(1)	The difference between the principal amounts and the carrying values of the senior notes in the table above reflects the unamortized debt issuance costs and discounts.


(2)	Fair value approximates carrying value because the credit facilities have variable interest rates based on selected short term market rates.

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BrightSphere Investment Group Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

7) Leases

The Company has operating leases for corporate offices, data centers, vehicles and certain equipment. The operating leases have remaining lease terms of 1 year to 6 years, some of which include options to extend the leases for up to 5 years, and some of which include options to terminate the leases within 1 year.

As of June 30, 2019, the ROU asset of $43.4 million was included within Other assets and the lease liability of $48.6 million was included within Other liabilities on the Condensed Consolidated Balance Sheet.

The following table summarizes information about the Company’s operating leases for the three and six months ended June 30, 2019 (in millions, except lease term and discount rate):



	Three Months Ended June 30,		Six Months Ended June 30,
	2019		2019
Operating lease cost	$	3.5	$	6.9
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	3.7		7.3
ROU asset obtained in exchange for new operating lease liabilities	0.3		5.4

In determining the incremental borrowing rate, the Company considered the interest rate yield for the specific interest rate environment and the Company’s credit spread at the inception of the lease. For the six months ended June 30, 2019, the weighted average remaining lease term was 5.0 years and the weighted average discount rate was 4.11%.

Maturities of operating lease liabilities were as follows (in millions):



	Operating Leases
Year Ending December 31,
2019 (excluding the six months ended June 30, 2019)	$	7.3
2020	13.9
2021	12.7
2022	8.6
2023	3.8
Thereafter	7.4
Total lease payments	53.7
Less imputed interest	(5.1		)
Total	$	48.6

Table of Contents

BrightSphere Investment Group Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

8) Commitments and Contingencies

Operational commitments

The Company had unfunded commitments to invest up to approximately $62 million in co-investments as of June 30, 2019. These commitments will be funded as required through the end of the respective investment periods ranging through fiscal 2024.

Certain Affiliates operate under regulatory authorities that require that they maintain minimum financial or capital requirements. Management is not aware of any violations of such financial requirements occurring during the period.

Litigation

The Company and its Affiliates are subject to claims, legal proceedings and other contingencies in the ordinary course of their business activities. Each of these matters is subject to various uncertainties, and it is possible that some of these matters may be resolved in a manner unfavorable to the Company or its Affiliates. The Company and its Affiliates establish accruals for matters for which the outcome is probable and can be reasonably estimated. If an insurance claim or other indemnification for a litigation accrual is available to the Company, the associated gain will not be recognized until all contingencies related to the gain have been resolved. As of June 30, 2019, there were no material accruals for claims, legal proceedings or other contingencies.

Indemnifications

In the normal course of business, such as through agreements to enter into business combinations and divestitures of Affiliates, the Company enters into contracts that contain a variety of representations and warranties and which provide general indemnifications. The Company’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Company that have not yet occurred.

Foreign tax contingency

The Company has clients in non-U.S. jurisdictions which require entities that are conducting certain business activities in such jurisdictions to collect and remit tax assessed on certain fees paid for goods and services provided. The Company does not believe this requirement is applicable based on its limited business activities in these jurisdictions. However, given the fact that uncertainty exists around the requirement, the Company has chosen to evaluate its potential exposure related to non-collection and remittance of these taxes. At June 30, 2019, management of the Company has estimated the potential maximum exposure and concluded that it is not material. No accrual for the potential exposure has been recorded as the probability of incurring any potential liability relating to this exposure is not probable at June 30, 2019.

Considerations of credit risk

Financial instruments that potentially subject the Company to significant concentrations of credit risk consist principally of cash and investments. The Company maintains cash and cash equivalents and short term investments with various financial institutions. These financial institutions are typically located in cities in which the Company and its Affiliates operate. For the Company and certain Affiliates, cash deposits at a financial institution may exceed Federal Deposit Insurance Corporation insurance limits.

Table of Contents

BrightSphere Investment Group Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

9) Earnings Per Share

Basic earnings per share is calculated by dividing net income attributable to controlling interests by the weighted-average number of shares outstanding. Diluted earnings per share is similar to basic earnings per share, but is adjusted for the effect of potentially issuable ordinary shares, except when inclusion is antidilutive.

The calculation of basic and diluted earnings per ordinary share is as follows (dollars in millions, except per share data):



	Three Months Ended June 30,				Six Months Ended June 30,
	2019		2018		2019			2018
Numerator:
Net income attributable to controlling interests	$	28.0	$	2.1	$	80.7		$	59.4
Less: Total income available to participating unvested securities⁽¹⁾	—		—		(0.1		)	(0.2		)
Total net income attributable to ordinary shares	$	28.0	$	2.1	$	80.6		$	59.2
Denominator:
Weighted-average ordinary shares outstanding—basic	91,457,301		108,445,541		94,550,527			108,918,328
Potential ordinary shares:
Restricted stock units	38,332		175,580		118,948			185,919
Weighted-average ordinary shares outstanding—diluted	91,495,633		108,621,121		94,669,475			109,104,247
Earnings per ordinary share attributable to controlling interests:
Basic	$	0.31	$	0.02	$	0.85		$	0.54
Diluted	$	0.31	$	0.02	$	0.85		$	0.54


(1)	Income available to participating unvested securities includes dividends paid on unvested restricted shares and their proportionate share of undistributed earnings.

Employee options to purchase 8,970,000 shares were not included in the computation of diluted EPS for the three and six months ended June 30, 2019 because the assumed proceeds from exercising such options exceed the average price of the ordinary shares for the period and, therefore, the options are deemed antidilutive.

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BrightSphere Investment Group Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

10) Revenue

Management fees

The Company’s management fees are a function of the fee rates the Affiliates charge to their clients, which are typically expressed in basis points, and the levels of the Company’s assets under management. The greatest driver of increases or decreases in this average fee rate is changes in the mix of the Company’s assets under management caused by net inflows or outflows in certain asset classes or disproportionate market movements.

Performance fees

The Company’s alternative products subject to performance fees earn these fees upon exceeding high-water mark performance thresholds or outperforming a hurdle rate. Conversely, the separate accounts / other products, which primarily earn management fees, are potentially subject to performance adjustments up or down based on investment performance versus benchmarks (i.e. fulcrum fees).

Other revenue

Included in other revenue are certain payroll and benefits costs and expenses paid on behalf of Funds by the Company’s Affiliates. In instances where a customer reimburses the Company for a cost paid on the customer’s behalf, the Company is acting as a principal and the reimbursement is accrued on a gross basis at cost as the corresponding reimbursable expenses are incurred. Revenue from expense reimbursement amounted to $1.3 million and $2.7 million for the three months ended June 30, 2019 and 2018, respectively. Revenue from expense reimbursement amounted to $2.3 million and $5.0 million for the six months ended June 30, 2019 and 2018, respectively, and is recorded in other revenue in the Company’s Condensed Consolidated Statements of Operations. Other revenue may also consist of other miscellaneous revenue, consisting primarily of administration and consulting services.

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BrightSphere Investment Group Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

10) Revenue (cont.)

Disaggregation of management fee revenue

The Company classifies its revenue (including only consolidated Affiliates that are included in management fee revenue) among the following asset classes:


i.	U.S. equity, which includes small cap through large cap securities and substantially value or blended investment styles;


ii.	Global / non-U.S. equity, which includes global and international equities including emerging markets;


iii.	Fixed income, which includes government bonds, corporate bonds and other fixed income investments in the United States; and


iv.	Alternatives, which consist of timberland investments, secondary Funds focused in real estate and private equity, and other alternative investments.

Revenue by asset class for the three and six months ended June 30, 2019 and 2018 were (in millions):



	Three Months Ended June 30,				Six Months Ended June 30,
	2019		2018		2019		2018
U.S. equity	$	40.0	$	45.5	$	80.4	$	93.1
Global / non-U.S. equity	116.0		126.2		232.9		254.8
Fixed income	6.5		6.8		12.9		13.6
Alternatives	43.4		47.9		87.2		109.9
Management fee revenue	$	205.9	$	226.4	$	413.4	$	471.4

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BrightSphere Investment Group Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

11) Accumulated Other Comprehensive Income (Loss)

The components of accumulated other comprehensive income (loss), net of tax, for the three months ended June 30, 2019 and 2018 are as follows:



	Foreign currency translation adjustment			Valuation and amortization of derivative securities			Total
Balance, as of March 31, 2019	$	2.3		$	(22.1	)	$	(19.8	)
Foreign currency translation adjustment	(0.6		)				(0.6		)
Amortization related to derivative securities, before tax				0.8			0.8
Tax impact	—			(0.2		)	(0.2		)
Other comprehensive income (loss)	(0.6		)	0.6			—
Balance, as of June 30, 2019	$	1.7		$	(21.5	)	$	(19.8	)



	Foreign currency translation adjustment			Valuation and amortization of derivative securities			Total
Balance, as of March 31, 2018	$	4.3		$	(24.5	)	$	(20.2	)
Foreign currency translation adjustment	(1.6		)				(1.6		)
Amortization related to derivative securities, before tax				0.7			0.7
Tax impact	—			(0.1		)	(0.1		)
Other comprehensive income (loss)	(1.6		)	0.6			(1.0		)
Balance, as of June 30, 2018	$	2.7		$	(23.9	)	$	(21.2	)

The components of accumulated other comprehensive income (loss), net of tax, for the six months ended June 30, 2019 and June 30, 2018 were as follows (in millions):



	Foreign currency translation adjustment			Valuation and amortization of derivative securities			Total
Balance, as of December 31, 2018	$	1.8		$	(22.7	)	$	(20.9	)
Foreign currency translation	(0.1		)				(0.1		)
Amortization related to derivative securities, before tax				1.5			1.5
Tax impact	—			(0.3		)	(0.3		)
Other comprehensive income (loss)	(0.1		)	1.2			1.1
Balance, as of June 30, 2019	$	1.7		$	(21.5	)	$	(19.8	)

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BrightSphere Investment Group Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

11) Accumulated Other Comprehensive Income (Loss)



	Foreign currency translation adjustment			Valuation and amortization of derivative securities			Total
Balance, as of December 31, 2017	$	3.5		$	(25.1	)	$	(21.6	)
Foreign currency translation	(0.8		)				(0.8		)
Amortization related to derivative securities, before tax				1.4			1.4
Tax impact	—			(0.2		)	(0.2		)
Other comprehensive income (loss)	(0.8		)	1.2			0.4
Balance, as of June 30, 2018	$	2.7		$	(23.9	)	$	(21.2	)

For the three months ended June 30, 2019 and 2018, the Company reclassified $0.8 million and $0.7 million from accumulated other comprehensive income (loss) to interest expense on the Condensed Consolidated Statements of Operations.

For the six months ended June 30, 2019 and 2018, the Company reclassified $1.5 million and $1.4 million from accumulated other comprehensive income (loss) to interest expense on the Condensed Consolidated Statements of Operations.

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BrightSphere Investment Group Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

12) Derivatives and Hedging

Cash flow hedge

In July 2015, the Company entered into a series of $300.0 million notional Treasury rate lock contracts which were designated and qualified as cash flow hedges. The Company documented its hedging strategy and risk management objective for this contract in anticipation of a future debt issuance. The Treasury rate lock contract eliminated the impact of fluctuations in the underlying benchmark interest rate for future forecasted debt issuances. The forecasted debt issuances occurred in July 2016 and the Treasury rate lock, which had an accumulated fair value of $(34.4) million, was settled. Refer to Note 6, Borrowings and Debt, for additional information on the debt issuances.

As of June 30, 2019, the balance recorded in accumulated other comprehensive income (loss) was $(21.5) million, net of tax. This balance will be reclassified to earnings through interest expense over the life of the issued debt. Amounts of $0.8 million and $0.7 million have been reclassified for the three months ended June 30, 2019 and 2018, respectively, and amounts of $1.5 million and $1.4 million have been reclassified for the six months ended June 30, 2019 and 2018, respectively. During the next twelve months the Company expects to reclassify approximately $3.0 million to interest expense.

Derivatives of consolidated Funds

In the normal course of business, the Company’s consolidated Funds may enter into transactions involving derivative financial instruments in connection with Funds’ investing activities. Derivative instruments may be used as substitutes for securities in which the Funds can invest, to hedge portfolio investments or to generate income or gain to the Funds. The Funds may also use derivatives to manage duration; sector and yield curve exposures and credit and spread volatility. Derivative financial instruments base their value upon an underlying asset, index or reference rate. These instruments are subject to various risks, including leverage, market, credit, liquidity and operational risks. The Funds manage the risks associated with derivatives on an aggregate basis, along with the risks associated with its trading and as part of its overall risk management policies.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Unless we state otherwise or the context otherwise requires, references in this Quarterly Report on Form 10-Q to “BrightSphere” or “BSIG” refer to BrightSphere Investment Group Inc., references to the “Company” refer to BSIG, and references to “we,” “our” and “us” refer to BSIG and its consolidated subsidiaries and equity-accounted Affiliates, excluding discontinued operations. References to the holding company or “Center” excluding the Affiliates refer to BrightSphere Inc., or “BSUS,” a Delaware corporation and wholly owned subsidiary of BSIG. Unless we state otherwise or the context otherwise requires, references in this Quarterly Report on Form 10-Q to “Affiliates” or an “Affiliate” refer to the asset management firms in which we have an ownership interest. References in this Quarterly Report on Form 10-Q to “OM plc” refer to Old Mutual plc, our former parent. None of the information in this Quarterly Report on Form 10-Q constitutes either an offer or a solicitation to buy or sell any of our Affiliates’ products or services, nor is any such information a recommendation for any of our Affiliates’ products or services.

The following discussion of our financial condition and results of operations should be read in conjunction with our Condensed Consolidated Financial Statements and related notes which appear elsewhere in this Quarterly Report on Form 10-Q.

This discussion contains forward-looking statements that involve risks and uncertainties. See “Forward-Looking Statements” at the end of this Item 2 for more information. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of various factors, including those discussed below.

This Management’s Discussion and Analysis of Financial Condition and Results of Operations, or MD&A, is designed to provide a reader of our financial statements with a narrative from the perspective of our management on our financial condition, results of operations, liquidity and certain other factors that may affect our future results.

Our MD&A is presented in five sections:

•

Overview provides a brief description of our Affiliates, a summary of The Economics of Our Business and an explanation of How We Measure Performance using a non-GAAP measure which we refer to as economic net income, or ENI. This section also provides a Summary Results of Operations and information regarding our Assets Under Management by Affiliate and strategy, and net flows by asset class, client type and client location.


•	U.S. GAAP Results of Operations for the Three and Six Months Ended June 30, 2019 and 2018 includes an explanation of changes in our U.S. GAAP revenue, expense and other items for the three and six months ended June 30, 2019 and 2018, as well as key U.S. GAAP operating metrics.

•

Non-GAAP Supplemental Performance Measure — Economic Net Income includes an explanation of the key differences between U.S. GAAP net income and ENI, the key measure management uses to evaluate our performance. This section also provides a reconciliation between U.S. GAAP net income attributable to controlling interests and ENI for the three and six months ended June 30, 2019 and 2018 as well as a reconciliation of key ENI operating items including ENI revenue and ENI operating expenses. In addition, this section provides key non-GAAP operating metrics and a calculation of tax on economic net income.


•	Capital Resources and Liquidity discusses our key balance sheet data. This section discusses Cash Flows from the business; Adjusted EBITDA; Future Capital Needs; and Long-Term Debt. The discussion of Adjusted EBITDA includes an explanation of how we calculate Adjusted EBITDA and a reconciliation of U.S. GAAP net income attributable to controlling interests to Adjusted EBITDA.


•	Critical Accounting Policies and Estimates provides a discussion of the key accounting policies used in the preparation of our U.S. GAAP financial statements.

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Overview

We are a diversified, multi-boutique asset management firm headquartered in Boston, Massachusetts. We completed a redomestication process to change our publicly traded parent company from a United Kingdom company to a Delaware corporation on July 12, 2019. We operate our business through seven affiliate firms to whom we refer in this Quarterly Report as our Affiliates. Through our Affiliates, we offer a diverse range of actively-managed investment strategies and products to institutional investors around the globe. While our Affiliates maintain autonomy in the investment process and the day-to-day management of their businesses, our strategy is to work with them to accelerate the growth and profitability of their firms.

Under U.S. GAAP, our Affiliates may be consolidated into our operations or may be accounted for under the equity method of accounting. We may also be required to consolidate certain of our Affiliates’ sponsored investment entities, or Funds, due to the nature of our decision-making rights, our economic interests in these Funds or the rights of third-party clients in those Funds.

Our Affiliates and their principal strategies include:


•	Acadian Asset Management LLC (“Acadian”)—a leading quantitatively-oriented manager of active global and international equity, and alternative strategies.


•	Barrow, Hanley, Mewhinney & Strauss, LLC (“Barrow Hanley”)—a widely recognized value-oriented investment manager of U.S., international and global equities, fixed income and a range of balanced investment management strategies.


•	Campbell Global, LLC (“Campbell Global”)—a leading sustainable timber and natural resource investment manager that seeks to deliver superior investment performance by focusing on unique acquisition opportunities, client objectives and disciplined management.


•	Copper Rock Capital Partners LLC (“Copper Rock”)—a specialized growth equity investment manager of small-cap international, global and emerging markets equity strategies.


•	Investment Counselors of Maryland, LLC (“ICM”)⁽¹⁾—a value-driven domestic equity manager with product offerings focused on small- and mid-cap companies.


•	Landmark Partners, LLC (“Landmark”)—a leading global secondary private equity, real estate and real asset investment firm.


•	Thompson, Siegel & Walmsley LLC (“TSW”)—a value-oriented investment manager focused on small- and mid-cap U.S. equity, international equity and fixed income strategies.


(1)	Accounted for under the equity method of accounting.

The Economics of Our Business

Our profitability is affected by a variety of factors including the level and composition of our average assets under management, or AUM, fee rates charged on AUM and our expense structure. Our Affiliates earn management fees based on assets under management. Approximately 75% of our management fees are calculated based on average AUM (calculated on either a daily or monthly basis) with the remainder of our management fees calculated based on period end AUM or other measuring methods. Changes in the levels of our AUM are driven by our investment performance and net client cash flows. Our Affiliates may also earn performance fees, or adjust management fees, when certain accounts differ in relation to relevant benchmarks or exceed or fail to exceed required returns. Approximately $47.9 billion, or 21% of our AUM in consolidated Affiliates, are in accounts with incentive fee or carried interest features in which BSIG participates in the performance fee. The majority of these incentive fees are calculated based on value added over the relevant benchmarks on a rolling three-year basis. Carried interests are features of private equity funds, which are calculated based on long-term cumulative returns.

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Our largest expense item is compensation and benefits paid to our and our Affiliates’ employees, which consists of both fixed and variable components. Fixed compensation and benefits represents base salaries and wages, payroll taxes and the costs of our employee benefit programs. Variable compensation, calculated as described below, may be awarded in cash, equity or profit interests.

The arrangements in place with our Affiliates result in the sharing of economics between BSUS and each Affiliate’s key management personnel using a profit-sharing model, except for ICM, which uses a revenue share model as a result of a legacy economic arrangement that has not been restructured. Profit sharing affects two elements within our earnings: (i) the calculation of variable compensation and (ii) the level of each Affiliate’s equity or profit interests distribution to its employees. Variable compensation is the portion of earnings that is contractually allocated to Affiliate employees as a bonus pool, typically representing a fixed percentage of earnings before variable compensation, which is measured as revenues less fixed compensation and benefits and other operating and administrative expenses. Profits after variable compensation are shared between us and Affiliate key employee equity holders according to our respective equity or profit interests ownership. The sharing of profits in this manner ensures that the economic interests of Affiliate key employees and those of BSUS are aligned, both in terms of generating strong annual earnings as well as investing those earnings back into the business in order to generate growth over the long term. We view profit sharing as an attractive operating model, as it allows us to share in the benefits of operating leverage as the business grows, and ensures all equity and profit interests holders are incentivized to achieve that growth.

Equity or profit interests owned by Affiliate key employees are either awarded as part of their variable compensation arrangements, or alternatively, may have originally resulted from BSUS acquiring less than 100% of the Affiliate. Over time, Affiliate key employee-owned equity or profit interests are recycled from one generation of employee-owners to the next, either by the next generation purchasing equity or profit interests directly from retiring principals, or by Affiliate key employees forgoing cash bonuses in exchange for the equivalent value in Affiliate equity or profit interests. The recycling of equity or profit interests is often facilitated by BSUS; see "—U.S. GAAP Results of Operations—U.S. GAAP Expenses—Compensation and Benefits Expense" for a further discussion.

How We Measure Performance

We manage our business in aggregate based on a single reportable segment, reflecting how our management assesses the performance of our business. Within our organizational framework, the same operational resources support multiple products and Affiliates and performance is evaluated at a consolidated level.

In measuring and monitoring the key components of our earnings, our management uses a non-GAAP financial measure, ENI, to evaluate the financial performance of, and to make operational decisions for, our business. We also use ENI to make resource allocation decisions, determine appropriate levels of investment or dividend payout, manage balance sheet leverage, determine Affiliate variable compensation and equity distributions, and incentivize management. It is an important measure in evaluating our financial performance because we believe it most accurately represents our operating performance and cash generation capability.

ENI differs from net income determined in accordance with U.S. GAAP as a result of both the reclassification of certain income statement items and the exclusion of certain non-cash or non-recurring income statement items. In particular, ENI excludes non-cash charges representing the changes in the value of Affiliate equity and profit interests held by Affiliate key employees, the results of discontinued operations which are no longer part of our business, restructuring, and that portion of consolidated Funds which are not attributable to our shareholders. ENI is also adjusted for amortization of acquisition-related contingent consideration and pre-acquisition retained equity with service components.

ENI revenue is primarily comprised of the fee revenues paid to us by our clients for our advisory services and earnings from our equity-accounted Affiliates. Revenue included within ENI differs from U.S. GAAP revenue in that it excludes amounts from consolidated Funds which are not attributable to our shareholders and includes our share of earnings from equity-accounted Affiliates.

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ENI expenses are calculated to reflect all usual expenses from ongoing continuing operations attributable to our shareholders. Expenses included within ENI differ from U.S. GAAP expenses in that they exclude amounts from consolidated Funds which are not attributable to our shareholders, revaluations of Affiliate key employee owned equity and profit interests, amortization and impairment of acquired intangibles and other acquisition-related items, and certain other non-cash expenses.

“Non-controlling interests” is a concept under U.S. GAAP that identifies net components of revenues and expenses that are not attributable to our shareholders. For example, the portion of the net income (loss) of any consolidated Fund that is attributable to the outside investors or clients of the consolidated Fund is included in “Non-controlling interests” in our Condensed Consolidated Financial Statements. Conversely, “controlling interests” is the portion of revenue or expense that is attributable to our shareholders.

For a more detailed discussion of the differences between U.S. GAAP net income and economic net income, see "—Non-GAAP Supplemental Performance Measure — Economic Net Income."

Summary Results of Operations

The following table summarizes our unaudited results of operations for the three and six months ended June 30, 2019 and 2018:



($ in millions, unless otherwise noted)	Three Months Ended June 30,									Six Months Ended June 30,
	2019			2018			2019 vs. 2018			2019			2018			2019 vs. 2018
U.S. GAAP Basis
Revenue	$	207.1		$	233.9		$	(26.8	)	$	414.3		$	483.6		$	(69.3	)
Pre-tax income from continuing operations attributable to controlling interests	42.1			5.7			36.4			116.4			91.7			24.7
Net income from continuing operations attributable to controlling interests	28.0			2.1			25.9			80.7			59.4			21.3
Net income attributable to controlling interests	28.0			2.1			25.9			80.7			59.4			21.3
U.S. GAAP operating margin⁽¹⁾	22.5		%	6.5		%	1596 bps			27.7		%	8.5		%	1920 bps
Earnings per share, basic ($)	$	0.31		$	0.02		$	0.29		$	0.85		$	0.54		$	0.31
Earnings per share, diluted ($)	$	0.31		$	0.02		$	0.29		$	0.85		$	0.54		$	0.31
Basic shares outstanding (in millions)	91.5			108.4			(16.9		)	94.6			108.9			(14.3		)
Diluted shares outstanding (in millions)	91.5			108.6			(17.1		)	94.7			109.1			(14.4		)

Economic Net Income Basis⁽²⁾⁽³⁾
(Non-GAAP measure used by management)
ENI revenue⁽⁴⁾	$	204.6		$	230.7		$	(26.1	)	$	410.3		$	478.5		$	(68.2	)
Pre-tax economic net income⁽⁵⁾	53.2			65.8			(12.6		)	104.8			137.2			(32.4		)
Adjusted EBITDA	63.4			72.8			(9.4		)	122.3			151.8			(29.5		)
ENI operating margin⁽⁶⁾	35.8		%	38.1		%	(237) bps			34.5		%	39.1		%	(461) bps
Economic net income⁽⁷⁾	41.0			50.5			(9.5		)	80.2			105.4			(25.2		)
ENI diluted EPS ($)	$	0.45		$	0.47		$	(0.02	)	$	0.85		$	0.97		$	(0.12	)

Other Operational Information
Assets under management (AUM) at period end (in billions)	$	225.0		$	234.3		$	(9.3	)	$	225.0		$	234.3		$	(9.3	)
Net client cash flows (in billions)	(2.9		)	(4.1		)	1.2			(4.7		)	(2.2		)	(2.5		)
Annualized revenue impact of net flows ⁽⁸⁾	(14.4		)	(15.2		)	0.8			(20.3		)	3.8			(24.1		)


(1)	U.S. GAAP operating margin equals operating income from continuing operations divided by total revenue.

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(2)	Economic net income is a non-GAAP measure we use to evaluate the performance of our business. For a reconciliation to U.S. GAAP financial information and a further discussion of economic net income refer to “—Non-GAAP Supplemental Performance Measure—Economic Net Income.”


(3)	Excludes restructuring costs at the Center of $4.5 million and costs associated with the redomicile to the U.S. of $1.1 million for the six months ended June 30, 2019. For the three months ended June 30, 2019, restructuring costs at the Center were $0.5 million and costs associated with the redomicile were $0.8 million.


(4)	ENI revenue is the ENI measure which corresponds to U.S. GAAP revenue.


(5)	Pre-tax economic net income is the ENI measure which corresponds to U.S. GAAP pre-tax income from continuing operations attributable to controlling interests.


(6)	ENI operating margin is a non-GAAP efficiency measure, calculated based on ENI operating earnings divided by ENI revenue. The ENI operating margin corresponds to our U.S. GAAP operating margin, excluding the effect of consolidated Funds.


(7)	Economic net income is the ENI measure which corresponds to U.S. GAAP net income from continuing operations attributable to controlling interests.

(8)

Annualized revenue impact of net flows represents the difference between annualized management fees expected to be earned on new accounts and net assets contributed to existing accounts, less the annualized management fees lost on terminated accounts or net assets withdrawn from existing accounts, including equity-accounted Affiliates. The annualized management fees are calculated by multiplying the annual gross fee rate for the relevant account by the net assets gained in the account in the event of a positive flow, excluding any current or future market appreciation or depreciation, or the net assets lost in the account in the event of an outflow, excluding any current or future market appreciation or depreciation. For a further discussion of the uses and limitations of the annualized revenue impact of net flows, see "Assets Under Management" herein.

Assets Under Management

The following table presents our assets under management by Affiliate as of each of the dates indicated:



($ in billions)	June 30, 2019		December 31, 2018
Acadian Asset Management	$	98.0	$	86.2
Barrow, Hanley, Mewhinney & Strauss	76.6		72.0
Campbell Global	4.7		4.6
Copper Rock Capital Partners	4.5		4.0
Investment Counselors of Maryland	2.2		1.8
Landmark Partners	18.1		17.8
Thompson, Siegel & Walmsley	20.9		19.9
Total assets under management	$	225.0	$	206.3

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Our primary asset classes include:


i.	U.S. equity, which includes small cap through large cap securities and substantially value or blended investment styles;


ii.	Global / non-U.S. equity, which includes global and international equities including emerging markets;


iii.	Fixed income, which includes government bonds, corporate bonds and other fixed income investments in the United States; and


iv.	Alternatives, which consist of timberland investments, secondary Funds focused in real estate and private equity, and other alternative investments.

The following table presents our assets under management by strategy as of each of the dates indicated:



($ in billions)	June 30, 2019		December 31, 2018
U.S. equity, small/smid cap value	$	5.7	$	5.1
U.S. equity, mid cap value	9.8		9.6
U.S. equity, large cap value	49.0		45.2
U.S. equity, core/blend	2.9		2.7
Total U.S. equity	67.4		62.6
Global equity	38.8		34.4
International equity	52.9		46.4
Emerging markets equity	28.0		26.0
Total global / non-U.S. equity	119.7		106.8
Fixed income	14.4		13.1
Alternatives	23.5		23.8
Total assets under management	$	225.0	$	206.3

The following table shows assets under management by client type as of each of the dates indicated:



($ in billions)	June 30, 2019				December 31, 2018
	AUM		% of total		AUM		% of total
Sub-advisory	$	64.3	28.6	%	$	61.3	29.7	%
Corporate/Union	39.4		17.5	%	36.4		17.6	%
Public/Government	71.8		31.8	%	63.9		31.0	%
Endowment/Foundation	5.1		2.3	%	4.5		2.2	%
OM plc Group	2.2		1.0	%	2.1		1.0	%
Commingled Trust/UCITS	30.8		13.7	%	28.2		13.7	%
Mutual Fund	2.2		1.0	%	2.0		1.0	%
Other	9.2		4.1	%	7.9		3.8	%
Total assets under management	$	225.0			$	206.3

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The following table shows assets under management by client location as of each of the dates indicated:



($ in billions)	June 30, 2019				December 31, 2018
	AUM		% of total		AUM		% of total
U.S.	$	169.9	75.5	%	$	156.8	76.0	%
Europe	19.9		8.8	%	17.3		8.4	%
Asia	11.4		5.1	%	10.4		5.0	%
Australia	10.3		4.6	%	9.2		4.5	%
Other	13.5		6.0	%	12.6		6.0	%
Total assets under management	$	225.0			$	206.3

AUM flows and the annualized revenue impact of net flows

In the following tables, we present our asset flows and market appreciation by asset class, client type and client location. We also present a key metric used to better understand our asset flows, the annualized revenue impact of net client cash flows. Annualized revenue impact of net flows represents the difference between annualized management fees expected to be earned on new accounts and net assets contributed to existing accounts, less the annualized management fees lost on terminated accounts or net assets withdrawn from existing accounts, including equity-accounted Affiliates. The annualized management fees are calculated by multiplying the annual gross fee rate for the relevant account by the net assets gained in the account in the event of a positive flow, excluding any current or future market appreciation or depreciation, or the net assets lost in the account in the event of an outflow, excluding any current or future market appreciation or depreciation.

The annualized revenue impact of net flows metric is designed to provide investors with a better indication of the potential financial impact of net client cash flows, however it has certain limitations. For instance, it does not include assumptions for the next twelve months' market appreciation or depreciation and investment performance associated with the assets gained or lost. Nor does it account for factors such as future client terminations or additional contributions or withdrawals over the next twelve months. Additionally, the basis points reported are fee rates based on the asset levels at the time of the transactions and do not consider the fact that client fee rates may change over the next twelve months.

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The following table summarizes our asset flows and market appreciation (depreciation) by asset class for each of the periods indicated:



	Three Months Ended June 30,						Six Months Ended June 30,
($ in billions, unless otherwise noted)	2019			2018			2019			2018
U.S. equity
Beginning balance	$	67.8		$	76.6		$	62.6		$	81.2
Gross inflows	0.8			0.7			1.8			2.2
Gross outflows	(3.4		)	(4.6		)	(6.1		)	(7.7		)
Net flows	(2.6		)	(3.9		)	(4.3		)	(5.5		)
Market appreciation (depreciation)	2.2			2.1			9.1			(0.9		)
Ending balance	$	67.4		$	74.8		$	67.4		$	74.8
Average AUM	$	67.0		$	76.1		$	66.6		$	78.4
Average AUM of consolidated Affiliates	$	64.8		$	74.0		$	64.5		$	76.3

Global / non-U.S. equity
Beginning balance	$	117.6		$	126.3		$	106.8		$	126.2
Gross inflows	2.8			4.4			7.9			9.2
Gross outflows	(3.6		)	(4.9		)	(8.1		)	(9.6		)
Net flows	(0.8		)	(0.5		)	(0.2		)	(0.4		)
Market appreciation (depreciation)	2.9			(3.5		)	13.1			(3.5		)
Ending balance	$	119.7		$	122.3		$	119.7		$	122.3
Average AUM⁽¹⁾	$	117.8		$	125.1		$	116.0		$	126.8

Fixed income
Beginning balance	$	12.9		$	13.9		$	13.1		$	13.5
Gross inflows	1.2			0.4			1.6			1.3
Gross outflows	(0.4		)	(0.3		)	(1.6		)	(0.5		)
Net flows	0.8			0.1			—			0.8
Market appreciation (depreciation)	0.7			(0.2		)	1.3			(0.5		)
Ending balance	$	14.4		$	13.8		$	14.4		$	13.8
Average AUM⁽¹⁾	$	13.5		$	13.9		$	13.3		$	13.7

Alternatives
Beginning balance	$	24.0		$	23.3		$	23.8		$	22.1
Gross inflows	0.3			0.6			0.7			3.7
Gross outflows	(0.4		)	(0.3		)	(0.6		)	(0.6		)
Hard asset disposals	(0.2		)	(0.1		)	(0.3		)	(0.2		)
Net flows	(0.3		)	0.2			(0.2		)	2.9
Market appreciation (depreciation)	(0.2		)	(0.1		)	(0.1		)	(0.1		)
Other⁽²⁾	—			—			—			(1.5		)
Ending balance	$	23.5		$	23.4		$	23.5		$	23.4
Average AUM⁽¹⁾	$	23.8		$	23.3		$	23.8		$	22.8

Total
Beginning balance	$	222.3		$	240.1		$	206.3		$	243.0
Gross inflows	5.1			6.1			12.0			16.4
Gross outflows	(7.8		)	(10.1		)	(16.4		)	(18.4		)
Hard asset disposals	(0.2		)	(0.1		)	(0.3		)	(0.2		)
Net flows	(2.9		)	(4.1		)	(4.7		)	(2.2		)
Market appreciation (depreciation)	5.6			(1.7		)	23.4			(5.0		)
Other⁽²⁾	—			—			—			(1.5		)
Ending balance	$	225.0		$	234.3		$	225.0		$	234.3
Average AUM	$	222.1		$	238.4		$	219.7		$	241.7
Average AUM of consolidated Affiliates	$	219.9		$	236.3		$	217.6		$	239.6

Annualized basis points: inflows	36.0			42.3			35.1			46.4
Annualized basis points: outflows	40.9			40.2			37.4			38.9
Annualized revenue impact of net flows ($ in millions)	$	(14.4	)	$	(15.2	)	$	(20.3	)	$	3.8

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(1)	Average AUM equals average AUM of consolidated Affiliates.


(2)	“Other” in 2018 primarily relates to the decline in billable AUM as a legacy alternative fund transitioned from billing based on committed AUM to net asset value.

We also analyze our asset flows by client type and client location. Our client types include:


i.	Sub-advisory, which includes assets managed for underlying mutual fund and variable insurance products which are sponsored by mutual fund platforms and insurance companies, where the end client is typically retail;


ii.	Institutional, which includes assets managed for public/government pension funds, including U.S. state and local government funds and non-U.S. sovereign wealth, local government and national pension funds; also includes corporate and union-sponsored pension plans; and


iii.	Retail/other, which includes assets managed for mutual funds sponsored by our Affiliates, defined contribution plans and accounts managed for high net worth clients.

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The following table summarizes our asset flows by client type for each of the periods indicated:



($ in billions)	Three Months Ended June 30,						Six Months Ended June 30,
	2019			2018			2019			2018
Sub-advisory
Beginning balance	$	65.3		$	76.7		$	61.3		$	80.1
Gross inflows	1.2			1.2			2.5			3.2
Gross outflows	(4.3		)	(4.0		)	(7.8		)	(7.4		)
Net flows	(3.1		)	(2.8		)	(5.3		)	(4.2		)
Market appreciation (depreciation)	2.1			0.7			8.3			(1.3		)
Ending balance	$	64.3		$	74.6		$	64.3		$	74.6

Institutional
Beginning balance	$	145.7		$	152.3		$	135.1		$	151.9
Gross inflows	3.6			4.5			8.2			12.4
Gross outflows	(3.1		)	(5.7		)	(7.7		)	(10.3		)
Hard asset disposals	(0.2		)	(0.1		)	(0.3		)	(0.2		)
Net flows	0.3			(1.3		)	0.2			1.9
Market appreciation (depreciation)	3.3			(2.2		)	14.0			(3.5		)
Other⁽¹⁾	—			—			—			(1.5		)
Ending balance	$	149.3		$	148.8		$	149.3		$	148.8

Retail/Other
Beginning balance	$	11.3		$	11.1		$	9.9		$	11.0
Gross inflows	0.3			0.4			1.3			0.8
Gross outflows	(0.4		)	(0.4		)	(0.9		)	(0.7		)
Net flows	(0.1		)	—			0.4			0.1
Market appreciation (depreciation)	0.2			(0.2		)	1.1			(0.2		)
Ending balance	$	11.4		$	10.9		$	11.4		$	10.9

Total
Beginning balance	$	222.3		$	240.1		$	206.3		$	243.0
Gross inflows	5.1			6.1			12.0			16.4
Gross outflows	(7.8		)	(10.1		)	(16.4		)	(18.4		)
Hard asset disposals	(0.2		)	(0.1		)	(0.3		)	(0.2		)
Net flows	(2.9		)	(4.1		)	(4.7		)	(2.2		)
Market appreciation (depreciation)	5.6			(1.7		)	23.4			(5.0		)
Other⁽¹⁾	—			—			—			(1.5		)
Ending balance	$	225.0		$	234.3		$	225.0		$	234.3


(1)	“Other” in 2018 primarily relates to the decline in billable AUM as a legacy alternative fund transitioned from billing based on committed AUM to net asset value.

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It is a strategic objective to increase our percentage of assets under management sourced from non-U.S. clients. Our categorization by client location includes:


i.	U.S.-based clients, where the contracting client is based in the United States, and


ii.	Non-U.S.-based clients, where the contracting client is based outside the United States.

The following table summarizes asset flows by client location for each of the periods indicated:



($ in billions)	Three Months Ended June 30,						Six Months Ended June 30,
	2019			2018			2019			2018
U.S.
Beginning balance	$	168.1		$	186.7		$	156.8		$	190.1
Gross inflows	3.7			3.3			7.6			11.2
Gross outflows	(6.2		)	(8.5		)	(12.2		)	(15.3		)
Hard asset disposals	(0.1		)	(0.1		)	(0.2		)	(0.2		)
Net flows	(2.6		)	(5.3		)	(4.8		)	(4.3		)
Market appreciation (depreciation)	4.4			(1.0		)	17.9			(4.1		)
Other⁽¹⁾	—			—			—			(1.3		)
Ending balance	$	169.9		$	180.4		$	169.9		$	180.4

Non-U.S.
Beginning balance	$	54.2		$	53.4		$	49.5		$	52.9
Gross inflows	1.4			2.8			4.4			5.2
Gross outflows	(1.6		)	(1.6		)	(4.2		)	(3.1		)
Hard asset disposals	(0.1		)	—			(0.1		)	—
Net flows	(0.3		)	1.2			0.1			2.1
Market appreciation (depreciation)	1.2			(0.7		)	5.5			(0.9		)
Other⁽¹⁾	—			—			—			(0.2		)
Ending balance	$	55.1		$	53.9		$	55.1		$	53.9

Total
Beginning balance	$	222.3		$	240.1		$	206.3		$	243.0
Gross inflows	5.1			6.1			12.0			16.4
Gross outflows	(7.8		)	(10.1		)	(16.4		)	(18.4		)
Hard asset disposals	(0.2		)	(0.1		)	(0.3		)	(0.2		)
Net flows	(2.9		)	(4.1		)	(4.7		)	(2.2		)
Market appreciation (depreciation)	5.6			(1.7		)	23.4			(5.0		)
Other⁽¹⁾	—			—			—			(1.5		)
Ending balance	$	225.0		$	234.3		$	225.0		$	234.3


(1)	“Other” in 2018 primarily relates to the decline in billable AUM as a legacy alternative fund transitioned from billing based on committed AUM to net asset value.

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At June 30, 2019, our total assets under management were $225.0 billion, an increase of $2.7 billion, or 1.2%, compared to $222.3 billion at March 31, 2019 and a decrease of $(9.3) billion, or (4.0)%, compared to $234.3 billion at June 30, 2018. The change in assets under management during the three months ended June 30, 2019 reflects net market appreciation of $5.6 billion, and net flows of $(2.9) billion, including hard asset disposals of $(0.2) billion. Net client cash flows excluding hard asset disposals for the three months ended June 30, 2019 were $(2.7) billion, compared to $(1.7) billion for the three months ended March 31, 2019 and $(4.0) billion for the three months ended June 30, 2018. The change in assets under management during the six months ended June 30, 2019 reflects net market appreciation of $23.4 billion offset by net flows of $(4.7) billion.

For the three months ended June 30, 2019, our net flows were $(2.9) billion compared to $(1.8) billion for the three months ended March 31, 2019 and $(4.1) billion for the three months ended June 30, 2018. The change in net flows during the three months ended June 30, 2019 compared to the three months ended March 31, 2019 was driven by lower gross sales. Hard asset disposals of $(0.2) billion, $(0.1) billion and $(0.1) billion are reflected in the net flows for the three months ended June 30, 2019, March 31, 2019 and June 30, 2018, respectively, and represent a liquidation and return of capital for investors in those assets. For the three months ended June 30, 2019, the annualized revenue impact of the net flows was $(14.4) million, as gross inflows of $5.1 billion during the three-month period were into asset classes yielding approximately 36 bps and gross outflows and hard asset disposals in the same period of $(8.0) billion were out of asset classes yielding approximately 41 bps. This is compared to the annualized revenue impact of net flows of $(5.9) million for the three months ended March 31, 2019 and $(15.2) million for the three months ended June 30, 2018.

For the six months ended June 30, 2019, our net flows were $(4.7) billion compared to $(2.2) billion for the six months ended June 30, 2018. The net flows in the six months ended June 30, 2019 were mainly impacted by lower sales in Alternatives in 2019, due to the cycle of fundraising. Hard asset disposals of $(0.3) billion are reflected in the net flows for the six months ended June 30, 2019 and $(0.2) billion for the six months ended June 30, 2018. For the six months ended June 30, 2019, the annualized revenue impact of the net flows decreased to $(20.3) million compared to $3.8 million for the six months ended June 30, 2018, which reflects basis points on inflows lower than outflows, as a result of higher fee Alternatives sales not repeating in 2019. Gross inflows of $12.0 billion in the six months ended June 30, 2019 yielded approximately 35 bps compared to $16.4 billion yielding approximately 46 bps in the year-ago period. Gross outflows and hard asset disposals of $(16.7) billion yielded approximately 37 bps in the six months ended June 30, 2019 compared to $(18.6) billion yielding approximately 39 bps in the year-ago period.

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U.S. GAAP Results of Operations for the Three and Six Months Ended June 30, 2019 and 2018

Our U.S. GAAP results of operations were as follows for the three and six months ended June 30, 2019 and 2018:



	Three Months Ended June 30,									Six Months Ended June 30,
($ in millions, unless otherwise noted)	2019			2018			Increase (Decrease)			2019			2018			Increase (Decrease)
U.S. GAAP Statement of Operations
Management fees	$	205.9		$	226.4		$	(20.5	)	$	413.4		$	471.4		$	(58.0	)
Performance fees	(2.2		)	3.0			(5.2		)	(5.0		)	5.0			(10.0		)
Other revenue	1.5			3.3			(1.8		)	2.9			5.8			(2.9		)
Consolidated Funds’ revenue	1.9			1.2			0.7			3.0			1.4			1.6
Total revenue	207.1			233.9			(26.8		)	414.3			483.6			(69.3		)
Compensation and benefits	123.7			183.4			(59.7		)	224.8			372.6			(147.8		)
General and administrative expense	31.1			29.8			1.3			63.6			59.3			4.3
Amortization of acquired intangibles	1.7			1.7			—			3.3			3.3			—
Depreciation and amortization	4.0			3.5			0.5			7.8			6.9			0.9
Consolidated Funds’ expense	—			0.2			(0.2		)	0.2			0.6			(0.4		)
Total expenses	160.5			218.6			(58.1		)	299.7			442.7			(143.0		)
Operating income	46.6			15.3			31.3			114.6			40.9			73.7
Investment income	2.1			(0.4		)	2.5			9.1			65.7			(56.6		)
Interest income	0.3			0.6			(0.3		)	1.4			1.1			0.3
Interest expense	(8.8		)	(6.1		)	(2.7		)	(15.8		)	(12.4		)	(3.4		)
Net consolidated Funds’ investment gains (losses)	(4.5		)	(3.3		)	(1.2		)	9.1			(5.7		)	14.8
Income from continuing operations before taxes	35.7			6.1			29.6			118.4			89.6			28.8
Income tax expense	14.1			3.6			10.5			35.7			32.3			3.4
Income from continuing operations	21.6			2.5			19.1			82.7			57.3			25.4
Gain (loss) on disposal of discontinued operations, net of tax	—			—			—			—			—			—
Net income	21.6			2.5			19.1			82.7			57.3			25.4
Net income (loss) attributable to non-controlling interests in consolidated Funds	(6.4		)	0.4			(6.8		)	2.0			(2.1		)	4.1
Net income attributable to controlling interests	$	28.0		$	2.1		$	25.9		$	80.7		$	59.4		$	21.3

Basic earnings per share ($)	$	0.31		$	0.02		$	0.29		$	0.85		$	0.54		$	0.31
Diluted earnings per share ($)	0.31			0.02			0.29			0.85			0.54			0.31
Weighted average basic ordinary shares outstanding	91.5			108.4			(16.9		)	94.6			108.9			(14.3		)
Weighted average diluted ordinary shares outstanding	91.5			108.6			(17.1		)	94.7			109.1			(14.4		)

U.S. GAAP operating margin⁽¹⁾	22.5		%	6.5		%				27.7		%	8.5		%

(1) The U.S. GAAP operating margin equals operating income from continuing operations divided by total revenue.

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The following table reconciles our net income attributable to controlling interests to our pre-tax income from continuing operations attributable to controlling interests:



($ in millions)	Three Months Ended June 30,				Six Months Ended June 30,
U.S. GAAP Statement of Operations	2019		2018		2019		2018
Net income attributable to controlling interests	$	28.0	$	2.1	$	80.7	$	59.4
Exclude: (Gain) loss on disposal of discontinued operations, net of tax	—		—		—		—
Net income from continuing operations attributable to controlling interests	28.0		2.1		80.7		59.4
Add: Income tax expense (benefit)	14.1		3.6		35.7		32.3
Pre-tax income from continuing operations attributable to controlling interests	$	42.1	$	5.7	$	116.4	$	91.7

U.S. GAAP Revenues

Our U.S. GAAP revenues principally consist of:


i.	management fees earned based on our overall weighted average fee rate charged to our clients and the level of assets under management;


ii.	performance fees earned or management fee adjustments when our Affiliates’ investment performance over agreed time periods for certain clients has differed from pre-determined hurdles;


iii.	other revenue, consisting primarily of consulting services as well as reimbursement of certain Fund expenses our Affiliates paid on behalf of our Funds; and


iv.	revenue from consolidated Funds, a portion of which is attributable to the holders of non-controlling interests in consolidated Funds.

Management Fees

Our management fees are a function of the fee rates our Affiliates charge to their clients, which are typically expressed in basis points, and the levels of our assets under management.

Excluding assets managed by our equity-accounted Affiliates, average basis points earned on average assets under management were 37.5 bps and 38.3 bps for the three and six months ended June 30, 2019, respectively, and 38.4 bps and 39.7 bps for the three and six months ended June 30, 2018, respectively. The greatest driver of increases or decreases in this average fee rate is changes in the mix of our assets under management caused by net inflows or outflows in certain asset classes, net catch-up fees or disproportionate market movements.

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Our average basis points by asset class (including only consolidated Affiliates that are included in management fee revenue, unless indicated) over each of the periods indicated were:



($ in millions, except AUM data in billions)	Three Months Ended June 30,						Six Months Ended June 30,
($ in millions, except AUM data in billions)	2019			2018			2019			2018
	Revenue		Basis Pts	Revenue		Basis Pts	Revenue		Basis Pts	Revenue		Basis Pts
U.S. equity	$	40.0	25	$	45.5	25	$	80.4	25	$	93.1	25
Global / non-U.S. equity	116.0		40	126.2		40	232.9		41	254.8		41
Fixed income	6.5		19	6.8		20	12.9		19	13.6		20
Alternatives	43.4		73	47.9		82	87.2		74	109.9		97
U.S. GAAP management fee revenue & weighted average fee rate on average AUM of consolidated Affiliates⁽¹⁾	$	205.9	37.5	$	226.4	38.4	$	413.4	38.3	$	471.4	39.7
Average AUM excluding equity-accounted Affiliates	$	219.9		$	236.3		$	217.6		$	239.6
Average AUM including equity-accounted Affiliates & weighted average fee rate	$	222.1	37.7	$	238.4	38.6	$	219.7	38.5	$	241.7	39.8


(1)	Amounts shown are equivalent to ENI management fee revenue. (See “ENI Revenues”)

Three months ended June 30, 2019 compared to three months ended June 30, 2018: Management fees decreased $(20.5) million, or (9.1)%, from $226.4 million for the three months ended June 30, 2018 to $205.9 million for the three months ended June 30, 2019. The decrease was due to lower levels of average assets under management excluding equity-accounted Affiliates, and net catch-up fees associated with alternative assets earned in 2018 not repeating in 2019. Net catch-up fees represent payment of certain Fund management fees back to the initial closing date for certain products with multiple closings, less placement fees paid to third parties related to these funds. Average assets under management excluding equity-accounted Affiliates decreased (6.9)%, from $236.3 billion for the three months ended June 30, 2018 to $219.9 billion for the three months ended June 30, 2019.

The decrease in management fee revenue is also driven by the decreases in basis point yields of our assets under management. Excluding equity-accounted Affiliates, the weighted average fee rate earned on our average assets under management was 37.5 basis points for the three months ended June 30, 2019 and 38.4 basis points for the three months ended June 30, 2018, with the decrease driven mostly by the mix of flows and market movements over the past four quarters and the decline in net catch-up fees.

Six months ended June 30, 2019 compared to six months ended June 30, 2018: Management fees decreased $(58.0) million, or (12.3)%, from $471.4 million for the six months ended June 30, 2018 to $413.4 million for the six months ended June 30, 2019. The decrease was primarily attributable to a decrease in both average assets under management excluding equity-accounted Affiliates and our weighted average fee rate in the six months ended June 30, 2019. Management fee revenue fell (20.7)% for alternative products and (8.6)% for global / non-U.S. equity, while falling (13.6)% for U.S. equity and (5.1)% for fixed income products. The decrease in alternative product management fee revenue was caused by alternative net catch-up fees earned in 2018 that did not repeat in 2019. Average assets under management excluding equity-accounted Affiliates decreased (9.2)%, from $239.6 billion for the six months ended June 30, 2018 to $217.6 billion for the six months ended June 30, 2019, mainly driven by the market decline in the fourth quarter of 2018.

Excluding equity-accounted Affiliates, the weighted average fee rate earned on our average assets under management was 38.3 basis points for the six months ended June 30, 2019 and 39.7 basis points for the six months ended June 30, 2018. The decrease was primarily driven by the impact of net catch-up fees for alternative products.

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Performance Fees

Approximately $47.9 billion, or 21% of our AUM in consolidated Affiliates, are in accounts with incentive fee or carried interest features in which we participate. Performance fees are typically shared with our Affiliate key employees through various contractual compensation and profit-sharing arrangements.

Three months ended June 30, 2019 compared to three months ended June 30, 2018: Performance fees decreased $(5.2) million, from $3.0 million for the three months ended June 30, 2018 to $(2.2) million for the three months ended June 30, 2019. Performance fees can be variable and are contractually triggered based on investment performance results over agreed upon time periods. The net negative performance fees in the three months ended June 30, 2019 represent downward management fee adjustments in certain sub-advisory accounts (i.e. fulcrum fees). The decrease was also attributable to lower performance fees earned by Alternative products.

Six months ended June 30, 2019 compared to six months ended June 30, 2018: Performance fees decreased $(10.0) million, from $5.0 million for the six months ended June 30, 2018 to $(5.0) million for the six months ended June 30, 2019. Performance fees can be variable and are contractually triggered based on investment performance results over agreed upon time periods. The decrease was also attributable to lower performance fees earned by Alternative products.

The liquidation of an alternative product may result in the recognition of a performance fee. With respect to liquidations likely to occur in the near term, we do not expect to receive any net performance fees that would be material to our operating results. These projections are based on market conditions and investment performance as of June 30, 2019.

Other Revenue

Three months ended June 30, 2019 compared to three months ended June 30, 2018: Other revenue decreased $(1.8) million, from $3.3 million for the three months ended June 30, 2018 to $1.5 million for the three months ended June 30, 2019. The decrease was primarily attributable to the decrease in revenue recorded for certain Fund expenses paid by our Affiliates and subsequently reimbursed by the Fund for the three months ended June 30, 2019.

Six months ended June 30, 2019 compared to six months ended June 30, 2018: Other revenue decreased $(2.9) million, from $5.8 million for the six months ended June 30, 2018 to $2.9 million for the six months ended June 30, 2019. The decrease was primarily attributable to the decrease in revenue recorded for certain Fund expenses paid by our Affiliates and subsequently reimbursed by the Fund for the six months ended June 30, 2019.

U.S. GAAP Expenses

Our U.S. GAAP expenses principally consist of:


i.	compensation paid to our investment professionals and other employees, including base salary, benefits, sales-based compensation, variable compensation, Affiliate distributions, revaluation of key employee owned Affiliate equity and profit interests, and the amortization of acquisition-related consideration and pre-acquisition employee equity;


ii.	general and administrative expenses;


iii.	amortization of acquired intangible assets;


iv.	depreciation and amortization charges; and


v.	expenses of consolidated Funds, a portion of which is attributable to the holders of non-controlling interests in consolidated Funds.

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Compensation and Benefits Expense

Our most significant category of expense is compensation and benefits awarded to our and our Affiliates’ employees. The following table presents the components of U.S. GAAP compensation expense for the three and six months ended June 30, 2019 and 2018:



	Three Months Ended June 30,				Six Months Ended June 30,
($ in millions)	2019		2018		2019			2018
Fixed compensation and benefits⁽¹⁾	$	48.4	$	47.5	$	99.2		$	96.7
Sales-based compensation⁽²⁾	3.1		4.2		5.8			9.1
Variable compensation⁽³⁾	49.0		61.3		101.7			125.2
Affiliate key employee distributions⁽⁴⁾	13.8		18.7		27.2			42.4
Non-cash Affiliate key employee equity revaluations⁽⁵⁾	7.1		34.0		(13.0		)	63.9
Acquisition-related consideration and pre-acquisition employee equity⁽⁶⁾	2.3		17.7		3.9			35.3
Total U.S. GAAP compensation and benefits expense	$	123.7	$	183.4	$	224.8		$	372.6

(1)

Fixed compensation and benefits includes base salaries, payroll taxes and the cost of benefit programs provided. For the three and six months ended June 30, 2019, $47.3 million and $97.0 million, respectively, of fixed compensation and benefits (of the $48.4 million and $99.2 million above) is included within economic net income, which excludes Fund expenses initially paid by our Affiliates on the Fund’s behalf and subsequently reimbursed. For the three and six months ended June 30, 2018, $44.8 million and $91.7 million, respectively of fixed compensation and benefits (of the $47.5 million and $96.7 million above) is included within economic net income, and also excludes Fund expenses initially paid by our Affiliates on the Fund’s behalf and subsequently reimbursed.


(2)	Sales-based compensation is paid to our sales and distribution teams and represents compensation earned by our sales professionals, paid over a multi-year period, related to revenue earned on new sales. Its variability is based upon the structure of sales-based compensation due on inflows of assets under management in both current and prior periods.

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(3)

Variable compensation is contractually set and calculated individually at each Affiliate, plus Center bonuses and compensation paid by our Affiliates on behalf of their Funds that are subsequently reimbursed. Variable compensation is usually awarded based on a contractual percentage of each Affiliate’s ENI profits before variable compensation and may be paid in the form of cash or non-cash Affiliate equity or profit interests. For Affiliates with an agreed split of performance fees between Affiliate employees and BSUS, the Affiliates’ share of performance fees is allocated entirely to variable compensation. Center variable compensation includes cash and BSIG equity. Non-cash variable compensation awards typically vest over several years and are recognized as compensation expense over that service period. The variable compensation ratio at each Affiliate, calculated as variable compensation divided by ENI earnings before variable compensation, will typically be between 25% and 35%.



	Three Months Ended June 30,				Six Months Ended June 30,
($ in millions)	2019		2018		2019		2018
Cash variable compensation	$	44.6	$	55.9	$	91.4	$	115.6
Non-cash equity-based award amortization	4.4		5.4		10.3		9.6
Total variable compensation^(a)	$	49.0	$	61.3	$	101.7	$	125.2


(a)	For the three and six months ended June 30, 2019, $48.4 million and $97.1 million, respectively of variable compensation expense (of the $49.0 million and $101.7 million, respectively) is included within economic net income, which excludes the variable compensation associated with restructuring at the Center.

(4)

Affiliate key employee distributions represent the share of Affiliate profits after variable compensation that is attributable to Affiliate key employee equity and profit interests holders, according to their ownership interests. The Affiliate key employee distribution ratio at each Affiliate is calculated as Affiliate key employee distributions divided by ENI operating earnings at that Affiliate. At certain Affiliates with tiered equity structures, BSUS and other classes of employee equity holders are entitled to an initial proportionate preference over profits after variable compensation, structured such that before a preference threshold is reached, there would be no required key employee distributions to the tiered equity holders, whereas for profits above the threshold, the key employee distribution amount to the tiered equity holders would be calculated based on the tiered key employee ownership percentages. Based on current economic arrangements, employee distributions range from approximately 20% to 40% of marginal ENI operating earnings at each of our consolidated Affiliates.

(5)

Non-cash Affiliate key employee equity revaluations represent changes in the value of Affiliate equity and profit interests held by Affiliate key employees. These ownership interests may in certain circumstances be repurchased by BSUS at a value based on a pre-determined fixed multiple of twelve-month earnings and as such a liability is carried on our balance sheet based on the expected cash to be paid. However, any equity or profit interests repurchased by BSUS can be used to fund a portion of future variable compensation awards, resulting in savings in cash variable compensation that offset the negative cash effect of repurchasing the equity. Our Affiliate equity and profit interest plans have been designed to ensure BSUS is not required to repurchase more equity than we can reasonably recycle through variable compensation awards in any given twelve month period.


(6)	Acquisition-related consideration and pre-acquisition employee equity represents the amortization of acquisition-related contingent consideration created as a result of the Landmark transaction. It also includes the value of employee equity owned pre-acquisition. These items have been included in U.S. GAAP compensation expense as a result of ongoing service requirements for employee recipients.

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Fluctuations in compensation and benefits expense for the periods presented are discussed below.

Three months ended June 30, 2019 compared to three months ended June 30, 2018: Compensation and benefits expense decreased $(59.7) million, or (32.6)%, from $183.4 million for the three months ended June 30, 2018 to $123.7 million for the three months ended June 30, 2019. Fixed compensation and benefits increased $0.9 million, or 1.9%, from $47.5 million for the three months ended June 30, 2018 to $48.4 million for the three months ended June 30, 2019, primarily reflecting new hires at the Affiliates and annual cost of living increases. Variable compensation decreased $(12.3) million, or (20.1)%, from $61.3 million for the three months ended June 30, 2018 to $49.0 million for the three months ended June 30, 2019. The decrease was attributable to lower pre-variable compensation earnings, which in turn was primarily attributable to the decrease in management fee revenue, as well as a lower cost structure at the Center. Sales-based compensation decreased $(1.1) million, or (26.2)%, from $4.2 million for the three months ended June 30, 2018 to $3.1 million for the three months ended June 30, 2019, as a result of the structure of sales-based compensation programs, driven by the timing of asset inflows which trigger sales-based compensation in both current and prior periods. Affiliate key employee distributions decreased $(4.9) million, or (26.2)%, from $18.7 million for the three months ended June 30, 2018 to $13.8 million for the three months ended June 30, 2019 as a result of lower underlying operating earnings and the levered structure of distributions at certain Affiliates. Revaluations of Affiliate equity decreased by $(26.9) million, from $34.0 million for the three months ended June 30, 2018 to $7.1 million for the three months ended June 30, 2019. Acquisition-related consideration and pre-acquisition equity decreased by $(15.4) million from $17.7 million for the three months ended June 30, 2018 to $2.3 million for the three months ended June 30, 2019. The decreases in the revaluations of Affiliate equity and amortization of acquisition-related consideration and pre-acquisition equity were driven by the impact of the contingent consideration arrangement at Landmark that was included in the 2018 results. This was recorded as compensation under U.S. GAAP due to certain service requirements associated with the arrangement, and was fully accrued for as of December 31, 2018.

Six months ended June 30, 2019 compared to six months ended June 30, 2018: Compensation and benefits expense decreased $(147.8) million, or (39.7)%, from $372.6 million for the six months ended June 30, 2018 to $224.8 million for the six months ended June 30, 2019. Fixed compensation and benefits increased $2.5 million, or 2.6%, from $96.7 million for the six months ended June 30, 2018 to $99.2 million for the six months ended June 30, 2019, primarily reflecting new hires at the Affiliates and annual cost of living increases. Variable compensation decreased $(23.5) million, or (18.8)%, from $125.2 million for the six months ended June 30, 2018 to $101.7 million for the six months ended June 30, 2019. The decrease was attributable to lower pre-variable compensation earnings, which in turn was primarily attributable to the decrease in management fee revenue, as well as a lower cost structure at the Center. Sales-based compensation decreased $(3.3) million, or (36.3)%, from $9.1 million for the six months ended June 30, 2018 to $5.8 million for the six months ended June 30, 2019, as a result of the structure of sales-based compensation programs, driven by the timing of asset inflows which trigger sales-based compensation in both current and prior periods. Affiliate key employee distributions decreased $(15.2) million, or (35.8)%, from $42.4 million for the six months ended June 30, 2018 to $27.2 million for the six months ended June 30, 2019, primarily as a result of lower earnings before Affiliate key employee distributions at the consolidated Affiliates and the levered structure of distributions at certain Affiliates. Revaluations of Affiliate equity decreased by $(76.9) million, from $63.9 million for the six months ended June 30, 2018 to $(13.0) million for the six months ended June 30, 2019. Acquisition-related consideration and pre-acquisition equity decreased $(31.4) million, or (89.0)% from $35.3 million for the six months ended June 30, 2018 to $3.9 million for the six months ended June 30, 2019. The decreases in the revaluations of Affiliate equity and amortization of acquisition-related consideration and pre-acquisition equity were driven by the impact of the contingent consideration arrangement at Landmark that was included in the 2018 results. This was recorded as compensation under U.S. GAAP due to certain service requirements associated with the arrangement, and was fully accrued for as of December 31, 2018.

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General and Administrative Expense

Three months ended June 30, 2019 compared to three months ended June 30, 2018: General and administrative expense increased $1.3 million, or 4.4%, from $29.8 million for the three months ended June 30, 2018 to $31.1 million for the three months ended June 30, 2019. The increase in general and administrative expenses primarily reflects new initiatives, additional system costs and the overall growth of the business.

Six months ended June 30, 2019 compared to six months ended June 30, 2018: General and administrative expense increased $4.3 million, or 7.3%, from $59.3 million for the six months ended June 30, 2018 to $63.6 million for the six months ended June 30, 2019, driven by new initiatives, additional system costs and the overall growth of the business.

Amortization of Acquired Intangibles Expense

Three months ended June 30, 2019 compared to three months ended June 30, 2018: Amortization of acquired intangibles expense was unchanged, at $1.7 million for the three months ended June 30, 2018 and $1.7 million for the three months ended June 30, 2019. This account primarily reflects the amortization of intangible assets acquired in the Landmark transaction.

Six months ended June 30, 2019 compared to six months ended June 30, 2018: Amortization of acquired intangibles expense was unchanged, at $3.3 million for the six months ended June 30, 2018 and $3.3 million for the six months ended June 30, 2019. This account primarily reflects the amortization of intangible assets acquired in the Landmark transaction.

Depreciation and Amortization Expense

Three months ended June 30, 2019 compared to three months ended June 30, 2018: Depreciation and amortization expense increased $0.5 million, or 14.3%, from $3.5 million for the three months ended June 30, 2018 to $4.0 million for the three months ended June 30, 2019. The increase was primarily due to additional software and technology investments in the business.

Six months ended June 30, 2019 compared to six months ended June 30, 2018: Depreciation and amortization expense increased $0.9 million, or 13.0%, from $6.9 million for the six months ended June 30, 2018 to $7.8 million for the six months ended June 30, 2019. The increase was primarily due to additional software and technology investments in the business.

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U.S. GAAP Other Non-Operating Items of Income and Expense

Other non-operating items of income and expense consist of:


i.	investment income;


ii.	interest income; and


iii.	interest expense.

Investment Income

Three months ended June 30, 2019 compared to three months ended June 30, 2018: Investment income increased $2.5 million, from $(0.4) million for the three months ended June 30, 2018 to $2.1 million for the three months ended June 30, 2019, reflecting an increase in returns generated by seed capital investments.

Six months ended June 30, 2019 compared to six months ended June 30, 2018: Investment income decreased $(56.6) million or (86.1)%, from $65.7 million for the six months ended June 30, 2018 to $9.1 million for the six months ended June 30, 2019. Included in the six months ended June 30, 2018 was $65.7 million representing the gain on the sale of our investment in Heitman that was not repeated in 2019.

Interest Income

Three months ended June 30, 2019 compared to three months ended June 30, 2018: Interest income decreased $(0.3) million, from $0.6 million for the three months ended June 30, 2018 to $0.3 million for the three months ended June 30, 2019. The decrease was due to lower average cash balances in the current quarter.

Six months ended June 30, 2019 compared to six months ended June 30, 2018: Interest income increased $0.3 million, from $1.1 million for the six months ended June 30, 2018 to $1.4 million for the six months ended June 30, 2019. The increase was due to higher average cash balances and increases in short-term investment returns in the current year.

Interest Expense

Three months ended June 30, 2019 compared to three months ended June 30, 2018: Interest expense increased $2.7 million, or 44.3%, from $6.1 million for the three months ended June 30, 2018 to $8.8 million for the three months ended June 30, 2019, reflecting a higher balance drawn on the non-recourse seed capital and revolving credit facilities in 2019.

Six months ended June 30, 2019 compared to six months ended June 30, 2018: Interest expense increased $3.4 million, or 27.4%, from $12.4 million for the six months ended June 30, 2018 to $15.8 million for the six months ended June 30, 2019, primarily reflecting the utilization of our revolving credit facility in February 2019.

U.S. GAAP Income Tax Expense

Our effective tax rate has been impacted by changes in liabilities for uncertain tax positions, tax effects of stock based compensation, limitations on executive compensation, the mix of income earned in the United States versus lower-taxed foreign jurisdictions and benefits from intercompany financing arrangements. Our effective tax rate could be impacted in the future by these items as well as further changes in tax laws and regulations in jurisdictions in which we operate.

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Three months ended June 30, 2019 compared to three months ended June 30, 2018: Income tax expense increased $10.5 million, from $3.6 million for the three months ended June 30, 2018 to $14.1 million for the three months ended June 30, 2019 primarily due to the increase in income from continuing operations before tax attributable to controlling interest and the adjustment for uncertain tax positions. The effective tax rate decreased to 33.6% for the three months ended June 30, 2019 from 62.6% for the three months ended June 30, 2018, primarily due to the decreased impact of the permanent items due to the increase in income from continuing operations before tax attributable to controlling interests in the three months ended June 30, 2019.

Six months ended June 30, 2019 compared to six months ended June 30, 2018: Income tax expense increased $3.4 million, from $32.3 million for the six months ended June 30, 2018 to $35.7 million for the six months ended June 30, 2019. The increase in income tax expense is primarily due to the increase in income from continuing operations before tax attributable to controlling interests in the first six months ended June 30, 2019 compared to the six months ended June 30, 2018 and the adjustment for uncertain tax positions. These increases were partially offset by the impact of the sale of Heitman recognized in the prior year. The effective tax rate decreased to 30.7% for the six months ended June 30, 2019 from 35.2% for the six months ended June 30, 2018. The decrease in the effective tax rate is primarily due to the impact of the Heitman sale reflected in the results for the six months ended June 30, 2018.

U.S. GAAP Consolidated Funds

Three months ended June 30, 2019 compared to three months ended June 30, 2018: Consolidated Funds’ revenue increased $0.7 million, from $1.2 million for the three months ended June 30, 2018 to $1.9 million for the three months ended June 30, 2019. Consolidated Funds’ expense decreased $(0.2) million for the three months ended June 30, 2019 compared to the three months ended June 30, 2018. Net consolidated Funds’ investment gain (loss) decreased $(1.2) million from $(3.3) million for the three months ended June 30, 2018 to $(4.5) million for the three months ended June 30, 2019. The net income or loss of all consolidated Funds, excluding any income or loss attributable to seed capital or co-investments we make in the Funds, is included in non-controlling interests in our Condensed Consolidated Financial Statements and is not included in net income attributable to controlling interests or in management fees.

Six months ended June 30, 2019 compared to six months ended June 30, 2018: Consolidated Funds’ revenue increased $1.6 million, from $1.4 million for the six months ended June 30, 2018 to $3.0 million for the six months ended June 30, 2019. Consolidated Funds’ expense decreased $(0.4) million, from $0.6 million for the six months ended June 30, 2018 to $0.2 million for the six months ended June 30, 2019. Net consolidated Funds’ investment gain (loss) increased $14.8 million from $(5.7) million for the six months ended June 30, 2018 to $9.1 million for the six months ended June 30, 2019. The net income or loss of all consolidated Funds, excluding any income or loss attributable to seed capital or co-investments we make in the Funds, is included in non-controlling interests in our Condensed Consolidated Financial Statements and is not included in net income attributable to controlling interests or in management fees.

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Key U.S. GAAP Operating Metrics

The following table shows our key U.S. GAAP operating metrics for the three and six months ended June 30, 2019 and 2018. The second, third and fourth metrics below have each been adjusted to eliminate the effect of consolidated Funds to more accurately reflect the economics of our Company.



	Three Months Ended June 30,						Six Months Ended June 30,
($ in millions)	2019			2018			2019			2018
Numerator: Operating income	$	46.6		$	15.3		$	114.6		$	40.9
Denominator: Total revenue	$	207.1		$	233.9		$	414.3		$	483.6
U.S. GAAP operating margin⁽¹⁾	22.5		%	6.5		%	27.7		%	8.5		%

Numerator: Total operating expenses⁽²⁾	$	160.5		$	218.4		$	299.5		$	442.1
Denominator: Management fee revenue	$	205.9		$	226.4		$	413.4		$	471.4
U.S. GAAP operating expense / management fee revenue⁽³⁾	78.0		%	96.5		%	72.4		%	93.8		%

Numerator: Variable compensation	$	49.0		$	61.3		$	101.7		$	125.2
Denominator: Operating income before variable compensation and Affiliate key employee distributions^(2)(4)(5)	$	107.5		$	94.3		$	240.7		$	207.7
U.S. GAAP variable compensation ratio⁽³⁾	45.6		%	65.0		%	42.3		%	60.3		%

Numerator: Affiliate key employee distributions	$	13.8		$	18.7		$	27.2		$	42.4
Denominator: Operating income before Affiliate key employee distributions^(2)(4)(5)	$	58.5		$	33.0		$	139.0		$	82.5
U.S. GAAP Affiliate key employee distributions ratio⁽³⁾	23.6		%	56.7		%	19.6		%	51.4		%


(1)	Excluding the effect of Funds consolidation in the applicable periods, the U.S. GAAP operating margin is 21.8% for the three months ended June 30, 2019 and 6.1% for the three months ended June 30, 2018.


(2)	Excludes consolidated Funds expense of $0.0 million for the three months ended June 30, 2019; $0.2 million for the three months ended June 30, 2018; $0.2 million for the six months ended June 30, 2019 and $0.6 million for the six months ended June 30, 2018.


(3)	Excludes the effect of Funds consolidation for the three and six months ended June 30, 2019 and 2018.


(4)	Excludes consolidated Funds revenue of $1.9 million for the three months ended June 30, 2019; $1.2 million for the three months ended June 30, 2018; $3.0 million for the six months ended June 30, 2019 and $1.4 million for the six months ended June 30, 2018.

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(5)	The following table identifies the components of operating income before variable compensation and Affiliate key employee distributions, as well as operating income before Affiliate key employee distributions:



	Three Months Ended June 30,						Six Months Ended June 30,
($ in millions)	2019			2018			2019			2018
Operating income	$	46.6		$	15.3		$	114.6		$	40.9
Affiliate key employee distributions	13.8			18.7			27.2			42.4
Operating (income) loss of consolidated Funds	(1.9		)	(1.0		)	(2.8		)	(0.8		)
Operating income before Affiliate key employee distributions	58.5			33.0			139.0			82.5
Variable compensation	49.0			61.3			101.7			125.2
Operating income before variable compensation and Affiliate key employee distributions	$	107.5		$	94.3		$	240.7		$	207.7

Effects of Inflation

For the three and six months ended June 30, 2019 and 2018, inflation did not have a material effect on our consolidated results of operations.

Non-GAAP Supplemental Performance Measure — Economic Net Income

As supplemental information, we provide a non-GAAP performance measure that we refer to as economic net income, or ENI, which represents our management’s view of the underlying economic earnings generated by us. We define economic net income as ENI revenue less (i) ENI operating expenses, (ii) variable compensation, (iii) key employee distributions, (iv) net interest and (v) taxes, each as further discussed in this section. ENI adjustments to U.S. GAAP include both reclassifications of U.S. GAAP revenue and expense items, as well as adjustments to U.S. GAAP results, primarily to exclude non-cash, non-economic expenses, or to reflect cash benefits not recognized under U.S. GAAP.

ENI is an important measure to investors because it is used by the Company to make resource allocation decisions, determine appropriate levels of investment or dividend payout, manage balance sheet leverage, determine Affiliate variable compensation and equity distributions, and incentivize management. It is also an important measure because it assists management in evaluating our operating performance and is presented in a way that most closely reflects the key elements of our profit share operating model with our Affiliates. For a further discussion of how we use ENI and why ENI is useful to investors, see “—Overview—How We Measure Performance.”

To calculate economic net income, we re-categorize certain line items on our Consolidated Statement of Operations to reflect the following:


•	We exclude the effect of Funds consolidation by removing the portion of Fund revenues, expenses and investment return which were not attributable to our shareholders.


•	We include within management fee revenue any fees paid to Affiliates by consolidated Funds, which are viewed as investment income under U.S. GAAP.


•	We include our share of earnings from equity-accounted Affiliates within other income in ENI revenue, rather than investment income.


•	We treat sales-based compensation as a general and administrative expense, rather than part of fixed compensation and benefits.


•	We identify separately from operating expenses variable compensation and Affiliate key employee distributions, which represent Affiliate earnings shared with Affiliate key employees.

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•	We net the separate revenues and expenses recorded under U.S. GAAP for certain Fund expenses initially paid by our Affiliates on the Funds’ behalf and subsequently reimbursed, to better reflect the actual economics of our business.

We also make the following adjustments to U.S. GAAP results to more closely reflect our economic results:

We exclude non-cash expenses representing changes in the value of Affiliate equity and profit interests held by Affiliate key employees. These ownership interests may in certain circumstances be repurchased by BSUS at a value based on a pre-determined fixed multiple of trailing earnings and as such this value is carried on our balance sheet as a liability. Non-cash movements in the value of this liability are treated as compensation expense under U.S. GAAP. However, any equity or profit interests repurchased by BSUS can be used to fund a portion of future variable compensation awards, resulting in savings in cash variable compensation that offset the negative cash effect of repurchasing the equity. Our Affiliate equity and profit interest plans have been designed to ensure BSUS is never required to repurchase more equity than we can reasonably recycle through variable compensation awards in any given twelve-month period.

ii.

We exclude non-cash amortization or impairment expenses related to acquired goodwill and other intangibles as these are non-cash charges that do not result in an outflow of tangible economic benefits from the business. We also exclude the amortization of acquisition-related contingent consideration, as well as the value of employee equity owned pre-acquisition, as occurred as a result of the Landmark transaction, where such items have been included in compensation expense as a result of ongoing service requirements for certain employees. Please note that the revaluations related to these acquisition-related items are included in (i) above.


iii.	We exclude capital transaction costs, including the costs of raising debt or equity, gains or losses realized as a result of redeeming debt or equity and direct incremental costs associated with acquisitions of businesses or assets.


iv.	We exclude seed capital and co-investment gains, losses and related financing costs. The net returns on these investments are considered and presented separately from ENI because ENI is primarily a measure of our earnings from managing client assets, which therefore differs from earnings generated by our investments in Affiliate products, which can be variable from period to period.


v.	We include cash tax benefits associated with deductions allowed for acquired intangibles and goodwill that may not be recognized or have timing differences compared to U.S. GAAP.


vi.	We exclude the results of discontinued operations attributable to controlling interests since they are not part of our ongoing business, and restructuring costs incurred in continuing operations.


vii.	We exclude deferred tax resulting from changes in tax law and expiration of statutes, adjustments for uncertain tax positions, deferred tax attributable to intangible assets and other unusual items not related to current operating results to reflect ENI tax normalization.

We also adjust our income tax expense to reflect any tax impact of our ENI adjustments.

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Reconciliation of U.S. GAAP Net Income to Economic Net Income for the Three and Six Months Ended June 30, 2019 and 2018

The following table reconciles net income attributable to controlling interests to economic net income for the three and six months ended June 30, 2019 and 2018:



		Three Months Ended June 30,						Six Months Ended June 30,
($ in millions)		2019			2018			2019			2018
U.S. GAAP net income attributable to controlling interests		$	28.0		$	2.1		$	80.7		$	59.4
Adjustments to reflect the economic earnings of the Company:
i.	Non-cash key employee-owned equity and profit interest revaluations⁽¹⁾	7.1			34.0			(13.0		)	63.9
ii.	Amortization of acquired intangible assets, acquisition-related consideration and pre-acquisition employee equity⁽¹⁾	4.0			19.4			7.2			38.6
iii.	Capital transaction costs	1.6			0.1			1.6			0.1
iv.	Seed/Co-investment (gains) losses and financings⁽²⁾	(2.8		)	6.0			(13.0		)	7.8
v.	Tax benefit of goodwill and acquired intangibles deductions	2.4			1.4			4.7			2.9
vi.	Discontinued operations and restructuring⁽³⁾	1.3			0.8			5.6			(64.8		)
vii.	ENI tax normalization	2.4			3.1			3.2			9.9
Tax effect of above adjustments, as applicable⁽⁴⁾		(3.0		)	(16.4		)	3.2			(12.4		)
Economic net income		$	41.0		$	50.5		$	80.2		$	105.4


(1)	The table below summarizes the Landmark-related components included in items (i) and (ii) of the above reconciliation:



	Three Months Ended June 30,						Six Months Ended June 30,
($ in millions)	2019			2018			2019			2018
Landmark contingent consideration	$	—		$	44.6		$	—		$	70.9
Landmark pre-acquisition employee equity	19.8			16.8			12.4			36.6
Landmark-related total	19.8			61.4			12.4			107.5
Other Affiliate equity and amortization of intangible assets	(8.7		)	(8.0		)	(18.2		)	(5.0		)
Total	$	11.1		$	53.4		$	(5.8	)	$	102.5


(2)	The net return on seed/co-investment (gains) losses and financings for the three and six months ended June 30, 2019 and 2018 is shown in the following table:

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	Three Months Ended June 30,						Six Months Ended June 30,
($ in millions)	2019			2018			2019			2018
Seed/Co-investment (gains) losses	$	(5.2	)	$	3.9		$	(17.7	)	$	4.1
Financing costs:
Seed/Co-investment average balance	144.9			130.5			146.3			120.0
Blended interest rate*	6.1		%	6.5		%	6.4		%	6.2		%
Financing costs	2.4			2.1			4.7			3.7
Net seed/co-investment (gains) losses and financing	$	(2.8	)	$	6.0		$	(13.0	)	$	7.8

* The blended rate is based first on the interest rate paid on the Company’s non-recourse seed capital facility up to the average amount drawn, and thereafter on the weighted average rate of the long-term debt.


(3)	The three and six months ended June 30, 2019 includes restructuring costs at the Center of $0.5 million and $4.5 million and costs associated with the redomicile to the U.S. of $0.8 million and $1.1 million, respectively. The six months ended June 30, 2018 includes the gain on sale of Heitman of $65.7 million.


(4)	Reflects the sum of lines (i), (ii), (iii), (iv) and the restructuring component of line (vi) multiplied by the 27.3% U.S. statutory tax rate (including state tax).

Limitations of Economic Net Income

Economic net income is the key measure our management uses to evaluate the financial performance of, and make operational decisions for, our business. Economic net income is not audited and is not a substitute for net income or other performance measures that are derived in accordance with U.S. GAAP. Furthermore, our calculation of economic net income may differ from similarly titled measures provided by other companies.

Because the calculation of economic net income excludes certain ongoing expenses, including amortization expense and certain compensation costs, it has certain material limitations and should not be viewed in isolation or as a substitute for U.S. GAAP measures of earnings.

ENI Revenues

The following table reconciles U.S. GAAP revenue to ENI revenue for the three and six months ended June 30, 2019 and 2018:



	Three Months Ended June 30,						Six Months Ended June 30,
($ in millions)	2019			2018			2019			2018
U.S. GAAP revenue	$	207.1		$	233.9		$	414.3		$	483.6
Include investment return on equity-accounted Affiliates	0.7			0.7			1.3			1.3
Exclude revenue from consolidated Funds attributable to non-controlling interests	(1.9		)	(1.2		)	(3.0		)	(1.4		)
Exclude Fund expenses reimbursed by customers	(1.3		)	(2.7		)	(2.3		)	(5.0		)
ENI revenue	$	204.6		$	230.7		$	410.3		$	478.5

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The following table identifies the components of ENI revenue:



	Three Months Ended June 30,					Six Months Ended June 30,
($ in millions)	2019			2018		2019			2018
Management fees⁽¹⁾	$	205.9		$	226.4	$	413.4		$	471.4
Performance fees⁽²⁾	(2.2		)	3.0		(5.0		)	5.0
Other income, including equity-accounted Affiliates⁽³⁾	0.9			1.3		1.9			2.1
ENI revenue	$	204.6		$	230.7	$	410.3		$	478.5


(1)	ENI management fees correspond to U.S. GAAP management fees.


(2)	ENI performance fees correspond to U.S. GAAP performance fees.

(3)

ENI other income is comprised primarily of other revenue under U.S. GAAP, plus our earnings from equity-accounted Affiliates of $0.7 million and $0.7 million for the three months ended June 30, 2019 and June 30, 2018, respectively. For the six months ended June 30, 2019 and 2018, our earnings from equity-accounted Affiliates were $1.3 million and $1.3 million, respectively. As further described in “—Non-GAAP Supplemental Performance Measure—Economic Net Income,” ENI other income also excludes certain Fund expenses initially paid by our Affiliates on the Funds’ behalf and subsequently reimbursed.



	Three Months Ended June 30,						Six Months Ended June 30,
($ in millions)	2019			2018			2019			2018
U.S. GAAP other revenue	$	1.5		$	3.3		$	2.9		$	5.8
Earnings from equity-accounted Affiliates	0.7			0.7			1.3			1.3
Exclude Fund expenses reimbursed by customers	(1.3		)	(2.7		)	(2.3		)	(5.0		)
ENI other income	$	0.9		$	1.3		$	1.9		$	2.1

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ENI Operating Expenses

The largest difference between U.S. GAAP operating expense and ENI operating expense relates to compensation. As shown in the following reconciliation, we exclude the impact of key employee equity revaluations. We also exclude the amortization of contingent purchase price and pre-acquisition equity owned by employees, both with a service requirement, associated with the Landmark acquisition. Variable compensation and Affiliate key employee distributions are also segregated out of U.S. GAAP operating expense in order to align with the manner in which these items are contractually calculated at the Affiliate level.

The following table reconciles U.S. GAAP operating expense to ENI operating expense for the three and six months ended June 30, 2019 and 2018.



	Three Months Ended June 30,						Six Months Ended June 30,
($ in millions)	2019			2018			2019			2018
U.S. GAAP operating expense	$	160.5		$	218.6		$	299.7		$	442.7
Less: items excluded from economic net income
Acquisition-related consideration and pre-acquisition employee equity	(2.3		)	(17.7		)	(3.9		)	(35.3		)
Non-cash key employee equity and profit interest revaluations	(7.1		)	(34.0		)	13.0			(63.9		)
Amortization of acquired intangible assets	(1.7		)	(1.7		)	(3.3		)	(3.3		)
Capital transaction costs	(1.6		)	(0.1		)	(1.6		)	(0.1		)
Restructuring costs⁽¹⁾	(1.3		)	(0.8		)	(5.6		)	(0.9		)
Fund expenses reimbursed by customers	(1.3		)	(2.7		)	(2.3		)	(5.0		)
Funds’ operating expense	—			(0.2		)	(0.2		)	(0.6		)
Less: items segregated out of U.S. GAAP operating expense
Variable compensation	(48.4		)	(61.3		)	(97.1		)	(125.2		)
Affiliate key employee distributions	(13.8		)	(18.7		)	(27.2		)	(42.4		)
ENI operating expense	$	83.0		$	81.4		$	171.5		$	166.0


(1)	Included in restructuring for the three and six months ended June 30, 2019 are restructuring costs at the Center of $0.5 million and $4.5 million, respectively, and costs associated with the redomicile to the U.S. of $0.8 million and $1.1 million, respectively.

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The following table identifies the components of ENI operating expense:



	Three Months Ended June 30,				Six Months Ended June 30,
($ in millions)	2019		2018		2019		2018
Fixed compensation & benefits⁽¹⁾	$	47.3	$	44.8	$	97.0	$	91.7
General and administrative expenses⁽²⁾	31.7		33.1		66.7		67.4
Depreciation and amortization	4.0		3.5		7.8		6.9
ENI operating expense	$	83.0	$	81.4	$	171.5	$	166.0


(1)	Fixed compensation and benefits include base salaries, payroll taxes and the cost of benefit programs provided. The following table reconciles U.S. GAAP compensation and benefits expense for the three and six months ended June 30, 2019 and 2018 to ENI fixed compensation and benefits expense:



	Three Months Ended June 30,						Six Months Ended June 30,
($ in millions)	2019			2018			2019			2018
Total U.S. GAAP compensation and benefits expense	$	123.7		$	183.4		$	224.8		$	372.6
Acquisition-related consideration and pre-acquisition employee equity	(2.3		)	(17.7		)	(3.9		)	(35.3		)
Non-cash key employee equity and profit interest revaluations excluded from ENI	(7.1		)	(34.0		)	13.0			(63.9		)
Sales-based compensation reclassified to ENI general & administrative expenses	(3.1		)	(4.2		)	(5.8		)	(9.1		)
Affiliate key employee distributions	(13.8		)	(18.7		)	(27.2		)	(42.4		)
Compensation related to restructuring expenses^(a)	(0.5		)	—			(4.5		)	—
Variable compensation	(48.4		)	(61.3		)	(97.1		)	(125.2		)
Fund expenses reimbursed by customers	(1.2		)	(2.7		)	(2.3		)	(5.0		)
ENI fixed compensation and benefits	$	47.3		$	44.8		$	97.0		$	91.7


(a)	Reflects $0.5 million and $4.5 million related to restructuring at the Center for the three and six months ended June 30, 2019, respectively.

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(2)	The following table reconciles U.S. GAAP general and administrative expense to ENI general and administrative expense:



	Three Months Ended June 30,						Six Months Ended June 30,
($ in millions)	2019			2018			2019			2018
U.S. GAAP general and administrative expense	$	31.1		$	29.8		$	63.6		$	59.3
Sales-based compensation	3.1			4.2			5.8			9.1
Capital transaction costs	(1.6		)	(0.1		)	(1.6		)	(0.1		)
Restructuring costs	(0.9		)	(0.8		)	(1.1		)	(0.9		)
ENI general and administrative expense	$	31.7		$	33.1		$	66.7		$	67.4

Key Non-GAAP Operating Metrics

The following table shows our key non-GAAP operating metrics for the three and six months ended June 30, 2019 and 2018. We present these metrics because they are the measures our management uses to evaluate the profitability of our business and are useful to investors because they represent the key drivers and measures of economic performance within our business model. Please see the footnotes below for an explanation of each ratio, its usefulness in measuring the economics and operating performance of our business, and a reference to the most closely related U.S. GAAP measure:



	Three Months Ended June 30,						Six Months Ended June 30,
($ in millions)	2019			2018			2019			2018
Numerator: ENI operating earnings⁽¹⁾	$	73.2		$	88.0		$	141.7		$	187.3
Denominator: ENI revenue	$	204.6		$	230.7		$	410.3		$	478.5
ENI operating margin⁽²⁾	35.8		%	38.1		%	34.5		%	39.1		%

Numerator: ENI operating expense	$	83.0		$	81.4		$	171.5		$	166.0
Denominator: ENI management fee revenue⁽³⁾	$	205.9		$	226.4		$	413.4		$	471.4
ENI operating expense ratio⁽⁴⁾	40.3		%	36.0		%	41.5		%	35.2		%

Numerator: ENI variable compensation	$	48.4		$	61.3		$	97.1		$	125.2
Denominator: ENI earnings before variable compensation⁽¹⁾⁽⁵⁾	$	121.6		$	149.3		$	238.8		$	312.5
ENI variable compensation ratio⁽⁶⁾	39.8		%	41.1		%	40.7		%	40.1		%

Numerator: Affiliate key employee distributions	$	13.8		$	18.7		$	27.2		$	42.4
Denominator: ENI operating earnings⁽¹⁾	$	73.2		$	88.0		$	141.7		$	187.3
ENI Affiliate key employee distributions ratio⁽⁷⁾	18.9		%	21.3		%	19.2		%	22.6		%


(1)	ENI operating earnings represents ENI earnings before Affiliate key employee distributions and is calculated as ENI revenue, less ENI operating expense and less ENI variable compensation. It differs from economic net income because it does not include the effects of Affiliate key employee distributions, net interest expense or income tax expense.

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The following table reconciles U.S. GAAP operating income to ENI operating earnings:



	Three Months Ended June 30,						Six Months Ended June 30,
($ in millions)	2019			2018			2019			2018
U.S. GAAP operating income	$	46.6		$	15.3		$	114.6		$	40.9
Include earnings from equity-accounted Affiliates	0.7			0.7			1.3			1.3
Exclude the impact of:
Affiliate key employee-owned equity and profit interest revaluations	7.1			34.0			(13.0		)	63.9
Amortization of acquired intangible assets, acquisition-related consideration and pre-acquisition employee equity	4.0			19.4			7.2			38.6
Capital transaction costs	1.6			0.1			1.6			0.1
Restructuring costs^(a)	1.3			0.8			5.6			0.9
Affiliate key employee distributions	13.8			18.7			27.2			42.4
Variable compensation	48.4			61.3			97.1			125.2
Funds’ operating (income) loss	(1.9		)	(1.0		)	(2.8		)	(0.8		)
ENI earnings before variable compensation	121.6			149.3			238.8			312.5
Less: ENI variable compensation	(48.4		)	(61.3		)	(97.1		)	(125.2		)
ENI operating earnings	73.2			88.0			141.7			187.3
Less: ENI Affiliate key employee distributions	(13.8		)	(18.7		)	(27.2		)	(42.4		)
ENI earnings after Affiliate key employee distributions	$	59.4		$	69.3		$	114.5		$	144.9


(a)	Included in restructuring for the three and six months ended June 30, 2019 are restructuring costs at the Center of $0.5 million and $4.5 million and costs associated with the redomicile to the U.S. of $0.8 million and $1.1 million.

(2)

The ENI operating margin, which is calculated before Affiliate key employee distributions, is used by management and is useful to investors to evaluate the overall operating margin of the business without regard to our various ownership levels at each of the Affiliates. The ENI operating margin is most comparable to our U.S. GAAP operating margin. Our U.S. GAAP operating margin, excluding the effect of consolidated Funds, is 21.8% for the three months ended June 30, 2019 and 6.1% for the three months ended June 30, 2018.

The ENI operating margin is important because it gives investors an understanding of the profitability of the total business relative to revenue, irrespective of the ownership position which BSIG has in each of its Affiliates. Management and investors use this ratio when comparing our profitability relative to our peer group and evaluating our ability to manage the cost structure and profitability of our business under different operating environments.


(3)	ENI management fee revenue corresponds to U.S. GAAP management fee revenue.

(4)

The ENI operating expense ratio is used by management and is useful to investors to evaluate the level of operating expense as measured against our recurring management fee revenue. We have provided this ratio since many operating expenses, including fixed compensation & benefits and general and administrative expense, are generally linked to the overall size of the business. We track this ratio as a key measure of scale economies at BSIG because in our profit sharing economic model, scale benefits both the Affiliate employees and BSIG shareholders. The ENI operating expense ratio is most comparable to the U.S. GAAP operating expense / management fee revenue ratio.

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(5)	ENI earnings before variable compensation is calculated as ENI revenue, less ENI operating expense.

(6)

The ENI variable compensation ratio is used by management and is useful to investors to evaluate consolidated variable compensation as measured against our ENI earnings before variable compensation. Variable compensation is contractually set and calculated individually at each Affiliate, plus Center bonuses. Variable compensation is usually awarded based on a contractual percentage of each Affiliate’s ENI earnings before variable compensation and may be paid in the form of cash or non-cash Affiliate equity or profit interests. Center variable compensation includes cash and BSIG equity. Non-cash variable compensation awards typically vest over several years and are recognized as compensation expense over that service period. The variable compensation ratio at each Affiliate, calculated as variable compensation divided by ENI earnings before variable compensation, will typically be between 25% and 35%. The ENI variable compensation ratio is most comparable to the U.S. GAAP variable compensation ratio.

(7)

The ENI Affiliate key employee distribution ratio is used by management and is useful to investors to evaluate Affiliate key employee distributions as measured against our ENI operating earnings. Affiliate key employee distributions represent the share of Affiliate profits after variable compensation that is attributable to Affiliate key employee equity and profit interests holders, according to their ownership interests. The Affiliate key employee distribution ratio at each Affiliate is calculated as Affiliate key employee distributions divided by ENI operating earnings at that Affiliate. At certain Affiliates, with tiered equity structures, BSUS and other classes of employee equity holders are entitled to an initial proportionate preference over profits after variable compensation, structured such that before a preference threshold is reached, there would be no required key employee distributions to the tiered equity holders, whereas for profits above the threshold the key employee distribution amount to the tiered equity holders would be calculated based on the tiered key employee ownership percentages. Based on current economic arrangements, employee distributions range from approximately 20% to 40% of marginal ENI operating earnings at each of our consolidated Affiliates. The ENI Affiliate key employee distributions ratio is most comparable to the U.S. GAAP Affiliate key employee distributions ratio.

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Tax on Economic Net Income

The following table reconciles the United States statutory tax to tax on economic net income:



	Three Months Ended June 30,						Six Months Ended June 30,
($ in millions)	2019			2018			2019			2018
Pre-tax economic net income⁽¹⁾	$	53.2		$	65.8		$	104.8		$	137.2
Intercompany interest expense deductible for U.S. tax purposes	(16.4		)	(19.6		)	(33.2		)	(38.9		)
Taxable economic net income	36.8			46.2			71.6			98.3
Taxes at the U.S. federal and state statutory rates⁽²⁾	(10.1		)	(12.7		)	(19.6		)	(26.9		)
Other reconciling tax adjustments	(2.1		)	(2.6		)	(5.0		)	(4.9		)
Tax on economic net income	(12.2		)	(15.3		)	(24.6		)	(31.8		)
Add back intercompany interest expense previously excluded	16.4			19.6			33.2			38.9
Economic net income	$	41.0		$	50.5		$	80.2		$	105.4
Economic net income effective tax rate⁽³⁾	22.9		%	23.3		%	23.5		%	23.2		%


(1)	Includes interest income and third party ENI interest expense, as shown in the following table:



	Three Months Ended June 30,						Six Months Ended June 30,
($ in millions)	2019			2018			2019			2018
U.S. GAAP interest income	$	0.3		$	0.6		$	1.4		$	1.1
U.S. GAAP interest expense	(8.8		)	(6.1		)	(15.8		)	(12.4		)
U.S. GAAP net interest expense	(8.5		)	(5.5		)	(14.4		)	(11.3		)
Other ENI interest expense exclusions^(a)	2.3			2.0			4.7			3.6
ENI net interest income (expense)	(6.2		)	(3.5		)	(9.7		)	(7.7		)
ENI earnings after Affiliate key employee distributions^(b)	59.4			69.3			114.5			144.9
Pre-tax economic net income	$	53.2		$	65.8		$	104.8		$	137.2


(a)	Other ENI interest expense exclusions represent cost of financing on seed capital and co-investments.


(b)	ENI earnings after Affiliate key employee distributions is calculated as ENI operating income (ENI revenue, less ENI operating expense, less ENI variable compensation), less Affiliate key employee distributions. Refer to “—Key Non-GAAP Operating Metrics” for a reconciliation from U.S. GAAP operating income (loss) to ENI earnings after Affiliate key employee distributions.


(2)	Taxed at U.S. Federal and State statutory rate of 27.3%.


(3)	The economic net income effective tax rate is calculated by dividing the tax on economic net income by pre-tax economic net income.

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Capital Resources and Liquidity

Cash Flows

The following table summarizes certain key financial data relating to cash flows. All amounts presented exclude consolidated Funds:



	Six Months Ended June 30,
($ in millions)	2019			2018
Cash provided by (used in)⁽¹⁾⁽²⁾
Operating activities	$	(229.5	)	$	70.6
Investing activities	(6.8		)	50.0
Financing activities	(8.6		)	(72.4		)


(1)	Excludes consolidated Funds.


(2)	Cash flow data shown only includes cash flows from continuing operations.

Comparison for the six months ended June 30, 2019 and 2018

Net cash provided by operating activities of continuing operations decreased $(300.1) million, from net cash provided of $70.6 million for the six months ended June 30, 2018 to net cash used of $229.5 million for the six months ended June 30, 2019, driven by a decrease in operating liabilities as the Landmark earnout was settled in the six months ended June 30, 2019. Net cash provided by investing activities of continuing operations decreased $(56.8) million, from $50.0 million provided in the six months ended June 30, 2018 to $6.8 million used for the six months ended June 30, 2019, driven primarily by the proceeds received from the sale of Heitman in the prior-year period. Net cash used in financing activities of continuing operations decreased $(63.8) million, from $72.4 million used for the six months ended June 30, 2018 to $8.6 million used for the six months ended June 30, 2019, primarily due to higher third party borrowings, offset by increased share repurchases and payment to OM plc for the deferred tax arrangement.

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Supplemental Liquidity Measure — Adjusted EBITDA

As supplemental information, we provide information regarding Adjusted EBITDA, which we define as economic net income before net interest, income taxes, depreciation and amortization. Adjusted EBITDA is a non-GAAP liquidity measure that we provide in addition to, but not as a substitute for, cash flows from operating activities. It should be noted that our calculation of Adjusted EBITDA may not be consistent with Adjusted EBITDA as calculated by other companies. We believe Adjusted EBITDA is a useful liquidity metric because it indicates our ability to make further investments in our business, service debt and meet working capital requirements. It is also encapsulated in our line of credit as part of our liquidity covenants.

The following table reconciles our U.S. GAAP net income attributable to controlling interests to EBITDA to Adjusted EBITDA to economic net income for the three and six months ended June 30, 2019 and 2018.



	Three Months Ended June 30,						Six Months Ended June 30,
($ in millions)	2019			2018			2019			2018
Net income attributable to controlling interests	$	28.0		$	2.1		$	80.7		$	59.4
Net interest expense to third parties	8.5			5.5			14.4			11.3
Income tax expense (including tax expenses related to discontinued operations)	14.1			3.6			35.7			32.3
Depreciation and amortization (including intangible assets)	5.7			5.2			11.1			10.2
EBITDA	$	56.3		$	16.4		$	141.9		$	113.2
Non-cash compensation costs associated with revaluation of Affiliate key employee-owned equity and profit interests	7.1			34.0			(13.0		)	63.9
Amortization of acquisition-related consideration and pre-acquisition employee equity	2.3			17.7			3.9			35.3
EBITDA of discontinued operations	—			—			—			—
(Gain) loss on seed and co-investments	(5.2		)	3.9			(17.7		)	4.1
Restructuring⁽¹⁾	1.3			0.8			5.6			(64.8		)
Capital transaction costs	1.6			0.1			1.6			0.1
Other	—			(0.1		)	—			—
Adjusted EBITDA	$	63.4		$	72.8		$	122.3		$	151.8
ENI net interest expense to third parties	(6.2		)	(3.5		)	(9.7		)	(7.7		)
Depreciation and amortization	(4.0		)	(3.5		)	(7.8		)	(6.9		)
Tax on economic net income	(12.2		)	(15.3		)	(24.6		)	(31.8		)
Economic net income	$	41.0		$	50.5		$	80.2		$	105.4


(1)	The three and six months ended June 30, 2019 includes restructuring costs at the Center of $0.5 million and $4.5 million and costs associated with the redomicile to the U.S. of $0.8 million and $1.1 million, respectively. The six months ended June 30, 2018 includes the gain on sale of Heitman of $65.7 million.

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Limitations of Adjusted EBITDA

As a non-GAAP, unaudited liquidity measure and derivation of EBITDA, Adjusted EBITDA has certain material limitations. It does not include cash costs associated with capital transactions and excludes certain U.S. GAAP expenses that fall outside the definition of EBITDA. Each of these categories of expense represents costs to us of doing business, and therefore any measure that excludes any or all of these categories of expense has material limitations.

Future Capital Needs

We believe that our available cash and cash equivalents to be generated from operations, supplemented by short-term and long-term financing, as necessary, will be sufficient to fund current operations and capital requirements for at least the next twelve months, as well as our day-to-day operations and future investment requirements. Our ability to secure short-term and long-term financing in the future will depend on several factors, including our future profitability, our relative levels of debt and equity and the overall condition of the credit markets.

Borrowings and Long-Term Debt

The following table summarizes our financing arrangements as of the dates indicated:



($ in millions)	6/30/2019		12/31/2018		Interest rate	Maturity
Borrowings and long-term debt of BSIG, net of issuance costs
Third party obligations:
Revolving credit facility	$	210.0	$	—	LIBOR + 1.50% plus 0.25% commitment fee	October 15, 2019
Non-recourse seed capital facility	25.0		—		LIBOR + 1.55% plus 0.95% commitment fee	July 17, 2020
Long-term bonds:
4.80% Senior Notes Due 2026	272.3		272.2		4.80%	July 27, 2026
5.125% Senior Notes Due 2031	121.2		121.1		5.125%	August 1, 2031
Total borrowings and long-term debt	$	628.5	$	393.3

Revolving Credit Facility

On October 15, 2014, we entered into a revolving credit facility with Citibank, as administrative agent and issuing bank, and Citigroup Global Markets Inc. and Merrill Lynch, Pierce, Fenner & Smith Incorporated as joint lead arrangers and joint book runners (as amended the “Credit Facility”). Pursuant to the terms of the Credit Facility, we may obtain loans on a revolving credit basis and procure the issuance of letters of credit in an aggregate amount at any time outstanding not in excess of $350 million. The Credit Facility has a maturity date of October 15, 2019. We intend to renew the Credit Facility prior to the maturity date. Borrowings under the facility bear interest, at our option, at either the per annum rate equal to (a) the greatest of (i) the prime rate, (ii) the federal funds effective rate plus 0.5% and (iii) the one month Adjusted LIBO Rate plus 1.0%, plus, in each case an additional amount based on our credit rating or (b) the London interbank offered rate for a period, at our election, equal to one, two, three or six months plus an additional amount ranging from 1.25% to 2.00%, with such additional amount based on our credit rating. In addition, we are charged a commitment fee based on the average daily unused portion of the revolving credit facility at a per annum rate ranging from 0.20% to 0.50%, with such amount being based on our credit rating.

Under the Credit Facility, the ratio of third-party borrowings to trailing twelve months Adjusted EBITDA cannot exceed 3.0x, and the interest coverage ratio must not be less than 4.0x. At June 30, 2019, our ratio of third-party borrowings to trailing twelve months Adjusted EBITDA was 2.3x and our interest coverage ratio was 10.6x.

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Our ratio of third party borrowings net of total cash and cash equivalents to trailing twelve months Adjusted EBITDA was 1.9x.

Moody’s Investor Service, Inc. and Standard & Poor’s have each assigned an investment-grade rating to our senior, unsecured long-term indebtedness. As a result of the assignment of the credit ratings, our interest rate on outstanding borrowings was set at LIBOR + 1.50% and the commitment fee on the unused portion of the revolving credit facility was set at 0.25%.

Non-recourse seed capital facility

In July 2017, the Company entered into a non-recourse seed capital facility collateralized by its seed capital holdings and can borrow up to $65.0 million, so long as the borrowing does not represent more than 50% of the value of the permitted seed capital collateral. At June 30, 2019, amounts outstanding under this non-recourse seed capital facility amounted to $25.0 million. Since this facility is non-recourse to us beyond the seed investments themselves, drawdowns under this facility are excluded from our third party debt levels for purposes of calculating our credit ratio covenants under the Credit Facility.

As of June 30, 2019, we were in compliance with the required covenants related to borrowings and debt facilities.

Critical Accounting Policies and Estimates

There have been no significant changes to the critical accounting policies disclosed in our most recent Form 10-K for the year ended December 31, 2018. Critical accounting policies are those that require management’s most difficult, subjective or complex judgments and would therefore be deemed the most critical to an understanding of our results of operations and financial condition.

Recent Accounting Developments

See discussion of Recent Accounting Developments in Note 2 of the accompanying Condensed Consolidated Financial Statements.

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Forward Looking Statements

This Quarterly Report on Form 10-Q includes forward-looking statements, as that term is used in the Private Securities Litigation Reform Act of 1995, including information relating to anticipated growth in revenues, margins or earnings, anticipated changes in our business and strategy, anticipated future performance of our business, the impact of the redomiciliation transaction, anticipated future investment performance of our Affiliates, our expected future net cash flows, our anticipated expense levels, changes in expense, the expected effects of acquisitions and expectations regarding market conditions. The words or phrases “will likely result,” “are expected to,” “will continue,” “is anticipated,” “can be,” “may be,” “aim to,” “may affect,” “may depend,” “intends,” “expects,” “believes,” “estimate,” “project,” and other similar expressions are intended to identify such forward-looking statements. Such statements are subject to various known and unknown risks and uncertainties and we caution readers that any forward-looking information provided by or on behalf of us is not a guarantee of future performance.

Actual results may differ materially from those in forward-looking information as a result of various factors, some of which are beyond our control, including but not limited to those discussed above and elsewhere in this Quarterly Report on Form 10-Q and in our most recent Annual Report on Form 10-K, filed with the Securities and Exchange Commission on February 28, 2019. Due to such risks and uncertainties and other factors, we caution each person receiving such forward-looking information not to place undue reliance on such statements. Further, such forward-looking statements speak only as of the date of this Quarterly Report on Form 10-Q and we undertake no obligations to update any forward looking statement to reflect events or circumstances after the date of this Quarterly Report on Form 10-Q or to reflect the occurrence of unanticipated events.

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Item 3. Quantitative and Qualitative Disclosures About Market Risk.

Market Risk

Our exposure to market risk is directly related to the role of our Affiliates as asset managers. Substantially all of our investment management revenues are derived from our Affiliates’ agreements with their clients. Under these agreements, the revenues we receive are based on the value of our assets under management or the investment performance on client accounts for which we earn performance fees. Accordingly, our revenues and net income may decline as a result of our assets under management decreasing due to depreciation of our investment portfolios. In addition, such depreciation could cause our clients to withdraw their funds in favor of investments offering higher returns or lower risk, which would cause our revenues and net income to decline further.

Our model for assessing the impact of market risk on our results uses June 30, 2019 ending AUM and management fee rates as the basis for management fee revenue calculations. With respect to performance fee revenue, we assume that relative investment performance is the same as in the past four quarters ended June 30, 2019. Therefore, market-driven changes in performance fees, which are typically based on relative performance versus market indices, reflect changes in the underlying AUM used in the calculation rather than differences in relative performance as a result of a changed market environment. The basis for the analysis is performance fees earned for the twelve months ended June 30, 2019.

Our profit sharing economic structure results in a sharing of market risk between us and our employees. Approximately 50% of our ENI cost structure is variable, representing variable compensation and key employee distributions for the Affiliates. These variable expenses generally are linked in a formulaic manner to the profitability of the business after covering operating expenses, which include base compensation and benefits, general and administrative expenses, and depreciation and amortization. In modeling the impact of market risk, we assume that these operating expenses remain unchanged, but the resulting impact on profit driven by increases or decreases in revenue will change variable compensation and Affiliate key employee distributions in line with their formulaic calculations. Any change in pre-tax profit is tax-affected at our statutory combined state and federal rate of approximately 27% to calculate profit after tax.

The value of our assets under management was $225.0 billion as of June 30, 2019. A 10% increase or decrease in the value of our assets under management, if proportionally distributed over all of our investment strategies, asset classes and client relationships, would cause an annualized increase or decrease in our gross management fee revenues of approximately $85.0 million based on our current weighted average fee rate of approximately 38 basis points, including equity-accounted Affiliates. Approximately $48.5 billion, or 22%, of our AUM, including equity-accounted Affiliates, are in accounts subject to performance fees. Of these assets, approximately 80% are in accounts for which performance fees, or management fee adjustments, are calculated based on investment return that differs from the relative benchmark returns. Assuming the market change does not impact our relative performance, a 10% increase or decrease in AUM would have no impact to our gross performance fees based on our trailing twelve month performance fees of $(0.2) million as of June 30, 2019. The combined impact on our management fees and performance fees would have a direct impact on our earnings and result in an annual change of approximately $30.7 million in our post-tax economic net income, given our current cost structure and operating model.

Equity market risk, interest rate risk, and foreign currency risk are the market risks that could have the greatest impact on our management fees, performance fees and our business profitability. Impacts on our management and performance fees can be calculated based on the percentage of AUM constituting equity investments, fixed income investments, or foreign currency denominated investments, respectively, multiplied by the relevant weighted average management fee and performance fee attributable to that asset class.

•

Our equity markets-based AUM includes U.S. equities (including small cap through large cap securities and substantially value or blended investment styles) and global/non-U.S. equities (including global, non-U.S. and emerging markets securities). A 10% increase or decrease in equity markets would cause our $187.1 billion of equity assets under management to increase or decrease by $18.7 billion, resulting in a change in annualized management fee revenue of $64.5 million and an annual change in post-tax economic net income of

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approximately $25.2 million, given our current cost structure, operating model, and weighted average equity fee rates of 35 basis points at the mix of strategies as of June 30, 2019. Approximately $37.0 billion, or 20%, of our equity markets-based AUM are in accounts subject to performance fees. Of these assets, approximately 99% are in accounts for which performance fees, or management fee adjustments, are calculated based on investment return that differs from the relative benchmark returns. Assuming the market change does not impact our relative performance, a 10% change in equity markets would have an approximate incremental $(0.4) million impact from performance fees on our post-tax economic net income, given our current cost structure and operating model.

•

Foreign currency AUM includes equity and alternative assets denominated in foreign currencies. A 10% increase or decrease in foreign exchange rates against the U.S. dollar would cause our $96.7 billion of foreign currency denominated AUM to increase or decrease by $9.7 billion, resulting in a change in annualized management fee revenue of $42.2 million and an annual change in post-tax economic net income of $16.3 million, based on weighted average fees earned on our foreign currency denominated AUM of 44 basis points at the mix of strategies as of June 30, 2019. Approximately $12.0 billion, or 12%, of our foreign currency denominated AUM are in accounts subject to performance fees. Of these assets, approximately 90% are in accounts for which performance fees, or management fee adjustments, are calculated based on investment return that differs from the relative benchmark returns. Assuming the market change does not impact our relative performance, a 10% change in foreign currency exchange rates would have an approximate incremental $0.1 million impact from performance fees on our post-tax economic net income, given our current cost structure and operating model.

•

Fixed income AUM includes instruments in government bonds, corporate bonds and other fixed income investments in the United States. A change in interest rates, resulting in a 10% increase or decrease in the value of our total fixed income AUM of $14.4 billion, would cause AUM to rise or fall by approximately $1.4 billion. Based on our fixed income weighted average fee rates of 19 basis points, annualized management fees would change by $2.8 million and post-tax economic net income would change by $1.1 million annually. There are currently no material fixed income assets earning performance fees as of June 30, 2019.

While the analysis above assumes that market changes occur in a uniform manner across the relevant portfolio, because of our declining fee rates for larger relationships and differences in our fee rates across asset classes, a change in the composition of our assets under management, in particular an increase in the proportion of our total assets under management attributable to strategies, clients or relationships with lower effective fee rates, could have a material negative impact on our overall weighted average fee rate.

As is customary in the asset management industry, clients invest in particular strategies to gain exposure to certain asset classes, which exposes their investment to the benefits and risks of such asset classes. We have not adopted a corporate-level risk management policy regarding client assets, nor have we attempted to hedge at the corporate level or within individual strategies the market risks that would affect the value of our overall assets under management and related revenues. Any reduction in the value of our assets under management would result in a reduction in our revenues.

Interest Rate Risk

We are exposed to interest rate risks primarily through borrowings under our Credit Facility. Interest on borrowings under the Credit Facility is based upon variable interest rates. Borrowings under our Credit Facility were $210 million as of June 30, 2019. We currently do not hedge against interest rate risk. As of June 30, 2019, a hypothetical 10% change in interest rates would have resulted in a $0.2 million change to our interest expense during the second quarter of 2019.

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Item 4. Controls and Procedures.

Controls and Procedures

Our management, including our Chief Executive Officer and our Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) at June 30, 2019. Based on this evaluation, our Chief Executive Officer and our Chief Financial Officer have concluded that our disclosure controls and procedures are effective.

Internal Control over Financial Reporting

There have been no changes in internal control over financial reporting during the quarter ended June 30, 2019 that have materially affected or are reasonably likely to materially affect our internal control over financial reporting.

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PART II — OTHER INFORMATION

Item 1. Legal Proceedings.

From time to time, we and our Affiliates may be parties to various claims, suits and complaints in the ordinary course of our business. Although the amount of liability that may result from these matters cannot be ascertained, we do not currently believe that, in the aggregate, they will result in liabilities material to our consolidated financial condition, future results of operations or cash flow.

Item 1A. Risk Factors

In addition to the other information set forth in this report, you should carefully consider the factors discussed in our most recent Annual Report on Form 10-K, filed with the Securities and Exchange Commission on February 28, 2019, under the heading “Risk Factors.”

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

The following table sets out information regarding purchases of equity securities by the Company for the three months ended June 30, 2019:



Period	Total number of shares purchased	Average price paid per share		Total number of shares purchased as part of publicly announced plans or programs	Approximate dollar value that may yet be purchased under the plans or programs⁽¹⁾ (in millions)
April 1-30, 2019	—	$	—	—	$	334.3
May 1-31, 2019	—	—		—	334.3
June 1-30, 2019	303,513	10.87		303,513	331.0
Total	303,513	$	10.87	303,513

(1)

On February 3, 2016, our Board of Directors authorized a $150.0 million open market share repurchase program, which was approved by shareholders on March 15, 2016. On April 18, 2018, our Board of Directors approved an amendment to the existing repurchase contract, to permit us to repurchase our ordinary shares, from time to time, up to an aggregate limit of $600.0 million of ordinary shares. This amendment was subsequently approved by our shareholders on June 19, 2018. We repurchased 303,513 shares under this program during the three months ended June 30, 2019. As of June 30, 2019, $331.0 million remained available to repurchase shares under the February 2016 program.

Item 6. Exhibits.



Exhibit No.			Description
2.1			Purchase Agreement, dated June 13, 2016, by and among OMAM Inc., OMAM (2016 Newco) LLC, Landmark Partners, LLC, LMRK Intermediary, Inc. and the sellers named therein, incorporated herein by reference to Exhibit 2.1 to the Current Report on Form 8-K/A filed on July 20, 2016.

3.1			Amended and Restated Certificate of Incorporation of BrightSphere Investment Group Inc., adopted as of July 12, 2019, incorporated herein by reference to Exhibit 3.1 to the Current Report on Form 8-K12B filed on July 15, 2019.

3.2			Amended and Restated Bylaws of BrightSphere Investment Group Inc., adopted as of July 12, 2019, incorporated herein by reference to Exhibit 3.2 to the Current Report on Form 8-K12B filed on July 15, 2019.

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Exhibit No.			Description
4.1*			Specimen Common Stock Certificate of BrightSphere Investment Group Inc.

4.2			Form of Senior or Subordinated Indenture, incorporated herein by reference to Exhibit 4.2 to the Registration Statement No. 333-207781 on Form S-3 filed on November 4, 2015.

4.3			Base Indenture, dated as of July 25, 2016, among OM Asset Management plc, as Issuer, Wilmington Trust, National Association, as Trustee, and Citibank, N.A., as Securities Administrator, incorporated herein by reference to Exhibit 4.1 to the Current Report on Form 8-K filed on July 25, 2016.

4.4			Supplemental Indenture, dated as of July 25, 2016, among OM Asset Management plc, as Issuer, Wilmington Trust, National Association, as Trustee, and Citibank, N.A., as Securities Administrator, incorporated herein by reference to Exhibit 4.2 to the Current Report on Form 8-K filed on July 25, 2016.

4.5			Form of 4.800% Note due 2026, incorporated herein by reference to Exhibit 4.2 to the Current Report on Form 8-K filed on July 25, 2016.

4.6			Second Supplemental Indenture, dated as of August 1, 2016, among OM Asset Management plc, as Issuer, Wilmington Trust, National Association, as Trustee, and Citibank, N.A. as Securities Administrator, incorporated herein by reference to Exhibit 4.2 to the Current Report on Form 8-K filed on August 1, 2016.

4.7			Form of 5.125% Note due 2031, incorporated herein by reference to Exhibit 4.2 to the Current Report on Form 8-K filed on August 1, 2016.

4.8*			Third Supplemental Indenture, dated as of July 11, 2019, among BrightSphere Investment Group plc, as Original Issuer, BrightSphere Investment Group Inc., as Successor Company, Wilmington Trust, National Association, as Trustee, and Citibank, N.A., as Securities Administrator.

4.9*			Fourth Supplemental Indenture, dated as of July 11, 2019, among BrightSphere Investment Group plc, as Original Issuer, BrightSphere Investment Group Inc., as Successor Company, Wilmington Trust, National Association, as Trustee, and Citibank, N.A., as Securities Administrator.

10.1			Revolving Credit Agreement, dated October 15, 2014, by and among OM Asset Management plc, certain lenders, and Citibank N.A., as administrative agent, with Citigroup Global Markets Inc. and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as joint book runners and joint lead arrangers, incorporated herein by reference to Exhibit 10.7 to Current Report on Form 8-K filed on October 20, 2014.

10.2			BrightSphere Investment Group Inc. Equity Incentive Plan, incorporated herein by reference to Exhibit 10.2 to the Current Report on Form 8-K12B filed on July 15, 2019.

10.3			Co-Investment Deed, dated October 8, 2014, by and between OM Asset Management plc and OM Group (UK) Limited, incorporated herein by reference to Exhibit 10.2 to Current Report on Form 8-K filed on October 20, 2014.

10.4*			Registration Rights Agreement, dated May 17, 2019, between BrightSphere Investment Group Inc. and Paulson & Co. Inc.

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Exhibit No.			Description
10.5*			Stockholder Agreement, dated May 17, 2019, between BrightSphere Investment Group Inc. and Paulson & Co. Inc.

10.6			Form of Indemnity Agreement, incorporated herein by reference to Exhibit 10.1 to the Current Report on Form 8-K12B filed on July 15, 2019.

10.7			Amended and Restated Limited Liability Company Agreement of Barrow, Hanley, Mewhinney & Strauss, LLC, effective February 26, 2018, incorporated herein by reference to Exhibit 10.9 to Annual Report on Form 10-K filed on February 28, 2018.

10.8			Seventh Amended and Restated Limited Liability Company Agreement of Acadian Asset Management LLC, effective July 1, 2017 incorporated herein by reference to Exhibit 10.10 to Annual Report on Form 10-K filed on February 28, 2018.

10.9			BrightSphere Investment Group Inc. Non-Employee Directors’ Equity Incentive Plan, incorporated herein by reference to Exhibit 10.3 to the Current Report on Form 8-K12B filed on July 15, 2019.

10.10			Form of Restricted Stock Unit Award Agreement for Employees, incorporated herein by reference to Exhibit 10.17 to Registration Statement No. 333-197106 on Form S-1 filed on September 8, 2014.

10.11			Form of Restricted Stock Award Agreement for Employees, incorporated herein by reference to Exhibit 10.16 to Registration Statement No. 333-197106 on Form S-1 filed on September 8, 2014.

10.12			Form of Restricted Stock Unit Award Agreement for Non-Employee Directors, incorporated herein by reference to Exhibit 10.18 to Registration Statement No. 333-197106 on Form S-1 filed on September 18, 2014.

10.13			Form of Restricted Stock Unit Award Agreement for Canadian Employees, incorporated herein by reference to Exhibit 10.19 to Registration Statement No. 333-197106 on Form S-1 filed on September 18, 2014.

10.14			Form of Restricted Stock Unit Award Agreement for Hong Kong Employees, incorporated herein by reference to Exhibit 10.20 to Registration Statement No. 333-197106 on Form S-1 filed on September 18, 2014.

10.15			Form of Restricted Stock Unit Award Agreement for U.K. Employees, incorporated herein by reference to Exhibit 10.21 to Registration Statement No. 333-197106 on Form S-1 filed on September 18, 2014.

10.16			Heads of Agreement, dated as of June 13, 2016, among OM Asset Management plc and OM Group (UK) Limited, amending the Deferred Tax Asset Deed, dated September 29, 2014, incorporated herein by reference to Exhibit 10.2 to Current Report on Form 8-K filed on June 14, 2016.

10.17			First Amendment dated September 1, 2015 to the Revolving Credit Agreement dated as of October 15, 2014 by and among OM Asset Management plc and Citibank, N.A., incorporated herein by reference to Exhibit 10.26 to Quarterly Report on Form 10-Q filed on August 9, 2016.

10.18			Second Amendment dated March 1, 2016 to the Revolving Credit Agreement, as amended, dated as of October 15, 2014 by and among OM Asset Management plc and Citibank, N.A., incorporated herein by reference to Exhibit 10.27 to Quarterly Report on Form 10-Q filed on August 9, 2016.

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Exhibit No.			Description

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Exhibit No.			Description
10.19			Third Amendment dated August 3, 2016 to the Revolving Credit Agreement, as amended, dated as of October 15, 2014 by and among OM Asset Management plc and Citibank, N.A., incorporated herein by reference to Exhibit 10.28 to Quarterly Report on Form 10-Q filed on August 9, 2016.

10.20*			Revolving Credit Agreement, dated October 15, 2014, as amended and restated as of July 11, 2019, by and among BrightSphere Investment Group Inc., certain lenders, and Citibank N.A., as administrative agent, with Citigroup Global Markets Inc. and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as joint book runners and joint lead arrangers.

10.21			Form of Transition Severance Agreement, incorporated herein by reference to Exhibit 10.28 to Quarterly Report on Form 10-Q, filed on November 9, 2017

10.22			Employment Agreement, dated December 30, 2018, by and between BrightSphere Inc. and GuangYang, incorporated by reference to Exhibit 10.26 to Annual Report on Form 10-K filed on February 28, 2019.

10.23			Employment Agreement, dated January 20, 2019, by and between BrightSphere Inc. and Suren Rana, incorporated by reference to Exhibit 10.27 to Annual Report on Form 10-K filed on February 28, 2019.

10.24			Option Award Agreement, effective December 30, 2018 by and between BrightSphere Investment Group plc and Guang Yang, incorporated by reference to Exhibit 4.1 to the Form S-8, filed on January 2, 2019.

10.25			Option Award Agreement, effective January 22, 2019 by and between BrightSphere Investment Group plc and Suren Rana, incorporated by reference to Exhibit 10.27 to Annual Report on Form 10-K filed on February 28, 2019.

10.26			Voting Agreement, dated May 17, 2019, between BrightSphere Investment Group plc and Paulson & Co. Inc., incorporated by reference to Exhibit 10.1 to the Form 8-K filed on May 23, 2019.

31.1*			Certification of the Company’s Chief Executive Officer pursuant to Exchange Act Rules 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2*			Certification of the Company’s Head of Finance pursuant to Exchange Act Rules 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1*			Certification of the Company’s Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2*			Certification of the Company’s Head of Finance pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101*			Interactive data files pursuant to Rule 405 of Regulation S-T: (i) the Condensed Consolidated Balance Sheets as of June 30, 2019 and December 31, 2018, (ii) the Condensed Consolidated Statements of Operations for the three and six months ended June 30, 2019 and 2018, (iii) the Condensed Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2019 and 2018, (iv) the Condensed Consolidated Statements of Changes in Shareholders’ Equity for the three and six months ended June 30, 2019 and 2018, (v) the Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2019 and 2018, and (vi) the Notes to Financial Statements.

104*			The cover page of this Quarterly Report on Form 10-Q, formatted in Inline eXtensible Business Reporting Language

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* Filed herewith

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SIGNATURES

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 thereunto duly authorized.



		BrightSphere Investment Group Inc.

Dated:	August 8, 2019

		By:	/s/ Guang Yang
			Guang Yang President, Chief Executive Officer and Executive Chairman (principal executive officer)

			/s/ Suren Rana
			Suren Rana Chief Financial Officer (principal financial officer)

			/s/ Daniel K. Mahoney
			Daniel K. Mahoney Senior Vice President and Head of Finance (principal accounting officer)

BSIG 201954

Exhibit 4.8

THIRD SUPPLEMENTAL INDENTURE

THIRD SUPPLEMENTAL INDENTURE, dated as of July 11, 2019 (this “Supplemental

Indenture”), among (i) BrightSphere Investment Group plc (formerly known as OM Asset Management PLC), a public limited company formed and existing under the laws of England and Wales (herein called the “Original Issuer”), (ii) BrightSphere Investment Group Inc., a Delaware corporation (together with its successors and assigns, the “Successor Company”), (iii) Wilmington Trust, National Association, a national banking association duly organized and existing under the laws of United States of America, as Trustee (herein called the “Trustee”), and (iv) Citibank, N.A., a national banking association duly organized and existing under the laws of the United States of America, as Securities Administrator (herein called the “Securities Administrator”), to the Indenture, dated as of July 25, 2016, among the Original Issuer, the Trustee and the Securities Administrator (the “Base Indenture”).

W I T N E S S E T H :

WHEREAS, the Original Issuer, the Trustee and the Securities Administrator have heretofore executed and delivered the Base Indenture and the First Supplemental Indenture thereto dated as of July 25, 2016 (the “First Supplemental Indenture” and the Base Indenture as supplemented by the First Supplemental Indenture, the “Indenture”), and pursuant to the Indenture, the Original Issuer has issued its 4.800% Senior Notes due 2026 (the “Notes”);

WHEREAS, the Board of Directors of the Original Issuer has decided to restructure the Original Issuer’s corporate group, which consists of the Original Issuer and its operating subsidiaries (such operating subsidiaries and the holding company collectively, the “BrightSphere Group”), and to change the jurisdiction of incorporation of the holding company of the BrightSphere Group from the

United Kingdom to Delaware (the “Redomestication”);

WHEREAS, in furtherance of the Redomestication, the Original Issuer has contributed interests in certain entities and certain other co-investment assets to the Successor Company (the “Seed Capital Contribution”) and concurrently with the execution and delivery hereof the Original Issuer will contribute all its material assets and liabilities to the Successor Company (which contribution, together with the Seed Capital Contribution, constitutes a conveyance by the Original Issuer to the Successor Company of the Original Issuer’s properties as an entity or substantially as an entity as contemplated by

Section 8.01 of the Indenture, the “Conveyance”);

WHEREAS, in connection with the Conveyance, pursuant to Section 8.01 of the Indenture, the Original Issuer desires that the Successor Company assume the Original Issuer’s obligations under the Notes and the Indenture, and the Successor Company desires to assume the Original Issuer’s obligations under the Notes and the Indenture;

WHEREAS, pursuant to Sections 9.01(a) of the Indenture, the Trustee, the Securities

Administrator and the Original Issuer are authorized to execute and deliver this Supplemental Indenture to evidence the succession of the Successor Company to the Original Issuer and the assumption by the Successor Company of the covenants of the Original Issuer contained in the Indenture and the Notes;

WHEREAS, the Original Issuer has furnished the Trustee with an Opinion of Counsel and an

Officers’ Certificate in accordance with the Indenture, stating that (i) the Conveyance and the

Supplemental Indenture comply with Article Eight of the Indenture, (ii) all conditions precedent

provided in the Indenture relating to the Conveyance and the execution and delivery of the Supplemental Indenture have been complied with and (iii) the execution of the Supplemental Indenture is authorized and permitted by the Indenture; and

WHEREAS, all things necessary to make this Supplemental Indenture a valid agreement of the Original Issuer, the Successor Company the Trustee and the Securities Administrator and a valid amendment of, and supplement to, the Indenture and the Notes have been done.

NOW, THEREFORE, in consideration of the premises set forth herein and for other good and valuable consideration, the receipt of which is hereby acknowledged, the parties hereto covenant and agree for the equal and proportionate benefit of all Holders of the Notes, as follows:

ARTICLE I

DEFINITIONS

SECTION 1.1 Defined Terms. As used in this Supplemental Indenture, terms defined in the Indenture are used herein as therein defined. The words “herein,” “hereof” and “hereby” and other words of similar import used in this Supplemental Indenture refer to this Supplemental Indenture as a whole and not to any particular section hereof. All references in the Indenture and the Notes to “OM Asset Management plc” and “BrightSphere Investment Group plc” are hereby amended and replaced, immediately upon the effectiveness of the Conveyance, with “BrightSphere Investment Group Inc.”

ARTICLE II

ASSUMPTION OF AGREEMENT TO ASSUME OBLIGATIONS

SECTION 2.1 Assumption of Obligations. Pursuant to Article Eight of the Indenture, the Successor Company (i) hereby assumes the due and punctual payment of the principal of (and premium, if any) and any interest (including all Additional Amounts, if any, payable pursuant to the Indenture) on all of the Notes, according to their tenor, and the due and punctual performance and observance of all of the covenants and conditions of the Indenture to be performed by the Original Issuer and (ii) hereby succeeds to and is substituted for the Original Issuer, with the same effect as if the Successor Company had been named as the Original Issuer in the Indenture and the Notes.

ARTICLE III

MISCELLANEOUS

SECTION 3.1 Notices. All notices or other communications to the Successor Company shall be given as provided in the Indenture addressed as follows:

If to the Successor Company:

BrightSphere Investment Group Inc.

200 Clarendon Street, 53rd Floor

Boston, Massachusetts 02116

Attention: General Counsel

SECTION 3.2 Concerning the Trustee and the Securities Administrator. Neither the Trustee nor the Securities Administrator shall assume any duties, responsibilities, or liabilities by reason of this

Supplemental Indenture other than to the extent set forth in the Indenture, and the Trustee and the

Securities Administrator shall be indemnified in accordance with the terms of the Indenture. Neither the Trustee nor the Securities Administrator shall be responsible in any manner whatsoever for or in respect of (i) the validity or sufficiency of this Supplemental Indenture, (ii) the correctness of any of the provisions contained herein, or (iii) the recitals contained herein, all of which recitals are made solely by the Original Issuer and the Successor Company. In entering into this Supplemental Indenture the Trustee shall be entitled to the benefit of every provision of the Indenture limiting the liability of, limiting the obligations of, or affording rights, defenses, exculpations, benefits, protections, privileges, immunities or indemnities to the Trustee as if they were expressly set forth for the benefit of the Trustee herein mutatis mutandis.

SECTION 3.3 Supplemental Indenture Controls. In the event of a conflict or inconsistency between the Indenture and this Supplemental Indenture, the provisions of this Supplemental Indenture shall control.

SECTION 3.4 Governing Law. This Supplemental Indenture shall be governed by and construed in accordance with the laws of the State of New York.

SECTION 3.5 Execution in Counterparts. This Supplemental Indenture may be executed in any number of counterparts, each of which shall be deemed to be an original regardless of whether delivered in physical or electronic form, but all such counterparts shall together constitute but one and the same instrument.

SECTION 3.6 Confirmation of Indenture. Except as amended and supplemented hereby, the Indenture is hereby ratified, confirmed and reaffirmed in all respects. The Indenture and this Supplemental Indenture shall be read, taken and construed as one and the same instrument.

SECTION 3.7 Headings. The titles and headings of the articles and sections of this Supplemental Indenture have been inserted for convenience of reference only, are not to be considered a part hereof, and shall in no way modify or restrict any of the terms or provisions hereof.

SECTION 3.8 Severability. In case any provision in this Supplemental Indenture shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

SECTION 3.9 No Adverse Interpretation of Other Agreements. This Supplemental Indenture may not be used to interpret another indenture, loan, or debt agreement other than the Indenture for purposes of the Notes. Any such indenture, loan, or debt agreement may not be used to interpret this Supplemental Indenture.

SECTION 3.10 Provisions Binding On Company’s Successors. All the covenants, stipulations, promises and agreements in this Supplemental Indenture contained by the Successor Company shall bind its successors and assigns, whether so expressed or not.

[Signature Page Follows]

IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed as of the date first above written.

BRIGHTSPHERE INVESTMENT GROUP PLC

By: /s/ Guang Yang_______________

Name: Guang Yang

Title: President and Chief Executive Officer

BRIGHTSPHERE INVESTMENT GROUP INC.

By: /s/ Guang Yang_______________

Name: Guang Yang

Title: President and Chief Executive Officer

WILMINGTON TRUST, NATIONAL

ASSOCIATION, as Trustee

By: /s/ Nedine P. Sutton____________

Name: Nedine P. Sutton

Title: Vice President

CITIBANK, N.A., as Securities Administrator

By: /s/ Danny Lee_________________

Name: Danny Lee

Title: Senior Trust Officer

Exhibit 4.9

FOURTH SUPPLEMENTAL INDENTURE

FOURTH SUPPLEMENTAL INDENTURE, dated as of July 11, 2019 (this “Supplemental

W I T N E S S E T H :

WHEREAS, the Original Issuer, the Trustee and the Securities Administrator have heretofore executed and delivered the Base Indenture and the Second Supplemental Indenture thereto dated as of July 25, 2016 (the “Second Supplemental Indenture” and the Base Indenture as supplemented by the Second Supplemental Indenture, the “Indenture”), and pursuant to the Indenture, the Original Issuer has issued its 5.125% Senior Notes due 2031 (the “Notes”);

United Kingdom to Delaware (the “Redomestication”);

Section 8.01 of the Indenture, the “Conveyance”);

WHEREAS, pursuant to Sections 9.01(a) of the Indenture, the Trustee, the Securities

WHEREAS, the Original Issuer has furnished the Trustee with an Opinion of Counsel and an

Officers’ Certificate in accordance with the Indenture, stating that (i) the Conveyance and the

Supplemental Indenture comply with Article Eight of the Indenture, (ii) all conditions precedent

ARTICLE I

DEFINITIONS

ARTICLE II

ASSUMPTION OF AGREEMENT TO ASSUME OBLIGATIONS

ARTICLE III

MISCELLANEOUS

SECTION 3.1 Notices. All notices or other communications to the Successor Company shall be given as provided in the Indenture addressed as follows:

If to the Successor Company:

BrightSphere Investment Group Inc.

200 Clarendon Street, 53rd Floor

Boston, Massachusetts 02116

Attention: General Counsel

SECTION 3.2 Concerning the Trustee and the Securities Administrator. Neither the Trustee nor the Securities Administrator shall assume any duties, responsibilities, or liabilities by reason of this

Supplemental Indenture other than to the extent set forth in the Indenture, and the Trustee and the

SECTION 3.4 Governing Law. This Supplemental Indenture shall be governed by and construed in accordance with the laws of the State of New York.

[Signature Page Follows]

IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed as of the date first above written.

BRIGHTSPHERE INVESTMENT GROUP PLC

By: /s/ Guang Yang_______________

Name: Guang Yang

Title: President and Chief Executive Officer

BRIGHTSPHERE INVESTMENT GROUP INC.

By: /s/ Guang Yang_______________

Name: Guang Yang

Title: President and Chief Executive Officer

WILMINGTON TRUST, NATIONAL

ASSOCIATION, as Trustee

By: /s/ Nedine P. Sutton____________

Name: Nedine P. Sutton

Title: Vice President

CITIBANK, N.A., as Securities Administrator

By: /s/ Danny Lee_________________

Name: Danny Lee

Title: Senior Trust Officer

Exhibit 10.4

REGISTRATION RIGHTS AGREEMENT

dated as of

May 17, 2019

by and among

BrightSphere Investment Group Inc.

and

Paulson & Co. Inc.

Table of Contents



		Page
ARTICLE 1 DEFINITIONS		1
1.1 Definitions		1
1.2 Interpretation		3
ARTICLE 2 REGISTRATION RIGHTS		4
2.1 Shelf Registration		4
2.2 Demand Registrations		5
2.3 Priority		5
2.4 Piggyback Registrations		5
2.5 Lock-up Agreements		6
2.6 Registration Procedures		6
2.7 Registration Expenses		8
2.8 Underwritten Offering		9
2.9 Suspension of Registration		9
2.10 Indemnification		9
2.11 Conversion of Other Securities		11
2.12 Rule 144; Rule 144A		11
2.13 Transfer of Registration Rights		11
ARTICLE 3 PROVISIONS APPLICABLE TO ALL DISPOSITIONS OF REGISTRABLE SECURITIES		11
3.1 Underwriter Selection		11
3.2 Cooperation with Sales		11
3.3 Expenses of Offerings		12
3.4 Further Assurances		12
ARTICLE 4 MISCELLANEOUS		12
4.1 Term		12
4.2 Other Holder Activities		12
4.3 No Inconsistent Agreements		12
4.4 Amendments and Waivers		12
4.5 No Third Party Beneficiaries		12
4.6 Entire Agreement		12
4.7 Severability		12
4.8 Counterparts		13
4.9 Remedies; Attorney’s Fees		13
4.10 GOVERNING LAW		13
4.11 No Assignment		13
4.12 Further Actions		13
4.13 Notice		13

REGISTRATION RIGHTS AGREEMENT

This Registration Rights Agreement, dated as of May 17, 2019 (this “Agreement”), is by and among BrightSphere Investment Group Inc., a Delaware corporation (the “Company”), and Paulson & Co. Inc., a Delaware corporation, (on behalf of the funds and accounts managed by it and its affiliates, “Paulson”, and together with the Company, each a “Party” and, collectively, the “Parties”). This Agreement shall be effective as of the date the shareholders of BrightSphere Investment Group plc vote to approve an exchange of ordinary shares held by each of the shareholders of BrightSphere Investment Group plc for shares of common stock of the Company (the “Effective Date”).

WHEREAS, Paulson is the owner of 20,000,552 shares of Common Stock (as defined herein) of the Company immediately prior to the date hereof; and

WHEREAS, the Company has agreed to provide Paulson certain rights as set forth herein.

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

DEFINITIONS

1.1Definitions. In this Agreement, the following terms shall have the following meanings:

(a)“Affiliate” means, with respect to any Person, any other Person directly or indirectly controlling, controlled by or under common control with, such other Person. For purposes of this definition, “control,” (including, with correlative meanings, the terms “controlled by” and “under common control with”) when used with respect to any Person, means the possession directly or indirectly of the power to direct or cause the direction of the management or policies of such Person, whether through ownership of voting securities or partnership or other ownership interests, by contract or otherwise.

(b)“Board of Directors” means the Board of Directors of the Company from time to time.

(c)“Business Day” means any day except (i) a Saturday, (ii) a Sunday, (iii) any day on which the principal office of the Company or Paulson is not open for business, and (iv) any other day on which commercial banks in New York, New York are authorized or obligated by law or executive order to close.

(d)“Common Stock” means the common stock, par value $0.001 per share, of the Company.

(e)“Company Outside Counsel” means one counsel selected by the Company to act on its behalf.

(f)“Covered Person” has the meaning set forth in Section 2.10(a).

(g)“Demand Registration” has the meaning set forth in Section 2.2(a).

(h)“Designated Holder” means Paulson or any other Holder holding shares of Common Stock of the Company constituting not less than 7% of the outstanding shares of Common Stock of the Company.

(i)“Exchange Act” means the United States Securities Exchange Act of 1934, as amended, and the rules and regulations of the SEC promulgated thereunder.

(j)“Fund” means any pooled investment vehicle for which any Subsidiary of the Company, directly or indirectly, provides investment advisory or sub-advisory services, or serves as the general partner, managing member or in any similar capacity (including any master or feeder fund, parallel fund or other alternative investment vehicle or third party co-investment vehicle).

(k)“Holder” means Paulson and any permitted transferee of Registrable Securities to whom registration rights have been transferred under Section 2.13 hereof.

(l)“Holders’ Counsel” means, if Paulson is participating in an offering of Registrable Securities, one counsel selected by Paulson for the Holders participating in such offering or otherwise and one counsel selected by the Holders of a majority of the Registrable Securities included in such offering.

(m)“Material Disclosure Event” means, as of any date of determination, any pending or imminent event relating to the Company or any of its Subsidiaries that the Board of Directors reasonably determines in good faith, after consultation with Company Outside Counsel, (i) would require disclosure of material, non-public information relating to such event in any Registration Statement under which Registrable Securities may be offered and sold (including documents incorporated by reference therein) in order that such Registration Statement would not be materially misleading and (ii) would not otherwise be required to be publicly disclosed by the Company at that time in a periodic report to be filed with or furnished to the SEC under the Exchange Act but for the filing of such Registration Statement.

(n)“Person” means any individual, corporation, partnership, joint venture, limited liability company, association or other business entity and any trust, unincorporated organization or political subdivision thereof.

(o)“Piggyback Registration” means any registration of Registrable Securities under the Securities Act requested by a Holder in accordance with Section 2.4(a).

(p)“register,” “registered” and “registration” refers to a registration made effective by preparing and filing a Registration Statement with the SEC in compliance with the Securities Act, and the declaration or ordering of the effectiveness of such Registration Statement, and compliance with applicable state or foreign securities laws of such states or countries in which Holders notify the Company of their intention to offer Registrable Securities.

(q)“Registration Expenses” has the meaning set forth in Section 2.7.

(r)“Registrable Securities” means all Common Stock held by a Holder and any equity securities issued or issuable directly or indirectly with respect to any such securities by way of conversion or exchange thereof or share dividend or share split or in connection with a combination of shares, recapitalization, reclassification, merger, amalgamation, arrangement, consolidation or other reorganization; provided that, any securities constituting Registrable Securities will cease to be Registrable Securities when (i) such securities are sold in a private transaction in which the transferor’s rights under this Agreement are not assigned to the transferee of the securities, (ii) with respect to Registrable Securities held by any Holder other than a Designated Holder, such securities are sold pursuant to an effective Registration Statement or are eligible to be sold without volume or manner of sale restrictions pursuant to Rule 144 or (iii) with respect to Registrable Securities held by a Designated Holder, such securities are sold pursuant to an effective Registration Statement or pursuant to Rule 144 (and such Registrable Securities are no longer “restricted securities” as defined under Rule 144).

(s)“Registration Statement” means any registration statement of the Company under the Securities Act that permits the public offering of any of the Registrable Securities pursuant to the provisions of this Agreement, including the prospectus, amendments and supplements to such registration statement, all exhibits, all material incorporated by reference or deemed to be incorporated by reference in such registration statement and all other documents filed with the SEC to effect a registration under the Securities Act.

(t)“Rule 144” means Rule 144 promulgated by the SEC under the Securities Act.

(u)“Rule 144A” means Rule 144A promulgated by the SEC under the Securities Act.

(v)“Rule 405” means Rule 405 promulgated by the SEC under the Securities Act.

(w)“Rule 415” means Rule 415 promulgated by the SEC under the Securities Act.

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

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

(z)“Selling Holder” means a Holder that holds Registrable Securities registered (or to be registered) in a Registration Statement.

(aa)“Selling Expenses” means all underwriting discounts, selling commissions and transfer taxes applicable to the sale of Registrable Securities hereunder.

(bb) “Stockholder Agreement” means the Stockholder Agreement, dated as of the date hereof, by and among the Company and Paulson, to which this Agreement is attached as Annex A.

(cc) “Shelf Registration Statement” means a Registration Statement that contemplates offers and sales of securities pursuant to Rule 415.

(dd) “Short-Form Registration Statement” means Form S-3 or any successor or similar form of registration statement pursuant to which the Company may incorporate by reference its filings under the Exchange Act made after the date of effectiveness of such registration statement.

(ee) “Subsidiaries” means, with respect to a Person, any corporation, limited liability company, partnership, association, business, trust, joint venture, business entity or other entity of any kind or nature, of which more than fifty percent (50%) of either the equity interests or the voting control is, directly or indirectly through Subsidiaries or otherwise, beneficially owned by such Person, or of which such Person or any Subsidiary serves as the general partner (in the case of a limited partnership) or the manager or managing member (in the case of a limited liability company); provided that (i) no Fund or any Subsidiary of a Fund shall be a Subsidiary for the purposes of this Agreement; (ii) the Company and its Subsidiaries will not be deemed to be Affiliates of Paulson and Paulson will not be deemed to be an Affiliate of the Company; and (iii) for purposes of this definition, notwithstanding anything to the contrary contained herein, Investment Counselors of Maryland, LLC shall be considered a “Subsidiary” of the Company.

(ff) “Suspension” has the meaning set forth in Section 2.9.

(gg) “Underwritten Offering” means a discrete registered offering of securities conducted by one or more underwriters pursuant to the terms of an underwriting agreement.

1.2 Interpretation.

(a)In this Agreement, except as the context may otherwise require, references to:

(i)any statute, statutory provision or regulation are to the statute, statutory provision or regulation as amended, modified, supplemented or replaced from time to time (and, in the case of statutes, include any rules and regulations promulgated under the statute) and to any section of any statute or regulation includes any successor to the section; and

(ii)any governmental authority includes any successor to that governmental authority.

(b)The words “hereby”, “herein,” “hereof,” “hereunder,” “hereto” and similar terms are to be deemed to refer to this Agreement as a whole and not to any specific Section.

(c)The words “include,” “includes” or “including” are to be deemed followed by the words “without limitation.” Any singular term in this Agreement will be deemed to include the plural, and any plural term the singular. All pronouns and variations of pronouns will be deemed to refer to the feminine, masculine or neuter, singular or plural, as the identity of the Person referred to may require.

(d)The table of contents and Article and Section headings are for reference purposes only and do not limit or otherwise affect any of the substance of this Agreement.

(e)It is the intention of the Parties that every covenant, term and provision of this Agreement shall be construed simply according to its fair meaning and not strictly for or against any Party, it being understood and agreed that the Parties to this Agreement are sophisticated and have had adequate opportunity and means to retain counsel to represent their respective interests and to otherwise negotiate the terms and provisions of this Agreement. Accordingly, the Parties hereby waive, to the fullest extent permitted by Applicable Law, the benefit of any Applicable Law that would require that in cases of uncertainty, the language of a contract should be strictly construed against, or most strongly construed against, the Party who drafted such language.

(f)No provision of this Agreement is to be construed to require, directly or indirectly, any Person to take any action, or omit to take any action, to the extent such action or omission would violate Applicable Law.

(g)“Writing,” “written” and comparable terms refer to printing, typing, and other means of reproducing words (including electronic media) in a visible form.

(h)All references to “$” or “dollars” mean the lawful currency of the United States of America.

(i)All terms not otherwise defined herein shall have the meaning given to such terms in the Stockholder Agreement.

ARTICLE 2

REGISTRATION RIGHTS

2.1Shelf Registration.

(a)Filing. At any time after the date upon the written request of any Holder, the Company shall promptly (but no later than forty-five (45) days after the receipt of such request) file with the SEC a Shelf Registration Statement (which, if permitted, shall be an “automatic shelf registration statement” as defined in Rule 405) relating to the offer and sale by such Holder of all or part of the Registrable Securities. If at any time while Registrable Securities are outstanding, the Company files any Shelf Registration Statement for its own benefit or for the benefit of holders of any of its securities other than the Holders, the Company shall use its reasonable best efforts to include in such Shelf Registration Statement such disclosures as may be required under the Securities Act to ensure that the Holders may sell their Registrable Securities pursuant to such Shelf Registration Statement through the filing of a prospectus supplement rather than a post-effective amendment.

(b)Effectiveness. The Company shall use its reasonable best efforts to (i) cause such Shelf Registration Statement to be declared effective under the Securities Act as promptly as practicable after such Shelf Registration Statement is filed and (ii) keep such Shelf Registration Statement (or a replacement Shelf Registration Statement) continuously effective and in compliance with the Securities Act and usable for the resale of Registrable Securities until such time as there are no Registrable Securities remaining.

(c)Sales by Holders. The plan of distribution contained in the Shelf Registration Statement referred to in this Section 2.1 (or related prospectus supplement) shall be determined by Paulson, if Paulson is a requesting Holder for such Shelf Registration Statement, or otherwise by the other requesting Holder or Holders. Each Holder shall be entitled to sell Registrable Securities pursuant to the Shelf Registration Statement referred to in this Section 2.1 from time to time and at such times as such Holder shall determine. Such Holder shall promptly advise the Company of its intention so to sell Registrable Securities pursuant to the Shelf Registration Statement.

(d)Underwritten Offering. If any Holder intends to sell Registrable Securities pursuant to the Shelf Registration Statement referred to in this Section 2.1 through an Underwritten Offering, the Company shall take all steps to facilitate such an offering, including the actions required pursuant to Section 2.6 and Section 3, as appropriate; provided, that the Company will not be required to facilitate such Underwritten Offering unless so requested by such Holder and unless the expected aggregate gross proceeds from such offering are at least $50 million.

2.2 Demand Registrations.

(a)Right to Request Additional Demand Registrations. At any time, any Holder may, by providing a written request to the Company, request to sell all or part of the Registrable Securities pursuant to a Registration Statement separate from a Shelf Registration Statement (a “Demand Registration”). Each request for a Demand Registration shall specify the kind and aggregate amount of Registrable Securities to be registered and the intended methods of disposition thereof (which, if not specified, shall be by way of Underwritten Offering). Promptly after its receipt of a request for a Demand Registration (but in any event within ten (10) days), the Company will give written notice of such request to all other Holders. Within thirty (30) days after the date the Company has given the Holders notice of the request for Demand Registration, the Company shall commence the registration, in accordance with Section 2.6 of this Agreement, of all Registrable Securities that have been requested to be registered in the request for Demand Registration and that have been requested by any other Holders by written notice to the Company within fifteen (15) days after the Company has given the Holders notice of the request for Demand Registration; provided, that the Company will not be required to effect a Demand Registration unless the expected

aggregate gross proceeds from the offering of the Registrable Securities to be registered in connection with such Demand Registration are at least $50 million.

(b)Limitations on Demand Registrations. Subject to Section 2.2(a) and this Section 2.2(b), any Holder will be entitled to request an unlimited number of Demand Registrations; provided that the Company will not be obligated to effect more than one Demand Registration which, for the avoidance of doubt, shall be in addition to any registration on a Shelf Registration Statement, in any six-month period. Any Holder shall be entitled to participate in a Demand Registration initiated by any other Holder.

(c)Withdrawal. A Holder may, by written notice to the Company, withdraw its Registrable Securities from a Demand Registration at any time prior to the effectiveness of the applicable Registration Statement. Upon receipt of notices from all applicable Holders to such effect, the Company shall cease all efforts to seek effectiveness of the applicable Registration Statement.

2.3 Priority. If a registration pursuant to Section 2.1 or 2.2 above is an Underwritten Offering and the managing underwriters of such proposed Underwritten Offering advise the Holders in writing that, in their opinion, the number of securities requested to be included in such Underwritten Offering exceeds the number which can be sold in such offering without being likely to have a significant adverse effect on the price, timing or distribution of the securities offered or the market for the securities offered, then the number of securities to be included in such Underwritten Offering shall be reduced in the following order of priority: first, there shall be excluded from the Underwritten Offering any securities to be sold for the account of any selling securityholder other than the Holders; second, there shall be excluded from the Underwritten Offering any securities to be sold for the account of the Company; and finally, the number of Registrable Securities of any Holders that have been requested to be included therein shall be reduced, pro rata based on the number of Registrable Securities owned by each such Holder, in each case to the extent necessary to reduce the total number of securities to be included in such offering to the number recommended by the managing underwriters.

2.4 Piggyback Registrations.

(a)Piggyback Request. Whenever the Company proposes to register any of its securities under the Securities Act or equivalent non-U.S. securities laws (other than (i) pursuant to a Demand Registration, (ii) pursuant to a registration statement on Form S-4 or any similar or successor form or (iii) pursuant to a registration solely relating to an offering and sale to employees or directors of the Company pursuant to any employee share plan or other employee benefit plan arrangement), and the registration form to be filed may be used for the registration or qualification for distribution of Registrable Securities, the Company will give prompt written notice to all Holders of its intention to effect such a registration (but in no event less than twenty (20) days prior to the proposed date of filing of the applicable Registration Statement) and, subject to Section 2.4(c), will include in such registration all Registrable Securities with respect to which the Company has received written requests for inclusion therein within fifteen (15) days after the date the Company’s notice is given to such Holders (a “Piggyback Registration”). There shall be no limitation on the number of Piggyback Registrations that the Company shall be required to effect under this Section 2.4.

(b)Withdrawal and Termination. Any Holder that has made a written request for inclusion in a Piggyback Registration may withdraw its Registrable Securities from such Piggyback Registration by giving written notice to the Company on or before the fifth (5th) day prior to the planned effective date of such Piggyback Registration. The Company may, without prejudice to the rights of Holders to request a registration pursuant to Section 2.1 or 2.2 hereof, terminate or withdraw any registration under this Section 2.4 prior to the effectiveness of such registration, whether or not any Holder has elected to include Registrable Securities in such registration, and, except for the obligation to pay or reimburse Registration Expenses, the Company will have no liability to any Holder in connection with such termination or withdrawal.

(c)Priority of Piggyback Registrations. If the managing underwriters advise the Company and Holders of Registrable Securities in writing that, in their opinion, the number of securities requested to be included in an Underwritten Offering to be effected pursuant to a Piggyback Registration exceeds the number which can be sold in such offering without being likely to have a significant adverse effect on the price, timing or distribution of the securities offered or the market for the securities offered, then the securities to be included in such Underwritten Offering shall be reduced pro rata based, in the case of the Holders, on the number of Registrable Securities owned by each Holder and included in such Underwritten Offering to be effected pursuant to a Piggyback Registration, and in the case of the Company, the number of securities to be sold for the account of the Company in such Underwritten Offering, to the extent necessary to reduce the total number of Registrable Securities to be included in such offering to the number recommended by the managing underwriters. No registration of Registrable Securities effected pursuant to a request under this Section 2.4 shall be deemed to have been effected pursuant to Sections 2.1 or 2.2 or shall relieve the Company of its obligations under Sections 2.1 or 2.2.

2.5 Lock-up Agreements. Each of the Company and the Holders agrees, upon notice from the managing underwriters in connection with any registration for an Underwritten Offering of the Company’s securities (other than pursuant to a registration statement on Form S-4 or any similar or successor form or pursuant to a registration solely relating to an offering and sale to employees or directors of the Company pursuant to any employee share plan or other employee benefit plan arrangement), not to effect (other than pursuant to such registration) any public sale or distribution of Registrable Securities, including, but not limited to, any sale pursuant to Rule 144, or make any short sale of, loan, grant any option for the purchase of, or otherwise dispose of, any Registrable Securities, any other equity securities of the Company or any securities convertible into or exchangeable or exercisable for any equity securities of the Company without the prior written consent of the managing underwriters during such period as reasonably requested by the managing underwriters (but in no event longer than the seven (7) days before and the ninety (90) days after the pricing of such Underwritten Offering); provided, that such restrictions shall not apply in any circumstance to (i) securities acquired by a Holder in the public market, (ii) distributions-in-kind to a Holder’s limited or other partners, members, Stockholders or other equity holders, or (iii) transfers by a Paulson to a Related Person of Paulson. Notwithstanding the foregoing, no holdback agreements of the type contemplated by this Section 2.5 shall be required of Holders (A) unless each of the Company’s directors, executive officers and holders of 7% or more of the outstanding Common Stock agrees to be bound by a substantially identical holdback agreement for at least the same period of time; or (B) that restrict the offering or sale of Registrable Securities pursuant to a Demand Registration. Notwithstanding this Section 2.5, no Holder shall be obligated to agree to any lock-up period during which it would be prevented from selling all or any portion of its Registrable Securities in privately negotiated transactions that are not executed through the facilities of a securities exchange.

2.6 Registration Procedures. If and whenever the Company is required to effect the registration of any Registrable Securities pursuant to this Agreement, the Company shall use its reasonable best efforts to effect and facilitate the registration, offering and sale of such Registrable Securities in accordance with the intended method of disposition thereof as promptly as is practicable, and the Company shall as expeditiously as possible:

(a)prepare and file with the SEC (within thirty (30) days after the date on which the Company has given Holders notice of the request for Demand Registration) a Registration Statement with respect to such Registrable Securities, make all required filings required in connection therewith and thereafter and (if the Registration Statement is not automatically effective upon filing) use its reasonable best efforts to cause such Registration Statement to become effective; provided that before filing a Registration Statement or any amendments or supplements thereto, the Company will furnish to Holders’ Counsel for such registration copies of all such documents proposed to be filed, which documents will be subject to review of such counsel at the Company’s expense, and give the Holders participating in such registration an opportunity to comment on such documents and keep such Holders reasonably informed as to the registration process; provided, further, that if the Board of Directors determines in its good faith judgment that registration at the time would require the inclusion of pro forma financial or other information, which requirement the Company is reasonably unable to comply with, then the Company may defer the filing (but not the preparation) of the Registration Statement which is required to effect the applicable registration for a reasonable period of time (but not in excess of forty-five (45) days).

(b)(i) prepare and file with the SEC such amendments and supplements to any Registration Statement as may be necessary to keep such Registration Statement effective for a period of either (A) not less than 6 months or, if such Registration Statement relates to an Underwritten Offering in the case of a Demand Registration, such longer period as in the opinion of counsel for the managing underwriters a prospectus is required by law to be delivered in connection with sales of Registrable Securities by an underwriter or dealer or the maximum period of time permitted by the Securities Act in the case of a Shelf Registration Statement, or (B) such shorter period ending when all of the Registrable Securities covered by such Registration Statement have been disposed of (but in any event not before the expiration of any longer period required under the Securities Act) and (ii) comply with the provisions of the Securities Act with respect to the disposition of all Registrable Securities covered by such Registration Statement;

(c)furnish to each Selling Holder such number of copies, without charge, of any Registration Statement, each amendment and supplement thereto, including each preliminary prospectus, final prospectus, all exhibits and other documents filed therewith and such other documents as such Selling Holder may reasonably request including in order to facilitate the disposition of the Registrable Securities owned by such Selling Holder;

(d)use its reasonable best efforts to register or qualify, including, by way of preparation, filing and approval of a prospectus, any Registrable Securities under such other securities or blue sky laws of such jurisdictions as any Selling Holder, and the managing underwriters, if any reasonably request and do any and all other acts and things that may be necessary or reasonably advisable to enable such Selling Holder and each underwriter, if any, to consummate the disposition of the seller’s Registrable Securities in such jurisdictions (provided that the Company will not be required to (i) qualify generally

to do business in any jurisdiction where it would not otherwise be required to qualify but for this subsection, (ii) subject itself to taxation in any such jurisdiction or (iii) consent to general service of process in any such jurisdiction);

(e)use its reasonable best efforts to cause all Registrable Securities covered by any Registration Statement to be registered with or approved by such other governmental agencies, authorities or self-regulatory bodies as may be necessary or reasonably advisable in light of the business, operations and jurisdiction of incorporation of the Company to enable the Selling Holders to consummate the disposition of such Registrable Securities in accordance with the intended method or methods of disposition thereof;

(f)during any time when a prospectus relating thereto is required to be delivered under the Securities Act, promptly notify each Selling Holder and Holder’s Counsel upon discovery that, or upon the discovery of the happening of any event as a result of which, the prospectus contains an untrue statement of a material fact or omits any fact necessary to make the statements therein not misleading in light of the circumstances under which they were made and, as promptly as practicable, prepare and furnish to such Selling Holders a reasonable number of copies of a supplement or amendment to such prospectus so that, as thereafter delivered to the purchasers of such Registrable Securities, such prospectus will not contain any untrue statement of a material fact or omit to state any fact necessary to make the statements therein not misleading in the light of the circumstances under which they were made;

(g)promptly notify each Selling Holder and Holders’ Counsel (i) when the Registration Statement, any prospectus supplement or any post-effective amendment to the Registration Statement has been filed and, with respect to such Registration Statement or any post-effective amendment, when the same has become effective, (ii) of any written comments by the SEC or of any request by the SEC for amendments or supplements to such Registration Statement or to amend or to supplement any prospectus contained therein or for additional information, and (iii) of the issuance by the SEC of any stop order suspending the effectiveness of such Registration Statement or the initiation or threatening of any proceedings for any of such purposes;

(h)cause all such Registrable Securities to be listed on each securities exchange on which similar securities issued by the Company are then listed or, if no similar securities issued by the Company are then listed on any securities exchange, use its reasonable best efforts to cause all such Registrable Securities to be listed on the New York Stock Exchange;

(i)provide a transfer agent and registrar for all such Registrable Securities not later than the effective date of such Registration Statement, and, if required, obtain a CUSIP number for such Registrable Securities not later than such effective date;

(j)enter into such customary agreements (including underwriting agreements with customary provisions in such forms as may be requested by the managing underwriters) and take all such other actions as the Selling Holders or the underwriters, if any, reasonably request in order to expedite or facilitate the disposition of such Registrable Securities (including, without limitation, effecting a share split or a combination of shares);

(k)make available for inspection by any Selling Holder, Holders’ Counsel, any underwriter participating in any disposition pursuant to the applicable Registration Statement and any attorney, accountant or other agent retained by any such Selling Holder or underwriter, all financial and other records, pertinent corporate documents and documents relating to the business of the Company reasonably requested by such Selling Holder, cause the Company’s officers, directors, employees and independent accountants to supply all information reasonably requested by any such Selling Holder, Holders’ Counsel, underwriter, attorney, accountant or agent in connection with such Registration Statement and make senior management of the Company available for customary due diligence and drafting activity; provided, that any such Person gaining access to information or personnel pursuant to this Section 2.6(k) shall (i) reasonably cooperate with the Company to limit any resulting disruption to the Company’s business and (ii) agree in a customary manner to protect the confidentiality of any information regarding the Company which the Company determines in good faith to be confidential, and of which determination such Person is notified, unless (A) the release of such information is requested or required by deposition, interrogatory, requests for information or documents by a governmental entity, subpoena or similar process, (B) such information is or becomes publicly known without a breach of this Agreement, (C) such information is or becomes available to such Person on a non-confidential basis from a source other than the Company or (D) such information is independently developed by such Person;

(l)otherwise use its reasonable best efforts to comply with all applicable rules and regulations of the SEC, and make available to its security holders, as soon as reasonably practicable, an earnings statement covering the period of at least twelve months beginning with the first day of the Company’s first full calendar quarter after the effective date of the

applicable Registration Statement, which earnings statement will satisfy the provisions of Section 11(a) of the Securities Act (including, at the Company’s option, Rule 158 thereunder);

(m)in the case of an Underwritten Offering, promptly incorporate in a prospectus supplement or post-effective amendment such information as the managing underwriters or any Selling Holder reasonably requests to be included therein, the purchase price being paid therefor by the underwriters and any other terms of the Underwritten Offering of the Registrable Securities to be sold in such offering, and promptly make all required filings of such prospectus supplement or post-effective amendment;

(n)in the event of the issuance of any stop order suspending the effectiveness of a Registration Statement, or of any order suspending or preventing the use of any related prospectus or ceasing trading of any securities included in such Registration Statement for sale in any jurisdiction, use every reasonable effort to promptly obtain the withdrawal of such order;

(o)make senior management of the Company available to assist to the extent requested by the managing underwriters of any Underwritten Offering to be made pursuant to such registration in the marketing of the Registrable Securities to be sold in the Underwritten Offering, including the participation of such members of the Company’s senior management in “road show” presentations and other customary marketing activities, including “one-on-one” meetings with prospective purchasers of the Registrable Securities to be sold in the Underwritten Offering, and otherwise to facilitate, cooperate with, and participate in each proposed offering contemplated herein and customary selling efforts related thereto, in each case to the same extent as if the Company were engaged in a primary registered offering of its Common Stock;

(p)obtain all consents of independent public accountants required to be included in the Registration Statement and, in connection with each offering and sale of Registrable Securities, obtain one or more comfort letters, addressed to the underwriters and to the Selling Holders, dated the effective date of the Registration Statement (and, in the case of each Underwritten Offering, dated the date of each closing under the underwriting agreement for such offering), signed by the Company’s independent public accountants in customary form and covering such matters of the type customarily covered by comfort letters as the underwriters or Paulson, if Paulson is Selling Holder in such offering, or otherwise by the Holders of a majority of the Registrable Securities being sold in such offering, reasonably request;

(q)provide all legal opinions from Company Outside Counsel required to be included in the Registration Statement, and, in connection with each closing of a sale of Registrable Securities, provide legal opinions from Company Outside Counsel, addressed to the underwriters and the Selling Holders, dated the effective date of each Registration Statement and each amendment and supplement thereto (and, if such registration includes an Underwritten Offering, dated the date of the closing under the underwriting agreement), with respect to the Registration Statement, each amendment and supplement thereto (including the preliminary prospectus) and such other documents relating thereto in customary form and covering such matters of the type customarily covered by legal opinions of such nature; and

(r)use its reasonable best efforts to take or cause to be taken all other actions, and do and cause to be done all other things necessary or reasonably advisable in the opinion of Holders’ Counsel to effect the registration, marketing and sale of such Registrable Securities.

The Company agrees not to file or make any amendment to any Registration Statement with respect to any Registrable Securities, or any amendment of or supplement to the prospectus used in connection therewith, that refers to any Holder covered thereby by name, or otherwise identifies such Holder as the holder of any securities of the Company, without the consent of such Holder, such consent not to be unreasonably withheld or delayed, unless and to the extent such disclosure is required by law. The Company may require each Holder of Registrable Securities as to which any registration is being effected to furnish the Company with such information regarding such Holder and pertinent to the disclosure requirements relating to the registration and the distribution of such securities as the Company may from time to time reasonably request in writing.

2.7 Registration Expenses. Whether or not any Registration Statement is filed or becomes effective, the Company shall pay directly or promptly reimburse all costs, fees and expenses incident to the Company’s performance of or compliance with this Agreement, including (i) all registration and filing fees, (ii) all fees and expenses associated with filings to be made with any securities exchange or with any other governmental or quasi-governmental authority; (iii) all fees and expenses of compliance with securities or blue sky laws, including reasonable fees and disbursements of counsel in connection therewith, (iv) all printing expenses (including expenses of printing certificates for Registrable Securities and of printing prospectuses if the printing of prospectuses is requested by the Holders or the managing underwriters, if any), (v) all “road show” expenses incurred in respect of any Underwritten Offering, including all costs of travel, lodging and meals, (vi) all messenger, telephone and delivery expenses, (vii) all fees and disbursements of Company Outside Counsel, (viii) all fees and

disbursements of all independent certified public accountants of the Company (including expenses of any “cold comfort” letters required in connection with this Agreement) and all other Persons retained by the Company in connection with such Registration Statement, (ix) all reasonable fees and disbursements of underwriters (other than Selling Expenses) customarily paid by the issuers or sellers of securities and, (x) all other costs, fees and expenses incident to the Company’s performance or compliance with this Agreement (all such expenses, “Registration Expenses”). The Selling Holders shall be responsible for the fees and expenses of Holders’ Counsel and Selling Expenses. The Company will, in any event, pay its internal expenses (including, all salaries and expenses of its officers and employees performing legal or accounting duties), the expenses of any annual audit or quarterly review and the expenses of any liability insurance. The Company shall have no obligation to pay any Selling Expenses or fees and expenses associated with Holders’ Counsel.

2.8 Underwritten Offering. No Holder may participate in any registration hereunder that is an Underwritten Offering unless such Holder (i) agrees to sell its Registrable Securities on the basis provided in any underwriting arrangements approved by the Persons entitled hereunder to approve such arrangements (including pursuant to the terms of any over-allotment or “green shoe” option requested by the managing underwriters; provided, that no Holder will be required to sell more than the number of Registrable Securities that such Holder has requested the Company to include in any registration), (ii) completes and executes all questionnaires, powers of attorney, indemnities, underwriting agreements and other documents reasonably required under the terms of such underwriting arrangements, and (iii) cooperates with the Company’s reasonable requests in connection with such registration or qualification (it being understood that the Company’s failure to perform its obligations hereunder, which failure is caused by such Holder’s failure to cooperate, will not constitute a breach by the Company of this Agreement); provided that no such Holder shall be required to make any representations or warranties in connection with any such registration other than representations and warranties as to (A) such Holder’s ownership of Registrable Securities to be transferred free and clear of all liens, claims, and encumbrances created by such Holder, (B) such Holder’s power and authority to effect such transfer, and (C) such matters pertaining to such Holder’s compliance with securities laws as reasonably may be requested; provided, further that any obligation of such Holder to indemnify any Person pursuant to any underwriting agreement shall be several, not joint and several, among such Holders selling Registrable Securities, and such liability shall be limited to the net amount received by such Holder, as applicable, from the sale of Registrable Securities pursuant to such registration (which amounts shall include the amount of cash or the fair market value of any assets in exchange for the sale or exchange of such Registrable Securities or that are the subject of a distribution), and the relative liability of each such Holder shall be in proportion to such net amounts.

2.9 Suspension of Registration. In the event of a Material Disclosure Event at the time of the filing, initial effectiveness or continued use of a Registration Statement, including a Shelf Registration Statement, the Company may, upon giving at least ten (10) days’ prior written notice of such action to the Holders, delay the filing or initial effectiveness of, or suspend use of, such Registration Statement (a “Suspension”); provided, however, that, the Company shall not be permitted to exercise a Suspension (i) more than twice during any 12-month period, (ii) for a period exceeding sixty (60) days on any one occasion, (iii) unless for the full period of the Suspension, the Company does not offer or sell securities for its own account, does not permit registered sales by any holder of its securities and prohibits offers and sales by its directors and officers, or (iv) at any time within seven (7) days prior to the anticipated pricing of an Underwritten Offering pursuant to a Demand Registration or within thirty-five (35) days after the pricing of such an Underwritten Offering. In the case of a Suspension, the Holders will suspend use of the applicable prospectus in connection with any sale or purchase of, or offer to sell or purchase, Registrable Securities, upon receipt of the notice referred to above. In connection with a Demand Registration, prior to the termination of any Suspension, the Holder that made the request for Demand Registration will be entitled to withdraw its Demand Notice. Upon receipt of notices from all Holders of Registrable Securities included in such Registration Statement to such effect, the Company shall cease all efforts to secure effectiveness of the applicable Registration Statement. The Company shall immediately notify the Holders upon the termination of any Suspension.

2.10 Indemnification.

(a)The Company agrees to indemnify and hold harmless to the fullest extent permitted by law, each Holder, any Person who is or might be deemed to be a controlling person of the Company or any of its Subsidiaries within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act, their respective direct and indirect general and limited partners, advisory board members, directors, officers, trustees, managers, members, agents, Affiliates and Stockholders, and each other Person, if any, who controls any such Holder or controlling person within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act (each such person being referred to herein as a “Covered Person”) against, and pay and reimburse such Covered Persons for any losses, claims, damages, liabilities, joint or several, to which such Covered Person may become subject under the Securities Act, the Exchange Act, any state blue sky securities laws, any equivalent non-U.S. securities laws or otherwise, insofar as such losses, claims, damages or liabilities (or actions or proceedings, whether commenced or threatened, in respect thereof) arise out of or are based upon (i) any untrue or alleged untrue statement of material fact contained or incorporated by reference in any Registration Statement, prospectus or

preliminary prospectus or any amendment thereof or supplement thereto or any document incorporated by reference therein, or any other such disclosure document (including reports and other documents filed under the Exchange Act and any document incorporated by reference therein) or other document or report, (ii) any omission or alleged omission of a material fact required to be stated therein or necessary to make the statements therein not misleading, or (iii) any violation by the Company of any rule or regulation promulgated under the Securities Act or any state securities laws applicable to the Company and relating to action or inaction required of the Company in connection with any such registration, and the Company will pay and reimburse such Covered Persons for any legal or any other expenses actually and reasonably incurred by them in connection with investigating, defending or settling any such loss, claim, liability, action or proceeding; provided, that the Company shall not be liable in any such case to the extent that any such loss, claim, damage, liability (or action or proceeding in respect thereof) or expense arises out of or is based upon an untrue statement or alleged untrue statement, or omission or alleged omission, made or incorporated by reference in such Registration Statement, any such prospectus or preliminary prospectus or any amendment or supplement thereto, or any document incorporated by reference therein, or any other such disclosure document (including reports and other documents filed under the Exchange Act and any document incorporated by reference therein) or other document or report, or in any application in reliance upon, and in conformity with, written information prepared and furnished to the Company by such Covered Person expressly for use therein. In connection with an Underwritten Offering, the Company, if requested, will indemnify the underwriters, their officers and directors and each Person who controls such underwriters (within the meaning of the Securities Act) to the same extent as provided above with respect to the indemnification of the Covered Persons and in such other manner as the underwriters may request in accordance with their standard practice.

(b)In connection with any Registration Statement in which one or more Holders are participating, each such Holder will indemnify and hold harmless the Company, its directors and officers, employees, agents and any Person who is or might be deemed to be a controlling person of the Company or any of its Subsidiaries within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act against any losses, claims, damages, liabilities, joint or several, to which such Holder or any such director or officer, any such underwriter or controlling person may become subject under the Securities Act, the Exchange Act, any state blue sky securities laws, any equivalent non-U.S. securities laws or otherwise, insofar as such losses, claims, damages or liabilities (or actions or proceedings, whether commenced or threatened, in respect thereof) arise out of or are based upon (i) any untrue or alleged untrue statement of material fact contained in the Registration Statement, prospectus or preliminary prospectus or any amendment thereof or supplement thereto or in any application or (ii) any omission or alleged omission of a material fact required to be stated therein or necessary to make the statements therein not misleading, but only to the extent that such untrue statement or omission is made in such Registration Statement, any such prospectus or preliminary prospectus or any amendment or supplement thereto, or in any application, in reliance upon and in conformity with written information prepared and furnished to the Company by such Holder expressly for use therein, and such Holder will reimburse the Company and each such director, officer, underwriter and controlling Person for any legal or any other expenses actually and reasonably incurred by them in connection with investigating, defending or settling any such loss, claim, liability, action or proceeding; provided, that the obligation to indemnify and hold harmless will be individual and several to each Holder and will be limited to the net amount of proceeds received by such Holder from the sale of Registrable Securities pursuant to such Registration Statement.

(c)Any Person entitled to indemnification hereunder shall give prompt written notice to the indemnifying party of any claim with respect to which it seeks indemnification; provided, that any delay or failure to so notify the indemnifying party shall relieve the indemnifying party of its obligations hereunder only to the extent, if at all, that it is actually and materially prejudiced by reason of such delay or failure. The indemnifying party shall have the right, exercisable by giving written notice to an indemnified party promptly after the receipt of written notice from such indemnified party of such claim or proceeding, to assume, at the indemnifying party’s expense, the defense of any such claim or proceeding, with counsel reasonably acceptable to such indemnified party; provided, that (i) any indemnified party shall have the right to select and employ separate counsel and to participate in the defense of such claim, but the fees and expenses of such counsel shall be at the expense of such indemnified party unless (A) the indemnifying party has agreed in writing to pay such fees or expenses, (B) the indemnifying party shall have failed to assume the defense of such claim within a reasonable time after receipt of notice of such claim or fails to employ counsel reasonably satisfactory to such indemnified party or to pursue the defense of such claim in a reasonably vigorous manner or (C) the named parties to any proceeding (including impleaded parties) include both such indemnified and the indemnifying party, and such indemnified party has reasonably concluded (based upon advice of its counsel) that there may be legal defenses available to it that are inconsistent with those available to the indemnifying party or that a conflict of interest is likely to exist among such indemnified party and any other indemnified parties (in which case the indemnifying party shall not have the right to assume the defense of such action on behalf of such indemnified party); and (ii) subject to clause (C) above, the indemnifying party shall not, in connection with any one such claim or proceeding or separate but substantially similar or related claims or proceedings in the same jurisdiction, arising out of the same general allegations or circumstances, be liable for the fees and expenses of more than one firm of attorneys (together with appropriate local counsel) at any time for all of the indemnified parties, or for fees and expenses that are not reasonable. Whether or not the indemnifying party assumes the defense, the indemnifying party shall not have the right to settle such action without the

consent of the indemnified party. No indemnifying party shall consent to entry of any judgment or enter into any settlement which does not include as an unconditional term thereof the giving by the claimant or plaintiff to such indemnified party of an unconditional release from all liability in respect to such claim or litigation.

(d)If the indemnification provided for in this Section 2.10 is held by a court of competent jurisdiction to be unavailable to an indemnified party with respect to any loss, liability, claim, damage or expense referred to therein, then the indemnifying party, in lieu of indemnifying such indemnified party thereunder, will contribute to the amount paid or payable by such indemnified party as a result of such loss, liability, claim, damage or expense in such proportion as is appropriate to reflect the relative fault of the indemnifying party on the one hand and of the indemnified party on the other hand in connection with the statements or omissions which resulted in such loss, liability, claim, damage or expense as well as any other relevant equitable considerations. The relevant fault of the indemnifying party and the indemnified party will be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission to state a material fact relates to information supplied by the indemnifying party or by the indemnified party and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. Notwithstanding the foregoing, the amount any Holder will be obligated to contribute pursuant to this Section 2.10(d) will be limited to an amount equal to the net proceeds to such Holder from the Registrable Securities sold pursuant to the Registration Statement which gives rise to such obligation to contribute (less the aggregate amount of any damages which the Holder has otherwise been required to pay in respect of such loss, claim, damage, liability or action or any substantially similar loss, claim, damage, liability or action arising from the sale of such Registrable Securities). No Person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any Person who was not guilty of such fraudulent misrepresentation.

(e)The indemnification provided for under this Agreement will remain in full force and effect regardless of any investigation made by or on behalf of the indemnified party or any officer, director or controlling Person of such indemnified party and will survive the registration and sale of any securities by any Person entitled to any indemnification hereunder and the expiration or termination of this Agreement.

2.11 Conversion of Other Securities. If Paulson offers any options, rights, warrants or other securities issued by it that are offered with, convertible into or exercisable or exchangeable for any Registrable Securities of such Holder representing not less than 7% of the outstanding Common Stock of the Company, the Registrable Securities underlying such options, rights, warrants or other securities shall be eligible for registration pursuant to Sections 2.1 and 2.4 hereof.

2.12 Rule 144; Rule 144A. The Company shall use its reasonable best efforts to file in a timely fashion all reports and other documents required to be filed by it under the Securities Act and the Exchange Act and shall take such further action as the Holders may reasonably request, all to the extent required by the SEC as a condition to the availability of Rule 144, Rule 144A or any similar rule or regulation hereafter adopted by the SEC under the Securities Act.

2.13 Transfer of Registration Rights. Paulson (and any transferee of any such member, or any subsequent transferee, of the rights under this Agreement in accordance with this Section 2.13) may transfer all or any portion of its rights under this Agreement to any transferee who acquires in such transfer Registrable Securities representing not less than 7% of the outstanding Common Stock of the Company. Any transfer of registration rights pursuant to this Section 2.13 from Paulson (and of any transferee of any such member, or any subsequent transferee, of the rights under this Agreement in accordance with this Section 2.13) to any Person shall be effective upon receipt by the Company of written notice from the transferor stating the name and address of the transferee and identifying the amount of Registrable Securities with respect to which rights under this Agreement are being transferred.

ARTICLE 3

PROVISIONS APPLICABLE TO ALL DISPOSITIONS OF REGISTRABLE SECURITIES

3.1Underwriter Selection. In any public or private offering of Registrable Securities by a Selling Holder, other than pursuant to a Piggyback Registration, such Selling Holder(s) shall have the sole right to select the managing underwriters to arrange such Underwritten Offering, which may include any Affiliate of such Selling Holder(s).

3.2 Cooperation with Sales. In addition to the provisions of Section 2.6 hereof, applicable to sales of Registrable Securities pursuant to a registration, in connection with any sale or disposition of Registrable Securities by a Selling Holder, the Company shall provide full cooperation, including:

(a)providing access to employees, management and Company records to any purchaser or potential purchaser, and to any underwriters, initial purchasers, brokers, dealers or agents involved in any sale or disposition, subject to entry into customary confidentiality arrangements;

(b)participation in road shows, investor and analyst meetings, conference calls and similar activities;

(c)using reasonable best efforts to obtain customary auditor comfort letters and legal opinions;

(d)entering into customary underwriting and other agreements;

(e)using reasonable best efforts to obtain any regulatory approval or relief necessary for any proposed sale or disposition; and

(f)filing of registration statements with the SEC or with other authorities or making other regulatory or similar filings necessary or advisable in order to facilitate any sale or disposition.

3.3 Expenses of Offerings. Notwithstanding anything to the contrary in this Agreement, the Company shall be responsible for any expenses associated with any sale of Registrable Securities by a Selling Holder, except for the fees and expenses of Holders’ Counsel and Selling Expenses.

3.4 Further Assurances. The Company shall use its reasonable best efforts to cooperate with and facilitate, and shall not interfere with, the disposition by a Selling Holder of its holdings of Registrable Securities.

ARTICLE 4

MISCELLANEOUS

4.1Term. This Agreement shall terminate upon such time as no Registrable Securities remain outstanding, except for the provisions of Sections 2.7, 2.10 and this Article 4 which shall survive such termination.

4.2 Other Holder Activities. Notwithstanding anything in this Agreement, none of the provisions of this Agreement shall in any way limit a Holder or any of its Affiliates from engaging in any brokerage, investment advisory, financial advisory, financing, asset management, trading, market making, arbitrage, investment activity and other similar activities conducted in the ordinary course of their business.

4.3 No Inconsistent Agreements. The Company represents and warrants that it has not entered into and covenants and agrees that it will not enter into, any agreement with respect to its securities which is inconsistent with or violates the rights granted to the Holders of Registrable Securities in this Agreement.

4.4 Amendments and Waivers. Except as otherwise provided herein, the provisions of this Agreement may be amended or waived only by written agreement executed by the Company and Paulson, or if Paulson is not a Holder, the Holders of a majority of the Registrable Securities. Any waiver or failure to insist upon strict compliance with any obligation, covenant or agreement shall not operate as a waiver of, or estoppel with respect to, any subsequent or other failure of compliance.

4.5 No Third Party Beneficiaries. Except in relation to the rights of indemnification provided to the Covered Persons pursuant to Section 2.10, nothing in this Agreement shall convey any rights upon any person or entity which is not a Party or a successor or permitted assignee of a Party to this Agreement.

4.6 Entire Agreement. This Agreement, together with the Stockholder Agreement, including any schedules or exhibits hereto or thereto, embody the entire agreement and understanding of the Parties hereto in respect of the subject matter covered by this Agreement and the Stockholder Agreement. There are no restrictions, promises, representations, warranties, covenants or undertakings, other than those expressly set forth or referred to herein or therein. This Agreement and the Stockholder Agreement supersede all prior agreements and understandings between the Parties with respect to such subject matter.

4.7 Severability. In the event that any one or more of the provisions contained herein, or the application thereof in any circumstances, is held invalid, illegal or unenforceable in any respect for any reason, the validity, legality and enforceability of any such provision in every other respect and of the remaining provisions contained herein shall not be in any

way impaired thereby, it being intended that all of the rights and privileges of the Parties shall be enforceable to the fullest extent permitted by law. To the extent that any such provision is so held to be invalid, illegal or unenforceable, the Parties shall in good faith use commercially reasonable efforts to find and effect an alternative means to achieve the same or substantially the same result as that contemplated by such provision.

4.8 Counterparts. This Agreement may be signed in any number of identical counterparts, each of which shall be deemed an original with the same effect as if the signatures thereto and hereto were upon the same instrument. The Parties hereto may deliver this Agreement by facsimile or by electronic mail and each Party shall be permitted to rely upon on the signatures so transmitted to the same extent and effect as if they were original signatures.

4.9 Remedies; Attorney’s Fees.

(a)The Parties hereby expressly recognize and acknowledge that immediate, extensive and irreparable damage could result, no adequate remedy at law would exist and damages would be difficult to determine in the event that any provision of this Agreement is not performed in accordance with its specific terms or otherwise breached. Therefore, in addition to, and not in limitation of, any other remedy available to any Party, except as otherwise expressly provided herein, an aggrieved Party under this Agreement shall be entitled to seek specific performance of the terms hereof and immediate injunctive relief, without the necessity of proving the inadequacy of money damages as a remedy. None of the Parties shall be required to obtain or furnish any bond or similar instrument in connection with or as a condition to obtaining or seeking any such remedy. For the avoidance of doubt, nothing in this Agreement shall diminish the availability of specific performance of the obligations under this Agreement or any other injunctive relief.

(b)Such remedies, and any and all other remedies provided for in this Agreement, shall be cumulative in nature and not exclusive and shall be in addition to any other remedies whatsoever which any Party may otherwise have. Each of the Parties hereby acknowledges and agrees that it may be difficult to prove damages with reasonable certainty, that it may be difficult to procure suitable substitute performance, and that injunctive relief and/or specific performance will not cause an undue hardship to the Parties. Each Party hereby further agrees that in the event of any action by the other Party for specific performance or injunctive relief, it will not assert that a remedy at law or other remedy would be adequate or that specific performance or injunctive relief in respect of such breach or violation should not be available on the grounds that money damages are adequate or any other grounds.

4.10 GOVERNING LAW. This Agreement shall be construed in accordance with and governed by the laws of the State of Delaware, without regard to the conflicts of laws rules thereof. The parties irrevocably consent to service of process by any means available under Delaware law and consent to the exclusive, both personal and subject-matter, jurisdiction and venue of any chancery court in the state of Delaware and irrevocably waive the right to object to such venue of any such court on the grounds that such forum is inconvenient. To the extent that in any jurisdiction any party may now or hereafter claim or be entitled to claim, for itself or its assets, immunity from suit, execution, attachment (before or after judgment) or other legal process, each party irrevocably agrees, to the extent permitted by law, not to claim, and it hereby waives, such immunity in connection with any contractual dispute with respect to this agreement. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY ACTION ARISING OUT OF THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

4.11 No Assignment. Except as otherwise provided for in this Agreement, neither this Agreement nor any of the rights, interests or obligations of any Party hereto may be assigned by such Party without the prior written consent of the other Party.

4.12 Further Actions. Each Party hereto shall, on notice of request from any other Party hereto, take such further action not specifically required hereby at the expense of the requesting Party, as the requesting Party may reasonably request for the implementation of the transactions contemplated hereby.

4.13 Notice. Unless otherwise provided in this Agreement, all notices and other communications provided for hereunder shall be dated and in writing and shall be deemed to have been given (i) when delivered, if delivered personally, sent by confirmed telecopy or sent by registered or certified mail, return receipt requested, postage prepaid, provided that such delivery is completed during normal business hours of the recipient, failing which such notice shall be deemed to have been given on the next Business Day, (ii) on the next Business Day if sent by overnight courier and delivered on such Business Day within ordinary business hours and, if not, the next Business Day following delivery; and (iii) when received, if received during normal business hours and, if not, the next Business Day after receipt, if delivered by means other than those specified above.

Such notices shall be delivered to the address set forth below, or to such other address as a Party shall have furnished to the other Party in accordance with this Section.

If to Paulson, to:

Paulson & Co. Inc.

1133 Avenue of the Americas

New York, NY 10036

Attention: Michael Waldorf

Telephone (212) 956-2472

Facsimile: (212) 351-5887

with a copy to:

Kleinberg, Kaplan, Wolff & Cohen

551 Fifth Avenue

New York, NY 10176

Attention: Chris Davis, Esq

Telephone (212) 880-9865

Facsimile: (212) 986-8866

If to the Company:

BrightSphere Investment Group Inc.

200 Clarendon Street, 53rd Floor

Boston, MA 02116

Attention: Richard Hart, General Counsel

Phone No.: 617-369-7341

Email: rhart@bsig.com

with a copy to:

Morgan, Lewis & Bockius LLP

101 Park Avenue

New York, NY 10178

Attention: Christina E. Melendi, Esq.

Phone No.: 212-309-6949

E-mail: christina.melendi@morganlewis.com

[Signature Page Follows]

IN WITNESS WHEREOF, the Parties have caused this Registration Rights Agreement to be executed and delivered as of the date first above written.

BrightSphere Investment Group Inc.

By: _/s/ Suren Rana___________

Name: Suren Rana

Title: Chief Financial Officer

Paulson & Co. Inc.

By: _/s/ Michael Waldorf_______

Name: Michael Waldorf

Title: Partner and Senior Counsel

[Signature Page to Registration Rights Agreement]

Exhibit 10.5

STOCKHOLDER AGREEMENT

BETWEEN

BRIGHTSPHERE INVESTMENT GROUP INC.

AND

PAULSON & CO. INC.

DATED AS OF MAY 17, 2019

STOCKHOLDERS AGREEMENT

THIS STOCKHOLDERS AGREEMENT (this “Agreement”), dated as of May 17, 2019, is among BrightSphere Investment Group Inc., a Delaware corporation (the “Company”) and Paulson & Co. Inc. a Delaware corporation (on behalf of certain Related Persons, “Paulson”). This Agreement shall be effective as of the date the shareholders of BrightSphere Investment Group plc vote to approve an exchange of ordinary shares held by each of the shareholders of BrightSphere Investment Group plc for shares of common stock of the Company (the “Effective Date”).

ARTICLE 1

DEFINITIONS; RULES OF CONSTRUCTION

SECTION 1.1 Definitions. The following terms, as used herein, have the following meanings:

“Affiliate” of any specified Person means any other Person directly or indirectly controlling, controlled by or under direct or indirect common control with such specified Person. For the purposes of this definition, “control” when used with respect to any Person means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms “controlling” and “controlled” have meanings correlative to the foregoing. No Person shall be deemed to be an Affiliate of another Person solely by virtue of the fact that both Persons own shares of the Company’s Capital Stock.

“Agreed Coverage” has the meaning set forth in Section 6.3(b).

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

“Applicable Law” means any domestic or foreign statute, law (including the common law), ordinance, rule, regulation, published regulatory policy or guideline, order, judgment, injunction, decree, award or writ of any court, tribunal, stock exchange or other regulatory authority, arbitrator, governmental authority, or other Person having jurisdiction, or any consent, exemption, approval or license of any governmental authority that applies in whole or in part to a Party and, with respect to the Company, includes the Exchange Act, the Securities Act, the Delaware General Corporation Law, the rules of the SEC, the Investment Advisers Act of 1940, as amended, and all related regulations, guidelines and instructions and the rules of the Exchange and any other exchange or quotation system on which the securities of the Company are listed or traded from time to time.

“Board of Directors” means the Board of Directors of the Company.

“Business Day” means any day except (i) a Saturday, (ii) a Sunday, (iii) any day on which the principal office of the Company or of Paulson is not open for business, and (iv) any other day on which commercial banks in New York, New York are authorized or obligated by law or executive order to close.

“Capital Stock” means, with respect to any Person, any and all shares, interests, participations, rights in or other equivalents (however designated) of such Person’s capital stock, and any rights, warrants or options exercisable or exchangeable for or convertible into such capital stock.

“Common Stock” means the Common Stock, par value $0.001 per share, of the Company.

“Company” has the meaning set forth in the preamble.

“Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract, as trustee, or otherwise, and “Controls” and “Controlled” shall have correlative meanings.

“Coverage Change” has the meaning set forth in Section 6.3(d).

“D&O Coverage” has the meaning set forth in Section 6.3(b).

“Dispute” has the meaning set forth in Section 7.1(a).

“Dispute Notice” has the meaning set forth in Section 7.1(a).

“Dispute Party” has the meaning set forth in Section 7.1(a).

“Directors” means a member of the Board and “Directors” has a correlative meaning.

“Effective Date” has the meaning set forth in the preamble.

“Equity Award” means a grant to a Director or employee of the Company or any of its Subsidiaries of vested or unvested Capital Stock or restricted Capital Stock, options to acquire Capital Stock, restricted securities, “phantom” share options or similar interests in the Company’s Capital Stock, in each case pursuant to an equity compensation plan approved by the Board of Directors.

“Exchange” means the New York Stock Exchange.

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

“Executive Officer” means the Chief Executive Officer, Chief Financial Officer and all other persons qualifying as “officers” of the Company for purposes of Rule 16a-1(f) under the Exchange Act.

“FAA” has the meaning set forth in Section 7.1(l).

“Fiduciary Coverage” has the meaning set forth in Section 6.3(b).

“Fund” means any pooled investment vehicle for which any Subsidiary of the Company, directly or indirectly, provides investment advisory or subadvisory services, or serves as the general partner, managing member or in any similar capacity (including any master or feeder fund, parallel fund or other alternative investment vehicle or third party co-investment vehicle).

“Independent Director” means a Director who is both (i) a NYSE Independent Director and (ii) in the case of the audit committee referred to in Section 3.2, “independent” for purposes of Rule 10A-3(b)(1) under the Exchange Act.

“M&A Transaction” means (i) any acquisition or purchase, direct or indirect, of assets of a Person (other than an immaterial amount of assets) whether or not comprising a going business, (ii) any acquisition or purchase, direct or indirect, of any equity, membership interests or voting securities of a Person, or (iii) a merger, amalgamation, consolidation, share exchange, business combination, sale of assets, reorganization, recapitalization, liquidation, dissolution or other similar transaction involving a Person, in each of (i), (ii) or (iii), involving the Company or any of its Subsidiaries and a buyer, seller or target company.

“NYSE Independent Director” means a Director who is “independent” within the meaning of, and determined by the Board of Directors in accordance with, Rule 303A.02 of the NYSE Manual.

“Party” and “Parties” has the respective meanings set forth in the preamble to this Agreement.

“Paulson” has the meaning set forth in the preamble.

“Paulson Director” has the meaning set forth in Section 3.1(a).

“Paulson Individual” has the meaning set forth in Section 6.3(j).

“Paulson Person” has the meaning set forth in Section 9.11(a).

“Person” means an individual, a corporation, a general or limited partnership, a limited liability company, a joint stock company, an association, a trust or any other entity or organization, including a government, a political subdivision or an agency or instrumentality thereof.

“Purchase Right Share Amount” has the meaning set forth in Section 5.2(b).

“Purchase Right Shares” has the meaning set forth in Section 5.2(a).

“Purchase Right Transaction” has the meaning set forth in Section 5.2(a).

“Registration Rights Agreement” means the registration rights agreement dated as of the date hereof between the Company and Paulson in the form attached hereto as Annex A.

“Related Person” means, with respect to Paulson, any investment fund, investment partnership, investment account or other investment Person whose investment manager, investment adviser, managing member or general partner is Paulson or a Related Person of Paulson.

“Representatives” means, with respect to any specified Person, such Person and such Person’s Affiliates, their successors and assigns and any of their respective agents, employees, stockholders, partners, members, representatives, officers, advisers and directors.

“Rules and Procedures” has the meaning set forth in Section 7.1(c).

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

“Securities Act” means the Securities Act of 1933.

“Second Threshold Date” means the date on which Paulson ceases to beneficially own, directly or indirectly, at least 20% of the outstanding shares of Common Stock.

“Subsidiary” means, with respect to a Person, any corporation, limited liability company, partnership, association, business, trust, joint venture, business entity or other entity of any kind or nature, of which more than fifty percent (50%) of either the equity interests or the Control is, directly or indirectly, through Subsidiaries or otherwise, beneficially owned by such Person, or of which such Person or any Subsidiary serves as the general partner (in the case of a limited partnership) or the manager or managing member (in the case of a limited liability company); provided that (i) no Fund or any Subsidiary of a Fund shall be a Subsidiary for purposes of this Agreement; (ii) the Company and its Subsidiaries shall not be deemed to be Subsidiaries of Paulson and Paulson will not be deemed to be Subsidiaries of the Companies; and (iii) for purposes of this definition, unless explicitly stated otherwise, Investment Counselors of Maryland, LLC shall be considered a “Subsidiary” of the Company.

“Third Threshold Date” means the date on which Paulson ceases to beneficially own, directly or indirectly, at least 7% of the outstanding shares of Common Stock.

SECTION 1.2 Timing of Provisions. In this Agreement, any provision which applies “until” a specified date shall apply on such specified date, and shall cease to apply on the date immediately following such specified date. If any of a Second Threshold Date or Third Threshold Date occur on the same date, Paulson shall be deemed to beneficially own the lowest number of outstanding shares of Common Stock referenced in any such defined term that is applicable to such date.

SECTION 1.3 Interpretation.

(a)In this Agreement, except as the context may otherwise require, references to:

(i) any statute, statutory provision or regulation are to the statute, statutory provision or regulation as amended, modified, supplemented or replaced from time to time (and, in the case of statutes, include any rules and regulations promulgated under the statute) and to any section of any statute or regulation includes any successor to the section; and

(ii) any governmental authority includes any successor to that governmental authority.

(b)The words “hereby”, “herein”, “hereof”, “hereunder” and similar terms are to be deemed to refer to this Agreement as a whole and not to any specific Section.

(c) The words “include”, “includes” or “including” are to be deemed followed by the words “without limitation”. Any singular term in this Agreement will be deemed to include the plural, and any plural term the singular. All pronouns and variations of pronouns will be deemed to refer to the feminine, masculine or neuter, singular or plural, as the identity of the Person referred to may require.

(d) The table of contents and Article and Section headings are for reference purposes only and do not limit or otherwise affect any of the substance of this Agreement.

(e) It is the intention of the parties that every covenant, term and provision of this Agreement shall be construed simply according to its fair meaning and not strictly for or against any party, it being understood and agreed that the parties to this Agreement are sophisticated and have had adequate opportunity and means to retain counsel to represent their respective interests and to otherwise negotiate the terms and provisions of this Agreement. Accordingly, the parties hereby waive, to the fullest extent permitted by Applicable Law, the benefit of any Applicable Law that would require that in cases of uncertainty, the language of a contract should be strictly construed against, or most strongly construed against, the party who drafted such language.

(f) No provision of this Agreement is to be construed to require, directly or indirectly, any Person to take any action, or omit to take any action, to the extent such action or omission would violate Applicable Law.

ARTICLE 2

REPRESENTATIONS AND WARRANTIES

SECTION 2.1 Representations. Each of the Parties hereby severally represents and warrants to each of the other Parties as follows:

(a) it has full power and capacity to enter into and perform its obligations under this Agreement, and has taken all necessary action to authorize the execution, delivery and performance of this Agreement by it;

(b) this Agreement has been duly and validly authorized, executed and delivered by such Party and constitutes a legal, valid and binding obligation of such Party, enforceable against such party in accordance with its terms;

(c) the execution and delivery of this Agreement and performance by such Party of its obligations under this Agreement does not conflict with, result in the breach of any of the terms or conditions of, constitute a default under or violate the organizational or constitutional documents of such party, any Applicable Law, any agreement or other document or undertaking to which such Party is a party or by which such Party or its properties or other assets is bound; and

(d) the execution and delivery of this Agreement and performance by such Party of its obligations under this Agreement does not require any shareholder or regulatory consent, approval, or authorization; provided, however, that the parties acknowledge that BrightSphere Investment Group plc, has entered or will enter into a transaction to change the jurisdiction of the parent of its corporate group from the United Kingdom to Delaware through an exchange of ordinary shares of BrightSphere Investment Group plc for shares of common stock of the Company and that such transaction requires the approval of the requisite majority of the shareholders of BrightSphere Investment Group plc.

ARTICLE 3

BOARD OF DIRECTORS AND CORPORATE GOVERNANCE

SECTION 3.1 Board of Directors.

(a) Paulson shall have the right, but not the obligation, to nominate to the Board of Directors (subject to their election by the stockholders of the Company) that number of individuals that is shown below (each such Director, a “Paulson Director”):

(i)two Directors until the Second Threshold Date;

(ii)after the Second Threshold Date and until the Third Threshold Date, one Director; and

(iii)after the Third Threshold Date, no Directors.

(b) Until the Third Threshold Date, the Company shall cause to be filled any vacancy on the Board of Directors created by the resignation, removal or incapacity of any Paulson Director with another Paulson Director

identified by Paulson and procure any removal of directors necessary to permit the appointment of any Paulson Director, to the extent Paulson would at such time have appointment rights for such Paulson Director pursuant to Section 3.1(a).

(c) For the avoidance of doubt, Paulson Directors shall not be required to be Independent Directors or meet any standard of independence from the Company. In addition, Paulson retains and does not hereby waive any nomination rights it may have as a shareholder of the Company.

SECTION 3.2 Audit Committee Membership. The Company undertakes that, until the Second Threshold Date, at least one member of the audit committee shall be a Paulson Director that is an Independent Director, provided (i) Paulson has designated an Independent Director to be a Paulson Director, (ii) such Paulson Director meets the standards for audit committee membership as set forth in the NYSE Manual and the rules under the Exchange Act and (iii) Paulson has notified the Company in writing that it desires a Paulson Director to be a member of the Audit Committee.

SECTION 3.3 Director Information.

(a) Each Paulson Director shall be entitled to disclose any information and provide relevant documents and materials about the Company and its Subsidiaries to, and discuss the affairs, finances and accounts of the Company and any of its Subsidiaries with Paulson’s officers and senior employees and professional advisers. The Company acknowledges that any Paulson Director taking action that is in accordance with the previous sentence shall not be in breach of any fiduciary, statutory, contractual or other duty.

(b) Notwithstanding the duties owed by each of the Directors to the Company, no Paulson Director shall be required to disclose to the Company or the Board of Directors any information or documentation regarding Paulson, its Related Persons or any investors in such Related Persons.

(c) The Company shall provide each Paulson Director with copies of all notices, minutes, consents and other materials provided by the Company to all other members of the Board of Directors (or members of any committee of the Board of Directors, as applicable) concurrently and in the same form as such materials are provided to such other members.

(d) Nothing in this Section 3.3 shall reduce or limit Paulson Directors’ access to information, reduce or limit Paulson Directors’ rights to disclose any information or create any obligation on the part of Paulson Directors to make disclosures to the Company, in each case as governed by Applicable Law.

ARTICLE 4

INFORMATION AND DISCLOSURE

SECTION 4.1 Information Rights.

(a)Without limiting any other rights that Paulson may have, whether under this Agreement or otherwise, unless otherwise requested in writing by Paulson, until the Third Threshold Date:

(i)the Company shall provide Paulson with (A) information and data reasonably requested by Paulson relating to the business and financial results of the Company and its Subsidiaries and (B) access, upon reasonable written notice and during usual business hours, to the Company’s personnel, data and systems;

(ii)the Company shall inform Paulson promptly (and in any event within three Business Days of occurrence) of any events or developments that might reasonably be expected to materially affect the Company’s consolidated financial results or otherwise be material to the Company; and

(iii)the Company shall provide, as promptly as reasonably possible (and in any event within two Business Days) of any request from Paulson (unless not reasonably available within such time, in which case as soon as possible thereafter), any information, records or documents (A) requested or demanded by any governmental, regulatory, judicial, supranational or self-regulatory authority having jurisdiction or oversight authority over Paulson or any of its Related Persons or (B) deemed necessary or advisable by Paulson in connection with any filing, report, response or communication made by Paulson or any of its Related Persons with or to an authority referred to in clause (A) of this Section 4.1(a)(iii) (whether made pursuant to specific request from such authority or in the ordinary course).

(b)In connection with the receipt of information by Paulson pursuant to this Section 4.1, Paulson shall employ reasonable procedures to restrict access to such information to only those Persons whom Paulson determines have a need to access such information. For the avoidance of doubt, the provisions of Section 8.7 hereof shall apply to all information provided to Paulson pursuant to this Section 4.1.

SECTION 4.2 Release of Information and Public Filings.

(a) Until the Second Threshold Date, the Company shall coordinate with Paulson with respect to the public release of any material information relating to the Company. The Company shall, to the extent practicable, provide Paulson with a copy of any such proposed public release no later than two (2) Business Days prior to publication, and shall consider in good faith incorporating any comments provided thereon by Paulson prior to such publication; provided, however, the Company shall have met the foregoing obligation to provide Paulson with a copy of any such proposed public release if it has provided the Paulson Directors with such copy.

(b)Notwithstanding the foregoing, in no event shall the rights set forth in this Section 4.2 apply to the extent that they would prevent the Company or Paulson from complying with its disclosure or other obligations under Applicable Law.

ARTICLE 5

SUBSEQUENT SALES OF ORDINARY SHARES

SECTION 5.1 Registration Rights. The Parties shall execute and deliver, concurrently with the execution and delivery of this Agreement, the Registration Rights Agreement.

SECTION 5.2 Preemptive Rights.

(a)As soon as practicable after determining to issue any Capital Stock or securities convertible into, exercisable or exchangeable for, Capital Stock (“Purchase Right Shares”), but in any event no fewer than twenty (20) Business Days prior to entering into a binding agreement to issue Purchase Right Shares to any Person other than Paulson or its Related Persons (a “Purchase Right Transaction”), the Company shall, in writing, offer, subject to consummation of the Purchase Right Transaction, to sell to Paulson (which offer may be assigned by Paulson to a Related Person of Paulson) the Purchase Right Share Amount at the Purchase Right Share Price. The Company shall describe the proposed Purchase Right Transaction in reasonable detail in such written offer, including the range of prices (which may be expressed in terms of discount and/or premium to the trading price of Capital Stock at the time the Company enters into a binding agreement to issue Purchase Right Shares) within which the Company reasonably expects to sell Purchase Right Shares in the Purchase Right Transaction.

(b) For purposes of this Section 5.2, the “Purchase Right Share Price” shall be the lowest purchase price (which need not be determined until the time at which the Company enters into definitive documentation with respect to the Purchase Right Transaction), if any, to be paid by a subscriber for or recipient of Purchase Right Shares in the Purchase Right Transaction; and the “Purchase Right Share Amount” shall be that number of the Purchase Right Shares as is equal to the amount obtained by multiplying the total number of Purchase Right Shares by a fraction, the numerator of which is the number of shares of Common Stock beneficially owned by Paulson, and the denominator of which is the total number of shares of Common Stock (excluding shares of Common Stock held in treasury) outstanding, in each case as of the time that the Company makes the offer to Paulson pursuant to Section 5.2(a) hereof.

(c) If the offer referred to in Section 5.2(a) hereof is irrevocably accepted (subject only to required regulatory approvals, if any) in writing within fifteen (15) Business Days after such offer is delivered to Paulson, then, only if the Purchase Right Transaction is consummated and the price per Purchase Right Share falls within the price range set forth in the written offer delivered to Paulson in accordance with Section 5.2(a), the Company shall issue or sell to Paulson (or any Related Person of Paulson, as the case may be), and Paulson (or any of its Related Persons, as the case may be) shall purchase or subscribe from the Company, that number of Purchase Right Shares as is equal to the Purchase Right Share Amount, at the Purchase Right Share Price.

(d) If the offer referred to in Section 5.2(a) hereof is not irrevocably accepted (subject only to required regulatory approvals, if any) in writing within fifteen (15) Business Days after such offer is delivered to Paulson, the Company will be free to consummate the Purchase Right Transaction described in the written offer delivered to Paulson in accordance with Section 5.2(a), within the price range described in such written offer, without issuing or selling any Purchase Right Shares to Paulson or any of its Related Persons. The Company shall not consummate any Purchase Right Transaction

other than (i) a Purchase Right Transaction described in the previous sentence or (ii) a Purchase Right Transaction described in Section 5.2(c) that is consummated within the price range described in a written offer to Paulson in accordance with Section 5.2(a).

(e) The purchase and sale or issue and subscription (as the case may be) of any Purchase Right Shares pursuant to this Section 5.2 shall take place concurrently with the closing of the Purchase Right Transaction, or, if a concurrent closing is not practicable, as promptly as practicable thereafter. At the time of purchase or issuance, the Company shall deliver to Paulson (or any of its Related Persons, as the case may be) certificates (or, in the event that the Company issues securities to a third party in an uncertificated form, other evidence of ownership) registered in the name of Paulson (or any of its Related Persons, as the case may be) representing the Purchase Right Shares purchased or issued, and not less than two (2) Business Days prior to the date of purchase or issuance Paulson (or any of its Related Persons, as the case may be) shall transfer to the Company the purchase price therefor in United States dollars by bank check or wire transfer of immediately available funds, as specified by the Company, to an account designated by the Company.

(f) The Company and Paulson each agree to use all commercially reasonable efforts to obtain any regulatory, stock exchange, or other approval required for any purchase or issuance of Purchase Right Shares by Paulson (or any of its Related Persons) pursuant to this Section 5.2.

(g)The provisions of this Section 5.2 shall apply, with the necessary changes, to any sale by the Company of shares of Capital Stock held in treasury.

(h)Notwithstanding the foregoing, the provisions of paragraphs (a) to (g) of this Section 5.2 shall not apply to Purchase Right Shares issued:

(i)as consideration for M&A Transactions;

(ii)as Equity Awards; or

(iii)at any time after the Third Threshold Date.

SECTION 5.3 Lock-Up Provisions.

(a)In connection with any underwritten offering of Capital Stock (whether or not pursuant to the Registration Rights Agreement), the Company shall, and shall cause the Executive Officers and Directors to, and, prior to the Third Threshold Date, Paulson shall, and shall cause its affiliated companies to, agree with the underwriters in such offering to a lock-up period of up to ninety (90) days (as determined by the underwriters), subject to customary extension provisions and carve-outs.

(b) Notwithstanding Section 5.3(a) hereof, neither Paulson nor any of its Related Persons shall be obligated to agree to any lock-up period during which it would be prevented from selling all or any portion of its Capital Stock in privately negotiated transactions that are not executed through the facilities of a securities exchange.

SECTION 5.4 Transfers by Paulson. In connection with the proposed disposition (direct or indirect) by Paulson prior to the Third Threshold Date of at least seven percent (7%) of the outstanding Common Stock, the Company shall use all reasonable efforts to take such actions as may be requested by Paulson including making available for review by the proposed acquirers of Common Stock and their financing sources and other transaction participants, and their respective advisors, all financial and other records, corporate documents and documents relating to the business of the Company and its Subsidiaries reasonably requested by Paulson (subject to the execution of a customary confidentiality agreement); making available senior management of the Company for customary management presentations, due diligence and drafting activity; obtaining any required consents of third parties (including Fund and other clients) and governmental authorities; and entering into customary agreements including purchase and sale agreements that include customary representations and warranties by the Company, provided that the obligation of the Company to enter into customary agreements shall not be deemed to require the Company to indemnify the acquirer for breach of such representations and warranties or otherwise be liable for damages arising from a breach of any such representation or warranty.

ARTICLE 6

OTHER PROVISIONS

SECTION 6.1 Access to Personnel and Data. Without limiting any other rights that Paulson may have, whether under this Agreement or otherwise, in addition to the specific rights of Paulson set forth elsewhere in this Agreement, until the Third Threshold Date and subject to Section 4.1(b) and (c) hereof the Company shall continue to provide representatives of Paulson with reasonable access to the Company’s personnel (including senior-level management and other employees) and data.

SECTION 6.2 Internal Communications Protocol. In addition to the specific rights of Paulson set forth elsewhere in this Agreement, until the Third Threshold Date, the Company and Paulson agree to mutually consult with respect to internal communications between the Company and its Subsidiaries which could reasonably be expected to be material to the Company provided, however, the Company shall have met the foregoing obligation if it has consulted with the Paulson Directors with respect to such internal communications.

SECTION 6.3 Access to Historic Records. For a period of two years following the Third Threshold Date, subject to an extension of up to ten years if required due to a legal, tax, accounting or regulatory requirement applicable to the requesting Party, Paulson and the Company shall retain the right to access such records of the other which exist resulting from Paulson’s control or ownership of all or a portion of the Company, its shares, its securities or its assets. Upon reasonable notice and at each Party’s own expense, Paulson (and its authorized representatives) and the Company (and its authorized representatives) shall be afforded access to such records at reasonable times and during normal business hours and each Party (and its authorized representatives) shall be permitted, at its own expense, to make abstracts from, or copies of, any such records.

SECTION 6.4 Indemnification; Liability Insurance.

(a)Until at least the day after the last date on which a Paulson Individual is a Director, officer or employee of the Company or any of its Subsidiaries, the Company shall grant indemnification (including advancement of expenses) to each such Director, officer and employee of the Company or any of its Subsidiaries to the greatest extent permitted under Applicable Law, as may be amended from time to time. Such indemnification and advancement shall continue as to any Paulson Individual (i) who becomes entitled to indemnification or advancement on or prior to such date, notwithstanding any change (except those changes made as required by Applicable Law) in the Company’s indemnification or advancement policies following such date, and (ii) with respect to liabilities existing or arising from events that have occurred on or prior to such date, notwithstanding such Paulson Individual’s ceasing to be a Director, officer or employee of the Company.

(b)The Company warrants and represents that, as of the date of this Agreement, the Company has insurance coverage with respect to director and officer liability (“D&O Coverage”) and fiduciary liability (“Fiduciary Coverage”) covering Directors, officers and employees of the Company, including Paulson Individuals serving in any such capacity at the Company (collectively, the “Agreed Coverage”).

(c)Subject to the provisions of this Section 6.4, the D&O Coverage and Fiduciary Coverage shall be renewed annually and kept in force by the Company on substantially the same terms in order to cover any claims made on or prior to the sixth anniversary of the last date on which any Paulson Individual is a Director, officer or employee of the Company. The Company shall be responsible for the cost of D&O Coverage and Fiduciary Coverage that covers Directors, officers and employees of the Company, including Paulson Individuals serving in any such capacity at the Company.

(d)As used in this Section 6.4, the term “D&O Coverage,” “Fiduciary Coverage”, and “Agreed Coverage” shall mean the coverages in place as of the date of this Agreement and “Coverage Change” shall mean any renewal, amendment, endorsement or replacement of such coverage. A change in premium for any such Agreed Coverage shall not be considered a “Coverage Change.”

(e)The Company will, at the date of this agreement and from time to time thereafter as applicable, provide Paulson with copies of any policies of insurance, binders, proposed terms or wording and other relevant information or documents with respect to the Agreed Coverage or any actual or proposed Coverage Change regarding the Agreed Coverage or Coverage Change provided, however, the Company shall have met the foregoing obligation to provide Paulson the relevant information if it has provided the Paulson Directors with such copies.

(f)The Company shall provide Paulson with reasonable prior notice of any proposed Coverage Change and any proposed change in premiums on the Agreed Coverage. No Coverage Change shall become effective that would have the effect of making the Agreed Coverage (i) less favorable to Paulson Individuals in comparison to Directors, officers or employees of the Company than is the Agreed Coverage prior to such Coverage Change, or (ii) less favorable to Paulson in comparison to the Company and its Subsidiaries than is the Agreed Coverage prior to such Coverage Change, without the prior written consent of Paulson.

(g)In the event that any insured makes a claim or delivers a notice of circumstances under any insurance policy providing the Agreed Coverage, then, provided that attorney-client privilege and attorney-work product privilege are protected and preserved with respect to such matters (including by entering into a common interest agreement), each of the Company (with respect to claims or notices by the Company or any of its Subsidiaries or any Director, officer or employee of the Company) and Paulson (with respect to claims or notices by Paulson or any Paulson Individual) shall promptly provide written notice to the other of such claim or notice of circumstances and shall continue to keep the other informed of the status and progress of such claim or notice of circumstances, including providing copies of such relevant documentation and correspondence with the insurers as the other may request.

(h)In the event that multiple insureds make claims or deliver notices of circumstances with respect to the same underlying events or facts under any insurance policy providing the Agreed Coverage, then, provided that attorney-client privilege and attorney-work product protection are protected and preserved with respect to such matters (including by entering into a common interest agreement), each of the Company (with respect to claims or notices by the Company or any of its Subsidiaries or any Director, officer or employee of the Company other than a Paulson Individual) and Paulson (with respect to claims or notices by Paulson or any Paulson Individual) shall cooperate with the other in connection with (i) the defense of allegations from third parties with respect to the underlying events or facts, and (ii) dealing with the insurers providing the Agreed Coverage with respect to asserting rights to coverage in respect of such third party claims and the underlying events or facts, in all cases with the intention of seeking to maximize the aggregate benefits to all insureds under the Agreed Coverage in respect of such third party claims and the underlying events or facts.

(i)In the event that any conflict of interest arises between insureds that make claims or deliver notices of circumstances under any insurance policy providing the Agreed Coverage, then each of the Company (with respect to claims or notices by the Company or any of its Subsidiaries or any Director, officer or employee of the Company) and Paulson (with respect to claims or notices by Paulson or any Paulson Individual) shall use commercially reasonable efforts to resolve such conflict or to manage it in such a way as to maximize the aggregate benefits to all insureds under the Agreed Coverage.

(j)For purposes of this Section 6.4, “Paulson Individual” shall mean (i) any director, officer or employee of Paulson, or (ii) any Person designated by Paulson as a Paulson Director and who serves in such capacity.

(k)Without prejudice to Section 6.4(a), where any Paulson Individual becomes involved in any claim, action, cause of action, suit, proceeding or investigation of any nature in connection with which he may be entitled to indemnification by the Company, the Company shall undertake to pay to any third party (as a direct and primary obligation of the Company to that third party) any expenses in connection therewith for which the Paulson Individual would be entitled to indemni-fication. This Section 6.4(k) shall apply to such expenses as are identified by the Paulson Individual. The Paulson Individual shall not be entitled to advancement of any such expenses that the Company is obligated to pay directly to a third party.

SECTION 6.5 Non-Solicitation.

(a) Until the Third Threshold Date, Paulson shall not, nor shall it cause or permit any of its Related Persons to, solicit for employment, recruit for employment or hire (or attempt to solicit, recruit or hire) any employees of the Company or any of its Subsidiaries who are known by Paulson (or the relevant Related Person) to be employed by the Company or any of its Subsidiaries without the prior written consent of the Company; and

(b) until the Third Threshold Date, the Company shall not, nor shall it cause or permit any of its Subsidiaries to, solicit for employment, recruit for employment or hire (or attempt to solicit, recruit or hire) any employees of Paulson or any of its Related Persons who are known by the Company (or its relevant Subsidiary) to be employed by Paulson or its Related Persons without the prior written consent of Paulson, provided, however, that nothing contained in this Section 6.5 shall prohibit or apply to a Party or any of its Subsidiaries conducting general advertisements that are not specifically targeted at employees of another Party or any of its Subsidiaries; and provided further, that the restrictions set forth in this Section 6.5 shall not apply to solicitations, recruitment or hiring by the “Affiliates” of the Company, as such term is used in the Company’s reports filed pursuant to the Exchange Act: if neither the Company nor any of its Subsidiaries other than such

“Affiliates” has induced, encouraged or participated in the otherwise prohibited solicitation, recruitment or hiring by such “Affiliate”.

ARTICLE 7

RESERVED

ARTICLE 8

GENERAL PROVISIONS

SECTION 8.1 Notices. Unless otherwise provided in this Agreement, all notices, consents and other communications provided for hereunder shall be dated and in writing (excluding email) and shall be deemed to have been given (a) when delivered, if delivered personally, sent by confirmed telecopy or sent by registered or certified mail, return receipt requested, postage prepaid, provided that such delivery is completed during normal business hours of the recipient, failing which such notice shall be deemed to have been given on the next Business Day, (b) on the next Business Day if sent by overnight courier and delivered on such Business Day within ordinary business hours and, if not, the next Business Day following delivery; and (c) when received, if received during normal business hours and, if not, the next Business Day after receipt, if delivered by means other than those specified above. Such notices shall be delivered to the address set forth below, or to such other address as a Party shall have furnished to the other Party in accordance with this Section 8.1:

If to Paulson:

Paulson & Co. Inc.

1133 Avenue of the Americas

New York, NY 10036

Attention: Michael Waldorf

Telephone (212) 956-2472

Facsimile: (212) 351-5887

with copies (which shall not constitute notice) to:

Kleinberg, Kaplan, Wolff & Cohen

551 Fifth Avenue

New York, NY 10176

Attention: Chris Davis, Esq

Telephone (212) 880-9865

Facsimile: (212) 986-8866

If to the Company:

BrightSphere Investment Group Inc.

200 Clarendon Street, 53rd Floor

Boston, MA 02116

Attention: Chief Executive Officer

Telephone: (617) 369-7371

Facsimile: (617)369-7456

with a copy (which shall not constitute notice) to:

Morgan Lewis & Bockius LLP

101 Park Avenue

New York, NY 10178-0060

Attention: Christina Edling Melendi, Esq.

Telephone: (212) 309-6949

Facsimile: (212) 309-6001

SECTION 8.2 Binding Effect; Benefits. This Agreement shall be binding upon and inure to the benefit of the parties to this Agreement and their respective successors and permitted assigns. Nothing in this Agreement, express or implied, is intended or shall be construed to give any person other than the parties to this Agreement or their respective successors or permitted assigns any legal or equitable right, remedy or claim under or in respect of any agreement or any provision contained herein.

SECTION 8.3 Remedies.

(a)The Parties hereby expressly recognize and acknowledge that immediate, extensive and irreparable damage could result, no adequate remedy at law would exist and damages would be difficult to determine in the event that any provision of this Agreement is not performed in accordance with its specific terms or is otherwise breached. Therefore, in addition to, and not in limitation of, any other remedy available to any Party, and notwithstanding the provisions of Article 7, an aggrieved Party under this Agreement is entitled to seek specific performance of the terms hereof and immediate injunctive relief, without the necessity of proving the inadequacy of money damages as a remedy. Neither Party shall be required to obtain or furnish any bond or similar instrument in connection with or as a condition to obtaining or seeking any such remedy. For the avoidance of doubt, nothing in this Agreement shall diminish the availability of specific performance of the obligations under this Agreement or any other injunctive relief.

SECTION 8.4 Governing Law. This Agreement shall be construed in accordance with and governed by the laws of the State of Delaware, without regard to the conflicts of laws rules thereof. The parties irrevocably consent to service of process by any means available under Delaware law and consent to the exclusive, both personal and subject-matter, jurisdiction and venue of any chancery court in the state of Delaware and irrevocably waive the right to object to such venue of any such court on the grounds that such forum is inconvenient. To the extent that in any jurisdiction any party may now or hereafter claim or be entitled to claim, for itself or its assets, immunity from suit, execution, attachment (before or after judgment) or other legal process, each party irrevocably agrees, to the extent permitted by law, not to claim, and it hereby waives, such immunity in connection with any contractual dispute with respect to this agreement. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY ACTION ARISING OUT OF THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

SECTION 8.5 Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but both of which together shall constitute one and the same instrument.

SECTION 8.6 Severability. In the event that any one or more of the provisions contained herein, or the application thereof in any circumstances, is held invalid, illegal or unenforceable in any respect for any reason, the validity, legality and enforceability of any such provision in every other respect and of the remaining provisions contained herein shall not be in any way impaired thereby, it being intended that all of the rights and privileges of the Parties shall be enforceable to the fullest extent permitted by law. To the extent that any such provision is so held to be invalid, illegal or unenforceable, the Parties shall in good faith use commercially reasonable efforts to find and effect an alternative means to achieve the same or substantially the same result as that contemplated by such provision.

SECTION 8.7 Confidential Information. Each Party shall treat all information provided to it by any other Party with the same degree of care as such Party treats its own information of the same nature (including, compliance with Regulation FD under the Exchange Act to the extent applicable), provided that this Section 8.7 shall not apply to information relating to or disclosed in any registration statement filed in accordance with the terms of the Registration Rights Agreement. Proprietary information received by a Party from any other Party shall not be utilized by such Party to engage, directly or indirectly (including through Subsidiaries) in a business in competition with the business of such other Party or any of its Subsidiaries; provided, however, that the Company agrees that Paulson may use proprietary information from the Company for

the purpose of monitoring and managing its investment in the Company. Notwithstanding the foregoing, the restrictions in this Section 8.7 shall not apply to any Party to the extent that (i) any information is or becomes generally available to the public other than as a result of disclosure by such Party, (ii) any information is required by Applicable Law to be disclosed by such Party or (iii) any information was or becomes available to such Party on a non-confidential basis and from a source (other than another Party or any Affiliate or representative of such other Party) that is not bound by a confidentiality agreement with respect to such information.

SECTION 8.8 Market Abuse. In no event shall any Party or any of its Subsidiaries or any of their respective directors, officers, or employees communicate material non-public information or price-sensitive information of any other Party in connection with acquiring or disposing of securities of any other Party or transacting in any way in such securities. Each Party shall be liable for any breach of this Section 8.8 by it or any of its Subsidiaries or any of their respective directors, officers, and employees.

SECTION 8.9 Amendment, Modification and Waiver. This Agreement may be amended, modified or supplemented only by written agreement executed by the Parties. Any failure of a Party to comply with any obligation, covenant or agreement contained in this Agreement may be waived by the Party entitled to the benefits thereof only by a written instrument duly executed by the Party granting such waiver, but such waiver or failure to insist upon strict compliance with such obligation, covenant or agreement shall not operate as a waiver of, or estoppel with respect to, any subsequent or other failure of compliance.

SECTION 8.10 No Partnership or Agency. Nothing in this Agreement shall create a partnership, joint venture or establish a relationship of principal and agent or any other fiduciary relationship between or among any of the Parties.

SECTION 8.11 Other Business. The Company:

(a) acknowledges that each of the other Parties and their respective members, partners, shareholders, officers and directors, employees, agents, representatives, appointed members of the Board of Directors and Subsidiaries (“Paulson Persons”) have or may have in the future other business interests, activities and investments, some of which may be in conflict or competition with the business of the Company or any of its Subsidiaries;

(b) agrees that, subject to Section 8.7, each of the Paulson Persons shall be entitled to carry on such other business interests, activities and investments in such manner as they, in their sole discretion, may choose, and shall not have any obligation to offer any interest or participation in or arising out of such activities, or the income or profits derived therefrom, to the Company or to any of its Subsidiaries; and

(c) agrees that, subject to Section 8.7, the pursuit of such activities, even if competitive with the business of the Company or any of its Subsidiaries, will not be deemed wrongful or improper.

SECTION 8.12 Assignment.

(a)Except as otherwise provided for in Section 8.12(b) or otherwise in this Agreement, neither this Agreement nor any of the rights of any Party under this Agreement may be assigned by such Party without the prior written consent of the other Parties.

(b)Notwithstanding Section 8.12(a) above, Paulson may, without such consent, assign this Agreement or any of their respective rights hereunder to:

(i)any Related Person of Paulson;

(ii)any other Person, provided that with respect to this Section 8.12(b)(ii) only (1) the assignee of such rights shall acquire initially the rights hereunder that Paulson would have at the level of ownership acquired by the assignee (subject to a change in such rights as the assignee’s level of ownership changes, as herein provided), (2) Paulson may only make one assignment pursuant to this Section 8.12(b)(ii), and (3) the assignee of such rights (and any future assignee) may subsequently assign its rights only once, in which event the subsequent assignee initially shall have the rights hereunder that the assignor would have at the level of ownership acquired by such assignee (subject to a change in such rights as the assignee’s level of ownership changes, as herein provided). For the avoidance of doubt, the parties intend that the assignment rights provided for in this Section 8.12(b)(ii) shall be interpreted as set forth in Schedule I.

SECTION 8.13 Further Assurances. Each Party shall, on being required to do so by any other Party, perform or procure the performance of all such acts and/or execute and/or deliver or procure the execution and/or delivery of all such documents (in each case at its own expense), as may be required by law or as any other Party may from time to time reasonably require in order to implement and give full effect to this Agreement.

SECTION 8.14 Reserved

SECTION 8.15 Entire Agreement. This Agreement, including any schedules or exhibits hereto, embodies the entire agreement and understanding of the Parties hereto in respect of the subject matter covered by this Agreement and supersedes in all respects all prior agreement relating to the subject matter hereof between the Parties. Notwithstanding the foregoing, nothing in this Agreement shall limit, reduce or eliminate any rights that Paulson may otherwise have.

SECTION 8.16 Reserved

SECTION 8.17 Term. Except to the extent set forth in the following sentence, this Agreement shall terminate and be of no further force or effect as of the Third Threshold Date. Notwithstanding the foregoing sentence, the provisions of Article 1, Article 7, Article 8, and Section 6.3 hereof shall survive termination of this Agreement. For the avoidance of doubt, to the extent this Agreement or rights hereunder have been assigned pursuant to Section 8.12(b)(ii), any termination pursuant to this Section 8.17 shall apply only with respect to the shareholder that ceases to beneficially own, directly or indirectly, at least 7% of the outstanding shares of Common Stock.

[SIGNATURE PAGE FOLLOW]

IN WITNESS WHEREOF, the Parties have caused this Stockholder Agreement to be executed as of the first day written above.

BRIGHTSPHERE INVESTMENT GROUP INC.

By: _/s/ Suren Rana_____________________

Name: Suren Rana

Title: Chief Financial Officer

PAULSON & CO. INC.

By: _/s/ Michael Waldorf_______________

Name: Michael Waldorf

Title: Partner and Senior Counsel



Table of Contents		Page
ARTICLE 1 DEFINITIONS; RULES OF CONSTRUCTION		1
SECTION 1.1 Definitions		1
SECTION 1.2 Timing of Provisions		3
SECTION 1.3 Interpretation		3
ARTICLE 2 REPRESENTATIONS AND WARRANTIES		4
SECTION 2.1 Representations		4
ARTICLE 3 BOARD OF DIRECTORS AND CORPORATE GOVERNANCE		4
SECTION 3.1 Board of Directors		4
SECTION 3.2 Audit Committee Membership		5
SECTION 3.3 Director Information		5
ARTICLE 4 INFORMATION AND DISCLOSURE		5
SECTION 4.1 Information Rights		5
SECTION 4.2 Release of Information and Public Filings		6
ARTICLE 5 SUBSEQUENT SALES OF ORDINARY SHARES		6
SECTION 5.1 Registration Rights		6
SECTION 5.2 Preemptive Rights		6
SECTION 5.3 Lock-Up Provisions		7
SECTION 5.4 Transfers by Paulson		7
ARTICLE 6 OTHER PROVISIONS		8
SECTION 6.1 Access to Personal Data		8
SECTION 6.2 Internal Communications Protocol		8
SECTION 6.3 Access to Historic Records		8
SECTION 6.4 Indemnification; Liability Insurance		8
SECTION 6.5 Non-Solicitation		9
ARTICLE 7 RESERVED		10
ARTICLE 8 GENERAL PROVISIONS		10
SECTION 8.1 Notices.		10
SECTION 8.2 Binding Effect; Benefits.		11
SECTION 8.3 Remedies.		11
SECTION 8.4 Governing Law		11
SECTION 8.5 Counterparts		11
SECTION 8.6 Severability		11
SECTION 8.7 Confidential Information		11
SECTION 8.8 Market Abuse		12
SECTION 8.9 Amendment, Modification and Waiver		12
SECTION 8.10 No Partnership or Agency		12
SECTION 8.11 Other Business		12
SECTION 8.12 Assignment		12
SECTION 8.13 Further Assurances		12
SECTION 8.14 Reserved		13
SECTION 8.15 Entire Agreement		13
SECTION 8.16 Reserved		13
SECTION 8.17 Term		13

Exhibit 10.20

REVOLVING CREDIT AGREEMENT

dated as of October 15, 2014,

as amended and restated as of July 11, 2019,

among

BRIGHTSPHERE INVESTMENT GROUP INC.,

THE LENDERS NAMED HEREIN,

and

CITIBANK, N.A., as Administrative Agent

___________________________

CITIGROUP GLOBAL MARKETS INC.

and

MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED,

as Joint Lead Arrangers and Joint Bookrunners

_________________________

TABLE OF CONTENTS



		Page

ARTICLE I

Definitions



SECTION 1.01. Defined Terms		1
SECTION 1.02. Classification of Loans and Borrowings		21
SECTION 1.03. Terms Generally		21
SECTION 1.04. Accounting Terms; GAAP		22
SECTION 1.05. References to Agreements		22

ARTICLE II

The Credits



SECTION 2.01. Commitments		22
SECTION 2.02. Loans and Borrowings		22
SECTION 2.03. Requests for Borrowings		23
SECTION 2.04. Letters of Credit		23
SECTION 2.05. Funding of Borrowings		27
SECTION 2.06. Interest Elections		27
SECTION 2.07. Fees		29
SECTION 2.08. Repayment of Loans; Evidence of Debt		29
SECTION 2.09. Interest on Loans		30
SECTION 2.10. Alternate Rate of Interest		30
SECTION 2.11. Termination and Reduction of Commitments		31
SECTION 2.12. Prepayment of Loans		31
SECTION 2.13. Increased Costs		32
SECTION 2.14. Break Funding Payments		33
SECTION 2.15. Taxes		33
SECTION 2.16. Payments Generally; Pro Rata Treatment; Sharing of Set‑offs		38
SECTION 2.17. Defaulting Lenders		39
SECTION 2.18. Mitigation Obligations; Replacement of Lenders		41
SECTION 2.19. Incremental Commitments		42

ARTICLE III

Representations and Warranties



SECTION 3.01. Organization; Powers		44
SECTION 3.02. Authorization and Enforceability		44
SECTION 3.03. Approvals; No Conflict		44
SECTION 3.04. Financial Condition; No Material Adverse Change		44
SECTION 3.05. Properties		45
SECTION 3.06. Litigation and Environmental Matters		45
SECTION 3.07. Compliance with Laws and Agreements		45
SECTION 3.08. Investment Company Status		46
SECTION 3.09. Margin Regulations		46
SECTION 3.10. Taxes		46
SECTION 3.11. ERISA		46
SECTION 3.12. Disclosure		46
SECTION 3.13. Anti-Corruption Laws and Sanctions		46

ARTICLE IV

Conditions



SECTION 4.01. [Reserved.]		47
SECTION 4.02. Conditions to Each Credit Event		47

ARTICLE V

Affirmative Covenants



SECTION 5.01. Financial Statements; Ratings Changes and Other Information		47
SECTION 5.02. Notice of Material Events		49
SECTION 5.03. Existence; Conduct of Business		49
SECTION 5.04. Payment of Obligations		49
SECTION 5.05. Maintenance of Properties; Insurance		49
SECTION 5.06. Books and Records; Inspection Rights		49
SECTION 5.07. Compliance with Laws		50
SECTION 5.08. Use of Proceeds		50
SECTION 5.09. [Reserved.]		50

ARTICLE VI

Negative Covenants



SECTION 6.01. Indebtedness		50
SECTION 6.02. Liens		52
SECTION 6.03. Sale and Lease-Back Transactions		53
SECTION 6.04. Fundamental Changes; Conduct of Business		53
SECTION 6.05. Asset Sales		53
SECTION 6.06. Transactions with Affiliates		54
SECTION 6.07. Limitation on Restricted Payments		55
SECTION 6.08. Limitation on Amendments to Certain Agreements		56
SECTION 6.09. Restrictive Agreements		56
SECTION 6.10. Hedging Agreements		57
SECTION 6.11. [Reserved.]		57
SECTION 6.12. Financial Covenants		57

ARTICLE VII

Events of Default

ARTICLE VIII

The Agent

ARTICLE IX

Miscellaneous



SECTION 9.01. Notices		61
SECTION 9.02. Survival		62
SECTION 9.03. Binding Effect		62
SECTION 9.04. Successors and Assigns		62
SECTION 9.05. Expenses; Indemnity; Damage Waiver		65
SECTION 9.06. Right of Setoff		66
SECTION 9.07. Applicable Law		66
SECTION 9.08. Waivers; Amendment		66
SECTION 9.09. No Fiduciary Relationship		67
SECTION 9.10. Entire Agreement		68
SECTION 9.11. WAIVER OF JURY TRIAL		68
SECTION 9.12. Severability		68
SECTION 9.13. Counterparts		68
SECTION 9.14. Headings		68
SECTION 9.15. Jurisdiction; Consent to Service of Process		69
SECTION 9.16. Confidentiality		69
SECTION 9.17. Electronic Communications		70
SECTION 9.18. USA Patriot Act		71
SECTION 9.19. Judgment Currency		71

REVOLVING CREDIT AGREEMENT dated as of October 15, 2014, as amended and restated as of July 11, 2019, among BRIGHTSPHERE INVESTMENT GROUP INC., a Delaware corporation (the “Borrower”), the lenders from time to time party hereto and CITIBANK, N.A., as administrative agent for such lenders.

The Borrower has requested that the Lenders extend credit in the form of Commitments pursuant to which the Borrower may, during the Availability Period, obtain Loans on a revolving credit basis and procure the issuance of Letters of Credit in an aggregate amount at any time outstanding not in excess of US $350,000,000 (as such amount may be increased in accordance herewith).

The Lenders are willing to extend such credit to the Borrower, and the Issuing Bank is willing to issue such Letters of Credit, in each case, on the terms and subject to the conditions set forth herein.

Accordingly, the parties hereto agree as follows:

ARTICLE I

Definitions

SECTION 1.01. Defined Terms. As used in this Agreement, the following terms shall have the meanings specified below:

“2019 Assignment Agreement” means the Borrower Assignment & Assumption and Amendment Agreement dated as of July 11, 2019, by and among BrightSphere UK, the Borrower, the Lenders party hereto and the Agent.

“2019 Internal Reorganization” means the internal reorganization of the BrightSphere Group to, among other things, transfer all of the material assets and liabilities of BrightSphere UK to the Borrower, including (i) the entire issued share capital of certain directly-owned subsidiaries of BrightSphere UK, (ii) the rights and obligations of the BrightSphere UK under the Existing Credit Agreement and this Agreement and (iii) the rights and obligations of BrightSphere UK under its outstanding notes, in each case, as further described in the 2019 Registration Statement);

“2019 Redomestication” means, collectively, and as further described in the 2019 Registration Statement, (a) the 2019 Internal Reorganization, (b) the subsequent transactions changing the jurisdiction of incorporation of the holding company of the BrightSphere Group from the United Kingdom to Delaware and (c) the subsequent re-registration as a private company, winding up and dissolution of BrightSphere UK.

“2019 Registration Statement” means Amendment No. 2 to the Form S-4 Registration Statement filed by the Borrower with the SEC on May 14, 2019.

“ABR Borrowing” means a Borrowing comprised of ABR Loans.

“ABR Loan” means a Loan bearing interest at a rate determined by reference to the Alternate Base Rate in accordance with the provisions of Article II.

“Accounts” means accounts payable owed to a Covered Subsidiary in respect of Management Fees or Performance Fees or otherwise as compensation for the provision of investment management or advisory services.

“Adjusted LIBO Rate” means, with respect to any Eurodollar Borrowing for any Interest Period, an interest rate per annum (rounded upwards, if necessary, to the next 1/100 of 1%) equal to the product of (a) the LIBO Rate in effect for such Interest Period and (b) Statutory Reserves.

“Administrative Questionnaire” means an Administrative Questionnaire supplied by the Agent.

“Affiliate” means, when used with respect to a specified Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the Person specified. In no event shall the Agent or any Lender be deemed to be an Affiliate of the Borrower or any of its Subsidiaries.

“Affiliate Subordination Agreement” means an Affiliate Subordination Agreement substantially in the form of Exhibit F or otherwise satisfactory to the Agent.

“Agent” means Citibank in its capacity as administrative agent hereunder or any successor administrative agent appointed in accordance with Article VIII hereof.

“Agent Parties” has the meaning assigned to such term in Section 9.17.

“Agreement” means this Revolving Credit Agreement, as amended from time to time in accordance with the terms hereof.

“Alternate Base Rate” means, with respect to any ABR Borrowing or overdue amounts hereunder for any day, a rate per annum (rounded upwards, if necessary, to the next 1/100 of 1%) equal to the greatest of (a) the Prime Rate in effect on such day, (b) the Federal Funds Effective Rate in effect on such day plus ½ of 1% and (c) the Adjusted LIBO Rate for a one-month Interest Period commencing on such day (or, if such day is not a Business Day, the immediately preceding Business Day) plus 1%; provided that, for purposes of this definition the Adjusted LIBO Rate on any day shall be based on the rate per annum equal to the London interbank offered rate as administered by the ICE Benchmark Administration Limited (or any other Person that takes over the administration of such rate) for deposits in U.S. Dollars (for delivery on such day) with a term of one month as displayed on the Reuters screen page that displays such rate (currently page LIBOR01) (or, in the event such rate does not appear on a page of the Reuters screen, on the appropriate page of such other information service that publishes such rate as shall be selected by the Agent from time to time in its reasonable discretion), at approximately 11:00 a.m., London time, two Business Days prior to such day. If for any reason the Agent shall have determined (which determination shall be conclusive absent manifest error) that it is unable to ascertain the Federal Funds Effective Rate for any reason, including the inability or failure of the Agent to obtain a quotation in accordance with the terms thereof, the Alternate Base Rate shall be determined without regard to clause (b) of the first sentence of this definition until the circumstances giving rise to such inability no longer exist. Any change in the Alternate Base Rate due to a change in the Prime Rate, the Federal Funds Effective Rate or the Adjusted LIBO Rate shall be effective from and including the effective date of such change in the Prime Rate, the Federal Funds Effective Rate or the Adjusted LIBO Rate, as the case may be.

“Anti-Corruption Laws” means all laws, rules, and regulations of any jurisdiction applicable to the Borrower or any of its Subsidiaries concerning or relating to bribery, corruption or money laundering, including the U.S. Foreign Corrupt Practices Act and the UK Bribery Act.

“Applicable Percentage” means, with respect to any Lender, the percentage of the total Commitments represented by such Lender’s Commitment; provided that when a Defaulting Lender shall

exist, “Applicable Percentage” shall mean the percentage of the aggregate amount of the Lenders’ Commitments (disregarding any Defaulting Lender’s Commitment) represented by such Lender’s Commitment. If the Commitments have terminated or expired, the Applicable Percentages shall be determined based upon the Commitments most recently in effect, giving effect to any assignments of Credit Exposures that shall have occurred after such termination or expiration.

“Applicable Rate” means, for any day, with respect to the commitment fees payable hereunder, or with respect to any Eurodollar Loan or ABR Loan, as the case may be, the applicable rate per annum set forth below under the caption, “Commitment Fee Rate”, “Eurodollar Margin” or “ABR Margin”, as the case may be, based upon the Category that applies on such day:



Pricing Category	Rating	Leverage Ratio	Commitment Fee Rate	Eurodollar Margin	ABR Margin
Category 1	BBB+ or Baa1 and higher	≤1.00:1.00	0.200%	1.25%	0.25%
Category 2	BBB or Baa2	≤1.75:1.00, but >1.00:1.00	0.250%	1.50%	0.50%
Category 3	BBB- or Baa3	≤2.25:1.00, but >1.75:1.00	0.375%	1.75%	0.75%
Category 4	Less than BBB- or Baa3	>2.25:1.00	0.500%	2.00%	1.00%

The applicable Pricing Category will be based on (a) at any time prior to the date that either Moody’s or S&P has assigned an initial rating to the Borrower’s senior, unsecured long-term indebtedness for borrowed money that is not subject to any credit enhancement, the Leverage Ratio of the Borrower calculated as of the last date of the most recently ended fiscal quarter of the Borrower for which financial statements and a compliance certificate have been delivered pursuant to Section 5.04; provided that, until such financial statements and compliance certificate have been delivered for the first full fiscal quarter ending after the Closing Date and for so long as this clause (a) applies, the Pricing Category shall be Pricing Category 2 and (b) on any time on or after the date on which such initial ratings from either of Moody’s and S&P have been assigned, the Applicable Ratings. For purposes of the foregoing, (i) if either Moody’s or S&P shall cease to have in effect an Applicable Rating (other than by reason of the circumstances referred to in the next succeeding paragraph), then the applicable Pricing Category will be based on the single available Applicable Rating, (ii) if the Applicable Ratings established or deemed to have been established by Moody’s and S&P shall fall within different Pricing Categories, the applicable Pricing Category shall be based on the higher of the two Applicable Ratings unless one of the ratings is two or more Pricing Categories lower than the other, in which case the applicable Pricing Category shall be determined by reference to the Pricing Category one rating higher than the lowest of the two Applicable Ratings, and (iii) if the Applicable Ratings established by Moody’s and S&P shall be changed (other than as a result of a change in the rating system of Moody’s or S&P), such change shall be effective as of the date on which it is first announced by the applicable rating agency, regardless of when notice of such change shall have been furnished by the Borrower to the Agent and the Lenders. Each change in the Applicable Rate shall apply during the period commencing on the effective date of such change and ending on the date immediately preceding the effective date of the next such change. From and after the time that an initial Applicable Rating is established, for any day when no Applicable Rating is in effect, the Commitment Fee Rate, the Eurodollar Margin and the ABR Margin shall be the rates set forth opposite Pricing Category 4.

If the rating system of Moody’s or S&P shall change, or if either such rating agency shall cease to be in the business of rating corporate debt obligations, the Borrower and the Lenders shall negotiate in good faith to amend this definition to reflect such changed rating system or the unavailability of ratings from such rating agency and, pending the effectiveness of any such amendment, the Commitment Fee Rate, the Eurodollar

Margin and the ABR Margin shall be determined by reference to the rating most recently in effect prior to such change or cessation.

“Applicable Rating” means, for each of Moody’s and S&P, (a) the rating assigned by such rating agency to the Borrower’s senior, unsecured long-term indebtedness for borrowed money that is not subject to any credit enhancement, (b) if such rating agency shall not have in effect a rating referred to in the preceding clause (a), then the rating assigned by such rating agency to the Loans, if any, or (c) if such rating agency shall not have in effect a rating referred to in either of the preceding clause (a) or (b), the “company” or “corporate credit” rating assigned by such rating agency to the Borrower.

“Approved Fund” has the meaning assigned to such term in Section 9.04(b).

“Assignment and Assumption” means an assignment and assumption agreement entered into by a Lender and an Eligible Assignee (with the consent of any party whose consent is required by Section 9.04), and accepted by the Agent, in substantially the form of Exhibit A.

“Assignment and Restatement Effective Date” has the meaning assigned to such term in the 2019 Assignment Agreement.

“Availability Period” means the period from and including the Closing Date to but excluding the earlier of the Maturity Date and the date of termination of the Commitments.

“Board” means the Board of Governors of the Federal Reserve System of the United States.

“Borrower” has the meaning assigned to such term in the heading of this Agreement.

“Borrowing” means Loans of the same Type made, converted or continued on the same date and, in the case of Eurodollar Loans, as to which a single Interest Period is in effect.

“Borrowing Request” has the meaning assigned to such term in Section 2.03(a).

“BrightSphere Group” means the corporate group that contains BrightSphere UK and its operating subsidiaries.

“BrightSphere UK” means BrightSphere Investment Group plc, a public limited company organized under the laws of England and Wales.

“Business Day” means any day (other than a day which is a Saturday, Sunday or legal holiday in the State of New York or the United Kingdom) on which banks are open for business in New York City and the United Kingdom; provided, however, that when used in connection with a Eurodollar Loan, the term “Business Day” shall also exclude any day on which banks are not open for dealings in U.S. Dollar deposits in the London interbank market.

“Capitalized Lease Obligations” of any Person means the obligations of such person under any lease that would be capitalized on a balance sheet of such person prepared in accordance with GAAP, and the amount of such obligations at any time shall be the capitalized amount thereof at such time determined in accordance with GAAP.

“Cash Collateralize” means, to pledge and deposit with, or deliver to the Agent, for the benefit of an Issuing Bank, as collateral for the obligations of the Borrower in respect of Letters of Credit or the obligations of Lenders to acquire participations in Letters of Credit, cash or, if the Agent and the applicable

Issuing Bank shall agree in their sole discretion, other credit support, in each case pursuant to documentation in form and substance satisfactory to the Agent and each applicable Issuing Bank. “Cash Collateral” shall have a meaning correlative to the foregoing and shall include the proceeds of such cash collateral and other credit support.

“Change in Control” means (i) any Person or group (within the meaning of the Exchange Act and the rules of the SEC thereunder) shall acquire or hold, directly or indirectly, beneficially or of record, Equity Interests of the Borrower representing more than 50% of the aggregate voting power represented by all issued and outstanding Equity Interests of the Borrower, (ii) less than a majority of the members of the board of directors of the Borrower shall be individuals who are either (x) members of such board on the Assignment and Restatement Effective Date or (y) members of the board whose election, or nomination for election by the stockholders of the Borrower, was approved by a vote of at least a majority of the members of the board then in office who are individuals described in clause (x) above or this clause (y) or (iii) any “Change in Control” (or similar event, however denominated) of the Borrower as defined in any agreement or instrument evidencing or governing Indebtedness (other than Non-Recourse Seed Indebtedness) or obligations in respect of one or more Hedging Agreements, of any one or more of the Borrower and its Covered Subsidiaries in an aggregate principal amount exceeding $50,000,000 shall occur. For purposes of the preceding sentence, the “principal amount” of the obligations of the Borrower or any Covered Subsidiary in respect of any Hedging Agreement at any time shall be the maximum aggregate amount (giving effect to any netting agreements) that the Borrower or such Covered Subsidiary would be required to pay if such Hedging Agreement were terminated at such time.

“Change in Law” means the occurrence, after the Closing Date, of any of the following: (a) the adoption of any law, rule, regulation or treaty, (b) any change in any law, rule, regulation or treaty or in the interpretation or application thereof by any Governmental Authority or (c) compliance by any Lender (or, for purposes of Section 2.13(b), by any lending office of such Lender or by such Lender’s holding company, if any) with any request, guideline or directive (whether or not having the force of law) of any Governmental Authority made or issued after the Closing Date; provided, however, that notwithstanding anything herein to the contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and each request, rule, guideline or directive thereunder or issued in connection therewith and (y) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case under clauses (x) and (y) above be deemed to be a “Change in Law”, regardless of the date enacted, adopted or issued.

“Citibank” means Citibank, N.A. and its successors and assigns.

“Closing Date” means October 15, 2014, the date on which the conditions to effectiveness of this Agreement set forth in Section 4.01 of the Existing Credit Agreement were satisfied (or waived in accordance with Section 9.08).

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

“Co-Investment Deed” has the meaning assigned to such term in the Existing Credit Agreement.

“Commitment” means, with respect to each Lender, the commitment of such Lender to make Loans hereunder (and to acquire participations in Letters of Credit as provided for herein), expressed as an amount representing the maximum aggregate permitted amount of such Lender’s Credit Exposure hereunder, as such commitment may be (a) reduced from time to time pursuant to Section 2.11, (b) reduced or increased

from time to time pursuant to assignments by or to such Lender pursuant to Section 9.04 or (c) increased pursuant to Incremental Commitments of such Lender pursuant to Section 2.19. The amount of each Lender’s Commitment is set forth opposite such Lender’s name on Schedule 2.01 or, if such Lender has entered into an Assignment and Assumption or Incremental Facility Agreement, set forth for such Lender in the Register. The aggregate amount of the Lenders’ Commitments as of the Closing Date was $350,000,000.

“Compliance Certificate” means a Compliance Certificate of a Financial Officer of the Borrower substantially in the form of Exhibit E.

“Consolidated Adjusted EBITDA” means, for any period, Consolidated Net Income for such period (a) excluding, without duplication and to the extent added or subtracted in computing Consolidated Net Income, (i) interest expense, including interest expense historically paid to Parent, (ii) income tax expense and tax benefits, (iii) depreciation and amortization charges, (iv) non-cash notional corporate cost allocations, (v) non-cash expenses representing changes in the value of equity and profit interests in subsidiaries held by key employees of such subsidiaries, (vi) seed capital and co-investment gains, losses and related financing costs, (vii) restructuring costs related to an exit from a distinct product or line of business, (viii) non-cash compensation expenses related to the award of stock or equity options, (ix) non-recurring cash expenses relating to capital transactions, including the IPO, (x) non-cash impairment charges relating to acquired goodwill and intangible assets, and (xi) other non-cash charges and expenses; provided that any cash payment made with respect to any non-cash expenses or charges added back in computing Consolidated Adjusted EBITDA for any earlier period pursuant to clause (a)(xi) shall be subtracted in computing Consolidated Adjusted EBITDA for the period in which such cash payment is made, and (b) less, without duplication and to the extent otherwise included in computing such Consolidated Net Income, nonrecurring gains, in each case determined on a consolidated basis for the Borrower in accordance with GAAP, as applicable.

“Consolidated Interest Expense” means, for any period, the total cash interest expense, other than interest expense associated with any Non-Recourse Seed Indebtedness or of any Fund or Fund Entity, of the Borrower and its Covered Subsidiaries on a consolidated basis for such period, in each case determined in accordance with GAAP.

“Consolidated Net Income” means, for any period, the consolidated net income or loss from continuing operations attributable to controlling interests of the Borrower and the Covered Subsidiaries for such period (other than net income or loss attributable to any Funds or Fund Entities), determined on a consolidated basis in accordance with GAAP.

“Consolidated Total Indebtedness” means, as of any date, the aggregate amount of all Indebtedness of the Borrower and the Covered Subsidiaries outstanding as of such date, in the amount that would be reflected on a balance sheet of the Borrower and the Covered Subsidiaries prepared on a consolidated basis as of such date in accordance with GAAP, excluding (i) accrued long-term liabilities in respect of previously recognized compensation expense attributable to equity and profit awards to employees, (ii) Non-Recourse Seed Indebtedness, (iii) Indebtedness of consolidated Fund Entities that is not subject to any Guarantee of the Borrower or any Covered Subsidiary and (iv) Indebtedness owed by the Borrower to OMGUK under the Note.

“Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a person, whether as general partner or through the ownership of voting securities, by contract or otherwise, and “Controlling” and “Controlled” shall have meanings correlative thereto.

“Core Business Entity” means any Person that is engaged in, or earns or is entitled to receive fees or income (including investment income and fees, Management Fees and Performance Fees) from, one or more Core Businesses.

“Core Businesses” means (i) investment or asset management services, financial advisory services, money management services or similar or related activities, including but not limited to services provided to mutual funds, private equity or debt funds, hedge funds, funds of funds, corporate or other business entities or individuals and in respect of separately managed accounts and (ii) investing in Equity Interests of entities substantially all of the businesses of which consist of providing services referred to in clause (i).

“Covered Subsidiaries” means each of the Subsidiaries other than any Subsidiaries that are Fund Entities. For the avoidance of doubt, references to the term “Covered Subsidiaries” shall (a) not include (i) Heitman LLC or (ii) Investment Counselors of Maryland, LLC unless and until such entity becomes a “Subsidiary” as defined herein and (b) include BrightSphere UK.

“Credit Exposure” means, with respect to any Lender at any time, the sum of the principal amount of such Lender’s Loans outstanding at such time and such Lender’s LC Exposure at such time.

“Default” means any event or condition which constitutes an Event of Default or which upon notice, lapse of time or both would constitute an Event of Default.

“Defaulting Lender” means, subject to Section 2.17(b), any Lender that (a) has failed, within two Business Days of the date required to be funded or paid, to (i) fund all or any portion of its Loans unless such Lender notifies the Agent in writing that such failure is the result of such Lender’s good faith determination that one or more conditions precedent to funding (each of which conditions precedent, together with any applicable default, shall be specifically identified in such writing) has not been satisfied, (ii) fund any portion of its participations in Letters of Credit or (iii) pay to the Agent, any Issuing Bank or any other Lender any other amount required to be paid by it hereunder, (b) has notified the Borrower, the Agent or any Issuing Bank in writing that it does not intend or expect to comply with its funding obligations hereunder or generally under other agreements in which it commits to extend credit, or has made a public statement to that effect (unless such writing or public statement relates to such Lender’s obligation to fund a Loan hereunder and states that such position is based on such Lender’s good faith determination that a condition precedent to funding (which condition precedent, together with any applicable default, shall be specifically identified in such writing or public statement) cannot be satisfied), (c) has failed, within three Business Days after written request by the Agent, any Issuing Bank or the Borrower made in good faith, to provide a certification from an authorized officer of such Lender in writing to the Agent and the Borrower that it will comply with its obligations (and is financially able to meet such obligations) hereunder to fund prospective Loans and participations in outstanding Letters of Credit (provided that such Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon receipt of such written certification by the Agent and the Borrower), (d) has, or has a direct or indirect parent company that has, (i) become the subject of a proceeding under any federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect, or (ii) had appointed for it a receiver, custodian, conservator, trustee, administrator, assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of its business or assets, including the Federal Deposit Insurance Corporation or any other state or federal regulatory authority acting in such a capacity; provided that a Lender shall not be a Defaulting Lender solely by virtue of the ownership or acquisition of any equity interest in that Lender or any direct or indirect parent company thereof by a Governmental Authority so long as such ownership interest does not result in or provide such Lender with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permit such Lender (or such Governmental Authority) to reject, repudiate,

disavow or disaffirm any contracts or agreements made with such Lender or (e) has, or has a direct or indirect parent company that has, become the subject of a Bail-In Action. Any determination by the Agent that a Lender is a Defaulting Lender under any one or more of clauses (a) through (e) above shall be conclusive and binding absent manifest error, and such Lender shall be deemed to be a Defaulting Lender (subject to Section 2.17(b)) upon delivery of written notice of such determination to the Borrower, each Issuing Bank and each Lender.

“Deferred Tax Asset Deed” has the meaning assigned to such term in the Existing Credit Agreement.

“Dollars”, “dollars” or “$” means lawful money of the United States of America.

“Eligible Assignee” means any Person (other than a natural person (or a holding company, investment vehicle or trust for, or owned and operated for the primary benefit of, a natural person), the Borrower or any Subsidiary or Affiliate thereof) that meets the requirements to be an assignee under Section 9.04(b).

“Environmental Laws” means all laws, rules, regulations, codes, ordinances, orders, decrees, judgments, injunctions, notices or binding agreements issued, promulgated or entered into by any Governmental Authority, relating in any way to the environment, preservation or reclamation of natural resources or the management, release or threatened release of any Hazardous Material.

“Environmental Liability” means any liability, contingent or otherwise (including any liability for damages, costs of environmental remediation, fines, penalties or indemnities), of the Borrower or any Subsidiary directly or indirectly resulting from or based upon (a) violation of any Environmental Law, (b) the generation, use, handling, transportation, storage, treatment or disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials, (d) the release or threatened release of any Hazardous Materials into the environment or (e) any contract, agreement or other consensual arrangement pursuant to which liability is assumed or imposed with respect to any of the foregoing.

“Equity Interests” means shares of capital stock, partnership interests, membership interests, beneficial interests or other ownership interests, whether voting or nonvoting, in, or interests in the income or profits of, a Person, and any warrants, options or other rights entitling the holder thereof to purchase or acquire any of the foregoing.

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

“ERISA Affiliate” means any trade or business (whether or not incorporated) that, together with the Borrower, is treated as a single employer under Section 414(b) or (c) of the Code or, solely for purposes of Section 302 of ERISA and Section 412 of the Code, is treated as a single employer under Section 414 of the Code.

“ERISA Event” means (a) any “reportable event”, as defined in Section 4043 of ERISA or the regulations issued thereunder with respect to a Plan (other than an event for which the 30‑day notice period is waived); (b) any failure by any Plan to meet the minimum funding standards (as defined in Section 412 of the Code or Section 302 of ERISA) applicable to such Plan, in each instance, whether or not waived; (c) the filing pursuant to Section 412(c) of the Code or Section 302(c) of ERISA of an application for a waiver of the minimum funding standard with respect to any Plan; (d) a determination that any Plan is, or is expected to be, in “at risk” status (as defined in Section 303(i)(4) of ERISA or Section 430(i)(4) of the

Code); (e) the incurrence by the Borrower or any of its ERISA Affiliates of any liability under Title IV of ERISA with respect to the termination of any Plan; (f) the receipt by the Borrower or any ERISA Affiliate from the PBGC or a plan administrator of any notice relating to an intention to terminate any Plan or Plans or to appoint a trustee to administer any Plan; (g) the incurrence by the Borrower or any of its ERISA Affiliates of any liability with respect to the withdrawal or partial withdrawal from any Plan or Multiemployer Plan; (h) the receipt by the Borrower or any ERISA Affiliate of any notice, or the receipt by any Multiemployer Plan from the Borrower or any ERISA Affiliate of any notice, concerning the imposition of Withdrawal Liability or a determination that a Multiemployer Plan is, or is expected to be, insolvent or in reorganization, within the meaning of Title IV of ERISA or in “endangered” or “critical” status within the meaning of Section 305 of ERISA or Section 432 of the Code or (i) the occurrence of a non-exempt “prohibited transaction” (as defined in Section 4975 of the Code or Section 406 of ERISA) with respect to a Plan with respect to which the Borrower or any ERISA Affiliate is a “disqualified person” (within the meaning of Section 4975 of the Code) or a “party in interest” (within the meaning of Section 406 of ERISA) which results in liability to the Borrower or a Covered Subsidiary.

“Eurodollar Borrowing” means a Borrowing comprised of Eurodollar Loans.

“Eurodollar Loan” means a Loan bearing interest at a rate determined by reference to the Adjusted LIBO Rate in accordance with the provisions of Article II.

“Event of Default” has the meaning assigned to such term in Article VII.

“Exchange Act” means the United States Securities Exchange Act of 1934, as amended.

“Excluded Taxes” means any of the following Taxes imposed on or with respect to a Recipient or required to be withheld or deducted from a payment to a Recipient: (a) Taxes imposed on or measured by net income (however denominated and including (for the avoidance of doubt) any backup withholding in respect thereof), franchise Taxes and branch profits Taxes, in each case, (i) imposed by the United States of America (or any political subdivision thereof) or as a result of such Recipient being organized under the laws of, or having its principal office or, in the case of any Lender, its applicable lending office located in, the jurisdiction imposing such Tax (or any political subdivision thereof) or (ii) that are Other Connection Taxes, (b) in the case of a Lender, any U.S. Federal withholding Taxes imposed with respect to an applicable interest in a Loan or Commitment pursuant to a law in effect on the date (i) such Lender acquires such interest in the Loan or Commitment (other than pursuant to an assignment request pursuant to Section 2.18) or (ii) such Lender changes its lending office, except in each case to the extent that, pursuant to Section 2.15(a), amounts with respect to such Taxes were payable either to such Lender’s assignor immediately before such Lender became a party hereto or to such Lender immediately before it changed its lending office, (c) any Taxes attributable to such Recipient’s failure to comply with Section 2.15(f), (d) any U.S. Federal withholding Taxes imposed under FATCA and (e) any UK Excluded Withholding Taxes.

“Existing Credit Agreement” means this Agreement as in effect immediately prior to giving effect to the 2019 Assignment Agreement on the Assignment and Restatement Effective Date.

“FATCA” means Sections 1471 through 1474 of the Code, as of the Closing Date (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official interpretations thereof, any agreement entered into pursuant to Section 1471(b)(1) of the Code, any intergovernmental agreement entered into in connection with the implementation of such Sections of the Code and any fiscal or regulatory legislation, rules or practices adopted pursuant to such intergovernmental agreement.

“Federal Funds Effective Rate” means, for any day, the weighted average (rounded upwards, if necessary, to the next 1/100 of 1%) of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers, as published on the next succeeding Business Day by the Federal Reserve Bank of New York, or, if such rate is not so published for any day which is a Business Day, the quotation for such day for such transactions received by the Agent from a Federal funds broker of recognized standing selected by it.

“Fee Letters” means the letter agreements, each dated September 4, 2014 between (i) the Borrower, Citibank and Citigroup Global Markets Inc. and (ii) the Borrower, Bank of America, N.A., and Merrill Lynch, Pierce, Fenner & Smith, Incorporated.

“Financial Officer” means (i) the chief financial officer of the Borrower, (ii) the chief executive officer of the Borrower, (iii) the head of affiliate management of the Borrower and (iv) any other senior officer of the Borrower designated in writing to the Agent by any of the foregoing officers of the Borrower.

“Foreign Lender” means a Lender that is a resident or organized under the laws of a jurisdiction other than that in which the Borrower is resident for tax purposes.

“Fronting Exposure” means, at any time there is a Defaulting Lender, with respect to any Issuing Bank, such Defaulting Lender’s LC Exposure with respect to Letters of Credit issued by such Issuing Bank other than LC Exposure as to which such Defaulting Lender’s participation obligation has been reallocated to other Lenders or Cash Collateralized in accordance with the terms hereof.

“Fund” means any investment fund or investment vehicle, including mutual funds, organized as a separate legal entity that is required to be consolidated with the Borrower under GAAP.

“Fund Entity” means (a) any Fund in respect of which any of the Covered Subsidiaries acts as manager or investment advisor or has rights with respect to Management Fees or Performance Fees and (b) any entity in which any entity described in clause (a) has an investment.

“GAAP” means generally accepted accounting principles as in effect from time to time in the United States of America, applied on a consistent basis.

“Governmental Authority” means the government of the United States of America, any other nation or any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government.

“Guarantee” of or by any Person (the “guarantor”) means any obligation, contingent or otherwise, of the guarantor guaranteeing or having the economic effect of guaranteeing any Indebtedness of any other Person (the “primary obligor”) in any manner, whether directly or indirectly, and including any obligation of the guarantor, direct or indirect, (a) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or to purchase (or to advance or supply funds for the purchase of) any security for the payment thereof, (b) to purchase or lease property, securities or services for the purpose of assuring the owner of such Indebtedness of the payment thereof, (c) to maintain working capital, equity capital or any other financial statement condition or liquidity of the primary obligor so as to enable the primary obligor to pay such Indebtedness or (d) as an account party in respect of any letter of credit or letter of guaranty issued to support such Indebtedness; provided, that the term Guarantee shall not include endorsements for collection or deposit in the ordinary course of business. The amount, as of any date of determination, of any Guarantee shall be the principal amount outstanding on such date of Indebtedness or

other obligation guaranteed thereby (or, in the case of (i) any Guarantee the terms of which limit the monetary exposure of the guarantor or (ii) any Guarantee of an obligation that does not have a principal amount, the maximum monetary exposure as of such date of the guarantor under such Guarantee (as determined, in the case of clause (i), pursuant to such terms or, in the case of clause (ii), reasonably and in good faith by a Financial Officer)). When used as a verb, the term “Guarantee” means to provide a Guarantee.

“Hazardous Materials” means all explosive or radioactive substances or wastes and all hazardous or toxic substances, wastes or other pollutants, including petroleum or petroleum distillates, asbestos or asbestos containing materials, polychlorinated biphenyls, radon gas, infectious or medical wastes and all other substances or wastes of any nature regulated pursuant to any Environmental Law.

“Hedging Agreement” means any interest rate protection agreement, foreign currency exchange agreement, commodity price protection agreement or other interest or currency exchange rate or commodity price hedging arrangement.

“Impacted Interest Period” has the meaning assigned to such term in the definition of “LIBO Rate”.

“Incremental Commitments” means, with respect to any Lender, the commitment, if any, of such Lender, established in accordance with Section 2.19 pursuant to an Incremental Facility Agreement, (a) to make Loans and to acquire participations in Letters of Credit hereunder, (b) to make revolving loans as part of a new tranche under this Agreement, or (c) to make term loans, in each case expressed as an amount representing the maximum aggregate permitted amount of such Lender’s Credit Exposure (or an equivalent amount in the case of clauses (b) and (c)) under such Incremental Facility Agreement.

“Incremental Facility Agreement” means an Incremental Facility Agreement, in form and substance reasonably satisfactory to the Agent, among the Borrower, the Agent and one or more Incremental Lenders, establishing Incremental Commitments and effecting such other amendments hereto and to the other Loan Documents as are contemplated by Section 2.19.

“Incremental Lender” means a Lender with an Incremental Commitment.

“Indebtedness” of any Person means, without duplication, (a) all obligations of such Person for borrowed money, (b) all obligations of such Person evidenced by bonds, debentures, notes or similar instruments, (c) all obligations of such Person under conditional sale or other title retention agreements relating to property acquired by such Person (excluding trade accounts payable incurred in the ordinary course of business), (d) all obligations of such Person in respect of the deferred purchase price of property or services (including payments in respect of non-competition agreements or other arrangements representing acquisition consideration, in each case entered into in connection with an acquisition, but excluding (i) current accounts payable incurred in the ordinary course of business, (ii) deferred compensation payable to directors, officers or employees of the Borrower or any Covered Subsidiary and (iii) any purchase price adjustment or earnout incurred in connection with an acquisition, except to the extent that on any date the amount payable pursuant to such purchase price adjustment or earnout is, or becomes, reasonably determinable and would be required to be reflected on a consolidated balance sheet of the Borrower prepared as of such date in accordance with GAAP), (e) all Capitalized Lease Obligations of such Person, (f) the maximum aggregate amount of all letters of credit and letters of guaranty in respect of which such Person is an account party (other than obligations with respect to any letter of credit and letter of guaranty securing obligations not otherwise constituting Indebtedness that is entered into in the ordinary course of business to the extent such letter of credit or letter of guaranty is not drawn upon), (g) all obligations, contingent or otherwise, of such Person in respect of bankers’ acceptances, (h) all Indebtedness of others secured by (or for which the holder

of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien on property owned or acquired by such Person, whether or not the Indebtedness secured thereby has been assumed by such Person, and (i) all Guarantees by such Person of Indebtedness of others. The Indebtedness of any Person shall include the Indebtedness of any other Person (including any partnership in which such Person is a general partner) to the extent such Person is liable therefor as a result of such Person’s ownership interest in or other relationship with such other Person, except to the extent the terms of such Indebtedness provide that such Person is not liable therefor. For the avoidance of doubt, the term Indebtedness shall not include any obligations of a Person under the Co-Investment Deed or the Deferred Tax Asset Deed, in each case as in effect on the Closing Date, to the extent such obligations were reflected on the consolidated pro forma balance sheet of the Borrower included in the Registration Statement.

“Indemnified Taxes” means (a) Taxes, other than Excluded Taxes, imposed on or with respect to any payment made by or on account of any obligation of the Borrower under any Loan Document and (b) to the extent not otherwise described in (a), Other Taxes.

“Intellectual Property License Agreement” has the meaning assigned to such term in the Existing Credit Agreement.

“Interest Coverage Ratio” means, for any period, the ratio of (a) Consolidated Adjusted EBITDA for such period to (b) Consolidated Interest Expense for such period; provided that the Interest Coverage Ratio in respect of each Test Period ending on the last day of each of the first four fiscal quarters of the Borrower ending after the Closing Date will be the ratio of (i) Consolidated Adjusted EBITDA for such Test Period to (ii) an amount equal to the actual Consolidated Interest Expense from the Closing Date through the last day of such Test Period multiplied by a fraction the numerator of which is 365 and the denominator of which is the number of days from the Closing Date through the last day of such Test Period.

“Interest Election Request” has the meaning assigned to such term in Section 2.06(b).

“Interest Payment Date” means (a) with respect to any ABR Loan, the last day of each March, June, September and December and (b) with respect to any Eurodollar Loan, the last day of the Interest Period applicable thereto and, in the case of a Eurodollar Loan with an Interest Period of more than three months’ duration, each day that would have been an Interest Payment Date for such Loan had successive Interest Periods of three months’ duration been applicable to such Loan.

“Interest Period” means, with respect to any Eurodollar Borrowing, the period commencing on the date of such Borrowing and ending on the numerically corresponding day (or, if there is no numerically corresponding day, on the last day) in the calendar month that is one, two, three or six months (or, if agreed to by each of the Lenders, 12 months) thereafter, as the Borrower may elect; provided, however, that (i) if any Interest Period would end on a day other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless such next succeeding Business Day would fall in the next calendar month, in which case such Interest Period shall end on the next preceding Business Day and (ii) any Interest Period that commences on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the last calendar month of such Interest Period) shall end on the last Business Day of the last calendar month of such Interest Period. For purposes hereof, the date of a Borrowing initially will be the date on which such Borrowing is made and thereafter will be the effective date of the most recent conversion or continuation of such Borrowing.

“Interpolated Rate” means, at any time, for any Interest Period, the rate per annum (rounded to the same number of decimal places as the LIBO Screen Rate) determined by the Agent (which determination shall be conclusive and binding absent manifest error) to be equal to the rate that results from interpolating

on a linear basis between: (a) the LIBO Screen Rate for the longest period for which the LIBO Screen Rate is available that is shorter than the Impacted Interest Period; and (b) the LIBO Screen Rate for the shortest period for which that Screen Rate is available that exceeds the Impacted Interest Period, in each case, at such time.

“IPO” means the initial public offering and sale by OMGUK, as selling shareholder, of at least 15% of the ordinary shares of the Borrower (calculated on a fully-diluted basis) pursuant to an effective registration statement filed with the SEC in accordance with the Securities Act of 1933 and the rules and regulations of the SEC promulgated thereunder.

“IRS” means the United States Internal Revenue Service.

“Issuing Bank” means (a) Citibank, N.A., and (b) each Lender that shall have become an Issuing Bank hereunder as provided in Section 2.04(i) (other than any Person that shall have ceased to be an Issuing Bank as provided in Section 2.04(i)), each in its capacity as an issuer of Letters of Credit hereunder. Each Issuing Bank may, in its discretion, arrange for one or more Letters of Credit to be issued by any domestic or foreign branch or by Affiliates of such Issuing Bank, in which case the term “Issuing Bank” shall include any such branch or Affiliate with respect to Letters of Credit issued by such branch or Affiliate (it being agreed that such Issuing Bank shall, or shall cause such branch or Affiliate to, comply with the requirements of Section 2.04 with respect to such Letters of Credit).

“Landmark Acquisition” means the acquisition of Landmark Partners by the Borrower pursuant to the Landmark Acquisition Agreement as in effect on the Third Amendment Effective Date.

“Landmark Acquisition Agreement” means the Purchase Agreement dated as of June 13, 2016, by and among Landmark Partners, LLC, OMAM (2016 Newco) LLC, OMAM Inc., LMRK Intermediary, Inc., the Sellers named therein and the Seller Representative named therein, as such agreement may be amended, amended and restated, supplemented or otherwise modified prior to the Third Amendment Effective Date.

“Landmark Credit Agreement” means the Fifth Amended and Restated Loan and Security Agreement dated as of May 27, 2014, between Landmark Partners and Silicon Valley Bank, as amended by the First Loan Modification Agreement dated as of March 31, 2016, as such agreement may be amended, amended and restated, supplemented or otherwise modified prior to the Third Amendment Effective Date.

“Landmark Partners” means Landmark Partners, LLC, a Delaware limited liability company.

“Landmark Partners Closing Date” means the date on which the Landmark Acquisition was consummated pursuant to the Landmark Acquisition Agreement in effect on the Third Amendment Effective Date.

“LC Disbursement” means a payment made by an Issuing Bank pursuant to a Letter of Credit.

“LC Expiration Date” has the meaning assigned to such term in Section 2.04(c).

“LC Exposure” means, at any time, the aggregate amount of (a) the sum of the amounts of all Letters of Credit that remain available for drawing at such time and (b) the sum of all LC Disbursements that have not yet been reimbursed by or on behalf of the Borrower at such time. The LC Exposure of any Lender at any time shall be its Applicable Percentage of the total LC Exposure at such time.

“Lenders” means (a) the Persons listed on Schedule 2.01 (unless any such Person has ceased to be a party hereto pursuant to an Assignment and Assumption) and (b) any financial institution that has become a party hereto pursuant to an Assignment and Assumption or an Incremental Facility Agreement (unless it has ceased to be a Lender pursuant to an Assignment and Assumption).

“Letter of Credit” means any standby letter of credit issued pursuant to this Agreement.

“Leverage Ratio” means, on any date, the ratio of (a) Consolidated Total Indebtedness as of such date to (b) Consolidated Adjusted EBITDA for the Test Period most recently ended on or prior to such date.

“LIBO Rate” means, with respect to any Eurodollar Borrowing for any Interest Period, the London interbank offered rate as administered by ICE Benchmark Administration (or any other Person that takes over the administration of such rate) for U.S. Dollars for a period equal in length to such Interest Period as displayed on pages LIBOR01 or LIBOR02 of the Reuters screen that displays such rate (or, in the event such rate does not appear on a Reuters page or screen, on any successor or substitute page on such screen that displays such rate, or on the appropriate page of such other information service that publishes such rate from time to time as selected by the Agent in its reasonable discretion; in each case the “LIBO Screen Rate”) at approximately 11:00 a.m., London time, two Business Days prior to the commencement of such Interest Period; provided that if the LIBO Screen Rate shall be less than zero, such rate shall be deemed to be zero for the purposes of this Agreement; provided further that if the Screen Rate shall not be available at such time for such Interest Period (an “Impacted Interest Period”) then the LIBO Rate shall be the Interpolated Rate; provided further that if any Interpolated Rate shall be less than zero, such rate shall be deemed to be zero for purposes of this Agreement.

“LIBO Screen Rate” has the meaning assigned to such term in the definition of “LIBO Rate”.

“Lien” means, with respect to any asset, (a) any mortgage, deed of trust, lien, pledge, encumbrance, charge or security interest in or on such asset, (b) the interest of a vendor or a lessor under any conditional sale agreement, capital lease or title retention agreement relating to such asset and (c) in the case of securities, any purchase option, call or similar right of a third party with respect to such securities.

“Loan Documents” means this Agreement, the Fee Letters and the Incremental Facility Agreements.

“Loans” means the revolving loans made by the Lenders to the Borrower pursuant to Section 2.02(a) of this Agreement.

“Management Fee Agreement” means any agreement or instrument requiring the payment of Management Fees, including any such agreement contained in the limited partnership agreement or other organizational documents of a Fund or Fund Entity, or any direct or indirect interest of the Borrower or any of the Covered Subsidiaries in the payment of Management Fees, including such interests arising by virtue of their ownership of Equity Interests under the limited partnership and other organizational documents of a Fund or Fund Entity or of a Person other than a Covered Subsidiary that is party to a Management Fee Agreement.

“Management Fees” means, without duplication, (i) any and all management fees and other fees (excluding incentive or performance fees dependent on investment performance or results) for management services (whether pursuant to a Management Fee Agreement or otherwise) and any and all distributions received by the Borrower or any Covered Subsidiary the source of which is Management Fees,

(ii) any and all “Management Fees” payable pursuant to any Management Fee Agreement and (iii) any and all payments received which are treated as a credit or offset or otherwise reduce such fees, and shall in any event include the “management fees” reported on the consolidated financial statements of the Borrower prepared in accordance with GAAP.

“Margin Stock” has the meaning given such term under Regulation U.

“Material Adverse Effect” means a material adverse effect on (a) the business, assets, financial condition or results of operations of the Borrower and its Covered Subsidiaries, taken as a whole, (b) the ability of the Borrower to perform its payment obligations under any Loan Document, (c) the rights of or remedies available to the Lenders under any Loan Document or (d) the validity or enforceability against the Borrower of any Loan Document.

“Material Indebtedness” means Indebtedness (other than the Loans, Letters of Credit and Non-Recourse Seed Indebtedness) or obligations in respect of one or more Hedging Agreements, of any one or more of the Borrower and its Covered Subsidiaries in an aggregate principal amount exceeding $50,000,000. For purposes of determining Material Indebtedness, the “principal amount” of the obligations of the Borrower or any Covered Subsidiary in respect of any Hedging Agreement at any time shall be the maximum aggregate amount (giving effect to any netting agreements) that the Borrower or such Covered Subsidiary would be required to pay if such Hedging Agreement were terminated at such time.

“Maturity Date” means the fifth anniversary of the Closing Date (or, if such day is not a Business Day, the next succeeding Business Day).

“Moody’s” means Moody’s Investors Service, Inc. and any successor to its rating agency business.

“Multiemployer Plan” means a multiemployer plan as defined in Section 4001(a)(3) of ERISA, to which the Borrower or any ERISA Affiliate makes or is obligated to make contributions, or during the preceding five plan years, has made or been obligated to make contributions.

“Non-Consenting Lender” means any Lender that does not approve any consent, waiver or amendment that (a) requires the approval of all or all affected Lenders in accordance with the terms of Section 9.08(b) and (b) has been approved by the Required Lenders.

“Non-Defaulting Lender” means, at any time, each Lender that is not a Defaulting Lender at such time.

“Non-Recourse Seed Indebtedness” means Indebtedness incurred by a Subsidiary to finance seed capital investments, which shall include incubation capital (to establish a track record), scale capital (to extend an existing product into a commingled fund) and co-investment capital (to support the formation of a closed-end partnership); provided that (i) such Indebtedness is not Guaranteed by the Borrower or any Covered Subsidiary and (ii) such Indebtedness has recourse solely to the investments being financed and not to any other assets of the Borrower or any Covered Subsidiary.

“Note” has the meaning assigned to such term in the Existing Credit Agreement.

“Obligations” means (a) the principal of and interest (including interest accruing during the pendency of any bankruptcy, insolvency, receivership or other similar proceeding, regardless of whether allowed or allowable in such proceeding) on the Loans made to the Borrower, when and as due, whether at maturity, by acceleration, upon one or more dates set for prepayment or otherwise, (b) each payment required

to be made by the Borrower in respect of any Letter of Credit, when and as due, including payments in respect of reimbursement of disbursements, interest thereon and obligations to provide cash collateral and (c) all other monetary obligations, including fees, costs, expenses and indemnities, whether primary, secondary, direct, contingent, fixed or otherwise (including monetary obligations incurred during the pendency of any bankruptcy, insolvency, receivership or other similar proceeding, regardless of whether allowed or allowable in such proceeding), of the Borrower under this Agreement or any other Loan Document.

“OMGUK” has the meaning assigned to such term in the Existing Credit Agreement.

“OMGUK Dividend” has the meaning assigned to such term in the Existing Credit Agreement.

“OMGUK Dividend Note” has the meaning assigned to such term in the Existing Credit Agreement.

“Other Connection Taxes” means, with respect to any Recipient, Taxes imposed as a result of a present or former connection between such Recipient and the jurisdiction imposing such Tax (other than connections arising from such Recipient having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to or enforced any Loan Document, or sold or assigned an interest in any Loan or Loan Document).

“Other Taxes” means any present or future stamp, court, documentary, intangible, recording, filing or similar Taxes that arise from any payment made under, from the execution, delivery, performance, enforcement or registration of, or from the registration, receipt or perfection of a security interest under, or otherwise with respect to, any Loan Document, except any such Taxes that (a) are Other Connection Taxes imposed with respect to an assignment (other than an assignment made pursuant to Section 2.17) or (b) arise as a result of the voluntary registration by a Lender of a Loan Document.

“Parent” has the meaning assigned to such term in the Existing Credit Agreement.

“Parent Agreements” means the Shareholder Agreement, the Seed Capital Management Agreement, the Co-Investment Deed, the Deferred Tax Asset Deed and the Intellectual Property License Agreement.

“Participant” has the meaning given such term in Section 9.04(c).

“Participant Register” has the meaning given such term in Section 9.04(c).

“PBGC” means the Pension Benefit Guarantee Corporation referred to and defined in ERISA and any successor entity performing similar functions.

“Performance Fees” means ownership interests or contractual rights representing the right to receive compensation dependent on investment performance or results and payments or distributions made or owed to a Covered Subsidiary in respect thereof.

“Permitted Encumbrances” means:

(a) Liens imposed by law for Taxes that are not yet due or are being contested in compliance with Section 5.04;

(b) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s and other like

Liens imposed by law (other than any Lien imposed pursuant to Section 430(k) of the Code or Section 303(k) of ERISA or a violation of Section 436 of the Code), arising in the ordinary course of business and securing obligations that are not overdue by more than 30 days or are being contested in compliance with Section 5.04;

(c) pledges and deposits made (i) in the ordinary course of business in compliance with workers’ compensation, unemployment insurance and other social security and similar laws and (ii) in respect of letters of credit, bank guarantees or similar instruments issued for the account of the Borrower or any Covered Subsidiary in the ordinary course of business supporting obligations of the type set forth in subclause (i) above;

(d) pledges and deposits made (i) to secure the performance of bids, trade contracts, leases, statutory obligations, surety and appeal bonds, performance bonds and other obligations of a like nature, in each case in the ordinary course of business and (ii) in respect of letters of credit, bank guarantees or similar instruments issued for the account of Borrower or any Covered Subsidiary in the ordinary course of business supporting obligations of the type set forth in clause (i) above;

(e) judgment liens in respect of judgments that do not constitute an Event of Default under Article VII;

(f) easements, zoning restrictions, rights-of-way and similar encumbrances on real property imposed by law or arising in the ordinary course of business that do not materially detract from the value of the affected property or interfere with the ordinary conduct of business of the Borrower or any Covered Subsidiary;

(g) banker’s liens, rights of setoff or similar rights and remedies as to deposit accounts or other funds maintained with depository institutions; provided that such deposit accounts or funds are not established or deposited for the purpose of providing collateral for any Indebtedness and are not subject to restrictions on access by Borrower or any Covered Subsidiary in excess of those required by applicable banking regulations;

(h) Liens representing any interest or title of a licensor, lessor or sublicensor or sublessor, or a licensee, lessee or sublicensee or sublessee, in the property subject to any lease, license or sublicense or concession agreement permitted by this Agreement;

(i) Liens that are contractual rights of set-off; and

(j) custodial liens, administrator liens and other similar Liens relating to investment assets, including rights of setoff, incurred in the ordinary course of business; provided that such assets are not subjected to such Liens for the purpose of providing collateral for any Indebtedness;

provided that the term “Permitted Encumbrances” shall not include any Lien securing Indebtedness.

“Person” or “person” means any natural person, corporation, business trust, joint venture, association, company, partnership, limited liability company or government, or any agency or political subdivision thereof.

“Plan” means any employee pension benefit plan, as defined in Section 3(2) of ERISA, (other than a Multiemployer Plan) that is subject to the provisions of Title IV of ERISA or Section 412 of the Code

or Section 302 of ERISA, and in respect of which the Borrower or any ERISA Affiliate is (or, if such plan were terminated, would under Section 4069 of ERISA be deemed to be) an “employer” as defined in Section 3(5) of ERISA.

“Platform” has the meaning assigned to such term in Section 9.17.

“Prime Rate” means the rate of interest per annum publicly announced from time to time by Citibank as its prime rate in effect at its principal office in New York City. The Prime Rate is not intended to be the lowest rate of interest charged by the Citibank in connection with extensions of credit to debtors; and each change in the Prime Rate shall be effective on the date such change is publicly announced as being effective.

“Recipient” means, as applicable, the Agent, the Issuing Bank or any Lender.

“Register” has the meaning given such term in Section 9.04(b)(iv).

“Registration Statement” has the meaning assigned to such term in the Existing Credit Agreement.

“Regulation D” means Regulation D of the Board as from time to time in effect and all official rulings and interpretations thereunder or thereof.

“Regulation T” means Regulation T of the Board as from time to time in effect and all official rulings and interpretations thereunder or thereof.

“Regulation U” means Regulation U of the Board as from time to time in effect and all official rulings and interpretations thereunder or thereof.

“Regulation X” means Regulation X of the Board as from time to time in effect and all official rulings and interpretations thereunder or thereof.

“Related Parties” means, with respect to any specified Person, such Person’s Affiliates and the directors, officers, employees, agents and advisors of such Person and of each Affiliate of such Person.

“Reorganization” has the meaning assigned to such term in the Existing Credit Agreement.

“Required Lenders” means Lenders having Credit Exposures and unused Commitments representing more than 50% of the sum of the total Credit Exposures and unused Commitments at such time.

“Responsible Officer” means a Financial Officer or the general counsel of the Borrower.

“Restricted Payment” means any dividend or other distribution (whether in cash, securities or other property) with respect to any Equity Interest in the Borrower or any Covered Subsidiary, or any payment or distribution (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any Equity Interests in the Borrower or any Covered Subsidiary or of any option, warrant or other right to acquire any such Equity Interests in the Borrower or any Covered Subsidiary.

“S&P” means Standard & Poor’s Financial LLC, a division of The McGraw Hill Companies, Inc., and any successor to its rating agency business.

“Sanctions” means economic or financial sanctions or trade embargoes imposed, administered or enforced from time to time by (a) the U.S. government, including the Office of Foreign Assets Control of the U.S. Department of the Treasury or the U.S. Department of State, or (b) the United Nations Security Council, the European Union, any European Union member state applicable to the Borrower and its Subsidiaries or Her Majesty’s Treasury of the United Kingdom.

“Sanctioned Country” means, at any time, a country or territory which is itself the subject or target of any Sanctions (including, without limitation, at the time of this Agreement, Cuba, Iran, North Korea, Sudan and Syria).

“Sanctioned Person” means, at any time, (a) any Person or vessel listed in any Sanctions-related list of designated or blocked Persons maintained by the Office of Foreign Assets Control of the U.S. Department of the Treasury, the U.S. Department of State, or by the United Nations Security Council, the European Union or any European Union member state applicable to the Borrower and its Subsidiaries, (b) any Person operating, organized or resident in a Sanctioned Country or (c) any Person owned or controlled by, or acting on behalf of, any such Person or Persons described in the foregoing clauses (a) or (b).

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

“Seed Capital Management Agreement” has the meaning assigned to such term in the Existing Credit Agreement.

“Shareholder Agreement” has the meaning assigned to such term in the Existing Credit Agreement.

“Statutory Reserves” means a fraction (expressed as a decimal), the numerator of which is the number one and the denominator of which is the number one minus the aggregate of the maximum reserve percentages (including any marginal, special, emergency or supplemental reserves) expressed as a decimal established by the Board and any other banking authority to which the Agent is subject for Eurocurrency Liabilities (as defined in Regulation D). Such reserve percentages shall include any imposed pursuant to Regulation D. Eurodollar Loans shall be deemed to constitute Eurocurrency Liabilities and to be subject to such reserve requirements without benefits of or credit for proration, exemptions or offsets. Statutory Reserves shall be adjusted automatically on and as of the effective date of any change in any reserve percentage.

“subsidiary” means, with respect to any Person (the “parent”) at any date, any corporation, limited liability company, partnership, association or other entity the accounts of which would be consolidated with those of the parent in the parent’s consolidated financial statements if such financial statements were prepared in accordance with GAAP as of such date, as well as any other corporation, limited liability company, partnership, association or other entity of which securities or other ownership interests representing more than 50% of the equity or more than 50% of the ordinary voting power or, in the case of a partnership, more than 50% of the general partnership interests are, as of such date, owned, controlled or held by the parent and/or one or more subsidiaries of the parent.

“Subsidiary” means (a) any subsidiary of the Borrower and (b) BrightSphere UK. For the avoidance of doubt, all references to the Subsidiaries of the Borrower or the Borrower and its Subsidiaries shall include BrightSphere UK.

“Taxes” means any present or future taxes, levies, imposts, duties, deductions, withholdings (including backup withholding), assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.

“Test Period” means each period of four consecutive fiscal quarters of the Borrower.

“Third Amendment Effective Date” means August 3, 2016.

“Transactions” means the execution, delivery and performance by the Borrower of this Agreement and the 2019 Assignment Agreement, the borrowing of Loans, the use of the proceeds thereof and the issuance of Letters of Credit hereunder.

“Type”, when used in respect of any Loan or Borrowing, shall refer to whether the rate of interest on such Loan or on the Loans comprising such Borrowing is determined by reference to the Adjusted LIBO Rate or the Alternate Base Rate.

“U.S. Person” means a “United States person” within the meaning of Section 7701(a)(30) of the Code.

“U.S. Tax Compliance Certificate” has the meaning given such term in Section 2.15(f)(ii)(B)(3).

“UK” and “United Kingdom” each mean the United Kingdom of Great Britain and Northern Ireland.

“UK Excluded Withholding Taxes” shall mean any deduction or withholding for or on account of UK Tax from a payment under any Loan where:

(a)the payment could have been made to the relevant Lender without any deduction or withholding if the Lender had been a UK Qualifying Lender, but on that date that Lender is not or has ceased to be a UK Qualifying Lender other than as a result of any change after the date it became a Lender under this Agreement in (or in the interpretation, administration, or application of) any law or treaty or any published practice or published concession of any relevant taxing authority; or

(b)the relevant Lender is a UK Treaty Lender and the Borrower making the payment is able to demonstrate that the payment could have been made to the Lender without the UK tax deduction had that Lender complied with its obligations under Section 2.15(g).

“UK Qualifying Lender” means a Lender which is beneficially entitled to interest payable to that Lender in respect of an advance under a Loan Document and is:

(a)a Lender (i) which is a bank (as defined for the purpose of section 879 of the UK Income Tax Act 2007) making an advance under a Loan Document and is within the charge to UK corporation tax as respects any payments of interest made in respect of that advance or would be within such charge as respects such payments apart from section 18A of the UK Corporation Tax Act 2009 or (ii) in respect of an advance made under a Loan Document by a person that was a bank (as defined for the purpose of section 879 of the UK Income Tax Act 2007) at the time that that advance was made and within the charge to UK corporation tax as respects any payments of interest made in respect of that advance; or

(b)a UK Treaty Lender.

“UK Treaty Lender” means a Lender which:

(a)is treated as a resident of a UK Treaty State for the purposes of the Treaty;

(b)does not carry on a business in the UK through a permanent establishment with which that Lender’s participation in the Loan is effectively connected; and

(c)meets all other conditions in the relevant Treaty for full exemption from Tax imposed by the UK on interest, except that for this purpose it shall be assumed that the following are satisfied: (i) any condition which relates (expressly or by implication) to there not being a special relationship between the Borrower and a Lender or between both of them and another person, or to the amounts or terms of any Loan and (ii) any necessary procedural formalities.

“UK Treaty State” means a jurisdiction having a double taxation agreement (a “Treaty”) with the UK which makes a provision for full exemption from tax imposed by the UK on interest.

“USA Patriot Act” means the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001.

“Wholly-Owned Subsidiary” means a Subsidiary of which Equity Interests (except for directors’ qualifying shares and other de minimis amounts of outstanding securities or ownership interests) representing 100% of the Equity Interests are, at the time any determination is being made, owned, controlled or held by the Borrower or one or more Wholly-Owned Subsidiaries of the Borrower or by the Borrower and one or more Wholly-Owned Subsidiaries of the Borrower.

“Withdrawal Liability” means liability to a Multiemployer Plan as a result of a complete or partial withdrawal from such Multiemployer Plan, as such terms are defined in Part I of Subtitle E of Title IV of ERISA.

“Withholding Agent” means the Borrower and the Agent.

SECTION 1.02 Classification of Loans and Borrowings. For purposes of this Agreement, Loans and Borrowings may be classified and referred to by Type (e.g., a “Eurodollar Loan” or “Eurodollar Borrowing”).

SECTION 1.03 Terms Generally. The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”. The word “will” shall be construed to have the same meaning and effect as the word “shall”. Unless the context requires otherwise (a) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications in Section 6.08 or as otherwise set forth herein), (b) any reference herein to any Person shall be construed to include such Person’s permitted successors and assigns, (c) the words “herein”, “hereof” and “hereunder”, and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof, (d) all references herein to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, this Agreement and (e) the words “asset” and “property” shall

be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights.

SECTION 1.04 Accounting Terms; GAAP. Except as otherwise expressly provided herein, all accounting terms and all terms of a financial nature shall be interpreted, all accounting determinations thereunder shall be made, and all financial statements required to be delivered thereunder shall be prepared, in accordance with GAAP, as in effect from time to time; provided that, if the Borrower notifies the Agent that the Borrower requests an amendment of any financial covenant to eliminate or modify the effect of any change after the date hereof in GAAP or in the application thereof on the operation of such covenant (or if the Agent notifies the Borrower that the Required Lenders request an amendment of any financial covenant for such purpose), regardless of whether any such notice is given before or after such change in GAAP or in the application thereof, then the Borrower’s compliance with such covenant shall be determined on the basis of GAAP as in effect and applied immediately before the relevant change became effective, until either such notice is withdrawn or such covenant is amended in a manner satisfactory to the Borrower and the Required Lenders. Notwithstanding any other provision contained herein, all terms of an accounting or financial nature used herein shall be construed, and all computations of amounts and ratios referred to herein shall be made, without giving effect to any election under Financial Accounting Standards Board Accounting Standards Codification 825 (or any other Financial Accounting Standard having a similar result or effect) to value any Indebtedness or other liabilities of the Borrower or any Subsidiary at “fair value”, as defined therein.

SECTION 1.05 References to Agreements. A reference to an agreement or other document “as in effect as of” a particular date, or words to similar effect, shall be construed to refer to the particular words of such agreement or document as of such date and shall not be construed as in any way restricting the ability of the parties thereto to amend, supplement or otherwise modify such agreement or document (subject to any restrictions on such amendments, supplements or modifications in Section 6.08 or as otherwise set forth herein).

ARTICLE II

The Credits

SECTION 2.01 Commitments. Subject to the terms and conditions set forth herein, each Lender agrees, severally and not jointly, to make Loans denominated in U.S. Dollars to the Borrower from time to time during the Availability Period in an aggregate principal amount that will not result in (i) such Lender’s Credit Exposure exceeding such Lender’s Commitment or (ii) the aggregate Credit Exposure exceeding the aggregate Commitments. Within the foregoing limits and subject to the terms and conditions set forth herein, the Borrower may borrow, prepay and reborrow Loans.

SECTION 2.02 Loans and Borrowings. (a) Each Loan shall be made as part of a Borrowing consisting of Loans of the same Type made by the Lenders ratably in proportion to their individual Commitments. The failure of any Lender to make any Loan required to be made by it shall not relieve any other Lender of its obligations hereunder; provided that the Commitments of the Lenders are several and no Lender shall be responsible for any other Lender’s failure to make Loans as required.

(b) Subject to Section 2.10, each Borrowing shall be comprised entirely of Eurodollar Loans or ABR Loans, as the Borrower may request pursuant to Section 2.03. Each Lender may at its option make any Loan by causing any domestic or foreign branch or Affiliate of such Lender to make such Loan; provided that any exercise of such option shall not affect in any manner the obligation of the Borrower to repay such Loan in accordance with the terms of this Agreement. Borrowings of more than one Type may

be outstanding at the same time; provided, however, that the Borrower shall not be entitled to request any Borrowing, including any conversion of an ABR Borrowing into a Eurodollar Borrowing, which, if made, would result in an aggregate of more than eight separate Eurodollar Borrowings of any Lender being outstanding hereunder at any one time. For purposes of the foregoing, Eurodollar Borrowings having different Interest Periods, regardless of whether they commence on the same date, shall be considered separate Borrowings.

(c) At the commencement of each Interest Period for any Eurodollar Borrowing, such Borrowing shall be in an aggregate principal amount which is an integral multiple of $500,000 and not less than $1,000,000. At the time that each ABR Borrowing is made, such Borrowing shall be in an aggregate principal amount which is an integral multiple of $500,000 and not less than $1,000,000, provided that an ABR Borrowing may be in an aggregate amount that is equal to the entire unused balance of the Commitments or that is required to finance the reimbursement of an LC Disbursement as contemplated by Section 2.04(e).

(d) Notwithstanding any other provision of this Agreement, the Borrower shall not be entitled to request, or to elect to convert or continue, any Eurodollar Borrowing if the Interest Period requested with respect thereto would end after the Maturity Date.

SECTION 2.03 Requests for Borrowings. (a) To request a Borrowing, the Borrower shall notify the Agent of such request (each, a “Borrowing Request”), which shall be in the form of Exhibit B or any other form approved by the Agent, in writing or by telecopy (a) in the case of a Eurodollar Borrowing, not later than 11:00 a.m., New York City time, three Business Days before the date of the proposed Borrowing or (b) in the case of an ABR Borrowing, not later than 10:00 a.m., New York City time, on the date of the proposed Borrowing. Each such Borrowing Request shall be irrevocable and shall be in a form approved by the Agent and signed by a Financial Officer of the Borrower. Each such Borrowing Request shall specify the following information in compliance with Section 2.02:

(i)the principal amount of the requested Borrowing;

(ii)the date of such Borrowing, which shall be a Business Day;

(iii)whether such Borrowing is to be an ABR Borrowing or a Eurodollar Borrowing;

(iv)in the case of a Eurodollar Borrowing, the initial Interest Period to be applicable thereto, which shall be a period contemplated by the definition of the term “Interest Period”; and

(v)the location and number of the Borrower’s account to which funds are to be disbursed.

If no election as to the Type of Borrowing is specified, then the requested Borrowing shall be an ABR Borrowing. If no Interest Period is specified with respect to any requested Eurodollar Borrowing, then the Borrower shall be deemed to have selected an Interest Period of one month duration. Promptly following receipt of a Borrowing Request in accordance with this Section, the Agent shall advise each Lender of the details thereof and of the amount of such Lender’s Loan to be made as part of the requested Borrowing.

SECTION 2.04 Letters of Credit. (a) General. Subject to the terms and conditions set forth herein, the Borrower may request the issuance of Letters of Credit (each of which shall be a standby letter and not a commercial or trade letter of credit) as the applicant thereof for the support of its or its Covered Subsidiaries’ obligations, in a form reasonably acceptable to the Agent and the relevant Issuing Bank, at any time and from

time to time prior to the LC Expiration Date. In the event of any inconsistency between the terms and conditions of this Agreement and the terms and conditions of any form of letter of credit application or other agreement submitted by the Borrower to, or entered into by the Borrower with, the relevant Issuing Bank relating to any Letter of Credit, the terms and conditions of this Agreement shall control. Notwithstanding anything herein to the contrary, no Issuing Bank shall have any obligation hereunder to issue, any Letter of Credit the proceeds of which would be made available to any Person (i) to fund any activity or business of or with any Sanctioned Person, or in any country or territory that at the time of such funding is the subject of any Sanctions or (ii) in any manner that would result in a violation of any Sanctions by any party to this Agreement.

(b)Notice of Issuance, Amendment, Renewal, Extension; Certain Conditions. To request the issuance of a Letter of Credit (or the amendment, renewal or extension of an outstanding Letter of Credit), the Borrower shall hand deliver or telecopy (or transmit by electronic communication, if arrangements for doing so have been approved by the relevant Issuing Bank) to the applicable Issuing Bank and the Agent (reasonably in advance of the requested date of issuance, amendment, renewal or extension, but in any event no less than three Business Days) a notice requesting the issuance of a Letter of Credit, or identifying the Letter of Credit to be amended, renewed or extended, and specifying the date of issuance, amendment, renewal or extension (which shall be a Business Day), the date on which such Letter of Credit is to expire (which shall comply with paragraph (c) of this Section), the amount of such Letter of Credit, the name and address of the beneficiary thereof and such other information as shall be necessary to prepare, amend, renew or extend such Letter of Credit. If requested by the applicable Issuing Bank, the Borrower also shall submit a letter of credit application on the Issuing Bank’s standard form in connection with any request for a Letter of Credit. A Letter of Credit shall be issued, amended, renewed or extended only if (and upon issuance, amendment, renewal or extension of each Letter of Credit the Borrower shall be deemed to represent and warrant that), after giving effect to such issuance, amendment, renewal or extension (i) the LC Exposure shall not exceed $50,000,000, (ii) no Lender’s Credit Exposure shall exceed its Commitment and (iii) the total Credit Exposures shall not exceed the total Commitments.

(c)Expiration Date. Each Letter of Credit shall expire (or be subject to termination by notice from the Issuing Bank to the beneficiary thereof) at or prior to the close of business on the earlier of (i) the date one year after the date of the issuance of such Letter of Credit (or, in the case of any renewal or extension thereof, one year after such renewal or extension) and (ii) the date that is five Business Days prior to the Maturity Date (the “LC Expiration Date”).

(d)Participations. By the issuance of a Letter of Credit (or an amendment to a Letter of Credit increasing the amount thereof) and without any further action on the part of the relevant Issuing Bank or the Lenders, such Issuing Bank hereby grants to each Lender, and each Lender hereby acquires from such Issuing Bank, a participation in such Letter of Credit equal to such Lender’s Applicable Percentage of the aggregate amount available to be drawn under such Letter of Credit. In consideration and in furtherance of the foregoing, each Lender hereby absolutely and unconditionally agrees to pay to the Agent, for the account of the relevant Issuing Bank, such Lender’s Applicable Percentage of each LC Disbursement made by such Issuing Bank and not reimbursed by the Borrower on the date due as provided in paragraph (e) of this Section, or of any reimbursement payment required to be refunded to the Borrower for any reason. Each Lender acknowledges and agrees that its obligation to acquire participations pursuant to this paragraph in respect of Letters of Credit is absolute and unconditional and shall not be affected by any circumstance whatsoever, including any amendment, renewal or extension of any Letter of Credit or the occurrence and continuance of a Default or reduction or termination of the Commitments, and that each such payment shall be made without any offset, abatement, withholding or reduction whatsoever.

(e)Reimbursement. If an Issuing Bank shall make any LC Disbursement in respect of a Letter of Credit, such Issuing Bank shall give prompt notice to the Borrower of such LC Disbursement, and the Borrower shall reimburse such LC Disbursement by paying to the Agent an amount equal to such LC Disbursement not later than 3:00 p.m., New York City time, on the date that such LC Disbursement is made, if the Borrower shall have received notice of such LC Disbursement prior to 12:00 noon., New York City time, on such date, or, if such notice has not been received by the Borrower prior to such time on such date, then not later than 12:00 noon, New York City time, on the Business Day immediately following the day that the Borrower receives such notice; provided that, if such LC Disbursement is not less than $1,000,000 the Borrower may, subject to the conditions to borrowing set forth herein, request in accordance with Section 2.03 that such payment be financed with an ABR Borrowing in an equivalent amount and, to the extent so financed, the Borrower’s obligation to make such payment shall be discharged and replaced by the resulting ABR Borrowing. If the Borrower fails to make such payment when due, the Agent shall notify each Lender of the applicable LC Disbursement, the payment then due from the Borrower in respect thereof and such Lender’s Applicable Percentage thereof. Promptly following receipt of such notice, each Lender shall pay to the Agent its Applicable Percentage of the payment then due from the Borrower, in the same manner as provided in Section 2.05 with respect to Loans made by such Lender (and Section 2.05 shall apply, mutatis mutandis, to the payment obligations of the Lenders), and the Agent shall promptly pay to such Issuing Bank the amounts so received by it from the Lenders. Promptly following receipt by the Agent of any payment from the Borrower pursuant to this paragraph, the Agent shall distribute such payment to the relevant Issuing Bank or, to the extent that Lenders have made payments pursuant to this paragraph to reimburse the Issuing Bank, then to such Lenders and the Issuing Bank as their interests may appear. Any payment made by a Lender pursuant to this paragraph to reimburse the Issuing Bank for any LC Disbursement (other than the funding of ABR Revolving Loans as contemplated above) shall not constitute a Loan and shall not relieve the Borrower of its obligation to reimburse such LC Disbursement.

(f)Obligations Absolute. The Borrower’s obligation to reimburse LC Disbursements as provided in paragraph (e) of this Section shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement under any and all circumstances whatsoever and irrespective of (i) any lack of validity or enforceability of any Letter of Credit or this Agreement, or any term or provision therein, (ii) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent or invalid in any respect or any statement therein being untrue or inaccurate in any respect, (iii) payment by the applicable Issuing Bank under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit, or (iv) any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of, or provide a right of setoff against, the Borrower’s obligations hereunder. Neither the Agent, the Lenders nor any Issuing Bank, nor any of their Related Parties, shall have any liability or responsibility by reason of or in connection with the issuance or transfer of any Letter of Credit or any payment or failure to make any payment thereunder (irrespective of any of the circumstances referred to in the preceding sentence), or any error, omission, interruption, loss or delay in transmission or delivery of any draft, notice or other communication under or relating to any Letter of Credit (including any document required to make a drawing thereunder), any error in interpretation of technical terms or any consequence arising from causes beyond the control of such Issuing Bank; provided that the foregoing shall not be construed to excuse such Issuing Bank from liability to the Borrower to the extent of any direct damages (as opposed to special, indirect, consequential or punitive damages, claims in respect of which are hereby waived by the Borrower to the extent permitted by applicable law) suffered by the Borrower that are caused by such Issuing Bank’s failure to exercise care when determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof. The parties hereto expressly agree that, in the absence of gross negligence or wilful misconduct on the part of an Issuing Bank (as finally determined by a court of competent jurisdiction),

such Issuing Bank shall be deemed to have exercised care in each such determination. In furtherance of the foregoing and without limiting the generality thereof, the parties agree that, with respect to documents presented which appear on their face to be in substantial compliance with the terms of a Letter of Credit, the applicable Issuing Bank may, in its sole discretion, either accept and make payment upon such documents without responsibility for further investigation, regardless of any notice or information to the contrary, or refuse to accept and make payment upon such documents if such documents are not in strict compliance with the terms of such Letter of Credit.

(g)Disbursement Procedures. An Issuing Bank shall, promptly following its receipt thereof, examine all documents purporting to represent a demand for payment under a Letter of Credit issued by it. Such Issuing Bank shall promptly notify the Agent and the Borrower in writing or by telecopy of such demand for payment and whether such Issuing Bank has made or will make an LC Disbursement thereunder or will refuse to honor such demand, as the case may be; provided that any failure to give or delay in giving such notice shall not relieve the Borrower of its obligation to reimburse such Issuing Bank and the Lenders with respect to any such LC Disbursement.

(h)Interim Interest. If an Issuing Bank shall make any LC Disbursement, then, unless the Borrower shall reimburse such LC Disbursement in full on the date such LC Disbursement is made, the unpaid amount thereof shall bear interest, for each day from and including the date such LC Disbursement is made to but excluding the date that the reimbursement is due and payable at the rate per annum then applicable to ABR Loans; provided that, if the Borrower fails to reimburse such LC Disbursement when due pursuant to paragraph (e) of this Section, then Section 2.09(c) shall apply. Interest accrued pursuant to this paragraph shall be for the account of the relevant Issuing Bank, except that interest accrued on and after the date of payment by any Lender pursuant to paragraph (e) of this Section to reimburse the Issuing Bank shall be for the account of such Lender to the extent of such payment.

(i)Designation and Replacement of Issuing Banks. The Borrower may, at any time and from time to time, with the consent of the Agent (which consent shall not be unreasonably withheld), designate as additional Issuing Banks one or more Lenders that agree to serve in such capacity as provided below. The acceptance by a Lender of an appointment as an Issuing Bank hereunder shall be evidenced by an agreement, which shall be in form and substance reasonably satisfactory to the Agent, executed by the Borrower, the Agent and such designated Lender and, from and after the effective date of such agreement, (i) such Lender shall have all the rights and obligations of an Issuing Bank under this Agreement and the other Loan Documents and (ii) references herein or therein to the term “Issuing Bank” shall be deemed to include such Lender in its capacity as an issuer of Letters of Credit hereunder. The Borrower may terminate the appointment of a Lender as an “Issuing Bank” hereunderby providing a written notice thereof to such Issuing Bank, with a copy to the Agent. Any such termination shall become effective upon the earlier of (i) such Issuing Bank acknowledging receipt of such notice and (ii) the 10th Business Day following the date of the delivery thereof. The Agent shall notify the Lenders of any such termination of the appointment of an Issuing Bank. At the time any such termination shall become effective, the Borrower shall pay all unpaid fees accrued for the account of the terminated Issuing Bank pursuant to Section 2.07(b). After the termination of an Issuing Bank hereunder, the terminated Issuing Bank shall remain a party hereto and shall continue to have all the rights and obligations of an Issuing Bank under this Agreement with respect to Letters of Credit issued by it prior to such termination, but shall not be required to issue additional Letters of Credit.

(j)Cash Collateralization. If any Event of Default shall occur and be continuing, on the Business Day that the Borrower receives notice from the Agent or the Required Lenders (or, if the maturity of the Loans has been accelerated, Lenders with LC Exposure representing greater than 50% of the total

LC Exposure) demanding the deposit of cash collateral pursuant to this paragraph, the Borrower shall deposit in an account with the Agent, in the name of the Agent and for the benefit of the Lenders, an amount in cash equal to 103% of the LC Exposure as of such date plus any accrued and unpaid interest thereon; provided that the obligation to deposit such cash collateral shall become effective immediately, and such deposit shall become immediately due and payable, without demand or other notice of any kind, upon the occurrence of any Event of Default with respect to the Borrower described in clause (h) or (i) of Article VII. Such deposit shall be held by the Agent as collateral for the payment and performance of the obligations of the Borrower under this Agreement. The Agent shall have exclusive dominion and control, including the exclusive right of withdrawal, over such account. Other than any interest earned on the investment of such deposits, which investments shall be made in short-term money market instruments or money market deposit accounts at the option and sole discretion of the Agent and at the Borrower’s risk and expense, such deposits shall not bear interest. Interest or profits, if any, on such investments shall accumulate in such account. Moneys in such account shall be applied by the Agent to reimburse each Issuing Bank for LC Disbursements for which it has not been reimbursed and, to the extent not so applied, shall be held for the satisfaction of the reimbursement obligations of the Borrower for the LC Exposure at such time or, if the maturity of the Loans has been accelerated (but subject to (i) the consent of Lenders with LC Exposure representing greater than 50% of the total LC Exposure and (ii) in the case of any such application at a time when any Lender is a Defaulting Lender (but only if, after giving effect thereto, the remaining cash collateral shall be less than the aggregate LC Exposure of all the Defaulting Lenders) the consent of each Issuing Bank), be applied to satisfy other obligations of the Borrower under this Agreement. If the Borrower is required to provide an amount of cash collateral hereunder as a result of the occurrence of an Event of Default, such amount (to the extent not applied as aforesaid) shall be returned to the Borrower within three Business Days after all Events of Default have been cured or waived to the extent that, after giving effect to such return, no Issuing Bank shall have any exposure in respect of the Non-Defaulting Lenders and or the remaining cash collateral and no Default shall have occurred and be continuing.

SECTION 2.05 Funding of Borrowings. (a) Each Lender shall make each Loan to be made by it hereunder on the proposed date thereof by wire transfer of immediately available funds to the Agent in New York, New York, not later than 12:00 noon., New York City time, and the Agent shall by 3:00 p.m., New York City time, credit the amounts so received to an account designated by the Borrower in the applicable Borrowing Request.

(b)Unless the Agent shall have received notice from a Lender prior to the proposed date of any Borrowing that such Lender will not make available to the Agent such Lender’s share of such Borrowing, the Agent may assume that such Lender has made such share available on such date in accordance with paragraph (a) of this Section and may, in reliance on such assumption, make available to the Borrower on such date a corresponding amount. In such event, if a Lender has not in fact made its share of the applicable Borrowing available to the Agent, then the applicable Lender and the Borrower (without waiving any claim against such Lender for such Lender’s failure to make such share available) severally agree to pay to the Agent forthwith on demand such corresponding amount with interest thereon, for each day from and including the date such amount is made available to the Borrower to but excluding the date of payment to the Agent, at (i) in the case of a payment to be made by such Lender, the greater of the Federal Funds Effective Rate and a rate determined by the Agent in accordance with banking industry rules on interbank compensation or (ii) in the case of a payment to be made by the Borrower, the interest rate applicable to ABR Loans. If such Lender pays such amount to the Agent, then such amount shall constitute such Lender’s Loan included in such Borrowing.

SECTION 2.06 Interest Elections. (a) Each Borrowing initially shall be of the Type specified in the applicable Borrowing Request and, in the case of a Eurodollar Borrowing, shall have an initial Interest

Period as specified in such Borrowing Request or as otherwise provided in this Section. Thereafter, the Borrower may elect to convert such Borrowing to a Borrowing of a different Type or to continue such Borrowing and, in the case of a Eurodollar Borrowing, may elect Interest Periods therefor, all as provided in this Section. The Borrower may elect different options with respect to different portions of the affected Borrowing, in which case each such portion shall be allocated ratably among the Lenders holding the Loans comprising such Borrowing, and the Loans comprising each such portion shall be considered a separate Borrowing.

(b)To make an election pursuant to this Section, the Borrower shall notify the Agent of such election (each, an “Interest Election Request”) in writing or by telecopy by the time that a Borrowing Request would be required under Section 2.03 if the Borrower were requesting a Borrowing of the Type resulting from such election to be made on the effective date of such election. Each such Interest Election Request shall be irrevocable and shall be in a form reasonably satisfactory to the Agent and signed by a Financial Officer.

(c)Each Interest Election Request shall specify the following information:

(i)the Borrowing to which such Interest Election Request applies and, if different options are being elected with respect to different portions thereof, the portions thereof to be allocated to each resulting Borrowing (in which case the information to be specified pursuant to clauses (iii) and (iv) below shall be specified for each resulting Borrowing, and the minimum amounts thereof shall be in compliance with Section 2.02(c));

(ii) the effective date of the election made pursuant to such Interest Election Request, which shall be a Business Day;

(iii) whether the resulting Borrowing is to be an ABR Borrowing or a Eurodollar Borrowing; and

(iv) if the resulting Borrowing is to be a Eurodollar Borrowing, the Interest Period to be applicable thereto after giving effect to such election, which shall be a period contemplated by the definition of the term “Interest Period”.

If any such Interest Election Request requests a Eurodollar Borrowing but does not specify an Interest Period, then the Borrower shall be deemed to have selected an Interest Period of one month duration.

(d)Promptly following receipt of an Interest Election Request, the Agent shall advise each Lender of the details thereof and of such Lender’s portion of each resulting Borrowing.

(e)If the Borrower fails to deliver a timely Interest Election Request with respect to a Eurodollar Borrowing prior to the end of the Interest Period applicable thereto, then, unless such Borrowing is repaid as provided herein, at the end of such Interest Period such Borrowing shall be converted to a Eurodollar Borrowing having an Interest Period of one month duration.

(f)Notwithstanding any contrary provision hereof, if an Event of Default has occurred and is continuing and the Agent so notifies the Borrower, then, so long as an Event of Default is continuing (i) no outstanding Borrowing may be converted to or continued as a Eurodollar Borrowing and (ii) unless repaid, each Eurodollar Borrowing shall be converted to an ABR Borrowing at the end of the Interest Period applicable thereto.

SECTION 2.07 Fees. (a) The Borrower agrees to pay to the Agent for the account of each Lender a commitment fee, which shall accrue at the Applicable Rate on the daily unused amount of the Commitment of such Lender during the preceding quarter (or other period commencing with the Closing Date or ending on the Maturity Date or the date on which the Commitments of such Lender shall expire or be terminated as provided herein). Accrued commitment fees shall be payable in arrears on the last day of March, June, September and December of each year and on the date on which the Commitments terminate, commencing on December 31, 2014. All commitment fees shall be computed on the basis of a year of 360 days and shall be payable for the actual number of days elapsed (including the first day but excluding the last day). For purposes of computing commitment fees, the Commitment of a Lender shall be deemed to be used to the extent of the outstanding Loans and LC Exposure of such Lender.

(b)The Borrower agrees to pay (i) to the Agent for the account of each Lender a participation fee with respect to its participations in Letters of Credit, which shall accrue at the same Applicable Rate used to determine the interest rate on Eurodollar Loans on the daily amount of such Lender’s LC Exposure (excluding any portion thereof attributable to unreimbursed LC Disbursements) during the period from and including the Closing Date to but excluding the later of the date on which such Lender’s Commitment terminates and the date on which such Lender ceases to have any LC Exposure and (ii) to each Issuing Bank, a fronting fee, which shall accrue at the rate or rates separately agreed upon between the Borrower and such Issuing Bank, as well as such Issuing Bank’s standard fees with respect to the issuance, amendment, renewal or extension of any Letter of Credit or processing of drawings thereunder as are agreed upon by the Issuing Bank and the Borrower. Participation fees and fronting fees accrued through and including the last day of March, June, September and December of each year shall be payable on the third Business Day following such last day, commencing on the third Business Day following December 31, 2014; provided that all such fees shall be payable on the date on which the Commitments terminate and any such fees accruing after the date on which the Commitments terminate shall be payable on demand. Any other fees payable to an Issuing Bank pursuant to this paragraph shall be payable within 10 days after demand. All participation fees shall be computed on the basis of a year of 360 days and shall be payable for the actual number of days elapsed (including the first day but excluding the last day).

(c)The Borrower agrees to pay to the Agent, for its own account, fees payable in the amounts at the times separately agreed upon between the Borrower and the Agent.

(d)The payment of the fees described in Sections 2.07(a) and (b) with respect to any Defaulting Lender shall be subject to Section 2.17(a).

(e)All fees payable hereunder shall be paid on the dates due, in immediately available funds, to the Agent (or an Issuing Bank, in the case of fees payable to it) for distribution, in the case of commitment fees and participation fees, to the Lenders. Fees paid shall be refundable under any circumstances.

SECTION 2.08 Repayment of Loans; Evidence of Debt. (a) The Borrower hereby unconditionally promises to pay to the Agent for the account of each Lender the then unpaid principal amount of each Loan of such Lender on the Maturity Date.

(b)Each Lender shall maintain in accordance with its usual practice an account or accounts evidencing the indebtedness to such Lender resulting from each Loan made by such Lender from time to time, including the amounts of principal and interest payable and paid to such Lender from time to time under this Agreement.

(c)The Agent shall maintain accounts in which it will record (i) the amount of each Loan made hereunder, the Type of each Loan made and the Interest Period applicable thereto, (ii) the amount of any principal or interest due and payable or to become due and payable from the Borrower to each Lender hereunder and (iii) the amount of any payment received by the Agent hereunder from the Borrower and each Lender’s share thereof. The entries made in the accounts maintained pursuant to this Section 2.08(c) shall be prima facie evidence of the existence and amounts of the obligations recorded therein; provided, that the failure of any Lender or the Agent to maintain such accounts or any error therein shall not in any manner affect the obligations of the Borrower to repay the Loans in accordance with the terms of this Agreement.

SECTION 2.09 Interest on Loans. (a) The Loans comprising each Eurodollar Borrowing shall bear interest at a rate per annum equal to the Adjusted LIBO Rate for the Interest Period in effect for such Borrowing plus the Applicable Rate.

(b)The Loans comprising each ABR Borrowing shall bear interest at a rate per annum equal to the Alternate Base Rate plus the Applicable Rate.

(c)Notwithstanding the foregoing, upon the occurrence and during the continuance of an Event of Default, if any principal of or interest on any Loan or any commitment, participation or other fees or other amount payable by the Borrower hereunder is not paid when due, whether at stated maturity, upon acceleration or otherwise, or, at the request of the Required Lenders, upon the occurrence and during the continuance of any other Event of Default, all outstanding Loans (regardless of whether then due) and all other amounts then due and payable under the Loan Documents shall bear interest, after as well as before judgment, at a rate per annum equal to (i) in the case of principal of any Loan, 2.00% plus the rate otherwise applicable to such Loan as provided in the preceding paragraphs of this Section or (ii) in the case of any other amount, 2.00% plus the rate applicable to ABR Loans as provided in paragraph (b) of this Section.

(d)Accrued interest on each Loan shall be payable in arrears on each Interest Payment Date for such Loan and upon termination of the Commitments; provided that (i) interest accrued pursuant to paragraph (c) of this Section shall be payable on demand, (ii) in the event of any repayment or prepayment of any Loan (other than a prepayment of an ABR Loan prior to the end of the Availability Period), accrued interest on the principal amount repaid or prepaid shall be payable on the date of such repayment or prepayment and (iii) in the event of any conversion of any Eurodollar Loan prior to the end of the current Interest Period therefor, accrued interest on such Loan shall be payable on the effective date of such conversion.

(e)All interest hereunder shall be computed on the basis of a year of 360 days, except that interest computed by reference to the Alternate Base Rate at times when the Alternate Base Rate is based on the Prime Rate shall be computed on the basis of a year of 365 days (or 366 days in a leap year), and in each case shall be payable for the actual number of days elapsed (including the first day but excluding the last day). The Alternate Base Rate shall be determined by the Agent, and such determination shall be conclusive absent manifest error.

SECTION 2.10 Alternate Rate of Interest. If prior to the commencement of any Interest Period for a Eurodollar Borrowing:

(a)the Agent determines (which determination shall be conclusive absent manifest error) that adequate and reasonable means do not exist for ascertaining the Adjusted LIBO Rate or the LIBO Rate for such Interest Period; or

(b)the Agent is advised by Required Lenders that the Adjusted LIBO Rate for such Interest Period will not adequately and fairly reflect the cost to such Lenders of making or maintaining their Loans included in such Eurodollar Borrowing for such Interest Period;

then the Agent shall give notice (which may be telephonic) thereof to the Borrower and the Lenders as promptly as practicable and, until the Agent notifies the Borrower and the Lenders that the circumstances giving rise to such notice no longer exist, (i) any Interest Election Request that requests the conversion of any Borrowing to, or continuation of any Borrowing as, a Eurodollar Borrowing shall be ineffective, and such Borrowing shall be continued as an ABR Borrowing, (ii) any Borrowing Request for a Eurodollar Borrowing shall be treated as a request for an ABR Borrowing and (iii) in the event of a determination described in clause (a) or (b) above with respect to the Adjusted LIBO Rate component of the Alternate Base Rate, the utilization of the Adjusted LIBO Rate component in determining the Alternate Base Rate shall be suspended.

SECTION 2.11 Termination and Reduction of Commitments. (a) Unless previously terminated, the Commitments shall terminate on the Maturity Date.

(b)The Borrower may at any time terminate, or from time to time permanently reduce, the Commitments; provided that (i) each reduction of the Commitments shall be in an amount that is an integral multiple of $500,000 and not less than $1,000,000 and (ii) the Borrower shall not terminate or reduce the Commitments if, after giving effect to any concurrent prepayment of the Loans in accordance with Section 2.12, the aggregate Credit Exposure would exceed the aggregate Commitment.

(c)The Borrower shall notify the Agent by written or telecopy notice of any election to terminate or reduce the Commitments under paragraph (b) above, at least three Business Days prior to the effective date of such termination or reduction, specifying the effective date thereof. Promptly following receipt of any such notice, the Agent shall advise the Lenders of the contents thereof. Each notice delivered by the Borrower pursuant to this Section shall be irrevocable; provided that a notice of termination or reduction of the Commitments under paragraph (b) of this Section may state that such notice is conditioned upon the effectiveness of other credit facilities, in which case such notice may be revoked by the Borrower (by notice to the Agent on or prior to the specified effective date) if such condition is not satisfied. Any termination or reduction of the Commitments shall be permanent. Each reduction of the Commitments shall be made ratably among the Lenders in proportion to their individual Commitments.

SECTION 2.12 Prepayment of Loans. (a) The Borrower shall have the right at any time and from time to time to prepay, without premium or penalty but subject to Section 2.14, any Borrowing, in whole or in part, upon giving written or telecopy notice to the Agent in accordance with paragraph (c) of this Section.

(b)In the event and on each occasion that the aggregate Credit Exposure exceeds the aggregate Commitments, the Borrower shall immediately prepay, without premium or penalty but subject to Section 2.14, Borrowings (or, if no such Borrowings are outstanding, Cash Collateralize the outstanding LC Exposure) in an aggregate amount as shall be necessary to eliminate the excess of such Credit Exposure over the aggregate Commitments (for purposes of this clause (b), Credit Exposure shall be calculated disregarding any portion of the LC Exposure which has been Cash Collateralized).

(c)The Borrower shall notify the Agent by written or telecopy notice of any prepayment hereunder (i) in the case of a prepayment of a Eurodollar Borrowing, not later than 11:00 a.m., New York City time, three Business Days before the date of prepayment or (ii) in the case of prepayment of an ABR Borrowing, not later than 10:00 a.m., New York City time, on the Business Day of prepayment. Each such

notice shall specify the prepayment date, the principal amount of each Borrowing (or portion thereof) to be prepaid and shall be irrevocable and shall commit the Borrower to prepay such Borrowing (or portion thereof) by the amount stated therein on the date stated therein, provided that, if a notice of prepayment is given in connection with a conditional notice of termination of the Commitments as contemplated by Section 2.11, then such notice of prepayment may be revoked if such notice of termination is revoked in accordance with Section 2.11. All prepayments under this Section 2.12 shall be subject to Section 2.14 but shall otherwise be without premium or penalty. All prepayments under this Section 2.12 shall be accompanied by payment of accrued interest on the principal amount being prepaid to the date of payment. Each partial prepayment of any Borrowing shall be in an amount which is an integral multiple of $100,000 and not less than $1,000,000 or, if less, the aggregate principal amount of such Borrowing. Each prepayment of a Borrowing shall be applied ratably to the Loans included in the prepaid Borrowing.

SECTION 2.13 Increased Costs. (a) If any Change in Law shall:

(i) impose, modify or deem applicable any reserve, special deposit, liquidity or similar requirement (including any compulsory loan, insurance charge or other assessment) against assets of, deposits with or for the account of, or credit extended by, any Lender (except any such reserve requirement reflected in the Adjusted LIBO Rate) or Issuing Bank; or

(ii) impose on any Lender or Issuing Bank or the London interbank market any other condition, cost or expense (other than Taxes) affecting this Agreement or Loans made by such Lender or any Letter of Credit or participation therein; or

(iii) subject any Recipient to any Taxes (other than (A) Indemnified Taxes and (B) Excluded Taxes) on its loans, loan principal, letters of credit, commitments or other obligations, or its deposits, reserves, other liabilities or capital attributable thereto;

and the result of any of the foregoing shall be to increase the cost to such Lender or such other Recipient of making, continuing, converting or maintaining any Loan (or of maintaining its obligation to make any such Loan), to increase the cost to such Lender or Issuing Bank of participating in, issuing or maintaining any Letter of Credit (or of maintaining its obligation to participate in or issue any Letter of Credit) or to reduce the amount of any sum received or receivable by such Lender, Issuing Bank or other Recipient hereunder (whether of principal, interest or otherwise), then the Borrower will pay to such Lender, Issuing Bank or other Recipient, as the case may be, such additional amount or amounts as will compensate such Lender, Issuing Bank or other Recipient, as the case may be, for such additional costs or expenses incurred or reduction suffered.

(b)If any Lender or any Issuing Bank determines that any Change in Law regarding capital or liquidity requirements has the effect of reducing the rate of return on such Lender’s or Issuing Bank’s capital or on the capital of such Lender’s or the Issuing Bank’s holding company, if any, as a consequence of this Agreement, the Commitments of or the Loans made by, or participations in Letters of Credit held by, such Lender, or the Letters of Credit issued by such Issuing Bank, to a level below that which such Lender or such Issuing Bank or such Lender’s or Issuing Bank’s holding company could have achieved but for such Change in Law (taking into consideration such Lender’s or Issuing Bank’s policies and the policies of such Lender’s or Issuing Bank’s holding company with respect to capital adequacy or liquidity), then from time to time the Borrower will pay to such Lender or Issuing Bank such additional amount or amounts as will compensate such Lender or Issuing Bank or such Lender’s or Issuing Bank’s holding company for any such reduction suffered.

(c)A certificate of a Lender or an Issuing Bank setting forth the amount or amounts necessary to compensate such Lender or Issuing Bank or such Lender’s or Issuing Bank’s holding company, as the case may be, as specified in paragraph (a) or (b) of this Section (collectively, the “Increased Costs”) and setting forth in reasonable detail the manner of determination of such amount or amounts, shall be delivered to the Borrower and shall be conclusive absent manifest error. The Borrower shall pay such Lender or Issuing Bank the amount shown as due on any such certificate within 10 days after receipt thereof. Notwithstanding the foregoing, Increased Costs shall not include incremental costs or expenses, such as general administrative or personnel expenses, incurred in connection with compliance with any Change in Law that are not attributable to a Lender or Issuing Bank making, continuing, converting or maintaining any Loan, or participating in, issuing or maintaining any Letter of Credit (or of maintaining its obligation to make Loans or to participate in or issue any Letter of Credit) hereunder.

(d)Failure or delay on the part of any Lender or Issuing Bank to demand compensation pursuant to this Section shall not constitute a waiver of such Lender’s or Issuing Bank’s right to demand such compensation; provided that the Borrower shall not be required to compensate a Lender or the Issuing Bank pursuant to this Section for any increased costs or reductions incurred more than 180 days prior to the date that such Lender or Issuing Bank, as the case may be, notifies the Borrower of the Change in Law giving rise to such increased costs or reductions and of such Lender’s or Issuing Bank’s intention to claim compensation therefor; provided further that, if the Change in Law giving rise to such increased costs or reductions is retroactive, the 180-day period referred to above shall be extended to include the period of retroactive effect thereof.

SECTION 2.14 Break Funding Payments. In the event of (a) the payment of any principal of any Eurodollar Loan other than on the last day of an Interest Period applicable thereto (including as a result of an Event of Default), (b) the conversion of any Eurodollar Loan other than on the last day of the Interest Period applicable thereto, (c) the failure to borrow, convert, continue or prepay any Eurodollar Loan on the date specified in any notice delivered pursuant hereto (whether or not such notice may be revoked in accordance with the terms hereof) or (d) the assignment of any Eurodollar Loan other than on the last day of the Interest Period applicable thereto as a result of a request by the Borrower pursuant to Section 2.18, then, in any such event, the Borrower shall compensate each Lender for the loss, cost and expense attributable to such event. In the case of a Eurodollar Loan, such loss, cost or expense to any Lender shall be deemed to include an amount determined by such Lender to be the excess, if any, of (i) the amount of interest which would have accrued on the principal amount of such Loan had such event not occurred, at the Adjusted LIBO Rate that would have been applicable to such Loan, for the period from the date of such event to the last day of the then current Interest Period therefor (or, in the case of a failure to borrow, convert or continue, for the period that would have been the Interest Period for such Loan), over (ii) the amount of interest that would accrue on such principal amount for such period at the interest rate which such Lender would bid were it to bid, at the commencement of such period, for dollar deposits of a comparable amount and period from other banks in the London interbank market. A certificate of any Lender setting forth any amount or amounts that such Lender is entitled to receive pursuant to this Section shall be delivered to the Borrower and shall be conclusive absent manifest error. The Borrower shall pay such Lender the amount shown as due on any such certificate within 10 days after receipt thereof.

SECTION 2.15 Taxes. (a) Any and all payments by or on account of any obligation of the Borrower under any Loan Document shall be made without deduction or withholding for any Taxes, except as required by applicable law. If any applicable law (as determined in the good faith discretion of an applicable Withholding Agent) requires the deduction or withholding of any Tax from any such payment by a Withholding Agent, then the applicable Withholding Agent shall be entitled to make such deduction or withholding and shall timely pay the full amount deducted or withheld to the relevant Governmental Authority in accordance with applicable law and, if such Tax is an Indemnified Tax, then the sum payable by the

Borrower shall be increased as necessary so that after such deduction or withholding has been made (including such deductions and withholdings applicable to additional sums payable under this Section) the applicable Recipient receives an amount equal to the sum it would have received had no such deduction or withholding been made.

(b)The Borrower shall timely pay to the relevant Governmental Authority in accordance with applicable law, or, at the option of the Agent, timely reimburse it for the payment of, any Other Taxes.

(c)As soon as practicable after any payment of Indemnified Taxes by the Borrower to a Governmental Authority, the Borrower shall deliver to the Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment or other evidence of such payment reasonably satisfactory to the Agent.

(d)The Borrower shall indemnify each Recipient, within 10 days after demand therefor, for the full amount of any Indemnified Taxes (including Indemnified Taxes imposed or asserted on or attributable to amounts payable under this Section) payable or paid by such Recipient or required to be withheld or deducted from a payment to such Recipient in connection with any Loan Document and any reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to the Borrower by a Lender (with a copy to the Agent), or by the Agent on its own behalf or on behalf of a Lender, shall be conclusive absent manifest error.

(e)Each Lender shall severally indemnify the Agent, within 10 days after demand therefor, for (i) any Indemnified Taxes attributable to such Lender (but only to the extent that the Borrower has not already indemnified the Agent for such Indemnified Taxes and without limiting the obligation of the Borrower to do so), (ii) any Taxes attributable to such Lender’s failure to comply with the provisions of Section 9.04(c) relating to the maintenance of a Participant Register and (iii) any Excluded Taxes attributable to such Lender, in each case, that are paid or payable by the Agent in connection with any Loan Document and any reasonable expenses arising therefrom or with respect thereto, whether or not such Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to any Lender by the Agent shall be conclusive absent manifest error. Each Lender hereby authorizes the Agent to set off and apply any and all amounts at any time owing to such Lender under any Loan Document or otherwise payable by the Agent to the Lender from any other source against any amount due to the Administrative Agent under this paragraph (e).

(f)(i) Any Lender that is entitled to an exemption from, or reduction of withholding Tax with respect to payments made under any Loan Document shall deliver to the Borrower and the Agent, at the time or times reasonably requested by the Borrower or the Agent, such properly completed and executed documentation reasonably requested by the Borrower or the Agent as will permit such payments to be made without, or at a reduced rate of, withholding. In addition, any Lender, if reasonably requested by the Borrower or the Agent, shall deliver such other documentation prescribed by applicable law or reasonably requested by the Borrower or the Agent as will enable the Borrower or the Agent to determine whether or not such Lender is subject to backup withholding or information reporting requirements. Notwithstanding anything to the contrary in the preceding two sentences, the completion, execution and submission of such documentation (other than such documentation set forth in this Section 2.15(f)(ii)(A), (ii)(B) and (ii)(D) below) shall not be required if in the Lender’s reasonable judgment such completion, execution or submission would subject such Lender to any material unreimbursed cost or expense or would materially prejudice the legal or commercial position of such Lender.

(ii)Without limiting the generality of the foregoing, in the event that the Borrower is a U.S. Person,

(A) any Lender that is a U.S. Person shall deliver to the Borrower and the Agent on or prior to the date on which such Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Agent), executed originals of IRS Form W-9 certifying that such Lender is exempt from U.S. Federal backup withholding tax;

(B) any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to the Borrower and the Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Agent), whichever of the following is applicable:

(1) in the case of a Foreign Lender claiming the benefits of an income tax treaty to which the United States is a party (x) with respect to payments of interest under any Loan Document, executed originals of IRS Form W-8BEN or IRS Form W-8BEN-E (or applicable successor form) establishing an exemption from, or reduction of, U.S. Federal withholding Tax pursuant to the “interest” article of such tax treaty and (y) with respect to any other applicable payments under any Loan Document, IRS Form W-8BEN or IRS Form W-8BEN-E (or applicable successor form) establishing an exemption from, or reduction of, U.S. Federal withholding Tax pursuant to the “business profits” or “other income” article of such tax treaty;

(2) executed originals of IRS Form W-8ECI (or successor form);

(3) in the case of a Foreign Lender claiming the benefits of the exemption for portfolio interest under Section 881(c) of the Code, (x) a certificate substantially in the form of Exhibit D-1 to the effect that such Foreign Lender is not (1) a “bank” within the meaning of Section 881(c)(3)(A) of the Code, (2) a “10 percent shareholder” of the Borrower within the meaning of Section 881(c)(3)(B) of the Code or (3) a “controlled foreign corporation” described in Section 881(c)(3)(C) of the Code (a “U.S. Tax Compliance Certificate”) and (y) executed originals of IRS Form W-8BEN or IRS Form W-8BEN-E (or applicable successor form); or

(4) to the extent a Foreign Lender is not the beneficial owner, executed originals of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN, IRS Form W-8BEN-E, a U.S. Tax Compliance Certificate substantially in the form of Exhibit D-2, Exhibit D-3 or Exhibit D-4, IRS Form W-9, and/or other certification documents from each beneficial owner, as applicable (including any applicable successor form);

(C) any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to the Borrower and the Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Agent), executed originals of any other form prescribed by applicable law as a basis for claiming exemption from or a reduction in U.S. Federal withholding Tax, duly completed, together with such supplementary documentation as may be prescribed by applicable law to permit the Borrower or the Agent to determine the withholding or deduction required to be made; and

(D) if a payment made to a Lender or the Agent under any Loan Document would be subject to U.S. Federal withholding Tax imposed by FATCA if such Lender or the Agent were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender or Agent shall deliver to the Borrower and the Agent at the time or

times prescribed by law and at such time or times reasonably requested by the Borrower or the Agent such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by the Borrower or the Agent as may be necessary for the Borrower and the Agent to comply with their obligations under FATCA and to determine that such Lender or Agent has complied with its obligations under FATCA or to determine the amount to deduct and withhold from such payment. Solely for purposes of this clause (B), “FATCA” shall include any amendments made to FATCA after the date of this Agreement.

Each Lender and the Agent agrees that if any form or certification it previously delivered expires or becomes obsolete or inaccurate in any respect, it shall update such form or certification or promptly notify the Borrower and the Agent in writing of its legal inability to do so.

(g) Additional United Kingdom Withholding Tax Matters.

(i) Subject to (ii) below, each Lender and the Borrower shall cooperate in completing any procedural formalities necessary for such the Borrower to obtain authorization to make such payment without withholding or deduction for Taxes imposed under the laws of the United Kingdom.

(ii) (A) A Lender on the Closing Date that (x) holds a passport under the HMRC DT Treaty Passport scheme and (y) wishes such scheme to apply to this Agreement, shall provide its scheme reference number and its jurisdiction of tax residence to the Borrower and the Administrative Agent; and

(B) a Lender that becomes a Lender hereunder after the Closing Date closes that (x) holds a passport under the HMRC DT Treaty Passport scheme and (y) wishes such scheme to apply to this Agreement, shall provide its scheme reference number and its jurisdiction of tax residence to the Borrower and the Administrative Agent.

(iii) If a Lender has confirmed its scheme reference number and its jurisdiction of tax residence in accordance with paragraph (g)(ii) above, the Borrower shall make a filing with HM Revenue & Customs with respect to such Lender (a “Borrower DTTP Request”), and shall promptly provide such Lender with a copy of such filing; provided that, if:

(A) the Borrower has not made a Borrower DTTP Filing in respect of such Lender; or

(B) the Borrower has made a Borrower DTTP Filing in respect of such Lender but:

(1) such Borrower DTTP Filing has been rejected by HM Revenue & Customs; or

(2) HM Revenue & Customs has not given the Borrower authority to make payments to such Lender without a deduction for tax within 60 days of the date of such Borrower DTTP Filing;

and in each case, the Borrower has notified that Lender in writing of either (1) or (2) above, then such Lender and the Borrower shall co-operate in completing any additional procedural formalities necessary for the Borrower to obtain authorization to make that payment without withholding or deduction for Taxes imposed under the laws of the United Kingdom.

(iv) If a Lender has not confirmed its scheme reference number and jurisdiction of tax residence in accordance with paragraph (g)(ii) above, the Borrower shall not make a Borrower DTTP Filing or

file any other form relating to the HMRC DT Treaty Passport scheme in respect of that Lender’s Commitment or its participation in any Loan unless the Lender otherwise agrees.

(v) The Borrower shall, promptly on making a Borrower DTTP Filing, deliver a copy of such Borrower DTTP Filing to the Agent for delivery to the relevant Lender.

(vi) Each Lender shall notify the Borrower and the Agent if it determines in its sole discretion that it is ceases to be entitled to claim the benefits of an income tax treaty to which the United Kingdom is a party with respect to payments made by the Borrower hereunder.

(h)If any party determines, in its reasonable discretion exercised in good faith, that it has received a refund of any Taxes as to which it has been indemnified pursuant to Section 2.13 or this Section 2.15 (including additional amounts paid pursuant to this Section 2.15), it shall pay to the indemnifying party an amount equal to such refund (but only to the extent of indemnity payments made under Section 2.13 or this Section 2.15 with respect to the Taxes giving rise to such refund), net of all out-of-pocket expenses (including any Taxes) of such indemnified party and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund). Such indemnifying party, upon the request of such indemnified party, shall repay to such indemnified party the amount paid to such indemnifying party pursuant to the previous sentence (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) in the event such indemnified party is required to repay such refund to such Governmental Authority. Notwithstanding anything to the contrary in this Section 2.15(h), in no event will any indemnified party be required to pay any amount to any indemnifying party pursuant to this Section 2.15(h) if such payment would place such indemnified party in a less favorable position (on a net after-Tax basis) than such indemnified party would have been in if the Tax subject to indemnification and giving rise to such refund had not been deducted, withheld or otherwise imposed and the indemnification payments or additional amounts with respect to such Tax had never been paid. This Section 2.15(h) shall not be construed to require any indemnified party to make available its Tax returns (or any other information relating to its Taxes which it reasonably deems confidential) to the indemnifying party or any other Person.

(i)Each Lender which becomes a party to this Agreement after the date of this Agreement shall indicate, in the Assignment and Assumption or Incremental Facility Agreement, as applicable, which it executes on becoming a party hereto, which of the following categories it falls into:


(A)	not a UK Qualifying Lender;


(B)	a UK Qualifying Lender (other than a UK Treaty Lender); or


(C)	a UK Treaty Lender.

If a new Lender fails to indicate its status in accordance with this Section 2.15(i) then such new Lender shall be treated for the purposes of this Agreement (including by the Borrower) as if it is not a UK Qualifying Lender until such time as it notifies the Agent which category applies (and the Agent, upon receipt of such notification, shall inform the Borrower). For the avoidance of doubt, an Assignment and Assumption shall not be invalidated by any failure of a Lender to comply with this Section 2.15(i).

(j)For purposes of this Section 2.15, the term “Lender” includes any Issuing Bank and the term “applicable law” includes FATCA.

Each party’s obligations under this Section 2.15 shall survive the resignation or replacement of the Agent or any assignment of rights by, or the replacement of, a Lender, the termination of the Commitments and the repayment, satisfaction or discharge of all obligations under any Loan Documents.

SECTION 2.16 Payments Generally; Pro Rata Treatment; Sharing of Set‑offs. (a) The Borrower shall make each payment required to be made by it hereunder or under any Loan Document (whether of principal, interest, fees or reimbursement of LC Disbursements, or of amounts payable under Section 2.13, 2.14 or 2.15, or otherwise) prior to 12:00 noon., New York City Time, on the date when due, in immediately available funds, without set off or counterclaim. Any amounts received after such time on any date may, in the discretion of the Agent, be deemed to have been received on the next succeeding Business Day for purposes of calculating interest thereon. All such payments shall be made to such accounts as may be specified by the Agent, except that payments required to be made directly to an Issuing Bank shall be so made and payments pursuant to Sections 2.13, 2.14, 2.15 and 9.05 shall be made directly to the Persons entitled thereto. The Agent shall distribute any such payments received by it for the account of any other Person to the appropriate recipient promptly following receipt thereof. If any payment hereunder shall be due on a day that is not a Business Day, the date for payment shall be extended to the next succeeding Business Day, and, in the case of any payment accruing interest, interest thereon shall be payable for the period of such extension. All payments hereunder shall be made in Dollars. Any payment required to be made by the Agent hereunder shall be deemed to have been made by the time required if the Agent shall, at or before such time, have taken the necessary steps to make such payment in accordance with the regulations or operating procedures of the clearing or settlement system used by the Agent to make such payments.

(b)If at any time insufficient funds are received by and available to the Agent to pay fully all amounts of principal, unreimbursed LC Disbursements, interest and fees then due hereunder, such funds shall be applied (i) first, towards payment of interest and fees then due hereunder, ratably among the parties entitled thereto in accordance with the amounts of interest and fees then due to such parties and (ii) second, towards payment of principal and LC Disbursements then due hereunder, ratably among the parties entitled thereto in accordance with the amounts of principal then due to such parties.

(c)If any Lender shall, by exercising any right of set off or counterclaim or otherwise, obtain payment in respect of any principal of or interest on any of its Loans or participations in LC Disbursements resulting in such Lender receiving payment of a greater proportion of the aggregate amount of its Loans and participations in LC Disbursements and accrued interest thereon than the proportion received by any other Lender, then the Lender receiving such greater proportion shall purchase (for cash at face value) participations in the Loans and participations in LC Disbursements of other Lenders to the extent necessary so that the benefit of all such payments shall be shared by the Lenders ratably in accordance with the relative aggregate amount of principal of and accrued interest on their Loans and participations in LC Disbursements; provided that (i) if any such participations are purchased and all or any portion of the payment giving rise thereto is recovered, such participations shall be rescinded and the purchase price restored to the extent of such recovery, without interest, and (ii) the provisions of this paragraph shall not be construed to apply to any payment made by the Borrower pursuant to and in accordance with the express terms of this Agreement or any payment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Loans or participations in LC Disbursements to any assignee or participant, other than to the Borrower or any Subsidiary or Affiliate of the Borrower (as to which the provisions of this paragraph shall apply). The Borrower consents to the foregoing and agrees, to the extent it may effectively do so under applicable law, that any Lender acquiring a participation pursuant to the foregoing arrangements may exercise against the Borrower rights of set-off and counterclaim with respect to such participation as fully as if such Lender were a direct creditor of the Borrower in the amount of such participation.

(d)Unless the Agent shall have received notice from the Borrower prior to the date on which any payment is due to the Agent for the account of the Lenders or Issuing Bank hereunder that the Borrower will not make such payment, the Agent may assume that the Borrower has made such payment on such date in accordance herewith and may, in reliance upon such assumption, distribute to the Lenders or Issuing Bank, as the case may be, the amount due. In such event, if the Borrower has not in fact made such payment, then each of the Lenders or Issuing Bank, as the case may be, severally agrees to repay to the Agent forthwith on demand the amount so distributed to such Lender or Issuing Bank with interest thereon, for each day from and including the date such amount is distributed to it to but excluding the date of payment to the Agent, at the greater of the Federal Funds Effective Rate and a rate determined by the Agent in accordance with banking industry rules on interbank compensation.

(e)If any Lender shall fail to make any payment required to be made by it hereunder, then the Agent may, in its discretion and notwithstanding any contrary provision hereof, apply any amounts thereafter received by the Agent for the account of such Lender to satisfy such Lender’s payment obligations hereunder until all such unsatisfied obligations are fully paid, and/or (ii) hold such amounts in a segregated account over which the Agent shall have exclusive control as cash collateral for, and application to, any future funding obligations of such Lender hereunder, in the case of each of clause (i) and (ii) above, in any order as determined by the Agent in its discretion.

SECTION 2.17 Defaulting Lenders.

(a)Defaulting Lender Adjustments. Notwithstanding anything to the contrary contained in this Agreement, if any Lender becomes a Defaulting Lender, then, until such time as such Lender is no longer a Defaulting Lender, to the extent permitted by applicable law:

(i)Waivers and Amendments. The Commitment and Credit Exposure of such Defaulting Lender shall not be included in determining whether the Required Lenders have taken or may take any action hereunder or under any other Loan Document (including any consent to any amendment, waiver or other modification pursuant to Section 9.08); provided that any amendment, waiver or other modification requiring the consent of all Lenders or all Lenders affected thereby shall, except as otherwise provided in Section 9.08, require the consent of such Defaulting Lender in accordance with the terms hereof.

(ii)Defaulting Lender Waterfall. Any payment of principal, interest, fees or other amounts received by the Agent for the account of such Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to Article VII or otherwise) or received by the Agent from a Defaulting Lender pursuant to Section 9.06 shall be applied at such time or times as may be determined by the Agent as follows: first, to the payment of any amounts owing by such Defaulting Lender to the Agent hereunder; second, to the payment of any amounts owing by such Defaulting Lender to the Issuing Bank; third, to Cash Collateralize the Issuing Bank’s Fronting Exposure with respect to such Defaulting Lender in accordance with Section 2.04(j); fourth, as the Borrower may request (so long as no Default exists), to the funding of any Loan in respect of which such Defaulting Lender has failed to fund its portion thereof as required by this Agreement, as determined by the Agent; fifth, if so determined by the Agent and the Borrower, to be held in a deposit account and released pro rata in order to (x) satisfy such Defaulting Lender’s potential future funding obligations with respect to Loans under this Agreement and (y) Cash Collateralize the Issuing Bank’s future Fronting Exposure with respect to such Defaulting Lender with respect to future Letters of Credit issued under this Agreement, in accordance with Section 2.04(j); sixth, to the payment of any amounts owing to the

Lenders or the Issuing Bank as a result of any judgment of a court of competent jurisdiction obtained by any Lender or the Issuing Bank against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement; seventh, so long as no Default exists, to the payment of any amounts owing to the Borrower as a result of any judgment of a court of competent jurisdiction obtained by the Borrower against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement; and eighth, to such Defaulting Lender or as otherwise directed by a court of competent jurisdiction; provided that if (x) such payment is a payment of the principal amount of any Loans or LC Disbursements in respect of which such Defaulting Lender has not fully funded its appropriate share, and (y) such Loans were made or the related Letters of Credit were issued at a time when the conditions set forth in Section 4.02 were satisfied or waived, such payment shall be applied solely to pay the Loans of, and LC Disbursements owed to, all Non-Defaulting Lenders on a pro rata basis prior to being applied to the payment of any Loans of, or LC Disbursements owed to, such Defaulting Lender until such time as all Loans and funded and unfunded participations in Letters of Credit are held by the Lenders pro rata in accordance with the Commitments without giving effect to Section 2.17(a)(iv). Any payments, prepayments or other amounts paid or payable to a Defaulting Lender that are applied (or held) to pay amounts owed by a Defaulting Lender or to post Cash Collateral pursuant to this Section 2.17(a)(ii) shall be deemed paid to and redirected by such Defaulting Lender, and each Lender irrevocably consents hereto.

(iii) Certain Fees.

(A)No Defaulting Lender shall be entitled to receive any fee pursuant to Section 2.07(a) for any period during which that Lender is a Defaulting Lender (and the Borrower shall not be required to pay any such fee that otherwise would have been required to have been paid to that Defaulting Lender).

(B)Each Defaulting Lender shall be entitled to receive fees in respect of Letters of Credit pursuant to Section 2.07(b) in respect of its participations in Letters of Credit for any period during which that Lender is a Defaulting Lender only to the extent allocable to its Applicable Percentage of the stated amount of Letters of Credit for which it has provided Cash Collateral pursuant to Section 2.04(j).

(C)With respect to any participation fee in respect of Letters of Credit not required to be paid to any Defaulting Lender pursuant to clauses (A) or (B) above, the Borrower shall (x) pay to each Non-Defaulting Lender that portion of any such fee otherwise payable to such Defaulting Lender with respect to such Defaulting Lender’s participation in Letters of Credit that has been reallocated to such Lender pursuant to clause (iv) below, (y) pay to the Issuing Bank, the amount of any such fee otherwise payable to such Defaulting Lender to the extent allocable to the Issuing Bank’s Fronting Exposure to such Defaulting Lender, and (z) not be required to pay the remaining amount of any such fee.

(iv) Reallocation of Participations to Reduce Fronting Exposure. All or any part of such Defaulting Lender’s participation in LC Exposure shall be reallocated among the Non-Defaulting Lenders in accordance with their respective Applicable Percentages (calculated without regard to such Defaulting Lender’s Commitment) but only to the extent that (x) the conditions set forth in Section 4.02 are satisfied at the time of such reallocation (and, unless the Borrower shall have otherwise notified the Agent at such time, the Borrower shall be deemed to have represented and warranted that such conditions are satisfied at such time), and (y) such reallocation does not cause the aggregate Credit Exposure of any Non-Defaulting Lender to exceed such Lender’s Commitment. Subject to

Section 9.20, no reallocation hereunder shall constitute a waiver or release of any claim of any party hereunder against a Defaulting Lender arising from that Lender having become a Defaulting Lender, including any claim of a Non-Defaulting Lender as a result of such Lender’s increased exposure following such reallocation.

(v)Cash Collateral. If the reallocation described in clause (iv) above cannot, or can only partially, be effected, the Borrower shall, without prejudice to any right or remedy available to it hereunder or under applicable law, Cash Collateralize the Issuing Bank’s Fronting Exposure in accordance with the procedures set forth in Section 2.04(j).

(b)Defaulting Lender Cure. If the Borrower, the Agent and the Issuing Bank agree in writing that a Lender is no longer a Defaulting Lender, the Agent will so notify the parties hereto, whereupon as of the effective date specified in such notice and subject to any conditions set forth therein (which may include arrangements with respect to any Cash Collateral), that Lender will, to the extent applicable, purchase at par that portion of outstanding Loans of the other Lenders or take such other actions as the Agent may determine to be necessary to cause the Loans and funded and unfunded participations in Letters of Credit to be held pro rata by the Lenders in accordance with the Commitments (without giving effect to Section 2.17(a)(iv)), whereupon such Lender will cease to be a Defaulting Lender; provided that no adjustments will be made retroactively with respect to fees accrued or payments made by or on behalf of the Borrower while that Lender was a Defaulting Lender; and provided, further, that except to the extent otherwise expressly agreed by the affected parties, no change hereunder from Defaulting Lender to Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender’s having been a Defaulting Lender.

(c)New Letters of Credit. So long as any Lender is a Defaulting Lender, the Issuing Bank shall not be required to issue, amend, extend, renew or increase any Letter of Credit unless it is satisfied that it will have no Fronting Exposure after giving effect thereto.

SECTION 2.18 Mitigation Obligations; Replacement of Lenders. (a) If any Lender requests compensation under Section 2.13, or if the Borrower is required to pay any Indemnified Taxes or additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.15, then such Lender shall use reasonable efforts to designate a different lending office for funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the judgment of such Lender, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to Section 2.13 or 2.15, as the case may be, in the future and (ii) would not subject such Lender to any unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender. The Borrower hereby agrees to pay all reasonable out‑of‑pocket costs and expenses incurred by any Lender in connection with any such designation or assignment.

(b)If (i) any Lender requests compensation under Section 2.13, (ii) the Borrower is required to pay Indemnified Taxes or any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.15, (iii) any Lender is a Defaulting Lender or (iv) any Lender is a Non-Consenting Lender, then the Borrower may, at its sole expense and effort, upon notice to such Lender and the Agent (and in the case of clause (iv) above, within 5 days after the date such Lender becomes a Non-Consenting Lender), (A) require such Lender to assign and delegate, without recourse (in accordance with and subject to the restrictions contained in Section 9.04(b)), all its interests, rights (other than its existing rights to payments pursuant to Section 2.13 or 2.15) and obligations under this Agreement and the other Loan Documents to an Eligible Assignee that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment); provided that (i) the Borrower shall have

received the prior written consent of the Agent and each Issuing Bank, which consent shall not unreasonably be withheld, (ii) such Lender shall have received payment of an amount equal to the outstanding principal of its Loans and participations in LC Disbursements, accrued interest thereon, accrued fees and all other amounts payable to it hereunder, from the assignee (to the extent of such outstanding principal and accrued interest and fees) or the Borrower (in the case of all other amounts), and (iii) in the case of any such assignment resulting from a claim for compensation under Section 2.13 or payments required to be made pursuant to Section 2.15, such assignment will result in a reduction in such compensation or payments. A Lender shall not be required to make any such assignment and delegation if, prior thereto, as a result of a waiver by such Lender or otherwise, the circumstances entitling the Borrower to require such assignment and delegation cease to apply.

SECTION 2.19 Incremental Commitments. (a) The Borrower may on one or more occasions, by written notice to the Agent, request prior to the Maturity Date, the establishment of Incremental Commitments; provided that the aggregate, cumulative amount of all Incremental Commitments established pursuant to this Section 2.19 after the Closing Date shall not exceed $150,000,000. Each such notice shall specify (i) the date on which the Borrower proposes that the Incremental Commitments shall be effective, which shall be a date not less than 10 Business Days (or such shorter period as may be agreed to by the Agent) after the date on which such notice is delivered to the Agent, (ii) the amount of the Incremental Commitments being requested and (iii) the identity of each Lender or other Person that the Borrower proposes become an Incremental Lender with respect thereto, together with the proposed aggregate amount of the Incremental Commitment for each such Lender or other Person (it being agreed that (x) any Lender approached to provide any Incremental Commitment may elect or decline, in its sole discretion, to provide such Incremental Commitment and (y) any such Person that is not a Lender must be an Eligible Assignee that is reasonably acceptable to the Agent and, to the extent applicable, each Issuing Bank).

(b)The terms and conditions of any Incremental Commitment and other extensions of credit to be made thereunder may be (i) identical to the terms and conditions of the Commitments and Loans and other extensions of credit made hereunder, (ii) in a separate tranche of revolving loans and commitments or (iii) incurred in the form of term loans, in each case as agreed by the applicable Lenders.

(c)The Incremental Commitments shall be effected pursuant to one or more Incremental Facility Agreements executed and delivered by the Borrower, each Incremental Lender providing such Incremental Commitments and the Agent; provided that no Incremental Commitments shall become effective unless (i) no Default or Event of Default shall have occurred and be continuing on the date of effectiveness thereof, both immediately prior to and immediately after giving effect to such Incremental Commitments and the making of Loans and other extensions of credit thereunder to be made on such date, (ii) on the date of effectiveness thereof, the representations and warranties of the Borrower set forth in the Loan Documents shall be true and correct (A) in the case of the representations and warranties qualified as to materiality, in all respects, and (B) otherwise, in all material respects, except in the case of any such representation and warranty that expressly relates to a prior date, in which case such representation and warranty shall be so true and correct on and as of such prior date, (iii) after giving effect to and the making of Loans and other extensions of credit thereunder to be made on the date of effectiveness thereof, the Borrower shall be in compliance with the covenants set forth in Section 6.12 on a pro forma basis as if such Loans or other extensions of credit had been incurred or assumed on the first day of the Test Period most recently ended on or prior to the date of such effectiveness, (iv) the Borrower shall make any payments required to be made pursuant to Section 2.14 in connection with such Incremental Commitments and the related transactions under this Section 2.19 and (v) the Borrower shall have delivered to the Agent such legal opinions, board resolutions, secretary’s certificates, officer’s certificates and other documents as shall reasonably be requested by the Agent in connection with any such transaction. Each Incremental Facility

Agreement may, without the consent of any Lender, effect such amendments to this Agreement and the other Loan Documents as may be necessary or appropriate, in the reasonable judgment of the Agent, to give effect to the provisions of this Section 2.19 (including to evidence a separate tranche of revolving loans and commitments or term loans).

(d)In the case of Incremental Commitments described in Section 2.19(b)(i), upon effectiveness of an Incremental Commitment of any Incremental Lender, (i) such Incremental Lender shall be deemed to be a “Lender” hereunder, and henceforth shall be entitled to all the rights of, and benefits accruing to, Lenders hereunder and shall be bound by all agreements, acknowledgements and other obligations of Lenders hereunder and under the other Loan Documents, and (ii)(A) such Incremental Commitment shall constitute (or, in the event such Incremental Lender already has a Commitment, shall increase) the Commitment of such Incremental Lender and (B) the aggregate amount of the Lenders’ Commitments shall be increased by the amount of such Incremental Commitment, in each case, subject to further increase or reduction from time to time as set forth in the definition of the term “Commitment”. For the avoidance of doubt, upon the effectiveness of any Incremental Commitment, the Credit Exposure of the Incremental Lender holding such Commitment, and the Applicable Percentages of all the Lenders shall automatically be adjusted to give effect thereto.

(e)On the date of the effectiveness of any Incremental Commitments described in Section 2.19(b)(i), each Lender shall be deemed to have assigned to each Incremental Lender holding such Incremental Commitments, and each such Incremental Lender shall be deemed to have purchased from each Lender, in an amount equal to the principal amount thereof (together with accrued and unpaid interest), such interests in the Loans and participations in Letters of Credit outstanding on such date as shall be necessary in order that, after giving effect to all such assignments and purchases, such Loans and participations in Letters of Credit will be held by all the Lenders (including such Incremental Lenders) ratably in accordance with their Applicable Percentages after giving effect to the effectiveness of such Incremental Commitments. Any Loans outstanding immediately prior to the date of the effectiveness of such Incremental Commitments that are Eurodollar Loans will (except to the extent otherwise repaid in accordance herewith) continue to be held by, and all interest thereon will continue to accrue for the accounts of, the Lenders holding such Loans immediately prior to the date of the effectiveness of such Incremental Commitments, in each case until the last day of the then-current Interest Period applicable to any such Loan, at which time such Loans will be repaid or refinanced with new Loans made pursuant to Section 2.01 in accordance with the Applicable Percentages of the Lenders (including the Incremental Lenders) after giving effect to the effectiveness of such Incremental Commitments; provided, however, that upon the occurrence of any Event of Default, each Incremental Lender will promptly purchase (for cash at face value) assignments of portions of such outstanding Loans of other Lenders so that, after giving effect thereto, all Loans that are Eurodollar Loans are held by the Lenders (including the Incremental Lenders) in accordance with their then-current Applicable Percentages. Any such assignments shall be effected in accordance with the provisions of Section 9.04, provided that the parties hereto hereby consent to such assignments and the minimum assignment amounts and processing and recordation fee set forth in Section 9.04(b) shall not apply thereto. Any ABR Loans outstanding on the date of the effectiveness of such Incremental Commitments shall either be prepaid on such date or refinanced on such date (subject to the satisfaction of applicable borrowing conditions) with Loans made on such date by the Lenders (including the Incremental Lenders) in accordance with their Applicable Percentages. In order to effect any such refinancing, (i) each Incremental Lender will make ABR Loans by transferring funds to the Agent in an amount equal to the aggregate outstanding amount of such Loans of such Type times a percentage obtained by dividing the amount of such Incremental Lender’s Incremental Commitment by the aggregate amount of the Lenders’ Commitments (after giving effect to the effectiveness of the Incremental Commitments on such date) and (ii) such funds will be applied to the prepayment of outstanding ABR Loans held by the

Lenders other than the Incremental Lenders, and transferred by the Agent to the Lenders other than the Incremental Lenders, in such amounts so that, after giving effect thereto, all ABR Loans will be held by the Lenders in accordance with their then-current Applicable Percentages. On the date of the effectiveness of such Incremental Commitments, the Borrower will pay to the Agent, for the accounts of the Lenders receiving such prepayments, accrued and unpaid interest on the aggregate principal amount of the Loans of the Borrower being prepaid. The Agent and the Lenders hereby agree that the minimum borrowing, pro rata borrowing and pro rata payment requirements contained elsewhere in this Agreement shall not apply to the transactions effected pursuant to the immediately preceding sentence.

(f)The Agent shall notify Lenders promptly upon receipt by the Agent of any notice from the Borrower referred to in Section 2.19 and of the effectiveness of any Incremental Commitments, in each case advising the Lenders of the details thereof and of the Applicable Percentages of the Lenders after giving effect thereto and of the assignments deemed to have been made pursuant to Section 2.19(e).

ARTICLE III

Representations and Warranties

The Borrower represents and warrants to each of the Lenders that:

SECTION 3.01 Organization; Powers. The Borrower and each of its Covered Subsidiaries is duly organized, validly existing and in good standing (if applicable) under the laws of its jurisdiction of organization, has all requisite authority to conduct its business as now conducted and, except where the failure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect, is qualified to do business in each jurisdiction where such qualification is required.

SECTION 3.02 Authorization and Enforceability. The Transactions are within the Borrower’s corporate powers and have been duly authorized by all necessary corporate and, if required, stockholder action. This Agreement has been duly executed and delivered by the Borrower and constitutes a legal, valid and binding obligation of the Borrower, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law.

SECTION 3.03 Approvals; No Conflict. The Transactions (a) do not require any consent or approval of, registration or filing with, or any other action by, any Governmental Authority or any third party, except such as have been obtained or made and are in full force and effect, (b) will not violate any applicable law or regulation, charter, by-laws or other organizational documents of the Borrower or any of its Covered Subsidiaries or any order of any Governmental Authority, (c) will not violate or result in a default under any Parent Agreement, or any indenture, material agreement or other material instrument binding upon the Borrower or any of its Covered Subsidiaries or any of their assets, or give rise to a right thereunder to require any payment to be made by the Borrower or any of its Covered Subsidiaries, and (d) will not result in the creation or imposition of any Lien on any assets of the Borrower or any of its Covered Subsidiaries.

SECTION 3.04 Financial Condition; No Material Adverse Change. (a) The Borrower has heretofore furnished to the Lenders (i) the consolidated balance sheet and related consolidated statements of operations, comprehensive income, changes in stockholders’ equity and cash flows of BrightSphere UK and its consolidated subsidiaries as of and for the fiscal year ended December 31, 2018, audited by and accompanied by the opinion of KPMG LLP, independent registered public accounting firm, and (ii) the unaudited consolidated balance sheet and related consolidated statements of operations, comprehensive income and cash flows of BrightSphere UK and its consolidated subsidiaries as of and for the fiscal quarter and the

portion of the fiscal year ending March 31, 2019, certified by its chief financial officer. Such financial statements (including the related notes and schedules thereto) present fairly in all material respects the financial condition and results of operations of BrightSphere UK and its consolidated subsidiaries as of such dates and for such periods in accordance with GAAP, subject to year end audit adjustments and the absence of footnotes in the case of the statements referred to in clause (ii) above.

(b)Since December 31, 2018, there has been no material adverse change in the business, assets, operations, or financial condition of BrightSphere UK and its subsidiaries, taken as a whole, and since the Closing Date, there has been no material adverse change in the business, assets, operations, or financial condition of the Borrower and its Subsidiaries, taken as a whole.

(c)Except as disclosed in the financial statements referred to above or the notes thereto, after giving effect to the Transactions, none of the Borrower or its Subsidiaries has, as of the Closing Date, any material contingent liabilities, unusual long-term commitments or material unrealized losses.

SECTION 3.05 Properties. (a) Each of the Borrower and its Covered Subsidiaries has good title to, or valid leasehold interests in, all its real and personal property material to its business, except for minor defects in title that do not interfere with its ability to conduct its business as currently conducted or to utilize such properties for their intended purposes.

(b)Each of the Borrower and its Subsidiaries owns, or is licensed to use, all trademarks, trade names, copyrights, patents and other intellectual property material to its business, and the use thereof by the Borrower and its Subsidiaries does not infringe upon the rights of any other Person, except for any such infringements that, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect.

SECTION 3.06 Litigation and Environmental Matters. (a) There are no actions, suits or proceedings by or before any arbitrator or Governmental Authority pending against or, to the knowledge of the Borrower, threatened in writing against or affecting the Borrower or any of its Covered Subsidiaries (i) as to which there is a reasonable possibility of an adverse determination and that, if adversely determined, could reasonably be expected, individually or in the aggregate, to result in a Material Adverse Effect or (ii) that involve this Agreement or the Transactions.

(b)Except with respect to any matters that, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect, neither the Borrower nor any of its Subsidiaries (i) has failed to comply with any Environmental Law or to obtain, maintain or comply with any permit, license or other approval required under any Environmental Law, (ii) has become subject to any Environmental Liability, (iii) has received notice of any claim with respect to any Environmental Liability or (iv) knows of any basis for any Environmental Liability.

SECTION 3.07 Compliance with Laws and Agreements. Each of the Borrower and its Covered Subsidiaries is in compliance with all laws, regulations and orders of any Governmental Authority applicable to it or its property and all indentures, agreements and other instruments binding upon it or its property, except where the failure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect. Each Subsidiary of the Borrower that is an “investment adviser” within the meaning of the Investment Advisers Act of 1940 is in compliance in all material respects with the requirements of the Investment Advisers Act of 1940 and the rules and regulations of the SEC thereunder, including the registration and reporting requirements thereof. No Default has occurred and is continuing.

SECTION 3.08 Investment Company Status. Except for Funds that are managed by Covered Subsidiaries of the Borrower and that are duly registered as Investment Companies under the Investment Company Act of 1940, neither the Borrower nor any Subsidiary is an “investment company” as defined in, or subject to regulation as an “investment company” under, the Investment Company Act of 1940.

SECTION 3.09 Margin Regulations. (a) Not more than 25% of the value of the assets of the Borrower and the Covered Subsidiaries subject to any restrictions on the sale, pledge or other disposition of assets under this Agreement, any other Loan Document or any other agreement to which any Lender or Affiliate of a Lender is party will at any time be represented by Margin Stock.

(b)No part of the proceeds of any Loan will be used, whether directly or indirectly, and whether immediately, incidentally or ultimately, for any purpose that entails a violation of, or that is inconsistent with, the provisions of the Regulations of the Board, including Regulation T, Regulation U and Regulation X.

SECTION 3.10 Taxes. The Borrower and each Covered Subsidiary have filed all United States Federal Tax returns and all other Tax returns which are required to be filed and have paid all Taxes stated to be due by the Borrower and each Covered Subsidiary pursuant to said returns or pursuant to any assessment received by the Borrower or any Covered Subsidiary, including without limitation all Federal and state withholding Taxes and all Taxes required to be paid pursuant to applicable law, except such Taxes, if any, as are being contested in good faith by appropriate proceedings and as to which adequate reserves have been provided for on the books of the Borrower or such Covered Subsidiary, or where a failure to so file or pay could not reasonably be expected to have a Material Adverse Effect.

SECTION 3.11 ERISA. No ERISA Event has occurred or is reasonably expected to occur that, when taken together with all other such ERISA Events for which liability is reasonably expected to occur, could reasonably be expected to result in a Material Adverse Effect. As of the most recent valuation date for any Plan, the funding target attainment percentage (as defined in Section 430(d)(2) of the Code) is 60% or higher and neither the Borrower nor any ERISA Affiliate knows of any facts or circumstances that could reasonably be expected to result in the funding attainment percentage dropping below 60% as of the most recent valuation date.

SECTION 3.12 Disclosure. No information included in any of the reports, financial statements, certificates or other information furnished by or on behalf of the Borrower to the Agent or any Lender in connection with the negotiation of this Agreement or any other Loan Document or delivered hereunder or thereunder (as modified or supplemented by other written information so furnished) contains any material misstatement of fact or omits to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, taken as a whole, not misleading; provided that, with respect to projected financial information and forward looking statements, the Borrower represents only that such information was prepared in good faith based upon assumptions believed to be reasonable at the time when prepared, it being understood that projected financial information and forward looking statements are inherently uncertain and that the Borrower gives no representation and warranty that projected results will be achieved.

SECTION 3.13 Anti-Corruption Laws and Sanctions. The Borrower has implemented and maintains in effect policies and procedures designed to ensure compliance by the Borrower, its Subsidiaries and their respective directors, officers, employees and agents with Anti-Corruption Laws and applicable Sanctions, and the Borrower, its Subsidiaries and their respective officers and employees and, to the knowledge of the Borrower, its directors and agents, are in compliance with Anti-Corruption Laws and applicable Sanctions

in all material respects. None of (a) the Borrower, any Subsidiary or, to the knowledge of the Borrower or such Subsidiary, any of their respective directors, officers or employees, or (b) to the knowledge of the Borrower, any agent of the Borrower or any Subsidiary that will act in any capacity in connection with or benefit from the credit facility established hereby, is a Sanctioned Person. The Transactions will not violate Anti-Corruption Laws or applicable Sanctions.

ARTICLE IV

Conditions

SECTION 4.01 [Reserved.]

SECTION 4.02 Conditions to Each Credit Event. The obligation of each Lender to make Loans on the occasion of any Borrowing, and of each Issuing Bank to issue, amend, renew or extend any Letter of Credit, are subject to the satisfaction of the following conditions:

(a) the representations and warranties set forth in this Agreement shall be true and correct (i) in the case of the representations and warranties qualified as to materiality, in all respects and (ii) otherwise, in all material respects, in each case on and as of the date of such Borrowing or the date of issuance, amendment, renewal or extension of such Letter of Credit, as applicable, except with respect to representations and warranties expressly made only as of an earlier date, in which case such representations and warranties were so true and correct on and as of such earlier date;

(b) at the time of and immediately after giving effect to such Borrowing or the issuance, amendment, renewal or extension of such Letter of Credit, as applicable, no Default shall have occurred and be continuing; and

(c) receipt by the Agent of a Borrowing Request in accordance with Section 2.03, or, in the case of the issuance, amendment, extension or renewal of a Letter of Credit, receipt by the relevant Issuing Bank and Agent of a notice requesting the issuance, amendment, extension or renewal of such Letter of Credit to the extent required by Section 2.04(b).

Each Borrowing and each issuance, amendment, renewal or extension of any Letter of Credit, shall be deemed to constitute a representation and warranty by the Borrower on the date thereof as to the matters specified in paragraphs (a) and (b) of this Section.

ARTICLE V

Affirmative Covenants

Until the Commitments have expired or been terminated and the principal of and interest on each Loan and all fees payable hereunder shall have been paid in full and all Letters of Credit shall have expired or terminated, in each case, without any pending draw, and all LC Disbursements shall have been reimbursed, the Borrower covenants and agrees with the Lenders that:

SECTION 5.01 Financial Statements; Ratings Changes and Other Information. The Borrower will furnish to the Administrative Agent and each Lender:

(a)within 90 days after the end of each fiscal year of the Borrower, its audited consolidated balance sheet and related consolidated statements of operations, comprehensive income, changes in stockholders’ equity and cash flows as of the end of and for such year, setting forth in each case in comparative form the figures for the previous fiscal year, all reported on by KMPG LLP or other independent public accountants of recognized national standing (without a “going concern” or like qualification commentary or exception and without any qualification or exception as to the scope of such audit) to the effect that such consolidated financial statements present fairly in all material respects the financial condition and results of operations of the Borrower and its consolidated Subsidiaries on a consolidated basis in accordance with GAAP consistently applied (it being understood and agreed that such financial statements will be prepared on substantially the same basis and with the substantially the same presentation as the audited financial statements of BrightSphere UK referred to in Section 3.04);

(b)within 45 days after the end of each of the first three fiscal quarters of each fiscal year of the Borrower, or, with respect to the second fiscal quarter of 2019, such longer period as may be permitted by the SEC in connection with the Borrower’s SEC reporting requirements, its consolidated balance sheet and related consolidated statements of operations, comprehensive income and cash flows as of the end of and for such fiscal quarter and the then elapsed portion of the fiscal year, setting forth in each case in comparative form the figures for the corresponding period or periods of (or, in the case of the balance sheet, as of the end of) the previous fiscal year, all certified by one of its Financial Officers as presenting fairly in all material respects the financial condition and results of operations of the Borrower and its consolidated Subsidiaries on a consolidated basis in accordance with GAAP consistently applied, subject to normal year-end audit adjustments and the absence of footnotes;

(c)concurrently with any delivery of financial statements under clause (a) or (b) above, a duly executed and completed Compliance Certificate (i) certifying as to whether a Default has occurred and, if a Default has occurred, specifying the details thereof and any action taken or proposed to be taken with respect thereto, (ii) setting forth reasonably detailed calculations demonstrating compliance with Section 6.12 and including calculations for the Test Period ending on the last day of the most recent fiscal quarter covered by such financial statements of Consolidated Adjusted EBITDA (including a detailed reconciliation from Consolidated Net Income to Consolidated Adjusted EBITDA) and Consolidated Interest Expense, (iii) stating whether any change in GAAP or in the application thereof has occurred since the date of the audited financial statements referred to in Section 3.04 and, if any such change has occurred, specifying the effect of such change on the financial statements accompanying such certificate and (iv) attaching unaudited consolidating financial statements relating to the financial statements delivered under paragraph (a) or (b) above, as applicable;

(d)concurrently with any delivery of financial statements under clause (a) above, a certificate of the accounting firm that reported on such financial statements stating whether they obtained knowledge during the course of their examination of such financial statements of any Default (which certificate may be limited to the extent required by accounting rules or guidelines);

(e) promptly after Moody’s or S&P shall have initially established, or at any time thereafter announced a change in, its Applicable Rating, written notice of such Applicable Rating or change; and

(f)promptly following any request therefor, such other information regarding the operations, business affairs and financial condition of the Borrower or any Subsidiary, or compliance with the terms of this Agreement, as the Administrative Agent or any Lender may reasonably request.

SECTION 5.02 Notice of Material Events. Promptly and in any event within five Business Days after a Responsible Officer of the Borrower becomes aware thereof, the Borrower will give notice in writing to the Agent of the following:

(a)any Event of Default or Default, specifying the nature and extent thereof and the corrective action (if any) taken or proposed to be taken with respect thereto;

(b)the filing or commencement of, or any written notice of intention of any Person to file or commence, any action, suit, proceeding or investigation, whether at law or in equity or by or before any arbitrator or Governmental Authority, against or affecting the Borrower or any Affiliate of the Borrower as to which there is a reasonable possibility of an adverse determination and that, if adversely determined, could reasonably be expected to result in a Material Adverse Effect;

(c)the occurrence of any ERISA Event that, alone or together with any other ERISA Events that have occurred, could reasonably be expected to result in, a Material Adverse Effect; and

(d)any other development or event that has resulted in, or could reasonably be expected to result in, a Material Adverse Effect.

SECTION 5.03 Existence; Conduct of Business. The Borrower will, and will cause each of its Covered Subsidiaries to, do or cause to be done all things necessary to preserve, renew and keep in full force and effect its legal existence and the rights, licenses, registrations, permits, privileges and franchises material to the conduct of its business; provided that the foregoing shall not prohibit any merger, consolidation, liquidation or dissolution permitted under Section 6.04.

SECTION 5.04 Payment of Obligations. The Borrower will, and will cause each of its Covered Subsidiaries to, pay its obligations (other than Indebtedness), including Tax liabilities, that, if not paid, could result in a Material Adverse Effect before the same shall become delinquent or in default, except where the validity or amount thereof is being contested in good faith by appropriate proceedings and (a) the Borrower or such Covered Subsidiary has set aside on its books adequate reserves with respect thereto in accordance with GAAP or (b) the failure to make payment pending such contest could not reasonably be expected to result in a Material Adverse Effect.

SECTION 5.05 Maintenance of Properties; Insurance. The Borrower will, and will cause each of its Covered Subsidiaries to, (a) keep and maintain all property material to the conduct of its business in good working order and condition, ordinary wear and tear excepted, and (b) maintain, with financially sound and reputable insurance companies, insurance in such amounts and against such risks as are customarily maintained by companies engaged in the same or similar businesses operating in the same or similar locations.

SECTION 5.06 Books and Records; Inspection Rights. The Borrower will, and will cause each Covered Subsidiary to, keep proper books and accounts in which full, true and correct entries are made of all dealings and transactions in relation to its business and activities sufficient to permit the preparation of consolidated financial statements in accordance with GAAP. Upon reasonable notice and during normal business hours, the Borrower will, and will cause each Covered Subsidiary to, provide the Agent or any Lender acting with the consent of the Agent with access to the books and financial records of the Borrower and each Covered Subsidiary, to make reasonable examinations and copies of the books of accounts and other financial records of the Borrower and each Covered Subsidiary, and to discuss the affairs, finances and accounts of the Borrower and each Covered Subsidiary with, and to be advised as to the same by, their officers and, in the presence of officers or other representatives of the Borrower, independent accountants at such

reasonable times and intervals as the Agent or Required Lenders may reasonably request; provided, however, so long as no Event of Default has occurred and is continuing, there shall not be more than one such inspection and examination in any calendar year.

SECTION 5.07 Compliance with Laws. The Borrower will, and will cause each of its Subsidiaries to, comply with all laws, rules, regulations and orders of any Governmental Authority applicable to it or its property, except where the failure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect. The Borrower will maintain in effect and enforce policies and procedures designed to ensure compliance by the Borrower, its Subsidiaries and their respective directors, officers, employees and agents with Anti-Corruption Laws and applicable Sanctions.

SECTION 5.08 Use of Proceeds. The Borrower will use the proceeds of (a) the Loans for working capital and general corporate purposes of the Borrower and the Covered Subsidiaries, including acquisitions, distributions and investments and (b) the Letters of Credit solely for working capital and general corporate purposes of the Borrower and the Covered Subsidiaries. The Borrower will not request any Borrowing or Letter of Credit, and the Borrower shall not use, and shall procure that its Subsidiaries and its or their respective directors, officers, employees and agents shall not use, the proceeds of any Borrowing or Letter of Credit (A) in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of value, to any Person in violation of any Anti-Corruption Laws, (B) for the purpose of funding, financing or facilitating any activities, business or transaction of or with any Sanctioned Person, or in any Sanctioned Country, or (C) in any manner that would result in the violation of any Sanctions applicable to any party hereto.

SECTION 5.09 [Reserved.]

ARTICLE VI

Negative Covenants

Until the Commitments have expired or terminated and the principal of and interest on each Loan and all fees payable hereunder have been paid in full and all Letters of Credit have expired or terminated, in each case, without any pending draw, and all LC Disbursements shall have been reimbursed, the Borrower covenants and agrees with the Lenders that:

SECTION 6.01 Indebtedness. The Borrower will not and will not permit any Covered Subsidiary to incur, create or suffer to exist any Indebtedness except:

(a)Indebtedness created hereunder, including Indebtedness pursuant to Incremental Facility Agreements;

(b)Indebtedness (i) of the Borrower to any Covered Subsidiary and (ii) of any Covered Subsidiary to the Borrower or any other Covered Subsidiary; provided that (A) such Indebtedness shall not have been transferred to any Person other than the Borrower or any other Covered Subsidiary and (B) any such Indebtedness owing by the Borrower shall be unsecured and subordinated in writing in right of payment to the Obligations pursuant to an Affiliate Subordination Agreement;

(c)Indebtedness of the Borrower or any Covered Subsidiary existing on the Closing Date and described on Schedule 6.01 and extensions, renewals and replacements of any such Indebtedness that do not increase the outstanding principal amount thereof;

(d)Indebtedness of the Borrower or any Covered Subsidiary incurred to finance the acquisition, construction or improvement of any fixed or capital assets, including Capital Lease Obligations, and any Indebtedness assumed in connection with the acquisition of any such assets or secured by a Lien on any such assets prior to the acquisition thereof, and extensions, renewals and replacements of any such Indebtedness that do not increase the outstanding principal amount thereof; provided that (i) such Indebtedness is incurred prior to or within 90 days after such acquisition or the completion of such construction or improvement and (ii) the aggregate principal amount of Indebtedness permitted by this clause (d) shall not exceed $5,000,000 at any time outstanding;

(e)Indebtedness of any Person that becomes a Covered Subsidiary after the date hereof; provided that (i) such Indebtedness exists at the time such Person becomes a Covered Subsidiary and is not created in contemplation of or in connection with such Person becoming a Covered Subsidiary, (ii) such Indebtedness has recourse solely to the assets of such Person and not to any other assets of the Borrower or any other Covered Subsidiary, (iii) such Indebtedness is not Guaranteed by the Borrower or any other Covered Subsidiary and (iv) such Indebtedness shall be refinanced or replaced no later than 90 days after the date on which such Person becomes a Covered Subsidiary with unsecured Indebtedness of the Borrower that is not Guaranteed by any Covered Subsidiary;

(f)unsecured Indebtedness of the Borrower and its Covered Subsidiaries representing deferred compensation to employees of the Borrower and its Covered Subsidiaries or long-term liability accruals in respect of previously recognized compensation expense attributable to equity and profit sharing awards to employees;

(g)Non-Recourse Seed Indebtedness;

(h)unsecured Indebtedness of any Covered Subsidiary under a revolving credit facility with a Core Business Entity of which Equity Interests are owned by such Covered Subsidiary or other Covered Subsidiaries; provided that (i) such Indebtedness is incurred in anticipation of the payment by such Core Business Entity to such Covered Subsidiary of a regularly scheduled distribution or a scheduled payment of specifically identifiable realized Performance Fees, (ii) any borrowing under any such revolving credit facility shall be repaid at the time such dividend is paid or payment is made, but not in any event later than 90 days after the date on which such Indebtedness was initially incurred and (iii) the aggregate principal amount of Indebtedness permitted by this clause (h) shall not exceed $10,000,000 at any time outstanding;

(i)other Indebtedness of Covered Subsidiaries in an aggregate principal amount not exceeding $5,000,000 at any time outstanding;

(j)other unsecured Indebtedness of the Borrower that is not Guaranteed by any Covered Subsidiary; and

(k)Indebtedness of Landmark Partners pursuant to the Landmark Credit Agreement in an aggregate principal amount not exceeding $15,000,000 at any time outstanding; provided that (i) such Indebtedness has recourse solely to the assets of Landmark Partners and its subsidiaries as of the Landmark Partners Closing Date and not to any other assets of the Borrower or any other Covered Subsidiary and (ii) such Indebtedness is not Guaranteed by the Borrower or any other Covered Subsidiary (other than Landmark Partners and its subsidiaries as of the Landmark

Partners Closing Date).

SECTION 6.02 Liens. The Borrower will not, nor will it permit any Covered Subsidiary to, create, incur, or suffer to exist any Lien in or on its property (now or hereafter acquired), or on any income or revenues or rights (including accounts receivable) in respect of any thereof, except:

(a)Permitted Encumbrances;

(b)any Lien existing on the Closing Date and described in Schedule 6.02 hereto; provided that (i) such Lien shall not apply to any property or asset of the Borrower or any Covered Subsidiary other than the properties or assets to which such Lien applies on the Closing Date and (ii) such Lien shall secure only those obligations that it secures on the Closing Date and extensions, renewals and replacements thereof that do not increase the outstanding principal amount thereof;

(c)Liens on fixed or capital assets acquired, constructed or improved by the Borrower or any Covered Subsidiary; provided that (i) such Liens secure only Indebtedness permitted by Section 6.01(d) that is incurred to finance such acquisition, construction or improvement (provided that such Indebtedness is incurred prior to or within 90 days after such acquisition or the completion of such construction or improvement and the principal amount of such Indebtedness does not exceed the cost of acquiring, constructing or improving such fixed or capital assets) and (ii) such Liens shall not apply to any other asset of the Borrower or any Covered Subsidiary (other than the proceeds thereof); and

(d)Liens on assets of a Person that becomes a Covered Subsidiary securing Indebtedness permitted by Section 6.01(e); provided that (A) such Lien is not created in contemplation of or in connection with such Person becoming a Covered Subsidiary, (B) such Lien does not apply to any other property or assets of the Borrower or any Covered Subsidiary and (C) such Lien shall secure only those obligations that it secures on the date such Person becomes a Covered Subsidiary;

(e)Liens on seed investments of Covered Subsidiaries securing Non-Recourse Seed Indebtedness relating to such investments;

(f)any Liens securing Indebtedness or other obligations in an aggregate principal amount not to exceed $5,000,000 at any time outstanding; and

(g)Liens on any property, rights or assets of Landmark Partners and its subsidiaries as of the Landmark Partners Closing Date securing Indebtedness permitted under Section 6.01(k); provided that such liens extend only to the property, rights and assets of Landmark Partners and its subsidiaries as of the Landmark Partners Closing Date and not any other property, rights and assets of the Borrower or any other Covered Subsidiary.

Notwithstanding anything herein to the contrary, the Borrower will not, and will not permit any Covered Subsidiary to (i) create, incur, assume or permit to exist any Lien on the Equity Interests in, or the Management Fees, Performance Fees, Accounts, or rights to any of the foregoing of, any Covered Subsidiary or other Core Business Entities, (ii) sell any Equity Interests owned by it in Covered Subsidiaries or in other Core Business Entities pursuant to any repurchase agreement or similar agreement or (iii) assign or sell any income or revenues from or rights in respect of the Equity Interests in, and the Management Fees, Performance Fees, Accounts, or rights to any of the foregoing of, any Covered Subsidiary or other Core Business Entity, except (x) in the case of clause (i) of this sentence, Permitted Encumbrances and (y) in the

case of clauses (ii) and (iii) of this sentence, in connection with any transaction which is expressly permitted pursuant to Section 6.05. Notwithstanding anything to the contrary in this Section 6.02, no transaction specifically permitted by 6.05 shall be deemed to violate this Section 6.02.

SECTION 6.03 Sale and Lease-Back Transactions. The Borrower will not, and will not permit any Covered Subsidiary to, enter into any arrangement, directly or indirectly, with any person whereby it shall sell or transfer any property, real or personal, used or useful in its business, whether now owned or hereafter acquired, and thereafter rent or lease such property or other property which it intends to use for substantially the same purpose or purposes as the property being sold or transferred.

SECTION 6.04 Fundamental Changes; Conduct of Business. (a) The Borrower will not, and will not permit any Covered Subsidiary to, merge into or consolidate with any other Person, or permit any other Person to merge into or consolidate with it, or liquidate or dissolve, except that, if at the time thereof and immediately after giving effect thereto no Default shall have occurred and be continuing (i) any Person may merge into or consolidate with the Borrower in a transaction in which the Borrower is the surviving entity; (ii) any Person (other than the Borrower) may merge or consolidate with any Covered Subsidiary in a transaction in which the surviving entity is a Covered Subsidiary; (iii) any Covered Subsidiary may liquidate, dissolve or otherwise wind down if the Borrower determines in good faith that such liquidation, dissolution or winding down is in the best interests of the Borrower and is not materially disadvantageous to the Lenders; and (iv) the Borrower or any Covered Subsidiary may consummate a merger, liquidation or dissolution to effect an asset sale permitted by Section 6.05.

(b) Neither the Borrower nor any Covered Subsidiary will engage to any material extent in any business other than Core Businesses and businesses reasonably related thereto.

(c) Notwithstanding the foregoing, and for the avoidance of doubt, this Section 6.04 shall not prohibit the transactions effecting the 2019 Redomestication.

SECTION 6.05 Asset Sales. The Borrower will not, and will not permit any of its Covered Subsidiaries to, sell, transfer, lease or otherwise dispose of any asset, including any Equity Interest owned by it, nor will the Borrower permit any of its Covered Subsidiaries to issue any additional Equity Interest in such Covered Subsidiary (other than directors’ qualifying shares and other nominal amounts of Equity Interests that are required to be held by other Persons under applicable law), except:

(a)sales, transfers, leases and other dispositions of inventory, used or surplus equipment and surplus office space in the ordinary course of business;

(b)sales, transfers and dispositions of assets (i) solely between or among Covered Subsidiaries or (ii) from any Covered Subsidiary to the Borrower;

(c)sales, transfers and other dispositions of assets (other than Equity Interests in a Covered Subsidiary or in a Core Business Entity) that are not permitted by any other clause of this Section; provided that the aggregate fair market value of all assets sold, transferred or otherwise disposed of in reliance upon this clause (c) shall not exceed, during any fiscal year of the Borrower, an amount equal to 10% of Consolidated Adjusted EBITDA for the most recently ended fiscal year of the Borrower;

(d)issuances of Equity Interests by any Covered Subsidiary to the Borrower or any other Covered Subsidiary so long as the recipient thereof is (i) the direct parent entity of the issuing Person,

(ii) the Borrower or (iii) a wholly-owned subsidiary of the Borrower;

(e)sales of securities (other than Equity Interests in Covered Subsidiaries or in Core Business Entities) or other instruments held by the Borrower or any Covered Subsidiary for investment or cash management purposes, including securities or other instruments acquired or held by a Covered Subsidiary for purposes of seeding, funding or otherwise maintaining any investment product or Fund with respect to which a Covered Subsidiary acts as an investment adviser, manager, distributor, general partner or in any similar capacity, in each case in the ordinary course of business and consistent with the customary practices of the Borrower and the Covered Subsidiaries or of the Parent;

(f)grants or sales of Equity Interests and grants of profit participation interests, including derivative instruments related thereto, in Covered Subsidiaries engaged in Core Businesses or in Core Business Entities to employees of such Covered Subsidiaries or Core Business Entities or of related Covered Subsidiaries (or to special purpose vehicles substantially all of the Equity Interests in which are owned by such employees) for the primary purpose of effecting compensation (including incentive compensation) arrangements with such employees for their services, provided that such grants are made in the ordinary course of business;

(g) sales or transfers of assets to the Parent or its Affiliates made pursuant to and in accordance with the terms of the Co-Investment Deed or the Deferred Tax Asset Deed;

(h)sales or transfers to effect the Reorganization;

(i)sales or transfers of Equity Interests owned by the Borrower and the Covered Subsidiaries in any Covered Subsidiary or Core Business Entity; provided that (w) all Equity Interests in Covered Subsidiaries and Core Business Entities which are sold or transferred pursuant to this clause (i) in any fiscal year of the Borrower shall not, in the aggregate, account for more than 10% of Consolidated Adjusted EBITDA for the immediately preceding fiscal year of the Borrower, (x) the Borrower determines in good faith that such sale or transfer is in the best interests of the Borrower and is not materially disadvantageous to the Lenders, (y) after giving effect to such sale or transfer, the Borrower shall be in compliance with the covenants set forth in Section 6.12 on a pro forma basis as if such sale or transfer had been consummated on the first day of the Test Period most recently ended on or prior to the date of such sale or transfer and (z) all sales, transfers and dispositions permitted by this clause (i) shall be made for at least 75% cash consideration (with contingent earnout payment obligations not being deemed “consideration” for purposes of this subclause (z)); and

(j)sales or transfers to effect the 2019 Redomestication;

provided that all sales, transfers, leases and other dispositions permitted hereby (except for those made pursuant to clause (b)(i), (d), (f), (g), (h) and (j) hereof) shall be made for fair value.

SECTION 6.06 Transactions with Affiliates. The Borrower will not, and will not permit any Covered Subsidiary to, sell or transfer any property or assets to, or purchase or acquire any property or assets from, or otherwise engage in any other transactions with, any of its Affiliates (any such transaction, a “Restricted Affiliate Transaction”), except that the Borrower or any Covered Subsidiary may:

(a)engage in any Restricted Affiliate Transaction at prices and on terms and conditions which, taken as a whole, are not materially less favorable to the Borrower or such Covered Subsidiary than would prevail in a comparable arms’-length transaction with unrelated third parties;

(b)effect any Restricted Payment permitted by Section 6.07;

(c)satisfy any indemnification obligation to, and other employment arrangements with, directors, officers, employees, managers and consultants of the Borrower or any Covered Subsidiary entered into in the ordinary course of business;

(d)enter into and continue ordinary course employment, compensation and benefits arrangements, including the reacquisition by Covered Subsidiaries from employees of equity and profit participation interests previously granted to such employees as part of their compensation;

(e)effect any transaction expressly permitted by Section 6.05, including any transaction effecting the 2019 Redomestication;

(f)enter into any Management Fee Agreement;

(g)effect transactions solely between or among Covered Subsidiaries or the Borrower and one or more Covered Subsidiaries otherwise permitted hereunder;

(h)effect the Reorganization and enter into any transition services agreements relating thereto and to the IPO (whether entered into on or after the Closing Date); provided that any such transition services agreement is on an arms-length basis or otherwise provides for periodic cash payments or reimbursements (not less frequently than quarterly) in amounts not less than the costs and expenses (including allocable employee compensation expenses) incurred by the Borrower or the Covered Subsidiaries in providing services thereunder, and having terms (including with respect to the calculation of such costs and expenses) customary for transition services agreements of the same general type; and

(i)perform its obligations under the Parent Agreements and the Note in accordance with the terms thereof.

SECTION 6.07 Limitation on Restricted Payments. The Borrower will not declare or make, or permit any Covered Subsidiary to declare or make, or agree to pay or make, directly or indirectly, any Restricted Payment or incur any obligation (contingent or otherwise) to do so except:

(a)each Covered Subsidiary may make Restricted Payments to the Borrower or any other Covered Subsidiary and to any other Person that owns an Equity Interest in such Covered Subsidiary ratably according to such Person’s holdings of the type of Equity Interests in respect of which a Restricted Payment is being made to the Borrower or any other Covered Subsidiary;

(b)the Borrower may pay the OMGUK Dividend prior to the consummation of the IPO and pay the OMGUK Dividend Note substantially simultaneously with the making of the initial Loans on the Closing Date;

(c)Restricted Payments by any Covered Subsidiary to employees in respect of Equity Interests or equity or profit participation interests in such Covered Subsidiary issued to such employee for the primary purposes of effecting a compensation arrangement, including the reacquisition for

cash consideration of such Equity Interests or equity or profit participation interests; provided that such compensation arrangements and such Restricted Payments are made in the ordinary course;

(d)so long as no Default has occurred and is continuing or would result therefrom, the Borrower may declare and pay regular quarterly cash dividends on its ordinary shares outstanding; provided that any dividend declared at a time when no Default has occurred and is continuing or would result from the payment thereof at such time may be paid on the announced payment date therefor, not withstanding that a Default is then continuing or would result from such payment (but no such Default shall be deemed to be waived as a result of this proviso);

(e)the Borrower may make Restricted Payments with respect to its Equity Interests; provided that no Default has occurred and is continuing or would result therefrom; and

(f)to effect the 2019 Redomestication.

SECTION 6.08 Limitation on Amendments to Certain Agreements. The Borrower will not agree to or permit any amendment, modification, suspension or waiver of any provision of any documents relating to the organization of the Borrower or any Covered Subsidiary, of any agreement or instrument evidencing or governing any Material Indebtedness, of the Landmark Credit Agreement or of any Parent Agreement that materially impairs the creditworthiness of the Borrower or is adverse in any material respect to the rights or interests of the Lenders hereunder. Notwithstanding the foregoing, and for the avoidance of doubt, this Section 6.08 does not prohibit any such amendment, modification, suspension or waiver executed to effect the 2019 Redomestication.

SECTION 6.09 Restrictive Agreements. The Borrower will not, and will not permit any Covered Subsidiary to, enter into, incur or permit to exist any agreement or other arrangement that restricts or imposes any condition upon (a) the ability of the Borrower or any Covered Subsidiary to create, incur or permit to exist any Lien upon any of its assets to secure any Obligations, (b) the ability of any Covered Subsidiary to pay dividends or other distributions with respect to its Equity Interests or to make or repay loans or advances to the Borrower or any Covered Subsidiary or (c) the ability of any Covered Subsidiary to Guarantee Indebtedness of the Borrower; provided that (i) the foregoing shall not apply to (A) restrictions and conditions imposed by law or by any Loan Document, (B) restrictions and conditions existing on the date hereof identified on Schedule 6.09 (but shall apply to any extension or renewal of, or any amendment or modification expanding the scope of, any such restriction or condition), (C) restrictions and conditions set forth in the Shareholder Agreement or the Intellectual Property License Agreement as in effect on the Closing Date, (D) in the case of any Covered Subsidiary that is not a Wholly-Owned Subsidiary, restrictions and conditions imposed by its organizational documents or any related joint venture, shareholder or similar agreement; provided that such restrictions and conditions apply only to such Covered Subsidiary and to any Equity Interests in such Covered Subsidiary, (E) restrictions and conditions imposed by loan documents entered into in connection with the Non-Recourse Seed Indebtedness; provided that any such restrictions and conditions apply solely to the seed capital investments financed with such Non-Recourse Seed Indebtedness, (F) restrictions and conditions under the Landmark Credit Agreement as in effect on the Third Amendment Effective Date (but shall apply to any extension or renewal of, or any amendment or modification expanding the scope of, any such restriction or condition), (ii) clause (a) of the foregoing shall not apply to (A) restrictions or conditions imposed by any agreement relating to secured Indebtedness permitted by Section 6.01 if such restrictions or conditions apply only to the assets securing such Indebtedness or (B) customary provisions in leases and other agreements restricting the assignment thereof and (iii) clause (b) of the foregoing shall not apply to customary restrictions and conditions contained in agreements relating to the sale of assets that is applicable only to such assets and solely pending such sale; provided that such sale is permitted hereunder.

Notwithstanding the foregoing, and for the avoidance of doubt, this Section 6.09 shall not prohibit the transactions, agreements or arrangements effecting the 2019 Redomestication.

SECTION 6.10 Hedging Agreements. The Borrower will not, and will not permit any Covered Subsidiary to, enter into any Hedging Agreement, except for Hedging Agreements entered into (i) to hedge or mitigate risks to which the Borrower or such Covered Subsidiary has actual exposure and (ii) not for speculative purposes.

SECTION 6.11 [Reserved.]

SECTION 6.12 Financial Covenants. (a) The Borrower will not permit the Leverage Ratio at the end of any fiscal quarter to exceed 3.00 to 1.00.

(b)The Borrower will not permit the Interest Coverage Ratio in respect of any Test Period to be less than 4.00 to 1.00.

ARTICLE VII

Events of Default

If any of the following events (“Events of Default”) shall occur:

(a)the Borrower shall fail to pay any principal of any Loan or any reimbursement obligation in respect of any LC Disbursement when and as the same shall become due and payable;

(b)the Borrower shall fail to pay any interest on any Loan or any fee or any other amount (other than an amount referred to in clause (a) of this Article) payable under this Agreement, when and as the same shall become due and payable, and such failure shall continue unremedied for a period of three or more Business Days;

(c)any representation or warranty made or deemed made by or on behalf of the Borrower or any Covered Subsidiary in connection with the Borrowings hereunder, in connection with any Loan Document or any amendment or modification thereof or waiver thereunder, or in any report, certificate, financial statements or other document furnished pursuant to or in connection with any Loan Document or any amendment or modification thereof or waiver thereunder shall prove to have been false or misleading in any material respect when so made, deemed made or furnished;

(d)the Borrower shall fail to observe or perform any covenant, condition or agreement contained in Section 5.02(a), Section 5.03 (with respect to the Borrower’s existence), the second sentence of Section 5.08, Section 5.09 or Article VI;

(e)the Borrower shall fail to observe or perform any covenant, condition or agreement contained in any Loan Document (other than those specified in clause (a), (b) or (d) of this Article), and such failure shall continue unremedied for a period of 30 days after notice thereof from the Agent or any Lender to the Borrower (which notice will be given at the request of any Lender);

(f)the Borrower or any Covered Subsidiary shall fail to make any payment (whether of principal or interest and regardless of amount) in respect of any Material Indebtedness, when and as the same shall become due and payable;

(g)any event or condition occurs that results in any Material Indebtedness becoming due prior to its scheduled maturity or that enables or permits (with or without the giving of notice, the lapse of time or both) the holder or holders of any Material Indebtedness or any trustee or agent on its or their behalf to cause any Material Indebtedness to become due, or to require the prepayment, repurchase, redemption or defeasance thereof, prior to its scheduled maturity; provided that this clause (g) shall not apply to secured Indebtedness that becomes due as a result of the voluntary sale or transfer of the property or assets securing such Indebtedness;

(h)an involuntary proceeding shall be commenced or an involuntary petition shall be filed seeking (i) liquidation, reorganization or other relief in respect of the Borrower or any Covered Subsidiary or its debts, or of a substantial part of its assets, under any Federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect or (ii) the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for the Borrower or any Covered Subsidiary or for a substantial part of its assets, and, in any such case referred to in (i) or (ii) above, such proceeding or petition shall continue undismissed for 60 days or an order or decree approving or ordering any of the foregoing shall be entered;

(i)the Borrower or any Covered Subsidiary shall (i) voluntarily commence any proceeding or file any petition seeking liquidation, reorganization or other relief under any Federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect, (ii) consent to the institution of, or fail to contest in a timely and appropriate manner, any proceeding or petition described in clause (h) of this Article, (iii) apply for or consent to the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for the Borrower or any Covered Subsidiary or for a substantial part of its assets, (iv) file an answer admitting the material allegations of a petition filed against it in any such proceeding, (v) make a general assignment for the benefit of creditors or (vi) take any action for the purpose of effecting any of the foregoing;

(j)one or more judgments for the payment of money in an aggregate amount in excess of $10,000,000 (net of insurance proceeds payable in respect thereto; provided that the applicable insurance carriers have been notified of such judgment and are not disputing liability with respect to the netted amount) shall be rendered against the Borrower, any Covered Subsidiary or any combination thereof and the same shall remain undischarged for a period of 30 consecutive days during which execution shall not be effectively stayed, or any action shall be legally taken by a judgment creditor to attach or levy upon any assets of the Borrower or any Covered Subsidiary to enforce any such judgment;

(k)an ERISA Event shall have occurred that, when taken together with all other ERISA Events that have occurred, could reasonably be expected to result in a Material Adverse Effect; or

(l)a Change in Control shall occur;

then, and in every such event (other than an event with respect to the Borrower described in clause (h) or (i) of this Article ), and at any time thereafter during the continuance of such event, the Agent may, and at the request of the Required Lenders shall, by notice to the Borrower, take any of the following actions, at the same or different times: (i) terminate the Commitments, and thereupon the Commitments shall terminate immediately, (ii) declare the Loans then outstanding to be due and payable in whole (or in part, in which case any principal not so declared to be due and payable may thereafter be declared to be due and payable), and thereupon the principal of the Loans so declared to be due and payable, together with accrued interest

thereon and any unpaid accrued fees and all other obligations of the Borrower accrued hereunder and under any other Loan Document, shall become forthwith due and payable, and (iii) require the deposit of cash collateral in respect of LC Exposure as provided in Section 2.04(j), in each case without presentment, demand, protest or any other notice of any kind, all of which are hereby expressly waived by the Borrower, anything contained herein or in any other Loan Document to the contrary notwithstanding; and in any event with respect to the Borrower described in paragraph (h) or (i) above, the Commitments shall automatically terminate and the principal of the Loans then outstanding, together with accrued interest thereon and any unpaid accrued fees and all other obligations of the Borrower accrued hereunder and under any other Loan Document, shall automatically become due and payable and the deposit of such cash collateral in respect of LC Exposure shall automatically become due, in each case without presentment, demand, protest or any other notice of any kind, all of which are hereby expressly waived by the Borrower, anything contained herein or in any other Loan Document to the contrary notwithstanding.

ARTICLE VIII

The Agent

Each of the Lenders and each Issuing Bank hereby irrevocably appoints the Agent as its agent and authorizes the Agent to take such actions on its behalf and to exercise such powers as are delegated to the Agent by the terms hereof and the other Loan Documents, together with such actions and powers as are reasonably incidental thereto.

The bank serving as the Agent hereunder shall have the same rights and powers in its capacity as a Lender or an Issuing Bank as any other Lender or Issuing Bank and may exercise the same as though it were not the Agent, and such bank and its Affiliates may accept deposits from, lend money to, act as the financial advisor or in any other advisory capacity for and generally engage in any kind of business with the Borrower or any Subsidiary or other Affiliate thereof as if it were not the Agent hereunder and without any duty to account therefor to the Lenders or Issuing Bank.

The Agent shall not have any duties or obligations except those expressly set forth herein and in the other Loan Documents. Without limiting the generality of the foregoing, (a) the Agent shall not be subject to any fiduciary or other implied duties, regardless of whether a Default has occurred and is continuing, (b) the Agent shall not have any duty to take any discretionary action or exercise any discretionary powers, except discretionary rights and powers expressly contemplated by the Loan Documents that the Agent is required to exercise in writing as directed by the Required Lenders (or such other number or percentage of the Lenders as shall be necessary, or as the Agent shall believe in good faith to be necessary, under the circumstances as provided in Section 9.08); provided that the Agent shall not be required to take any action that, in its opinion, could expose the Agent to liability or be contrary to any Loan Document or applicable law, and (c) except as expressly set forth herein, the Agent shall not have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to the Borrower or any of its Subsidiaries that is communicated to or obtained by the bank serving as Agent or any of its Affiliates in any capacity. The Agent shall not be liable for any action taken or not taken by it with the consent or at the request of the Required Lenders (or such other number or percentage of the Lenders as shall be necessary, or as the Agent shall believe in good faith to be necessary, under the circumstances as provided in Section 9.08) or in the absence of its own gross negligence or willful misconduct, as determined by a court of competent jurisdiction by a final and non-appealable judgment. The Agent shall be deemed not to have knowledge of any Default unless and until written notice thereof is given to the Agent by the Borrower, a Lender or the Issuing Bank, and the Agent shall not be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or representation made in or in connection with this Agreement or any Loan Document, (ii) the contents of any certificate, report or other document delivered hereunder or thereunder or in connection

herewith or therewith, (iii) the performance or observance of any of the covenants, agreements or other terms or conditions set forth herein or therein or the occurrence of any Default, (iv) the validity, enforceability, effectiveness or genuineness of this Agreement, any other Loan Document or any other agreement, instrument or document, or (v) the satisfaction of any condition set forth in Article IV or elsewhere herein, other than to confirm receipt of items expressly required to be delivered to the Agent or satisfaction of any condition that expressly refers to the matters described therein being acceptable or satisfactory to the Agent. Notwithstanding anything herein to the contrary, the Agent shall not have any liability arising from any confirmation of the Credit Exposure or the component amounts thereof.

Nothing in this Agreement or any other Loan Document shall require the Agent or any of its Related Parties to carry out any “know your customer” or other checks in relation to any Person on behalf of any Lender and each Lender confirms to the Agent that it is solely responsible for any such checks it is required to carry out and that it may not rely on any statement in relation to such checks made by the Agent or any of its Related Parties.

The Agent shall be entitled to rely upon, and shall not incur any liability for relying upon, any notice, request, certificate, consent, statement, instrument, document or other writing (including any electronic message, Internet or intranet website posting or other distribution) believed by it to be genuine and to have been signed or sent or otherwise authenticated by the proper Person. The Agent also may rely upon any statement made to it orally or by telephone and believed by it to have been made by the proper Person, and shall not incur any liability for relying thereon. The Agent may consult with legal counsel (who may be counsel for the Borrower), independent accountants and other experts selected by it, and shall not be liable for any action taken or not taken by it in accordance with the advice of any such counsel, accountants or experts.

The Agent may perform any and all its duties and exercise its rights and powers hereunder or under any other Loan Documents by or through any one or more sub-agents appointed by the Agent. The Agent and any such sub-agent may perform any and all its duties and exercise its rights and powers through their respective Related Parties. The exculpatory provisions of the preceding paragraphs shall apply to any such sub-agent and to the Related Parties of the Agent and any such sub-agent, and shall apply to their respective activities in connection with any syndication of the credit facilities provided for herein as well as activities as Agent.

Subject to the appointment and acceptance of a successor Agent as provided in this paragraph, the Agent may resign at any time by notifying the Lenders, the Issuing Banks and the Borrower. Upon any such resignation, the Required Lenders shall have the right, with the consent of the Borrower (such consent not to be unreasonably withheld or delayed), to appoint a successor. If no successor shall have been so appointed by the Required Lenders and shall have accepted such appointment within 30 days after the retiring Agent gives notice of its resignation, then the retiring Agent may, on behalf of the Lenders and the Issuing Banks, appoint a successor Agent which shall be a bank with an office in New York, New York, or an Affiliate of any such bank.

If the Person serving as Agent is a Defaulting Lender pursuant to clause (d) of the definition thereof, the Required Lenders may, to the extent permitted by applicable law, by notice in writing to the Borrower and such Person remove such Person as Agent and, with the consent of the Borrower (such consent not to be unreasonably withheld or delayed), appoint a successor. If no such successor shall have been so appointed by the Required Lenders and shall have accepted such appointment within 30 days (or such earlier day as shall be agreed by the Required Lenders) (the “Removal Effective Date”), then such removal shall nonetheless become effective in accordance with such notice on the Removal Effective Date.

Upon the acceptance of its appointment as Agent hereunder by a successor, such successor shall succeed to and become vested with all the rights, powers, privileges and duties of the retiring Agent, and the retiring or removed Agent shall be discharged from its duties and obligations hereunder. The fees payable by the Borrower to a successor Agent shall be the same as those payable to its predecessor unless otherwise agreed between the Borrower and such successor. After the Agent’s resignation or removal hereunder, the provisions of this Article and Section 9.03 shall continue in effect for the benefit of such retiring Agent, its sub agents and their respective Related Parties in respect of any actions taken or omitted to be taken by any of them while it was acting as Agent.

Each Lender further represents that it has, independently and without reliance upon the Agent or any other Lender and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement as a Lender, and to make, acquire or hold Loans hereunder. Each Lender shall, independently and without reliance upon the Agent or any other Lender and based on such documents and information (which may contain material, non-public information within the meaning of the United States securities laws concerning the Borrower and its Affiliates) as it shall from time to time deem appropriate, continue to make its own decisions in taking or not taking action under or based upon this Agreement, any related agreement or any document furnished hereunder or thereunder and in deciding whether or to the extent to which it will continue as a Lender or assign or otherwise transfer its rights, interests and obligations hereunder.

The provisions of this Article are solely for the benefit of the Agent, the Lenders and the Issuing Banks and the Borrower shall not have any rights as a third party beneficiary of any such provisions.

ARTICLE IX

Miscellaneous

SECTION 9.01 Notices. (a) Except in the case of notices and other communications expressly permitted to be given by telephone (and subject to paragraph (b) below), all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail, sent by telecopy or, where permitted herein, sent by email, as follows:

(i)if to the Borrower, to it at BrightSphere Investment Group Inc., Attention of: Dan Mahoney, Head of Finance (Telecopy No. (617) 369-7486); email: dmahoney@bsig.com; with a copy to Richard Hart, Chief Legal Officer (Telecopy No. (617) 369-7441 ); email: rhart@bsig.com;

(ii)if to the Agent, to it at Citibank, N.A., 1615 Brett Road, Building III, New Castle, DE 19720, Attention of Bank Loan Syndications Department (Telecopy No. (212) 994‑0961); email: GLAgentOfficeOps@citi.com with a copy to email: ashley.morris@citi.com; and

(iii) if to a Lender, to it at its address (or telecopy number or email address) set forth in its Administrative Questionnaire.

(b)Notices and other communications to the Lenders and Issuing Banks hereunder may be delivered or furnished by electronic mail communications pursuant to procedures approved by the Agent; provided that the foregoing shall not apply to notices pursuant to Article II unless otherwise agreed by the Agent and the applicable Lender or Issuing Bank, as the case may be. The Agent or the Borrower may, in its discretion, agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it; provided that approval of such procedures may be limited to particular notices or communications.

(c)Each of the Borrower and the Agent may change its address, telecopy number or email address for notices and other communications hereunder by notice to the other parties hereto. Each Lender may change its address, telecopy number or email address for notices and other communications hereunder by notice to the Borrower and the Agent. All notices and other communications given to any party hereto in accordance with the provisions of this Agreement shall be deemed to have been given on the date of receipt.

SECTION 9.02 Survival. All covenants, agreements, representations and warranties made by the Borrower herein and in the certificates or other instruments delivered in connection with or pursuant to this Agreement or any other Loan Document shall be considered to have been relied upon by the other parties hereto and shall survive the execution and delivery of this Agreement and the making by the Lenders of the Loans, regardless of any investigation made by any such other party or on its behalf, and notwithstanding that the Agent, or any Lender may have had notice or knowledge of any Default or incorrect representation or warranty at the time any Loan is made, or continued or converted hereunder, and shall continue in full force and effect as long as the principal of or any accrued interest on any Loan or any fee or any other amount payable under this Agreement or any other Loan Document is outstanding and unpaid and so long as the Commitments have not expired or terminated. The provisions of Sections 2.13, 2.14, 2.15, 9.05 and 9.19 and Article VIII shall survive and remain in full force and effect regardless of the consummation of the transactions contemplated hereby, the repayment of the Loans, the expiration or termination of the Commitments or the termination of this Agreement or any provision hereof.

SECTION 9.03 Binding Effect. This Agreement shall become effective as provided in the 2019 Assignment Agreement.

SECTION 9.04 Successors and Assigns. (a) The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby, except that (i) the Borrower may not assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of each Lender (and any attempted assignment or transfer by the Borrower without such consent shall be null and void) and (ii) no Lender may assign or otherwise transfer its rights or obligations hereunder except in accordance with this Section. Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby (including any Affiliate of an Issuing Bank that issues any Letter of Credit), Participants (to the extent provided in paragraph (c) of this Section) and, to the extent expressly contemplated hereby, the Related Parties of each of the Agent, the Issuing Banks and the Lenders) any legal or equitable right, remedy or claim under or by reason of this Agreement.

(b)(i) Subject to the conditions set forth in paragraph (b)(ii) below, any Lender may assign to one or more Eligible Assignees all or a portion of its rights and obligations under this Agreement (including all or a portion of its Commitments, participations in Letters of Credit and the Loans at the time owing to it) with the prior written notice to and consent (such consent not to be unreasonably withheld or unduly delayed) of:

(A)the Borrower (which consent shall be deemed to have been given unless the Borrower objects to such assignment by written notice to the Agent within 10 Business Days after having received notice thereof); provided that (i) no consent of the Borrower shall be required for an assignment to a Lender, an Affiliate of a Lender, an Approved Fund or, if an Event of Default has occurred and is continuing, any other assignee and (ii) any refusal by the Borrower

to consent to a proposed assignment to a non-bank assignee that is primarily engaged in Core Businesses and is a competitor of the Borrower will not be deemed unreasonable;

(B)the Agent; and

(C)each Issuing Bank.

(ii)Assignments shall be subject to the following additional conditions:

(A)except in the case of an assignment to a Lender or an Affiliate of a Lender or an assignment of the entire remaining amount of the assigning Lender’s Commitments or Loans, the amount of the Commitments or Loans of the assigning Lender subject to each such assignment (determined as of the date the Assignment and Assumption with respect to such assignment is delivered to the Agent) shall not be less than $5,000,000 and shall be an integral multiple of $1,000,000 in excess thereof unless the Borrower otherwise consents; provided that no such consent of the Borrower shall be required if an Event of Default under clause clause (a), (b), (h) or (i) of Article VII has occurred and is continuing;

(B)each partial assignment shall be made as an assignment of a proportionate part of all the assigning Lender’s rights and obligations under this Agreement;

(C)the parties to each assignment shall execute and deliver to the Agent an Assignment and Assumption, together with a processing and recordation fee of $3,500 (for which the Borrower shall not be responsible); provided that the Agent may, in its sole discretion, elect to waive such fee in the case of any assignment; and

(D)the assignee, if it shall not be a Lender, shall deliver to the Agent an Administrative Questionnaire.

For purposes of this Section 9.04(b), the term “Approved Fund” has the following meaning:

“Approved Fund” means any Person (other than a natural person) that is engaged in making, purchasing, holding or investing in bank loans and similar extensions of credit in the ordinary course of its business and that is managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that manages a Lender.

(iii) Subject to acceptance and recording thereof pursuant to paragraph (b)(v) of this Section, from and after the effective date specified in each Assignment and Assumption the Eligible Assignee thereunder shall be a party hereto and, to the extent of the interest assigned by such Assignment and Assumption, have the rights and obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Assumption, be released from its obligations under this Agreement (and, in the case of an Assignment and Assumption covering all of the assigning Lender’s rights and obligations under this Agreement, such Lender shall cease to be a party hereto but shall continue to be entitled to the benefits of Sections 2.13, 2.14, 2.15 and 9.05). Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this Section 9.04 shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with paragraph (c) of this Section.

(iv) The Agent, acting for this purpose as a non-fiduciary agent of the Borrower, shall maintain at one of its offices a copy of each Assignment and Assumption delivered to it and a register for the recordation of the names and addresses of the Lenders, the Commitment of, and principal amount (and stated interest) of the Loans owing to, each Lender pursuant to the terms hereof from time to time (the “Register”). The entries in the Register shall be conclusive absent manifest error, and the Borrower, the Agent and the Lenders shall treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the contrary. The Register shall be available for inspection by the Borrower, any Issuing Bank and any Lender, at any reasonable time and from time to time upon reasonable prior notice.

(v) Upon its receipt of a duly completed Assignment and Assumption executed by an assigning Lender and an Eligible Assignee, the assignee’s completed Administrative Questionnaire (unless the assignee shall already be a Lender hereunder), the processing and recordation fee referred to in paragraph (b) of this Section and any written consent to such assignment required by paragraph (b) of this Section, the Agent shall accept such Assignment and Assumption and record the information contained therein in the Register. No assignment shall be effective for purposes of this Agreement unless it has been recorded in the Register as provided in this paragraph.

(c)Any Lender may, without the consent of the Borrower or the Agent sell participations to one or more banks or other entities (a “Participant”) in all or a portion of such Lender’s rights and obligations under this Agreement (including all or a portion of its Commitments and Loans owing to it); provided that (A) such Lender’s obligations under this Agreement shall remain unchanged, (B) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations and (C) the Borrower, the Agent and the other Lenders shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement. Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that such Lender shall retain the sole right to enforce this Agreement and to approve any amendment, modification or waiver of any provision of this Agreement; provided that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, modification or waiver described in the first proviso to Section 9.08(b) that affects such Participant. The Borrower agrees that each Participant shall be entitled to the benefits of Sections 2.13, 2.14 and 2.15 (subject to the requirements and limitations therein, including the requirements and obligations of the Participant under Section 2.15(f) (it being understood that the documentation required under Sections 2.15(f) shall be delivered to the participating Lender)) to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to paragraph (b) of this Section; provided that such Participant (A) agrees to be subject to the provisions of Section 2.16 as if it were an assignee under paragraph (b) of this Section; and (B) shall not be entitled to receive any greater payment under Sections 2.13 or 2.15, with respect to any participation, than its participating Lender would have been entitled to receive, except to the extent such entitlement to receive a greater payment results from a Change in Law that occurs after the Participant acquired the applicable participation. To the extent permitted by law, each Participant also shall be entitled to the benefits of Section 9.08 as though it were a Lender, provided such Participant agrees to be subject to Section 2.16 as though it were a Lender. Each Lender that sells a participation shall, acting solely for this purpose as a non-fiduciary agent of the Borrower, maintain a register on which it enters the name and address of each Participant and the principal amounts (and stated interest) of each Participant’s interest in the Loans or other obligations under this Agreement (the “Participant Register”); provided that no Lender shall have any obligation to disclose all or any portion of the Participant Register to any Person (including the identity of any Participant or any information relating to a Participant’s interest in any Commitments, Loans or its other obligations under any Loan Document) except to the extent that such disclosure is necessary to

establish that such Commitment, Loan or other obligation is in registered form under Section 5f.103-1(c) of the United States Treasury Regulations. The entries in the Participant Register shall be conclusive absent manifest error, and such Lender shall treat each person whose name is recorded in the Participant Register as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary. For the avoidance of doubt, the Agent (in its capacity as administrative agent) shall have no responsibility for maintaining a Participant Register.

(d)Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement to secure obligations of such Lender, including any pledge or assignment to secure obligations to a Federal Reserve Bank, and this Section shall not apply to any such pledge or assignment of a security interest; provided that no such pledge or assignment of a security interest shall release a Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.

SECTION 9.05 Expenses; Indemnity; Damage Waiver. (a) The Borrower shall pay (i) all reasonable out-of-pocket expenses incurred by the Agent and its Affiliates, including the reasonable fees, charges and disbursements of counsel for the Agent, in connection with the preparation, execution, delivery and administration of this Agreement or any amendments, modifications or waivers of the provisions hereof (whether or not the transactions contemplated hereby or thereby shall be consummated), (ii) all reasonable out-of-pocket expenses incurred by an Issuing Bank in connection with the issuance, amendment, renewal or extension of any Letter of Credit or any demand for payment thereunder and (iii) all reasonable out-of-pocket expenses incurred by the Agent, an Issuing Bank or any Lender, including the fees, charges and disbursements of any counsel for the Agent or any Lender, in connection with the enforcement or protection of its rights in connection with this Agreement and the other Loan Documents, including its rights under this Section, or in connection with the Loans made or Letters of Credit issued hereunder, including all such out-of-pocket expenses incurred during any negotiations associated with a workout or restructuring in respect of such Loans or Letters of Credit.

(b)The Borrower shall indemnify the Agent, each Issuing Bank and each Lender, and each Related Party of any of the foregoing Persons (each such Person being called an “Indemnitee”) against, and hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities, penalties and related expenses, including the fees, charges and disbursements of any counsel for any Indemnitee, incurred by or asserted against any Indemnitee arising out of, in connection with, or as a result of (i) the preparation, execution, delivery and administration of this Agreement, the other Loan Documents or any agreement or instrument contemplated hereby, the performance by the parties hereto of their respective obligations hereunder or under any other Loan Document or the consummation of the Transactions or any other transactions contemplated hereby or thereby, (ii) any Loan, Letter of Credit or the use of the proceeds therefrom (including any refusal by any Issuing Bank to honor a demand for payment under a Letter of Credit if the documents presented in connection with such demand do not strictly comply with the terms of such Letter of Credit), (iii) any actual or alleged presence or release of Hazardous Materials on or from any property owned or operated by the Borrower or any of its Subsidiaries, or any Environmental Liability related in any way to the Borrower or any of its Subsidiaries, or (iv) any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other theory and regardless of whether any Indemnitee is a party thereto; provided that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related expenses are determined by a court of competent jurisdiction by final and non-appealable judgment to have resulted (i) from the gross negligence or willful misconduct of such Indemnitee or (ii) such Indemnitee’s breach of its obligations under this Agreement or the other Loan Documents. This Section

9.05(b) shall not apply with respect to Taxes other than any Taxes that represent losses or damages arising from any non-Tax claim.

(c)To the extent that the Borrower fails to pay any amount required to be paid by it to the Agent or an Issuing Bank under paragraph (a) or (b) of this Section, each Lender severally agrees to pay to the Agent or such Issuing Bank, such Lender’s pro rata share (determined as of the time that the applicable unreimbursed expense or indemnity payment is sought) of such unpaid amount; provided that the unreimbursed expense or indemnified loss, claim, damage, liability or related expense, as the case may be, was incurred by or asserted against the Agent or such Issuing Bank in its capacity as such. For purposes of this Section, a Lender’s “pro rata share” shall be determined based upon its share of the sum of the total Credit Exposures and unused Commitments at the time.

(d)To the extent permitted by applicable law, each party hereto agrees that it shall not assert, and hereby waives, any claim against any Person (including any Indemnitee), on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this Agreement or any agreement or instrument contemplated hereby, the Transactions, any Loan or Letter of Credit or the use of the proceeds thereof, provided that, nothing in this paragraph (d) shall relieve the Borrower of any obligation it may have to indemnify an Indemnitee against special, indirect, consequential or punitive damages asserted against such Indemnitee by a third party.

(e)All amounts due under this Section shall be payable not later than 10 days after written demand therefor.

(f)No Indemnitee shall be liable for any damages arising from the use by unintended recipients of any information or other materials distributed by it through telecommunications, electronic or other information transmission systems in connection with this Agreement or any other Loan Document or the transactions contemplated hereby or thereby, except to the extent that such damages are determined by a court of competent jurisdiction by final and non-appealable judgment to have resulted from the gross negligence or willful misconduct of such Indemnitee.

SECTION 9.06 Right of Setoff. If an Event of Default shall have occurred and be continuing, each Lender and each of its Affiliates is hereby authorized at any time and from time to time, to the fullest extent permitted by law, to set off and apply any and all deposits (general or special, time or demand, provisional or final) at any time held and other obligations at any time owing by such Lender or Affiliate to or for the credit or the account of the Borrower against any of and all the obligations of the Borrower now or hereafter existing under this Agreement held by such Lender, regardless of whether such Lender shall have made any demand under this Agreement and although such obligations may be unmatured. The rights of each Lender under this Section are in addition to other rights and remedies (including other rights of setoff) which such Lender may have. Each Lender agrees to notify the Borrower and the Agent promptly after any such setoff and application to the extent permitted by law.

SECTION 9.07 Applicable Law. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK.

SECTION 9.08 Waivers; Amendment. (a) No failure or delay of the Agent, any Issuing Bank or any Lender in exercising any power or right hereunder or under any other Loan Document shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or

discontinuance of steps to enforce such a right or power, preclude any other or further exercise thereof or the exercise of any other right or power. The rights and remedies of the Agent and the Lenders hereunder and under the other Loan Documents are cumulative and are not exclusive of any rights or remedies that they would otherwise have. No waiver of any provision of this Agreement or any other Loan Document or consent to any departure by the Borrower therefrom shall in any event be effective unless the same shall be permitted by paragraph (b) below, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given. No notice or demand on the Borrower in any case shall entitle the Borrower to any other or further notice or demand in similar or other circumstances. Without limiting the generality of the foregoing, the making of a Loan shall not be construed as a waiver of any Default, regardless of whether the Agent or any Lender may have had notice or knowledge of such Default at the time.

(b)Neither this Agreement nor any other Loan Document nor any provision hereof or thereof may be waived, amended or modified except, in the case of this Agreement, pursuant to an agreement or agreements in writing entered into by the Borrower and the Required Lenders or by the Borrower and the Agent with the consent of the Required Lenders; provided that no such agreement shall (i) increase the Commitment of any Lender without the written consent of such Lender, (ii) reduce the principal amount of any Loan or LC Disbursement or reduce the rate of interest thereon, or reduce any fees payable hereunder, without the written consent of each Lender affected thereby, (iii) postpone the scheduled date of payment of the principal amount of any Loan or LC Disbursement, or any interest thereon, or any fees payable hereunder, or reduce the amount of, waive or excuse any such payment, or postpone the scheduled date of expiration of any Commitment without the written consent of each Lender affected thereby, (iv) change Section 2.12(c) or 2.16(b) in a manner that would alter the pro rata sharing of payments required thereby, without the written consent of each Lender, (v) change any of the provisions of this Section or the definition of “Required Lenders” or any other provision hereof or of any other Loan Document specifying the number or percentage of Lenders required to waive, amend or modify any rights hereunder or make any determination or grant any consent hereunder, without the written consent of each Lender; provided further that no such agreement shall amend, modify or otherwise affect the rights or duties of the Agent or any Issuing Bank hereunder without the prior written consent of the Agent or such Issuing Bank, as applicable. Notwithstanding the foregoing, (1) no consent with respect to any amendment, waiver or other modification of this Agreement or any other Loan Document shall be required of any Defaulting Lender, except with respect to any amendment, waiver or other modification referred to in clause (i), (ii) or (iii) of the first proviso of this paragraph and then only in the event such Defaulting Lender shall be affected by such amendment, waiver or other modification and (2) any provision of this Agreement may be amended by an agreement in writing entered into by the Borrower and the Agent to cure any ambiguity, omission, mistake, defect or inconsistency so long as, in each case, the Lenders shall have received at least five Business Days prior written notice thereof and the Agent shall not have received, within five Business Days of the date of such notice to the Lenders, a written notice from the Required Lenders stating that the Required Lenders object to such amendment.

SECTION 9.09 No Fiduciary Relationship. The Borrower, on behalf of itself and the Covered Subsidiaries, agrees that in connection with all aspects of the transactions contemplated hereby and any communications in connection therewith, the Borrower, the Covered Subsidiaries and their Affiliates, on the one hand, and the Agent, the Lenders and their Affiliates, on the other hand, will have a business relationship that does not create, by implication or otherwise, any fiduciary duty on the part of the Agent, the Lenders or their Affiliates, and no such duty will be deemed to have arisen in connection with any such transactions or communications.

The Agent, each Issuing Bank, each Lender and their affiliates, may have economic interests that conflict with those of the Borrower. The Borrower acknowledges and agrees that (i) the transactions contemplated by this Agreement and the related documents are arm’s-length commercial transactions between the Agent, the Issuing Banks and the Lenders, on the one hand, and the Borrower, on the other, (ii) in connection therewith and with the process leading to such transaction the Agent, each of the Issuing Banks and each of the Lenders is acting solely as a principal and not the agent or fiduciary of the Borrower, its management, stockholders, creditors or any other person, (iii) the Agent, the Issuing Banks and the Lenders have not assumed an advisory or fiduciary responsibility in favor of the Borrower with respect to the transactions contemplated hereby or the process leading thereto (irrespective of whether the Agent, any Issuing Bank, any Lender or any of their affiliates has advised or is currently advising the Borrower on other matters) or any other obligation to the Borrower except the obligations expressly set forth in this Agreement or the related documents and (iv) the Borrower has consulted its own legal and financial advisors to the extent it deemed appropriate. The Borrower further acknowledges and agrees that it is responsible for making its own independent judgment with respect to such transactions and the process leading thereto. The Borrower agrees that it will not claim that the Agent, any Issuing Bank, or any Lender has rendered advisory services of any nature or respect, or owes a fiduciary or similar duty to the Borrower, in connection with such transaction or the process leading thereto.

SECTION 9.10 Entire Agreement. This Agreement, the other Loan Documents and any separate letter agreements with respect to fees constitute the entire contract among the parties relative to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof.

SECTION 9.11 WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

SECTION 9.12 Severability. Any provision of this Agreement held to be invalid, illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and enforceability of the remaining provisions hereof; and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction.

SECTION 9.13 Counterparts. This Agreement may be executed in two or more counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract, and shall become effective as provided in Section 9.03.

SECTION 9.14 Headings. Article and Section headings and the Table of Contents used herein are for convenience of reference only, are not part of this Agreement and are not to affect the construction of, or to be taken into consideration in interpreting, this Agreement.

SECTION 9.15 Jurisdiction; Consent to Service of Process. (a) The Borrower hereby irrevocably and unconditionally submits, for itself and its property, to the exclusive jurisdiction of any New York State court and of the United States District Court of the Southern District of New York, and any appellate court from any thereof, in any action or proceeding arising out of or relating to this Agreement or the other Loan Documents, or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in such New York State or, to the extent permitted by law, in such Federal court. Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Nothing in this Agreement shall affect any right that the Agent or any Lender may otherwise have to bring any action or proceeding relating to this Agreement or the other Loan Documents against the Borrower or its properties in the courts of any jurisdiction.

(b)The Borrower hereby irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement or the other Loan Documents in any New York State or Federal court. Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.

(c)The Borrower hereby irrevocably designates, appoints and empowers BrightSphere Inc. (the “Process Agent”), with offices on the date hereof at 200 Clarendon Street, 53^rd Floor, Boston, MA 02116, as its designee, appointee and agent to receive, accept and acknowledge for and on its behalf, and in respect of its property, service of any and all legal process, summons, notices and documents that may be served in any such action or proceeding arising out of or relating to this Agreement or any other Loan Document. Such service may be made by mailing or delivering a copy of such process to the Borrower in care of the Process Agent (or any successor thereto, as the case may be) at such Process Agent’s above address (or the address of any successor thereto, as the case may be), and the Borrower hereby irrevocably authorizes and directs the Process Agent (and any successor thereto) to accept such service on its behalf. If for any reason such designee, appointee and agent shall cease to be available to act as such, the Borrower agrees to designate a new designee, appointee and agent in New York City on the terms and for the purposes of this provision reasonably satisfactory to Agent, and further shall at all times maintain an agent for service of process in the United States of America, so long as there shall be outstanding any Obligations. The Borrower shall give notice to the Agent of any such appointment of successor agents for service of process, and shall obtain from each successor agent a letter of acceptance of appointment and promptly deliver the same to the Agent.

(d)Each party to this Agreement irrevocably consents to service of process in the manner provided for notices in Section 9.01 or, in the case of service of process against the Borrower, as specified in paragraph (c) of this Section 9.15. Nothing in this Agreement will affect the right of any party to this Agreement to serve process in any other manner permitted by law.

SECTION 9.16 Confidentiality. (a) Each of the Agent and the Lenders agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (i) to its and its Affiliates’ directors, officers, employees and agents, including accountants, legal counsel and other advisors on a “need to know” basis (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential), (ii) to the extent requested by any regulatory authority having jurisdiction over such Agent or

Lender, (iii) to the extent required by applicable laws or regulations or by any subpoena or similar legal process, (iv) to any other party to this Agreement, (v) in connection with the exercise of any remedies hereunder or any suit, action or proceeding relating to this Agreement, the other Loan Documents or the enforcement of rights hereunder or thereunder, (vi) subject to an agreement containing provisions substantially the same as those of this Section, to (A) any permitted assignee of or Participant in, or any prospective permitted assignee of or Participant in, any of its rights or obligations under this Agreement or (B) any actual or prospective counterparty (or its advisors) to any swap or derivative transaction relating to the Borrower and its obligations, (vii) with the consent of the Borrower or (viii) to the extent such Information (A) becomes publicly available other than as a result of a breach of this Section or (B) becomes available to the Agent or any Lender on a nonconfidential basis from a source other than the Borrower. For the purposes of this Section, “Information” means all information received from the Borrower or any Subsidiary relating to the Borrower or such Subsidiary or its or their business, other than any such information that is available to the Agent or any Lender on a nonconfidential basis prior to disclosure by the Borrower or any Subsidiary. Any Person required to maintain the confidentiality of Information as provided in this Section shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information. In addition, the Agent and the Lenders may disclose the existence of this Agreement and information (other than fees) about this Agreement to market data collectors, similar service providers to the lending industry and service providers to the Agent and the Lenders in connection with the administration of this Agreement, any other Loan Document, and the Commitments.

(b)Each transferee shall be deemed, by accepting any assignment or participation hereunder, to have agreed to be bound by this Section 9.16.

SECTION 9.17 Electronic Communications. The Borrower hereby agrees that, unless otherwise requested by the Agent, it will provide to the Agent all information, documents and other materials that it is obligated to furnish to the Agent pursuant to Section 5.01(a), (b) and (e) (the “Communications”) by transmitting the Communications in an electronic/soft medium (provided such Communications contain any required signatures) in a format reasonably acceptable to the Agent to oploanswebadmin@citigroup.com (or such other e-mail address as shall be designated by the Agent from time to time); provided, that any delay or failure to comply with the requirements of this Section 9.17 shall not constitute a Default or an Event of Default hereunder, it being understood that this Section 9.17 shall not extend the dates by which the Borrower is required to deliver to the Agent the information, documents and other materials required to be delivered pursuant to Section 5.04(a), (b) and (e). The Borrower further agrees that the Agent may make the Communications available to the Lenders by posting the Communications on DebtDomain or a substantially similar electronic transmission system, access to which is controlled by the Agent (the “Platform”). The Platform is provided “as is” and “as available”. The Agent Parties (as defined below) do not warrant the accuracy or completeness of the Communications or the adequacy of the Platform and expressly disclaim liability for errors or omissions in the Communications. No warranty of any kind, express, implied or statutory, including any warranty of merchantability, fitness for a particular purpose, non-infringement of third-party rights or freedom from viruses or other code defects, is made by the Agent Parties in connection with the Communications or the Platform. In no event shall the Agent or any of its Affiliates or any of their respective officers, directors, employees, agents, advisors or representatives (collectively, “Agent Parties”) have any liability to the Borrower, any Lender or any other Person or entity for damages of any kind, including direct or indirect, special, incidental or consequential damages, losses or expenses (whether in tort, contract or otherwise) arising out of the Borrower’s or the Agent’s transmission of Communications through the Internet, except to the extent the liability of any Agent Party is found in a final, nonappealable judgment by a court of competent jurisdiction to have resulted primarily from the gross negligence or wilful misconduct of, or breach of this Agreement by, such Agent Party

SECTION 9.18 USA Patriot Act. Each Lender that is subject to Section 326 of the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) hereby notifies the Borrower that pursuant to the requirements of the USA PATRIOT Act it is required to obtain, verify and record information that identifies the Borrower, which information includes the name and address of the Borrower and other information that will allow such Lender to identify the Borrower in accordance with the USA PATRIOT Act.

SECTION 9.19 Judgment Currency. (a) If, for the purpose of obtaining judgment in any court, it is necessary to convert a sum owing hereunder in one currency into another currency, each party hereto agrees, to the fullest extent that it may effectively do so, that the rate of exchange used shall be that at which in accordance with normal banking procedures in the relevant jurisdiction the first currency could be purchased with such other currency on the Business Day immediately preceding the day on which final judgment is given.

(b)The obligations of the Borrower in respect of any sum due to any party hereto or any holder of any obligation owing hereunder (the “Applicable Creditor”) shall, notwithstanding any judgment in a currency (the “Judgment Currency”) other than US Dollars (the “Agreement Currency”), be discharged only to the extent that, on the Business Day following receipt by the Applicable Creditor of any sum adjudged to be so due in the Judgment Currency, the Applicable Creditor may in accordance with normal banking procedures in the relevant jurisdiction purchase the Agreement Currency with the Judgment Currency; if the amount of the Agreement Currency that may be so purchased is less than the sum originally due to the Applicable Creditor in the Agreement Currency, the Borrower agrees, as a separate obligation and notwithstanding any such judgment, to indemnify the Applicable Creditor against such loss. The obligations of the Borrower under this Section shall survive the termination of this Agreement and the payment of all other amounts owing hereunder.

SECTION 9.20 Acknowledgement and Consent to Bail-In of EEA Financial Institutions. Notwithstanding anything to the contrary in any Loan Document or in any other agreement, arrangement or understanding among the parties hereto, each party hereto acknowledges that any liability of any EEA Financial Institution arising under any Loan Document, to the extent such liability is unsecured, may be subject to the Write-Down and Conversion Powers of an EEA Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by:

(a)the application of any Write-Down and Conversion Powers by an EEA Resolution Authority to any such liabilities arising hereunder which may be payable to it by any party hereto that is an EEA Financial Institution; and

(b)the effects of any Bail-in Action on any such liability, including, if applicable:

(i)a reduction in full or in part or cancellation of any such liability;

(ii)a conversion of all, or a portion of, such liability into shares or other instruments of ownership in such EEA Financial Institution, its parent entity, or a bridge institution that may be issued to it or otherwise conferred on it, and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability under this Agreement or any other Loan Document; or

(iii) the variation of the terms of such liability in connection with the exercise of the Write-Down and Conversion Powers of any EEA Resolution Authority.

The following terms shall for purposes of this Section 9.20 have the meanings set forth below:

“Bail-In Action” means the exercise of any Write-Down and Conversion Powers by the applicable EEA Resolution Authority in respect of any liability of an EEA Financial Institution.

“Bail-In Legislation” means, with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule.

“EEA Financial Institution” means (a) any credit institution or investment firm established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any financial institution established in an EEA Member Country which is a subsidiary of an institution described in clause (a) or (b) of this definition and is subject to consolidated supervision with its parent.

“EEA Member Country” means any member state of the European Union, Iceland, Liechtenstein and Norway.

“EEA Resolution Authority” means any public administrative authority or any person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.

“EU Bail-In Legislation Schedule” means the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor person), as in effect from time to time.

“Write-Down and Conversion Powers” means, with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule.

[Remainder of Page Intentionally Left Blank]

Exhibit 31.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Guang Yang, certify that:


1.	I have reviewed this Quarterly Report on Form 10-Q of BrightSphere Investment Group plc;


2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;


3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;


4.	The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:


(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;


(b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;


(c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and


(d)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and


5.	The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):


(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and


(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 8, 2019



	/s/ Guang Yang
	Guang Yang
	President, Chief Executive Officer and Executive Chairman

Exhibit 31.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Suren Rana, certify that:


1.	I have reviewed this Quarterly Report on Form 10-Q of BrightSphere Investment Group plc;


2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;


3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;


4.	The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:


(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;


(b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;


(c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and


(d)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and


5.	The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):


(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and


(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 8, 2019



	/s/ Suren Rana
	Suren Rana
	Chief Financial Officer

Exhibit 32.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Guang Yang, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge, the Quarterly Report on Form 10-Q of BrightSphere Investment Group plc for the quarterly period ended June 30, 2019 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that the information contained in such Report fairly presents in all material respects the financial condition and results of operations of BrightSphere Investment Group plc for the periods covered by the Report. The foregoing certification is being furnished to the Securities and Exchange Commission as part of the Report. A signed original of this statement has been provided to BrightSphere Investment Group plc and will be retained by BrightSphere Investment Group plc and furnished to the Securities and Exchange Commission or its staff upon request.



Date:	August 8, 2019	/s/ Guang Yang
		Guang Yang
		President, Chief Executive Officer and Executive Chairman

Exhibit 32.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I,Suren Rana, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge, the Quarterly Report on Form 10-Q of BrightSphere Investment Group plc for the quarterly period ended June 30, 2019 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that the information contained in such Report fairly presents in all material respects the financial condition and results of operations of BrightSphere Investment Group plc for the periods covered by the Report. The foregoing certification is being furnished to the Securities and Exchange Commission as part of the Report. A signed original of this statement has been provided to BrightSphere Investment Group plc and will be retained by BrightSphere Investment Group plc and furnished to the Securities and Exchange Commission or its staff upon request.



Date:	August 8, 2019	/s/ Suren Rana
		Suren Rana
		Chief Financial Officer