Free Response - District Court of Arizona - Arizona

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LAW OFFICES One Arizona Center, 400 E. Van Buren Phoenix, Arizona 85004-2202 (602) 382-6000

John J. Bouma (#001358) James R. Condo (#005867) Patricia Lee Refo (#017032) Joseph G. Adams (#018210) SNELL & WILMER L.L.P. One Arizona Center 400 E. Van Buren Phoenix, AZ 85004-2202 Telephone: (602) 382-6000 E-Mail: [email protected] Attorneys for Defendant Kirkland & Ellis IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF ARIZONA Diane Mann, as Trustee for the Estate of LeapSource, Inc. et al., Plaintiffs, v. GTCR Golder Rauner, L.L.C.; a Delaware limited liability company, et al., Defendants. No. CIV 02-2099 PHX RCB KIRKLAND & ELLIS' RESPONSE TO PLAINTIFFS' STATEMENT OF ADDITIONAL FACTS PRECLUDING SUMMARY JUDGMENT RE PROFESSIONAL MALPRACTICE CLAIM (Assigned to Hon. Robert C. Broomfield)

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Pursuant to Local Rule 56.1, and Federal Rule of Civil Procedure Rule 56, Kirkland & Ellis ("K&E") submits the following response to Plaintiffs' Statement of Additional Facts Precluding Summary Judgment. K&E notes that Statement Nos. 122 to 261 are identical to the Statements of Additional Facts that plaintiffs previously submitted in opposition to K&E's separate Motion for Summary Judgment Regarding Aiding and Abetting Breaches of Fiduciary Duty and Tortious Interference Claims. Likewise, K&E's responses to those statements are the same. Rather than resubmit its evidence in response to those statements, K&E has cited to the various exhibits attached to the previously-filed Declaration of Joseph G. Adams (doc. # 305, filed on December 12, 2005) ("Adams Decl."). 106. Kirkland & Ellis prepared and filed the Certificate of Incorporation of

"Kirkco, Inc." on September 16, 1999. (See Exhibit 10 to Kirkland & Ellis's Statement of

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Facts.) RESPONSE: Not disputed for purposes of this motion that Joan Donovan, a K&E paralegal, prepared and filed the certification of incorporation. See K&E's Statement of Facts in Support of Motion for Summary Judgment Regarding Malpractice and Professional Negligence (doc. # 329, filed on February 27, 2006) ("SOF") ¶ 22. 107. Joan Donovan, an employee of Kirkland & Ellis, was the sole incorporator

of Kirkco, Inc. (See Exhibit 10 to Kirkland & Ellis's Statement of Facts.) RESPONSE: Not disputed for purposes of this motion. 108. The Articles of Incorporation of Kirkco, Inc., were prepared by Kirkland &

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Ellis. (See Exhibit 10 to Kirkland & Ellis's Statement of Fact; Klein Dep., Exhibit 9 to Kirkland & Ellis SOF at 16:16­17:5.) RESPONSE: Not disputed for purposes of this motion that Joan Donovan, a K&E paralegal, prepared the articles of incorporation. See SOF ¶ 22. 109. Kirkland & Ellis billed LeapSource for "Legal services rendered and

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expenses incurred from December 1 through December 31, 1999, in connection with the formation of Leap, Inc., and related matters, including: "Review term sheet; prepare, negotiate and revise Purchase Agreement, Certificate of Incorporation, Stockholders Agreement, Registration Agreement, Senior Management Agreement and Professional Services Agreement; review management side letters and employment agreements; telephone conferences regarding the foregoing; prepare resolutions and stock certificates; facilitate closing; and various related matters." (Kirkland & Ellis January 25, 2000 letter and invoice to Leap Inc., attached as SOAF Exhibit 5, Bates Nos. LS-48-1473-1474). RESPONSE: Not disputed for purposes of this motion that K&E sent a bill to both LeapSource
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and GTCR for legal services rendered to GTCR. Pursuant to the Purchase Agreement, LeapSource agreed to pay GTCR's legal expenses regarding its investment in LeapSource. See SOF ¶ 51. 110. Kirkland & Ellis held telephone conferences regarding tax issues and

preformed legal research pertaining to an Internal Revenue Code section 338(h)(10) election with regard to LeapSource's acquisition of ICG Consulting. (Kirkland & Ellis May 9, 2000 letter and invoice to LeapSource, Inc., attached as SOAF Exhibit 5, Bates Nos. LS-48-1469-1470). RESPONSE: Disputed. The cited invoice does not mention anything about "LeapSource's acquisition of ICG Consulting." There is no evidence to suggest that the telephone conferences concerned such a topic. Further, there is no basis to indicate that any representatives of LeapSource were involved in these telephone conversations. Pursuant to the Purchase Agreement, LeapSource agreed to pay GTCR's legal expenses regarding its investment in LeapSource. See SOF ¶ 51. 111. Kirkland & Ellis reviewed materials regarding the issuance of additional

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shares, prepared new LeapSource stock certificates, conferred regarding Warn Act issues and liabilities relating to LeapSource employee terminations, and held telephone conferences regarding these and various related matters. (Kirkland & Ellis March 21, 2001 letter and invoice to LeapSource, Inc., SOAF Exhibit 5, Bates Nos. KE000364-365). RESPONSE: Not disputed for purposes of this motion that the invoice prepared by K&E references these issues. This work was performed for K&E's client GTCR, not LeapSource. Pursuant to the Purchase Agreement, LeapSource agreed to pay GTCR's legal expenses regarding its investment in LeapSource. See SOF ¶ 51. 112. Kirkland & Ellis also prepared and issued the stock certificates on behalf of

Kirkco, Inc. (Kirkco Certificate of Stock issued to Christine Kirk September 27, 1999, Bates Nos. KE001196-1197; KE003187-3190). SOAF Exhibit 5.
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RESPONSE: Disputed to the extent that this statement suggests that the issuance of Kirkco stock certificates was performed "on behalf of Kirkco, Inc." The record evidence shows that K&E generated stock certificates for Kirkco in connection with its work for GTCR. See SOF ¶ 53. 113. Kirkland & Ellis billed LeapSource for the preparation and distribution of

their stock certificates. (Kirkland & Ellis June 22, 2000 letter and invoice to LeapSource, Inc., attached as SOAF Exhibit 5, Bates Nos. LS-48-1461-1462). RESPONSE: Disputed to the extent that this statement suggests that K&E's transmission of an invoice jointly to GTCR and LeapSource created an attorney-client relationship. Pursuant to the Purchase Agreement, LeapSource agreed to pay GTCR's legal expenses regarding its investment in LeapSource. See SOF ¶ 51. Further, the record evidence shows that K&E prepared stock certificates for LeapSource in connection with its work for GTCR. See SOF ¶ 53. 114. Kirkland & Ellis analyzed issues regarding a LeapSource stock split and

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equity issuances for LeapSource. (Kirkland & Ellis January 22, 2001 letter and invoice to LeapSource, Inc., attached as SOAF Exhibit 5, Bates Nos. KE000362-363). RESPONSE: Disputed that K&E's work in analyzing a LeapSource stock split and equity issuances was performed "for LeapSource." The record evidence shows that LeapSource was represented by its own counsel at Osborn Maledon for these matters, and that K&E was representing GTCR. See SOF ¶¶ 67, 68. 115. Kirkland & Ellis prepared and filed the Restated Certificate of Incorporation

of Kirkco, Inc. (Restated Certificate of Incorporation of Kirkco, Inc., Bates Nos. KE001134-001147). RESPONSE: Not disputed for purposes of this motion that K&E prepared and filed this
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document in connection with the execution of the formation documents. 116. Kirkland & Ellis prepared the Amended and Restated By-laws of Kirkco,

Inc. (Amended and Restated By-laws of Kirkco, Inc., Bates Nos. KE001274-1289). RESPONSE: Not disputed for purposes of this motion that K&E prepared this document in connection with the execution of the formation documents. 117. Kirkland & Ellis repeatedly prepared LeapSource corporate documentation

including stock certificates, supplements to Purchase Agreement and Directors' Consents related to GTCR's periodic funding provided to LeapSource, Inc. (Kirkland & Ellis letter of July 11, 2000, with enclosures, Bates Nos. KE003231-3248). RESPONSE: Not disputed for purposes of this motion that K&E prepared the documents identified above at the request of its client GTCR related to the periodic investments made by GTCR in LeapSource. 118. Kirkland & Ellis maintained a corporate record book for LeapSource.

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(Kirkland & Ellis memorandum, dated February 16, 2001, Bates No. KE003839). RESPONSE: Disputed that K&E maintained an official corporate record book for LeapSource in 2001. According to Chris Kirk, Tina Rhodes, and Michelle Matiski, LeapSource's counsel at Osborn Maledon assumed responsibility for the LeapSource corporate minute book in mid-2000. (Kirk Dep. at 641:2-12; Rhodes Dep. at 249:9-20; Matiski at 137:28.1) Not disputed that K&E kept various corporate records in its files relating to its work for GTCR. 119. Kirkland & Ellis maintained a stock ledger for the issuance of shares of

stock in LeapSource, Inc. (Kirkland & Ellis November 27, 2000 letter and invoice to LeapSource, Inc., Bates Nos. LS-34-0054-0055). Copies of these deposition pages are attached to the separate declaration of Joseph G. Adams, which is filed on this date.
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RESPONSE: Not disputed that K&E maintained a stock ledger for the purpose of tracking investments made by its client GTCR in LeapSource. 120. Richard Clyne of Kirkland & Ellis wrote to Christine Kirk, CEO of

LeapSource on February 15, 2001, regarding shareholder consents. (Kirkland & Ellis facsimile transmittal cover sheet, dated February 15, 2001, Bates No. KE003840). RESPONSE: Disputed to the extent that the statement suggests that Clyne and Kirk engaged in any substantive communications in 2001. Not disputed that Clyne periodically forwarded documents to LeapSource to be signed by Chris Kirk. 121. Kirkland & Ellis prepared a draft offer of employment letter on behalf of

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Kirkco, Inc. (Kirkland & Ellis to Christine Kirk with attachments, dated October 6, 1999, Bates Nos. KE004280-KE004284). See paragraph 56, above. RESPONSE: Not disputed for purposes of this motion that K&E forwarded to Kirk a draft offer letter and employment checklist that had previously been approved by K&E's client GTCR. As Kirk testified, all employment agreements were prepared by LeapSource's counsel at Osborn Maledon, not K&E. See SOF ¶ 56. 122. K&E was aware of the existence and terms of the five written agreements

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referred to in the K&E Statement of Facts ¶ 1 in support of K&E's Motion for Summary Judgment regarding Aiding and Abetting and Tortious Interference Claims. ("Five written agreements were executed on September 27, 1999 to implement GTCR's funding of LeapSource and to launch LeapSource's operations. K&E assisted in the drafting and negotiation of the agreements.") RESPONSE: Not disputed for purposes of this motion. 123. Those agreements included the Purchase Agreement, the Stockholders'

Agreement, a Senior Management Agreement with Christine Kirk, a Registration
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Agreement, and a Professional Services Agreement. Copies of these agreements were attached as Exhibits 6 through 10 to the Statement of Facts in support of GTCR's Motion for Summary Judgment on Joint Venture-Related Claims [Docket No. 271]. RESPONSE: Not disputed for purposes of this motion. 124. The GTCR Fund VI entities were the majority shareholders in LeapSource.

See SOAF Exhibit 23 (action by majority shareholders to remove Mr. Gilman from the LeapSource board of directors). RESPONSE: Not disputed for purposes of this motion. 125. GTCR principals Bruce Rauner and Joseph Nolan were directors of LeapSource no later than the beginning of December 1999. Board Minutes, December 2, 1999, SOAF Exhibit 2. RESPONSE: Not disputed for purposes of this motion. 126. GTCR Portfolio Principal Daniel Yih was made a member of the

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LeapSource board of directors on February 16, 2001. Board Minutes, February 16, 2001, SOAF Exhibit 3. RESPONSE: Not disputed for purposes of this motion that Daniel Yih was elected to the LeapSource board of directors in February 2001. 127. Rauner, Nolan, and Yih remained directors of LeapSource in 2001, during

the time that AEG Partners was retained and when David Eaton was made Chief Restructuring Officer of LeapSource. Board Minutes, March 29 and May 10, 2001, SOAF Exhibit 4. RESPONSE: Not disputed for purposes of this motion that Rauner, Nolan, and Yih served as directors of LeapSource when LeapSource retained AEG Partners, LLC and when David
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Eaton was subsequently named Chief Restructuring Officer. 128. Q. A. In the years 1999 to 2001, GTCR was a substantial client of Kirkland & How long has GTCR been a client of Kirkland & Ellis? Their first fund was formed in 1979. They've been a client since.

Ellis, and had been a client since 1979:

Evanich Deposition. 9:17-20. Q. In terms of the size of client GTCR is to Kirkland & Ellis, going back in the 1999-2001 timeframe, can you give me an estimate of Kirkland & Ellis' annual billings to GTCR? MS. REFO: During that time period? MR. WEINBERGER: Yes. A. I really don't know the answer to that.

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BY MR. WEINBERGER: Q. A. Q. A. Is it more or less than $1 million? More. More or less than $5 million? Some years less; some years more.

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Evanich Deposition 10:24-11:12. RESPONSE: Disputed on the ground that the testimony does not refer to a "substantial client." Not disputed that GTCR is a long-standing client of K&E or that the testimony of Kevin Evanich is accurate. 129. David Eaton considered GTCR to be K&E partner Kevin Evanich's client.

Eaton Deposition at 35:12-21: Q. Okay. At the time that you were given this particular GTCR portfolio client assignment, do you recall if there was a Kirkland & Ellis partner whose responsibility was the GTCR companies? A. I think the partner responsible for the GTCR compa --GTCR relationship was Kevin Evanich. Q. To your knowledge, GTCR is still Kevin Evanich's client?
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A.

To my knowledge, yes.

RESPONSE: Not disputed for purposes of this motion. 130. Between September 1999 and July 2001, Kirkland & Ellis were also acting

as the attorneys for Kirkco, Inc. and LeapSource. Among other things, Kirkland & Ellis formed the company, maintained the stock ledger for LeapSource, issued common and preferred stock on behalf of LeapSource, and prepared Board consents and resolutions for the company. K&E was chosen to provide those services for LeapSource by GTCR: Q. Is it your testimony that you retained Kirkland & Ellis to represent the company between September 16 and September 27 [1999]? A. I was told by GTCR that I would use Kirkland & Ellis.

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Q. Is it your testimony that you, as the sole director, retained Kirkland & Ellis to represent the company between September 16 and September 27? A. Yes, I believe so. **** Q. How did you retain Kirkland & Ellis on September 16 to represent the company? A. I had a number of conversations with Kirkland & Ellis. They formed the company. They did the tax filings. **** Q. Do you remember any conversation with anyone from Kirkland & Ellis between September 16 and September 27 in which you, as the sole director, said in substance, "I would like to retain Kirkland & Ellis to represent LeapSource"? A. I recall a conversation with Richard Clyne where he said, "We will be doing all of the work for LeapSource. I am going to be faxing you things. You need to sign them and fax them back to me." **** Q. Was Mr. Schumacher aware that Kirkland & Ellis would be preparing the incorporation documents? A. Well, there was a point at which Mr. Schumacher wanted to do that. He and Jeff Gilbert had said that it would be cheaper, that they were - their rates were significantly less. I asked Joe Nolan about that, and Joe said, no, that Kirkland &
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Ellis handled all of the companies that GTCR invested in, that they would be LeapSource's counsel. Kirk Deposition 613:5-620:4. RESPONSE: Disputed. None of the cited testimony supports the proposition that K&E was acting as attorneys for LeapSource or Kirkco. Steve Ritchie and Richard Clyne, the attorneys at K&E who represented GTCR in connection with its investment in LeapSource, each testified that they were representing GTCR, not LeapSource. (Clyne Dep. at 40:11-19, attached as Ex. 1 to Adams Decl.; Ritchie Dep. at 22:23 - 23:7, attached as Ex. 2 to Adams Decl.) In the opinion of Prof. Ted Schneyer, K&E's legal ethics expert, "K&E never had a lawyer-client relationship with [LeapSource]." (Report of T. Schneyer at 12, attached as Ex. 4 to Adams Decl.) 131. Q. A. Q. Ms. Kirk also testified as follows about K&E's role in forming LeapSource: Did you participate in the incorporation of LeapSource? Yes. What did you do?

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A. Kirkland & Ellis, as counsel for the company, asked me to execute requests for tax I.D. numbers, both, I believe, federal and state. There were other regulatory items that they asked me to execute. They would draft them, send them to me. I would sign them, and then, depending on what their instructions were, I would either, for example, fax it to the regulatory body or send it back to them. Kirk Deposition 209:18-210:4. Q. .... Did LeapSource have counsel between September 16 and September 27, 1999? A. Well, Kirkland & Ellis formed LeapSource. They did the work for LeapSource, so I would say, yes, Kirkland & Ellis was LeapSource's counsel. Kirk Deposition 612:10-14. RESPONSE: Not disputed for purposes of this motion that Kirk testified as set forth above or that a paralegal from K&E filed the articles of incorporation for Kirkco, Inc., which later

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changed its name to LeapSource. K&E disputes the conclusions in Kirk's testimony, which lack foundation, are not based on personal knowledge, and are contradicted by other witnesses. (Schumacher Dep. at 79:17 - 80:5, attached as Ex. 3 to Adams Decl.; Clyne Dep. at 40:11-19, attached as Ex. 1 to Adams Decl.; Ritchie Dep. at 22:23 - 23:7, attached as Ex. 2 to Adams Decl.) 132. Mr. Nolan testified that GTCR "frequently" used K&E to "do work for our

companies," referring to the companies in which GTCR funds made equity investments: Q. Do you remember having any conversation with Chris Kirk about what law firm would be used to form the company that became LeapSource? A. I don't remember that specifically, no.

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Q. You don't remember a discussion with her about reasons that Kirkland & Ellis should be used to form the company because of its familiarity with GTCR's business? A. I don't remember that specifically but that's quite possible.

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Q. Do you remember having a discussion with Chris Kirk about K&E being retained to provide services to LeapSource, including maintaining the minutes, the stock ledger for the company? MR. FOSTER: Object to the form. MS. REFO: Object to the form. A. I don't remember that specifically, no.

BY MR. STIRLING: Q. Is that something that you have required for other companies funded by LeapSource -- by GTCR? MR. FOSTER: Objection -- I object to the form. [-] in there. A. We use K&E a lot. They're familiar with our documents, and a lot of times it's -- they do work for our companies. That makes it easier to get the equity documents done. MR. STIRLING: Q. When you say "they do work for our companies," do you mean the companies in which GTCR equity funds make investments? A. Yes.

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Nolan Deposition 153:17-154:23. RESPONSE: Disputed to the extent that plaintiffs contend that the cited testimony shows that K&E was performing legal services on behalf of companies in which GTCR made an equity investment. The cited testimony speaks for itself. 133. K&E billed LeapSource for those services from September 1999 through

January 2001, and LeapSource paid K&E for the work performed and billed by K&E, with the exception of the January 2001 statement, which apparently remained unpaid at the time of the LeapSource bankruptcy petition. See K&E Statements and evidence of payment, SOAF Exhibit 5. RESPONSE: Not disputed for purposes of this motion that K&E sent its bills to LeapSource and GTCR, and that LeapSource paid the bills pursuant to its agreement with GTCR to pay GTCR's legal expenses associated with LeapSource. 134. Mr. Yih, a former Kirkland & Ellis attorney and GTCR Portfolio Principal,

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appointed by GTCR to act as LeapSource's "Crisis Manager" and then made a member of the LeapSource board of directors, also believed that Kirkland & Ellis was counsel for LeapSource. Mr. Yih testified as follows: Q. Were you aware that Kirkland & Ellis had provided professional services to LeapSource? MS. REFO: Objection to the form. A. I believed, yes, at the time, that it was also company's counsel.

BY MR. STIRLING: Q. A. Kirkland & Ellis was? Yes.

Yih Deposition 334:20 - 335:3. RESPONSE: Disputed that K&E was ever counsel for LeapSource. Yih testified that no one

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from LeapSource ever told him that K&E was representing LeapSource and that he had no personal knowledge that K&E ever represented LeapSource. (Yih Dep. at 493:24 494:12, attached as Ex. 5 to Adams Decl.) 135. Tina Rhodes described her working relationship with Kirkland & Ellis, the

nature of the work they handled and for which they billed LeapSource. Her testimony on this subject includes the following description of services provided by Kirkland & Ellis to LeapSource: Q. In connection with your responsibilities at LeapSource, did you have occasion to interact with attorneys from the law firm of Kirkland & Ellis? A. Yes.

Q. Who were the attorneys that you interacted with while you were at LeapSource? A. In the beginning of my employment, primarily Richard Clyne, and it was for minutes, board of directors minutes. Q. When you say "minutes," how do you mean that?

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A. Managing the minutes. Whenever there was a board of directors meeting, being the secretary, I'd work with him to get them drafted up. Also, stock certificates, as well. He issued those for LeapSource in the beginning. Rhodes Deposition 10:18 - 11:8. Q. On the next to the last line of that paragraph there is a clause that refers to, "prepare resolutions and stock certificates." Do you see that? A. Yes.

Q. Are those the corporate minutes or, rather, corporate acts that you referred to earlier in your testimony? A. Yes.

Rhodes Deposition 13: 19- 14:1 Q. BY MR. STIRLING: What was your understanding with respect to Kirkland & Ellis' representation of LeapSource during the period of time that Kirkland & Ellis was maintaining the stock ledger for the corporation? MR. CONDO: Object to the form of the question. Q. BY MR. STIRLING: You can answer.

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A. That they created organization documents for the company as well as handled administrative -- what I would call administrative matters including the resolutions and the stock certificates. Q. By "administrative matters," you're referring to - - well, what might also be described as corporate maintenance? A. Correct, yes.

Rhodes Deposition 16:16- 17:6. RESPONSE: Disputed that this testimony supports plaintiffs' contention that it reflects "services provided by Kirkland & Ellis to LeapSource." As Ms. Rhodes testified, she "never went to Kirkland & Ellis for any type of substantive legal advice on behalf of LeapSource," and the services that K&E performed regarding LeapSource were "ministerial." (Rhodes Dep. at 233:14-24, attached as Ex. 6 to Adams Decl.) 136. Michelle Matiski, another of LeapSource's outside counsel with the Phoenix

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law firm of Osborn & Maledon, testified that she was told that LeapSource had retained Kirkland & Ellis when it hired David Eaton for the restructuring of the company. She said: Q. Did anyone from LeapSource ever tell you during that time that they believed they had retained Kirkland & Ellis rather than AEG in connection with their retention of Mr. Eaton? A. Q. A. Q. Yes. Who said that? I don't remember. What do you remember about someone from LeapSource saying that?

A. I remember being told that Dave Eaton was of counsel to Kirkland & Ellis and that GTCR required LeapSource to hire him and therefore Kirkland & Ellis to work on the restructuring - or the work out, to work on the work out- work with the company. Q. A. Do you remember who said that? No.

Matiski Deposition, 49:21-50:11.
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RESPONSE: Disputed. The cited testimony is not competent evidence because it lacks foundation and is inadmissible hearsay. There is no evidence that any identifiable person at LeapSource concluded that LeapSource hired K&E by retaining Eaton. Even Chris Kirk testified that she did not believe that the board vote to retain AEG was a vote to retain K&E. (Kirk Dep. at 667:13-18, attached Ex. 7 to Adams Decl.) 137. Daniel Yih was asked to work on LeapSource matters beginning in

December 2000: Q. ... Are you aware of, other than in his capacity as a member of the board of directors, any services that Mr. Nolan provided to LeapSource? A. Again, my involvement with the company was almost zero prior to my involvement in the end of December, so I don't know specifically again. Q. Other than the information that you had obtained from these voice-mail messages, what did you know about LeapSource before you traveled to Arizona at the end of December, 2000? A. I had heard that there was discussions about an initial public offering or another transaction of that sort, a financing transaction, but that's all I had heard. Yih Deposition 31:21-32:12. RESPONSE: Not disputed for purposes of this motion, though the cited testimony does not reflect that anyone asked Yih to do anything. 138. The interests of GTCR and LeapSource were adverse when Mr. Yih first

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became involved in the business of LeapSource in December 2000: Q. You don't recall any discussion about whether GTCR had honored its agreements with LeapSource? A. I remember from the very beginning of my involvement in the company, there was a question of whether or not we had - GTCR had fulfilled a commitment. Yih Deposition 326:18-23. Q. At any time in 2001 do you remember there being a discussion about whether GTCR had met its obligations to LeapSource under the professional services agreement?

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A. There were a number of concerns raised, I believe, in a letter from Tom Gilman at some point in the first quarter. I don't remember specifically if it raised questions about the professional services agreement. Q. Do you recall there being any discussion among the principals of GTCR about the letter written by Tom Gilman concerning whether GTCR had performed its obligations to LeapSource? A. Yes. There was conversations around Tom Gilman's letter and the allegations that were made. Yih Deposition, 328:17-329:8. RESPONSE: Disputed. The cited testimony does not support the proposition that "[t]he interests of GTCR and LeapSource were adverse when Mr. Yih first became involved in the business of LeapSource in December 2000." 139. In January 2001, Dan Yih told Chris Kirk that GTCR had effectively "cut

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off her arms and legs to operate the business" and was prepared to liquidate LeapSource: Q. Okay. Do you remember any -- anytime in January of 2001 having a conversation with Christine Kirk where you told her that you had cut off her arms and legs to operate the business of LeapSource? A. There was a conversation on January 30th where we had met with ADP, and we were scheduled to meet with Chris and Tom Gilman after that meeting. January 30th followed our having tried to work with the company to effect cost reductions and having been disappointed what -- with what she presented to us. And then there was a fairly, I think, contentious relationship with respect to me at that point in time because I had told her that we were disappointed with the costreduction effort that she had put forth. She had kept us waiting for a long time after the ADP meeting, and I remember being very upset because I think the tenor of the conversation with us was -- I think someone mentioned bobbing and weaving and delaying and trying to avoid direct conversations with respect to some of the issues that I was raising, so 1 was very upset. And I remember that in that conversation in particular, I said that we were not afraid -- GTCR was not afraid of trying to figure out whether or not we should liquidate the company, stop funding and liquidate the company, not that -- that we would but that we weren't afraid to address that issue if she wasn't prepared to respond to us with our questions and work with us.
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I don't remember if the discussion about the, quote, "cutting off the arms and legs" was part of that conversation or a previous conversation. She alleged that my interviewing members of her management team below her was undermining her authority, and I said, "Yes, it is effectively cutting off your arms and legs within the organization." I certainly never, ever threatened her physically to cut off her arms and legs. I did agree with her that interviewing management members below her was effectively cutting off her arms and legs. Yih Deposition, 158:7- 160:5. Q. A. Q. A. Q. You're reading -- I'm sorry. This is from GTCR 002315; correct? Yes. This is the second bullet point in the -- in the middle of that page? Yes. All right.

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A. I think that -- I don't recall that statement. I do recall, at the end of January, that we said that we would not -- we would certainly consider liquidation, we would be prepared to liquidate if necessary, in the context of the management team not cooperating with us in trying to determine the various different funding requests, and -- I'm sorry -- the different cost-reduction efforts. And so I do recall that at the end of January. Yih Deposition, 357:3-20. RESPONSE: Not disputed for purposes of this motion that Yih recalled saying that "it is effectively cutting off your arms and legs within the organization" and that GTCR would consider various alternatives, including liquidation. 140. In January 2001, K&E billed time to LeapSource for a "conference

regarding WARN Act issues and liabilities relating to employee terminations; telephone conferences regarding the foregoing; and various related matters." See Kirkland & Ellis bill for "Legal services rendered ... from January 1, 2001 through January 31, 2001," KE000365. SOAF Exhibit 5.

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RESPONSE: Disputed. The cited invoice does not reflect that K&E "billed time to LeapSource." Instead, K&E performed services for its client GTCR, and LeapSource agreed to pay for those services pursuant to the Purchase Agreement. 141. When K&E was performing legal research in preparation for a LeapSource

RIF at the request of GTCR and contrary to LeapSource corporate officers, K&E was on notice that the interests of LeapSource and GTCR were adverse. RESPONSE: Disputed. Plaintiffs do not cite to any record evidence to support this proposition. 142. Thomas Gilman spent 27 years of his career rising through the ranks of

Chrysler. Gilman Deposition, 16:6-18:21, SOAF Exhibit 18. RESPONSE: Not disputed for purposes of this motion. 143. Thomas Gilman served in various positions at Chrysler. He served: as Head

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of Financial Planning; in various executive level financial management roles until he became Controller of Chrysler Financial; he then became CFO of Chrysler Financial and finally served on the Daimler Benz Chrysler Merger Team until he retired from Chrysler in 2000. Gilman Deposition, 16:6-21, SOAF Exhibit 18. RESPONSE: Not disputed for purposes of this motion. 144. Thomas Gilman, prior to retiring from Chrysler served as Controller of

Chrysler for 3 years, as CFO of Chrysler Financial for 1 year and on the Daimler Benz Chrysler Merger Team for 2 years. Gilman Deposition, 16:6-18:15, SOAF Exhibit 18. RESPONSE: Not disputed for purposes of this motion. 145. Thomas Gilman was a Vice President of Chrysler Corporation and Chief

Integration Officer for the Daimler Benz Chrysler Merger Team. Gilman Deposition, 16:6-18:21, SOAF Exhibit 18.
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RESPONSE: Not disputed for purposes of this motion. 146. On February 24, 2001, Tom Gilman sent a memorandum to the members of

LeapSource board reciting a history of questionable and wrongful acts by the representatives of GTCR. Confidential Memorandum from Tom Gilman to the LeapSource board dated February 24, 2001 (the "Gilman Memorandum"). SOAF Exhibit 6. RESPONSE: Not disputed for purposes of this motion that Gilman sent the memo attached as Exhibit 6 to the LeapSource board of directors. K&E disputes that the letter is an accurate representation of events involving GTCR and LeapSource. The specific facts and allegations in the letter lack foundation and constitute inadmissible hearsay to the extent that they are offered by plaintiffs to prove the truth of the matters asserted. 147. The Gilman Memorandum was addressed to all LeapSource Board of

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Directors members because it concerned a number of issues relating to the status of LeapSource and several alternatives for consideration by the board. This document was faxed to the board members, including the principals of GTCR who were on the LeapSource board, Bruce Rauner, Joe Nolan, and Dan Yih. SOAF Exhibit 6. RESPONSE: Not disputed for purposes of this motion that Gilman sent the memo attached as Exhibit 6 to the LeapSource board of directors. K&E disputes that the letter is an accurate representation of events involving GTCR and LeapSource. The specific facts and allegations in the letter lack foundation and constitute inadmissible hearsay to the extent that they are offered by plaintiffs to prove the truth of the matters asserted. 148. The Gilman Memorandum described the history of several disputes with

GTCR and the GTCR members of the board of directors, and itemized numerous acts by GTCR and by principals of GTCR that were harmful to LeapSource and have been alleged as breaches of fiduciary duties in this action. SOAF Exhibit 6.
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RESPONSE: Disputed. The specific facts and allegations in the Gilman Memorandum lack foundation and constitute inadmissible hearsay to the extent that they are offered by plaintiffs to prove the truth of the matters asserted. 149. The Gilman Memorandum complained that "GTCR representatives

contributed to the creation of an abnormal operating environment, the breakdown of authority, the compromising of the chain of command, the subversive undermining of the CEO." Gilman Memorandum at page 4, SOAF Exhibit 6. RESPONSE: Not disputed for purposes of this motion that the Gilman Memorandum contains this statement. However, this statement lacks foundation and constitutes inadmissible hearsay to the extent that it is offered by plaintiffs to prove the truth of the matter asserted. 150. The Gilman Memorandum complained that GTCR began negotiating

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directly with Mike Makings on his $2.5 million Note that was then in default. Gilman Memorandum at pages 4-5, SOAF Exhibit 6. RESPONSE: Not disputed for purposes of this motion that the Gilman Memorandum contained this statement. However, this statement lacks foundation and constitutes inadmissible hearsay to the extent that they are offered by plaintiffs to prove the truth of the matters asserted. 151. The Gilman Memorandum complained that GTCR exposed LeapSource to

significant financial and legal risk by demanding that LeapSource negotiate down its contractual severance obligations. Gilman Memorandum at page 5, SOAF Exhibit 6. RESPONSE: Not disputed for purposes of this motion that the Gilman Memorandum contained this specific statement. However, this statement lacks foundation and constitutes inadmissible hearsay to the extent that they are offered by plaintiffs to prove the truth of the matters asserted.
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152.

The Gilman Memorandum complained that GTCR had told LeapSource

representatives that they would fund the Cargill contract if LeapSource executed its first reduction in force and then, after the reduction in force, GTCR refused to fund the Cargill transition. Gilman Memorandum at pages 5-6, SOAF Exhibit 6; Kirk Deposition 310:21311:3, SOAF Exhibit 7. RESPONSE: Not disputed for purposes of this motion that the Gilman Memorandum contained this statement. However, this statement lacks foundation and constitutes inadmissible hearsay to the extent that they are offered by plaintiffs to prove the truth of the matters asserted. 153. The reduction in force demanded by GTCR caused the loss of the Computer

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Horizons business, and damaged the company. Gilman Memorandum at page 7, SOAF Exhibit 6; Gilman Summary of Opinions SOAF Exhibit 8. RESPONSE: Disputed. The specific facts and allegations in the Gilman Memorandum lack foundation and constitute inadmissible hearsay to the extent that they are offered by plaintiffs to prove the truth of the matters asserted. The Gilman Summary of Opinions provides contains no admissible evidence supporting this statement. 154. Tom Gilman's efforts to work with GTCR in the interests of LeapSource led

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to the conflict described in the Gilman Memorandum in late February 2001. Letter from Tom Gilman to Dan Yih, Sean Cunningham and Joe Nolan dated January 26, 2001, SOAF Exhibit 9; Gilman Memorandum at page 7, SOAF Exhibit 6. RESPONSE: Disputed. The specific facts and allegations in the cited documents lack foundation and constitute inadmissible hearsay to the extent that they are offered by plaintiffs to prove the truth of the matters asserted. 155. The GTCR members of the board reacted very strongly to Mr. Gilman's

suggestion that GTCR and the GTCR members of the LeapSource board were not acting
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in the best interests of LeapSource. Q. Thank you. What was your reaction to that memorandum from Mr. Gilman? A. Q. A. That I was charitable when I said that he was misguided. You're referring to your testimony yesterday? Yes.

Yih Deposition, 355:12-17. RESPONSE: Not disputed for purposes of this motion. 156. When asked what was incorrect about the Gilman Memorandum, the first

point that Mr. Yih identified as "incorrect" - that he had ever said that GTCR was prepared to liquidate LeapSource today - was revealed to be a minor quibble, as he actually admitted making the statement in the same answer: ("A. I think that -- I don't recall that statement. I do recall, at the end of January, that we said that we would not -we would certainly consider liquidation, we would be prepared to liquidate if necessary ..."). See SOAF ¶ 29, above. RESPONSE: Disputed. The cited deposition testimony does not support this statement. 157. When GTCR received the Gilman Memorandum to the LeapSource board

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dated February 24, 2001 GTCR immediately consulted with Kirkland & Ellis, and discussed the issues raised in the Gilman Memorandum with K&E. Yih Deposition at 329:3-331:8 and 439:8-18, SOAF Exhibit 10: Q. You don't remember there being any discussion among the principals of GTCR, in the absence of counsel, about what Mr. Gilman has alleged? A. I don't know what to say. It was all discussions with counsel.

Q. Your answer, then, is, to your knowledge, there were no discussions about the allegations made by Mr. Gilman except in the presence of counsel? A. There was - initially we received the information. We were very concerned. We wanted to make sure that - collectively, everyone wanted to make sure that we ... understood the issues and addressed the issues, and we immediately contacted
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counsel. Yih Deposition, 329:19-330:8. Q. At the time that you were consulting with Kirkland & Ellis about the allegations made by Mr. Gilman, was it your understanding that Kirkland & Ellis was also counsel for LeapSource? A. I don't think I particularly thought about it. I thought that Kirkland was counsel for the company at some point in time. When I was consulting them on this particular issue, I was assuming they were representing GTCR. Yih Deposition, 335:7-15. RESPONSE: Not disputed for purposes of this motion. 158. GTCR Portfolio Principal and LeapSource board member Dan Yih

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forwarded Mr. Gilman's memorandum to litigation partner James Munson at Kirkland & Ellis by email on February 25, 2001. See Gilman Memorandum with attached email, SOAF Exhibit 6, at KE010472. RESPONSE: Not disputed for purposes of this motion. 159. David Eaton also received a copy of the Gilman Memorandum dated

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February 24, 2001. Gilman Memorandum produced by AEG, Bates AEG000651 to 000661, SOAF Exhibit 11. RESPONSE: Not disputed for purposes of this motion. 160. Sean Cunningham's notes of a meeting in late January 2001 identified

GTCR's objectives with respect to LeapSource as follows: "1. Limit downside, 2. Avoid embarrassment, 3. Protect COMSYS, other investment(s)." Notes of Sean Cunningham at Bates GTCR012260-012261, Deposition Exhibit 196, SOAF Exhibit 12: Q. Okay. The following page bears a date, "January 22, Monday," at the top of the page and, in parentheses, the names begin of Tom, Dan, Joe, Chris, and your initials; correct? A. That's correct.
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Q. Do you know whether these are notes of a meeting between those people on January 22? A. Yes, I believe that it was a meeting in person in Phoenix on January the 22nd. *** Q. If you could read out loud the ... the sentence -- or, well, the words and then the three bullet points that follow -- or the three numbered points, I should say -that follow on that page and the top of the following page. A. Yes. I -- I appear to be taking notes at a meeting about a - - a sale or merger of the business. And I write, "GTCR has one objective," colon, and then, off to the right, I appear to have three points, numbered 1 through 3, and No. I circled is "Limit downside." No. 2 circled is "Avoid embarrassment." And No. 3 circled on the next page says, "Protect COMSYS, comma, other investment, parentheses, S," closed parentheses. Cunningham Deposition 64:17-66:8. RESPONSE: Disputed to the extent that the statement attempts to impute the notes of a single GTCR employee to GTCR. 161. At the time those notes were taken, Mr. Cunningham was recently employed

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by GTCR and was taking his direction primarily from Joe Nolan and Dan Yih: Q. Who would have told Sean Cunningham that these were GTCR's objectives? MR. FOSTER: Objection. BY MR. STIRLING: Q. And --

MR. FOSTER: Object to the form; Calls for speculation, no foundation. A. I don't know who would have said that to Sean.

BY MR. STIRLING: Q. Okay. Sean Cunningham, at the time, had just become employed by GTCR; is that correct? A. Yes.

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Q. He -- he was not in a position to be deciding what GTCR's objectives were; correct? A. Q. A. Q. A. Q. A. Absolutely. Absolutely you're agreeing with me? Absolutely -Okay. -- you're correct. I just wanted -He would not determine what GTCR's object -- objectives are.

Q. To your knowledge, at the time, January 22, 2001, Mr. Cunningham was taking direction from either you or Joe Nolan; correct? A. Correct.

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Yih Deposition 324:21-325:22. RESPONSE: Disputed to the extent that the statement attempts to impute the notes taken by Sean Cunningham to Joe Nolan or Dan Yih. 162. David Eaton has been licensed to practice law since 1978. Eaton Deposition

at 12:3-5, SOAF Exhibit 13. RESPONSE: Not disputed for purposes of this motion. 163. David Eaton's practice of law began to focus exclusively on financial

reorganizations and bankruptcy in 1985. Eaton Deposition at 28:21-29:6, SOAF Exhibit 13. RESPONSE: Not disputed for purposes of this motion. 164. David Eaton was a partner at Kirkland & Ellis between 1991 and 1997

working in the field of financial restructuring, corporate reorganization and bankruptcy in the firm's corporate reorganization and bankruptcy department. Eaton Deposition at

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13:16-18 and 25:2-8, SOAF Exhibit 13. RESPONSE: Not disputed for purposes of this motion. 165. While David Eaton worked as an attorney at K & E he was involved in the

financial restructuring of one of GTCR's portfolio companies: Q. Going back now to your position at Kirkland & Ellis between `91 and `97, at any point during that time did you ever work on or consult on any business of GTCR? A. Q. A. I believe I consulted on one matter relating to a GTCR portfolio company. When, approximately, was that? Sometime between 1991 and 1997. *** Q. A. What was your assignment on this particular client? Pardon me.

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I was involved in the financial restructuring of that company. Eaton Deposition 34:1-8, 35:4-8. RESPONSE: Not disputed for purposes of this motion, but the time period at issue was somewhere between 1991 to 1997, when he worked as a partner at K&E, not the time frame at issue in this case during which he was "of counsel" to K&E. 166. David Eaton's relationship as an "of counsel" attorney with Kirkland &

Ellis began in the summer of 1999. Eaton Deposition at 23:3-6, SOAF Exhibit 13; Letter from Kirkland & Ellis to David Eaton dated June 11, 1999, Bates KE000293 to 295, SOAF Exhibit14. RESPONSE: Not disputed for purposes of this motion. 167. David Eaton's relationship as an "of counsel" attorney with Kirkland &

Ellis ended on June 30, 2001. Eaton Deposition at 112:7-9, SOAF Exhibit 13.

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RESPONSE: Disputed. Eaton's testimony and Exhibit 13 state only that the "of counsel" relationship would last "through" June 30, 2001. 168. David Eaton a. Was handling financial reorganization and bankruptcy matters for Kirkland clients; b. c. d. e. f. For most of that time, had an office at K&E; Had two floating secretaries; Maintained a direct-dial phone number at K & E; Had access to the K & E voice mail system; and Was covered on the K & E errors and omissions insurance policy: Q. During the roughly two years of this of-counsel relationship, did you maintain an office at Kirkland & Ellis? A. For most of it -- I'm not sure I did for all of it, but for most of it I did. While he was an "of counsel" attorney for K & E between 1999 and 2001,

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Q. Okay. Is there a specific period of time when you can think that you did not? A. I might not have had an office during the last few months of this relationship but I'm not sure. Q. Okay. But prior to that time you're -- you're fairly confident that you did have an office there? A. Q. A. Yes. I know I had an office there. Okay. And did you have a regular assigned secretary to you? I had two floating secretaries. I did not have one regular secretary.

Q. Okay. You had a specific direct-dial phone number, voice-mail access for -A. Q. Yes. -- yourself?

Were you covered, to your knowledge, on the Kirkland & Ellis errors-andomissions policy?

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A.

I believe I was.

Q. And I believe it's mentioned on the second page of this document. The second full paragraph down, it -- it -- it appears that Kirkland & Ellis' E & O carrier was through ALAS? A. Q. A. Yes. And that's the company that you had previously worked for; correct? Yes.

Q. And during this of-counsel relationship, the type of work that you would have been doing for Kirkland & Ellis clients was -- was that, again, in the financial reorganization and bankruptcy area? A. Yes.

Eaton Deposition 47:13-49:2. RESPONSE: K&E responds to the specific portions of this statement as follows: a. Disputed. For the time period relevant to this motion (January 2001 through

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August 2001), Eaton's work as an "of counsel" attorney at K&E was limited to one matter for a single client unrelated to LeapSource. (Declaration of Kevin Evanich, attached as Ex. 8 to Adams Decl.) Further, Eaton limited his "of counsel" work to a part-time basis because he "did not want to practice law full-time" and he wanted to "be involved in other businesses." (Eaton Dep. at 43:12 - 45:10, attached as Ex. 10 to Adams Decl.) b. Not disputed for purposes of this motion, but only for use in connection with

the part-time work that Eaton performed as an "of counsel" attorney billing time through K&E to one or more of its clients. In addition, Eaton maintained a regular office at AEG's offices in Highland Park, Illinois from which he performed AEG work. c. Not disputed for purposes of this motion, but only for use in connection with

the part-time work that Eaton performed as an "of counsel" attorney billing time through K&E to one or more of its clients. d. Not disputed for purposes of this motion that K&E maintained a direct-dial

number at K&E for Eaton for use in connection with the part-time work that Eaton

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performed as an "of counsel" attorney billing time through K&E to one or more of its clients. e. Not disputed for purposes of this motion that Eaton had access to the K&E

voicemail system for use in connection with the part-time work that Eaton performed as an "of counsel" attorney billing time through K&E to one or more of its clients. f. Not disputed for purposes of this motion that, for conduct in connection

with his duties as an "of counsel" lawyer for K&E, Eaton had the same insurance coverage as other lawyers covered by the K&E insurance policy. 169. While acting as an "of counsel" lawyer for K&E, David Eaton spent the

great majority of his time working on K&E business. Q. During the duration of the of-counsel relationship, can you estimate for me the amount of your time you spent working on Kirkland & Ellis business? A. Until -- from the inception of the relationship until early 2001, it would have been the great majority of my time. Thereafter I spent more time working on -- relatively more time working on AEG matters and on LA Gear. I'm sorry. During the year 2000 ... Kirkland would still have been -- the ofcounsel position would have been the majority of my time. I -- I -- I -- I did take on more of the LA Gear role and some AEG matters during the year 2000. Q. So during the time of your LA Gear assignment and as AEG came into form, the amount of time that you devoted to Kirkland & Ellis business, percentage-wise, decreased? A. It decreased somewhat and -- and particularly starting in early 2001.

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Eaton Deposition, 50:3-22. RESPONSE: Disputed. There is no record support for this statement. In his deposition, Eaton testified that he spent the majority of his time as an "of counsel" lawyer working on K&E business until early 2001, when he spent more time working on matters outside his K&E relationship. Moreover, Eaton was not "acting as an `of counsel' lawyer for K&E" while

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working on other matters. 170. While acting as an "of counsel" lawyer for K & E David Eaton had

contractually estimated at least 1,000 to 1,200 hours as the minimum amount of time he would bill to K & E matters. Letter from Kirkland & Ellis to David Eaton dated June 11, 1999, SOAF Exhibit 14. RESPONSE: Disputed. There is no record support for the assertion that Eaton had contracted to work any particular amount of time. The document states that "there is no minimum hours that you must work," and only that Eaton and K&E "targeted approximately 1,000 to 1,200 hours per annum" as the amount of work Eaton would perform. 171. Today, David Eaton is again practicing law as a partner in Kirkland & Ellis'

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corporate reorganization and bankruptcy department. Eaton Deposition at 13:16-18, SOAF Exhibit 13. RESPONSE: Not disputed for purposes of this motion. 172. Kevin Evanich, a partner with Kirkland & Ellis, contacted David Eaton

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concerning LeapSource sometime in February of 2001. Eaton Deposition at 35:12-21 and 55:1-22, SOAF Exhibit 13. RESPONSE: Not disputed for purposes of this motion. 173. Eaton was recommended to become involved in a matter in which K&E was

already involved on behalf of GTCR. David Eaton was referred to GTCR by Mr. Evanich at K&E. Q. Was there an occasion when you referred Mr. Eaton to LeapSource? MS. REFO: Object to the form. A. No.

And to short-circuit this, maybe I -- I should jump in, which counsel tells me I should never do, but I actually believe in the American system of justice. I think openness is a good thing.
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I referred David Eaton to GTCR, to represent G -- to talk to GTCR about working for LeapSource, but I don't think I ever talked to anyone at LeapSource. Evanich Deposition 21:2-14. Q. Is it -- is it your memory that Mr. Eaton was recommended to GTCR by Kirkland & Ellis? A. Yes, that is correct.

Q. Were you aware that Mr. Eaton was an attorney of-counsel to Kirkland & Ellis at the time of this engagement? A. I don't recall specifically.

Yih Deposition 430:9-14. RESPONSE: Disputed that K&E was already involved in the financial advisory and restructuring services for LeapSource to which AEG and Eaton devoted their efforts. The cited deposition testimony provides no basis for this statement. Not disputed that Evanich referred Eaton "to talk to GTCR about working for LeapSource." 174. Eaton was advised before he was engaged that GTCR had been funding and

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had suspended funding of LeapSource, and he admitted learning at some point that there was a dispute between GTCR and the LeapSource "former management" about the GTCR funding obligation: Q. Okay. Going back now to your first meeting at GTCR's offices, prior to the engagement -A. Uh-huh.

Q. -- dealing with LeapSource, you mentioned that you were told that -- that GTCR had been funding and had suspended funding. That -- what were you told about that? A. Q. A. Q. I don't recall any specifics -Were you told --- other than what I have already told you. I'm sorry. Thank you.

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Were -- were you told that there was any dispute between GTCR and LeapSource with regard to GTCR's funding obligations? A. At some point I was advised that there was a dispute between the former management of LeapSource and GTCR regarding GTCR's funding obligations, but I don't -- I don't know when I became aware of that dispute. Eaton Deposition 86:21- 87:15. RESPONSE: Disputed. The cited deposition testimony provides no basis for the statement that Eaton was told that funding of LeapSource was suspended. In fact, Eaton plainly testified that he recalled no specifics. Not disputed that Eaton subsequently learned about a dispute between the former management of LeapSource and GTCR. 175. When Eaton was hired, Kirk and Gilman were still members of the

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LeapSource board of directors. Ms. Kirk and Mr. Gilman were subsequently removed from the LeapSource board by GTCR entities as majority shareholders in LeapSource. SOAF Exhibit 15. RESPONSE: Not disputed for purposes of this motion that Kirk and Gilman were members of the LeapSource board of directors when the board voted to retain AEG Partners, LLC, or that Kirk was removed from the LeapSource board of directors pursuant to a written consent of the stockholders executed by GTCR entities. Disputed that Gilman was removed from the board. As set forth in Exhibit 15, Gilman resigned from the board and his resignation was accepted by the board. 176. Eaton did not bother to find out, or did not remember, that "former

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management" Kirk and Gilman were still members of the board of directors in March 2001: Q. At the time you heard of this dispute between former management and GTCR over their funding obligations, were you aware of whether or not the former management were still members of the LeapSource board of directors? A. Q. I ... I don't know whether they were or not. Did -- did you look into that?
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A.

I don't know.

Q. Were you aware that there was a time when former management -- that -when -- just so we're clear, when you're speaking of "former management," are you speaking of whom you now know to be Chris Kirk and Tom Gilman? A. Yes, those are the names.

Q. All right. Were you aware that there was a time when Chris Kirk and Tom Gilman, though no longer officers of LeapSource, were members of the board of directors? A. I am aware of that. I don't know the circumstances under which I became aware of that or when. Q. Okay. Were you aware of that during the tenure of your engagement with LeapSource? A. I don't know.

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Eaton Deposition 88:24-89:23. RESPONSE: Disputed. The cited testimony does not support the statement that Eaton "did not bother" to find out certain information. Not disputed that Eaton did not recall at his deposition the specifics of when Gilman and Kirk left the board. 177. Mr. Evanich admitted that the interests of GTCR and LeapSource were

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adverse, but testified that he did not remember when or how that came to be the case: Q. To your knowledge, at any time in the year 2001 were the interests of LeapSource and GTCR adverse? A. You've asked the question in a very precise way, and I want to make sure I answer the question that you've asked. I have no clear recollection of the timing of any of these events, so I can only answer it in a general way to say that at some point in the history of GTCR's investment in LeapSource, its interests became adverse. When that happened, how that happened, I don't know. Evanich Deposition 24:23-25:11. RESPONSE: Not disputed for purposes of this motion.

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178.

Eaton was originally consulted to advise GTCR about what course of action

was in GTCR's best interests: Dan Yih: We have a K&E kind of advisor on us that we need for GTCR's perspective and he's gonna plan on being there on Monday to talk through things with you. Tom Gilman: Ok.

Bruce Rauner: Yeah, GTCR is gonna hire a crisis manager/expert, you know, on troubled financings, etc. He's gonna come in on Monday. Tom Gilman: Down here?

Bruce Rauner: Yeah. It's hard to get educated on what's going on and that can help because depending on wha