Exhibit 10.40
Execution Copy

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AGREEMENT AND PLAN OF MERGER
BY AND AMONG
KEYSTONE AUTOMOTIVE HOLDINGS, INC.,
LKQ CORPORATION,
KAH ACQUISITION SUB, INC.,
CERTAIN STOCKHOLDERS OF KEYSTONE AUTOMOTIVE HOLDINGS, INC.,
AND
THE EQUITYHOLDERS REPRESENTATIVE

DATED AS OF DECEMBER 5, 2013

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Page

ARTICLE I THE MERGER
2

1.1.

The Merger
2

1.2.

Closing
2

1.3.

Effective Time
2

1.4.

Effects of the Merger
2

1.5.

Certificate of Incorporation and Bylaws
2

1.6.

Directors and Officers
3

ARTICLE II EFFECT OF THE MERGER; MERGER CONSIDERATION
3

2.1.

Conversion of Company Shares
3

2.2.

Dissenting Shares
3

2.3.

Treatment of Stock Options; Restricted Stock; and Restricted Stock Units
4

2.4.

Payments to the Equityholders
5

2.5.

Other Payments by Parent at Closing
6

2.6.

Closing Net Working Capital and Net Closing Cash Adjustments
7

2.7.

Representative Holdback Amount and WC Estimated Surplus
10

2.8.

Tax Withholding
10

2.9.

Tax Deductions
10

ARTICLE III REPRESENTATIONS AND WARRANTIES REGARDING THE
COMPANY
10

3.1.

Organization and Qualification of the Company
10

3.2.

Organization and Qualification of Subsidiaries
11

3.3.

Capitalization
11

3.4.

Authority
12

3.5.

No Conflict
13

3.6.

Consents; Stockholder Approval
13

3.7.

Financial Statements
13

3.8.

No Undisclosed Liabilities
14

3.9.

Absence of Certain Changes
15

3.10.

Assets and Properties
15

3.11.

Real Property; Real Property Leases
15

3.12.

Intellectual Property
17

3.13.

Contracts
17

3.14.

Litigation
19

3.15.

Compliance with Laws; Permits
19

3.16.

Insurance
20

3.17.

Environmental Matters
20

3.18.

Employment Matters
21

3.19.

Employment Benefit Plans
22

3.20.

Taxes
25

3.21.

Ownership of Assets
27

CI-9382152 v14     i

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3.22.

Customers; Suppliers
27

3.23.

Bank Accounts; Powers of Attorney
27

3.24.

Interested Party Transactions
28

3.25.

Brokers' and Finders' Fees
28

3.26.

No Other Representations
28

ARTICLE IV REPRESENTATIONS AND WARRANTS OF THE STOCKHOLDER
PARTIES
29

4.1.

Organization and Qualification of Stockholder Party
29

4.2.

Ownership
29

4.3.

Authority
29

4.4.

No Conflict
29

4.5.

No Legal Actions
29

4.6.

Brokers' and Finders' Fees
30

ARTICLE V REPRESENTATIONS AND WARRANTIES OF PARENT AND
MERGER SUB
30

5.1.

Organization of Parent and Merger Sub
30

5.2.

Authority
30

5.3.

No Conflict
30

5.4.

Consents; Stockholder Approval
30

5.5.

No Legal Actions
31

5.6.

Ownership and Activities of Merger Sub
31

5.7.

Financing
31

5.8.

Solvency
31

5.9.

Acknowledgment
31

5.10.

Brokers' and Finders' Fees
32

5.11.

No Other Representations
32

ARTICLE VI COVENANTS
32

6.1.

Conduct of Business
32

6.2.

Access to Information; Confidentiality
34

6.3.

Satisfaction of Closing Conditions; Regulatory Matters
35

6.4.

Indemnification of Officers and Directors
37

6.5
.
Employees; Benefit Plans
38

6.6
.
Preservation of Records
39

6.7
.
Outstanding Letters of Credit
39

6.8
.
Director Resignations
39

6.9
.
Notice of Certain Events
39

6.1
.
No Solicitation of Other Bids
40

6.11
.
Employee Non-Solicit
41

6.12
.
Transfer of Common Stock; Voting; Company Stockholder Approval
41

6.13
.
Bonus Payments
42

6.14
.
NTP Payments
42

6.15
.
Access to Assets
42

6.16
.
Section 280G of the Code
42

6.17
.
Transfer of Title
42

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6.18
.
Closing Bank Debt
43

6.19
.
Stockholder Termination of Agreements
43

6.20
.
Further Assurances
43

ARTICLE VII CONDITIONS PRECEDENT TO THE CLOSING
43

7.1.

Conditions to Each Party's Obligations
43

7.2.

Conditions to the Obligation of Parent and Merger Sub
44

7.3.

Conditions to the Obligation of the Company
45

ARTICLE VIII TERMINATION
46

8.1.

Termination
46

8.2.

Effect of Termination
48

ARTICLE IX INDEMNIFICATION
48

9.1
.
Survival of Representations and Warranties
48

9.2
.
Indemnification
49

9.3
.
Limitations
50

9.4
.
Procedures
52

9.5
.
Third Party Claims
53

9.6
.
Purchase Price Adjustments
54

9.7
.
Fraud and Willful Misconduct
54

ARTICLE X TAX MATTERS
55

10.1
.
Tax Indemnity
55

10.2
.
Responsibility for Filing Tax Returns
56

10.3
.
Tax Contests
57

10.4
.
Assistance and Cooperation
58

10.5
.
Transfer Taxes
58

10.6
.
Treatment of Payments
59

ARTICLE XI DEFINITIONS; CONSTRUCTION
59

11.1.

Definitions
59

11.2.

Construction
71

ARTICLE XII GENERAL PROVISIONS
72

12.1
.
Equityholders Representative; Power of Attorney
72

12.2
.
Expenses
73

12.3
.
Public Announcements
74

12.4
.
Notices
74

12.5
.
Entire Agreement
75

12.6
.
Severability
75

12.7
.
Specific Performance
75

12.8
.
Successors and Assigns; Assignment; Parties in Interest
76

12.9
.
Amendment; Waiver
76

12.10
.
Governing Law; Venue
76

12.11
.
Waiver of Jury Trial
77

12.12
.
Other Remedies
77

CI-9382152 v14     iii

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12.13
.
Counterparts; Electronic Delivery
77

Exhibit

Exhibit A    Form of Promissory Note
Exhibit B    Form of Mortgage

CI-9382152 v14     iv

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AGREEMENT AND PLAN OF MERGER
This Agreement and Plan of Merger, dated as of December 5, 2013 (this
“Agreement”), is entered into by and among Keystone Automotive Holdings, Inc., a
Delaware corporation (the “Company”), LKQ Corporation, a Delaware corporation
(“Parent”), KAH Acquisition Sub, Inc., a Delaware corporation and a wholly owned
subsidiary of Parent (“Merger Sub”), the undersigned stockholders of the Company
(the “Stockholder Parties”), and Sphere Capital, LLC - Series A, a Delaware
limited liability company, in its capacity as the representative of the
Equityholders (the “Equityholders Representative”). (Unless the context
otherwise makes clear, capitalized terms used in this Agreement are defined in
ARTICLE XI.)
BACKGROUND
A.    This Agreement constitutes an agreement of merger, as such term is used in
Section 251(b) of the General Corporation Law of the State of Delaware (the
“DGCL”), providing for the merger of Merger Sub with and into the Company with
the Company continuing as the surviving corporation (the “Merger”) in accordance
with the terms and conditions of this Agreement and the DGCL, whereby each
issued and outstanding share of capital stock of the Company will be converted
into the right to receive the Per Share Merger Consideration.
B.    A special committee of the Board of Directors of the Company (the “Board”)
has unanimously recommended that the Board approve this Agreement and declare
its advisability to the Company and the Stockholders.
C.    The Board has unanimously adopted resolutions (i) approving this Agreement
and declaring its advisability, (ii) approving the transactions contemplated
hereby, including the Merger, (iii) determining that the terms of the Merger and
the other transactions contemplated hereby are fair to, advisable and in the
best interests of, the Company and the Stockholders, (iv) directing that this
Agreement be submitted to the Stockholders for consideration for adoption or
rejection and (v) recommending that the Stockholders adopt this Agreement.
D.    The boards of directors of both Parent and Merger Sub have each
unanimously adopted resolutions approving and declaring advisable this Agreement
and the transactions contemplated hereby, including the Merger, and authorizing
Parent and Merger Sub to enter into this Agreement and to consummate the Merger.
E.    The Company, Parent and Merger Sub desire to make certain representations,
warranties and agreements in connection with the Merger and the other
transactions contemplated hereby and prescribe various conditions to the Merger
as provided herein.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing and of the mutual
representations, warranties and agreements contained herein, the Parties hereby
agree as follows:

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ARTICLE I
THE MERGER

1.1.    The Merger. At the Effective Time, and subject to and on the terms and
conditions of this Agreement and the provisions of the DGCL, the Company and
Merger Sub shall consummate the Merger pursuant to which: (a) Merger Sub shall
be merged with and into the Company, the separate existence of Merger Sub shall
cease, (b) the Company shall continue as the surviving corporation in the Merger
(the “Surviving Corporation”) and shall continue to be governed by the
applicable Laws of the State of Delaware, and (c) the separate corporate
existence of the Company with all its properties, rights, privileges, powers,
franchises and immunities, shall continue unaffected by the Merger. The Merger
shall have the effects set forth in the applicable provisions of the DGCL.
1.2.    Closing. The closing (the “Closing”) of the Merger shall take place as
promptly as practicable, but no later than three (3) Business Days, following
the satisfaction or waiver of the conditions set forth in ARTICLE VII (other
than conditions that by their nature are to be satisfied at the Closing, but
subject to the satisfaction or waiver of such conditions) at the offices of K&L
Gates LLP, 70 West Madison Street, Chicago, Illinois or on such other date or
place as shall be agreed in writing between the Company and Parent; provided
that the Closing shall not take place earlier than January 3, 2014. The date on
which the Closing occurs is referred to in this Agreement as the “Closing Date.”
1.3.    Effective Time. On the Closing Date, the Parties shall file with the
Delaware Secretary of State a certificate of merger (the “Certificate of
Merger”) duly executed in accordance with the relevant provisions of the DGCL
and shall make all other filings or recordings required under the DGCL to give
full effect to the Merger. The Merger shall become effective at such time as the
Certificate of Merger is duly filed with the Delaware Secretary of State, or at
such later date and time as Parent and the Company shall agree and specify in
the Certificate of Merger (the “Effective Time”).
1.4.    Effects of the Merger. The Merger shall have the effects provided in
this Agreement and in the applicable provisions of the DGCL. Without limiting
the generality of the foregoing, and subject thereto, at the Effective Time, all
of the properties, rights, privileges, powers, franchises and immunities of the
Company and Merger Sub shall vest in the Surviving Corporation, and all debts,
liabilities and duties of the Company and Merger Sub shall become the debts,
liabilities and duties of the Surviving Corporation.
1.5.    Certificate of Incorporation and Bylaws. At the Effective Time, (a) the
certificate of incorporation of Merger Sub, as in effect immediately prior to
the Effective Time, shall be the certificate of incorporation of the Surviving
Corporation until thereafter changed or amended as provided therein or by
Applicable Law, except that the name of the Surviving Corporation shall continue
to be Keystone Automotive Holdings, Inc. until amended in accordance with
Applicable Law and (b) the bylaws of Merger Sub, as in effect immediately prior
to the Effective Time, shall be the bylaws of the Surviving Corporation until
thereafter changed or amended as provided therein or by Applicable Law, except
that the name of the Surviving Corporation shall continue to be Keystone
Automotive Holdings, Inc. until amended in accordance with Applicable Law.

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1.6.    Directors and Officers. The members of the board of directors of Merger
Sub immediately prior to the Effective Time shall become the initial directors
of the Surviving Corporation at the Effective Time, and the officers of Merger
Sub immediately prior to the Effective Time shall become the initial officers of
the Surviving Corporation at the Effective Time, in each case to hold office
until their respective successors shall have been duly elected, designated or
qualified, or until their earlier death, resignation or removal in accordance
with the certificate of incorporation and bylaws of the Surviving Corporation.
The officers of the Company immediately prior to the Effective Time shall cease
to be officers of the Company at the Effective Time.
ARTICLE II
EFFECT OF THE MERGER; MERGER CONSIDERATION

2.1.    Conversion of Company Shares. At the Effective Time, by virtue of the
Merger and without any action on the part of the Company or Merger Sub or on the
part of any other Person:
(a)    Except as otherwise provided in Section 2.1(b) and Section 2.2, each
share of Common Stock issued and outstanding immediately prior to the Effective
Time shall be converted automatically into and thereafter represent solely the
right to receive the Initial Per Share Merger Consideration and the Subsequent
Payments to be made with respect thereto as provided in Section 2.4(f) (all such
amounts, taken together, the “Per Share Merger Consideration”). From and after
the Effective Time, all such shares of Common Stock shall no longer be
outstanding and shall automatically be cancelled and shall cease to exist, and
each holder of a certificate formerly representing any such shares shall cease
to have any rights with respect thereto, except the right to receive the Per
Share Merger Consideration.
(b)    Each share of Common Stock held in the treasury of the Company and each
share of Common Stock owned by Parent, or by any other direct or indirect wholly
owned subsidiary of Parent, immediately prior to the Effective Time, shall be
automatically canceled and retired and shall cease to exist and no payment or
other consideration shall be made with respect thereto.
(c)    Each share of common stock, par value $0.01 per share, of Merger Sub that
is issued and outstanding immediately prior to the Effective Time shall be
converted automatically into and become one share of common stock, par value
$0.01 per share, of the Surviving Corporation, so that, at the Effective Time,
Parent shall be the holder of all of the issued and outstanding shares of the
Surviving Corporation’s common stock.
2.2.    Dissenting Shares. Shares of Common Stock outstanding immediately prior
to the Effective Time and held by a holder who has not voted in favor of the
Merger or consented thereto in writing and who has demanded appraisal for such
shares in accordance with the DGCL (“Dissenting Shares”) shall not be converted
into a right to receive the Per Share Merger Consideration but instead shall be
entitled to receive the fair value of such shares of Common Stock as may be
determined to be due with respect to such Dissenting Shares pursuant to Section
262 of the DGCL (and at the Effective Time, such Dissenting Shares shall no
longer be outstanding and shall automatically be cancelled and shall cease to
exist and such holder shall

 

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cease to have any rights with respect thereto except the rights set forth in
Section 262 of the DGCL), unless and until such holder fails to perfect,
withdraws or otherwise loses such holder’s right to appraisal under the DGCL.
If, after the Effective Time, such holder fails to perfect, withdraws or
otherwise loses such holder’s right to appraisal, each such share of Common
Stock shall be treated as if it had been converted at the Effective Time into
the right to receive the Per Share Merger Consideration as and when provided in
Section 2.1(a), without any interest thereon. The Company shall give Parent
(a) prompt notice of (i) any demands for appraisal pursuant to the DGCL received
by the Company, but in any event not later than one (1) day after such demand is
received by the Company, (ii) withdrawals of such demands, and (iii) any other
instruments served pursuant to the DGCL and received by the Company in
connection with such demands, and (b) the opportunity to participate in all
negotiations and proceedings with respect to demands for appraisal under the
DGCL prior to the Effective Time. The Company shall not, except with the prior
written consent of Parent or as otherwise required by Applicable Law, make any
payment with respect to any such demands for appraisal or offer to settle or
settle any such demands without Parent’s prior written consent.
2.3.    Treatment of Stock Options; Restricted Stock; and Restricted Stock
Units.
(a)    Treatment of Stock Options. Prior to the Effective Time, the Company
shall cause each Stock Option that has not expired and is outstanding
immediately prior to the Effective Time to become or otherwise be deemed fully
vested at such time and to be canceled and converted at the Effective Time into
the right to receive payment of the Initial Stock Option Cancellation Payment
and the Subsequent Payments to be made with respect thereto as provided in
Section 2.4(f).
(b)    Treatment of Restricted Stock. Prior to the Effective Time, the Company
shall cause each share of Restricted Stock that is unvested and outstanding
immediately prior to the Effective Time to become or otherwise be deemed fully
vested Common Stock at such time and, accordingly, each such share shall be
converted automatically into and thereafter represent solely the right to
receive the Initial Per Share Merger Consideration and the Subsequent Payments
with respect thereto as provided in Section 2.4(f).
(c)    Treatment of Restricted Stock Units. Prior to the Effective Time, the
Company shall cause each Restricted Stock Unit that is unvested and outstanding
immediately prior to the Effective Time to become or otherwise be deemed fully
vested at such time and to be canceled and converted at the Effective Time into
the right to receive payment of the Initial Per Share Merger Consideration and
the Subsequent Payments with respect thereto as provided in Section 2.4(f).
(d)    Company Equity Incentive Plan. After the Effective Time, the Company
Equity Incentive Plan shall be terminated and no further Stock Options, shares
of Restricted Stock, Restricted Stock Units, or other rights with respect to
Common Stock shall be granted thereunder.

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2.4.    Payments to the Equityholders.
(a)    Prior to the Closing Date, the Company shall distribute to each
Stockholder of record (including holders of Restricted Stock) a customary letter
of transmittal in form and substance reasonably satisfactory to Parent (the
“Letter of Transmittal”) for use in surrendering the Certificates evidencing the
shares of Common Stock held by such Stockholder (or in lieu thereof an Affidavit
of Loss as provided in Section 2.4(d)) in exchange for the payments provided for
in this Agreement.
(b)    Each Stockholder who has, prior to the Effective Time, properly
completed, executed and delivered to the Company a Letter of Transmittal and the
Certificate(s) evidencing such Stockholder’s shares of Common Stock (or an
Affidavit of Loss in lieu thereof) shall be entitled to receive from Parent on
the Closing Date, and Parent shall pay to such Stockholder on the Closing Date,
an amount equal to the Initial Per Share Merger Consideration multiplied by the
number of shares of Common Stock represented by the Certificate surrendered (or
referred to in the Affidavit of Loss delivered in lieu thereof), such payments
to be made by check or by wire transfer as requested by such Stockholder in the
Letter of Transmittal delivered by such Stockholder; provided, however, that
with respect to the holders of Restricted Stock immediately prior to the
Effective Time, such payments shall be made through the Company’s or its
applicable Subsidiary’s payroll account as provided in Section 2.4(e).
(c)    With respect to any Stockholder who has not properly completed, executed
and delivered a Letter of Transmittal to the Company prior to the Effective
Time, or who has failed to deliver the Certificate(s) evidencing such
Stockholder’s shares of Common Stock (or an Affidavit of Loss in lieu thereof),
Parent shall pay to the Equityholders Representative at the Closing an amount
equal to the Initial Per Share Merger Consideration multiplied by the total
number of shares of Common Stock held by all such Stockholders (other than
Dissenting Shares), such funds to be held by the Equityholders Representative
(subject to applicable abandoned property, escheat and similar Laws) for further
payment to each such Stockholder when and as such Stockholder delivers a
properly completed and executed Letter of Transmittal and the Certificate(s)
evidencing such Stockholder’s shares of Common Stock (or an Affidavit of Loss in
lieu thereof) to the Equityholders Representative (who shall promptly thereafter
deliver such documents to Parent), at which time such Stockholder shall be
entitled to receive from the funds held by the Equityholders Representative the
same amount (payable in the same manner, except with respect to shares of
Restricted Stock, which shall be payable as provided in Section 2.4(e)) as such
Stockholder would have received from Parent under Section 2.4(b) if such Letter
of Transmittal and Certificate(s) (or Affidavit of Loss in lieu thereof) had
been delivered to the Company prior to the Effective Time.
(d)    If any Certificate which formerly represented shares of Common Stock held
by any Stockholder shall have been lost, stolen or destroyed, such Stockholder
may, in lieu of delivering such Certificate with the Letter of Transmittal
delivered in accordance with Section 2.4(b) or Section 2.4(c), complete, execute
and deliver an affidavit of loss in form reasonably satisfactory to Parent,
including customary indemnity provisions (an “Affidavit of Loss”).
(e)    As soon as reasonably practicable after the Effective Time, but in any
event not later than the first regular payroll that occurs not earlier than
three (3) Business Days

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following the Effective Time, the Surviving Corporation shall pay through the
Company’s or its applicable Subsidiary’s payroll account, in accordance with its
regular payroll practices (and subject to all applicable payroll Taxes and
withholding Taxes) to (i) each former holder of a Stock Option who has delivered
an Option Consent Agreement, the Initial Stock Option Cancellation Payment, (ii)
each holder of Restricted Stock, the portion of the Unpaid Class B Dividends
specified by the Company not less than three (3) Business Days prior to the
Closing Date, (iii) each applicable Employee, the amount of Transaction Expenses
specified by the Company for such Employee not less than three (3) Business Days
prior to the Closing Date, and (iv) each former holder of shares of Restricted
Stock and each former holder of Restricted Stock Units who has delivered a
Restricted Stock Unit Consent Agreement an amount in cash equal to the Initial
Per Share Merger Consideration multiplied by the number of outstanding shares of
Restricted Stock (or number of Restricted Stock Units) held by such holder of
Restricted Stock (or Restricted Stock Units) immediately prior to the Effective
Time. The Company has accrued, or shall prior to the Closing accrue, all
applicable employer payroll Taxes and withholding Taxes payable by the Company
in connection with the cash distributions set forth in clauses (i) through (iv)
of this Section 2.4(e).
(f)    In addition to the payments to be made to the Equityholders as provided
above, the Equityholders shall also be entitled to receive, subject to Section
12.1(b), the Subsequent Payments from the Equityholders Representative in
accordance with their respective Equity Ownership Percentages. The foregoing
notwithstanding, to the extent required by applicable Law, the Surviving
Corporation shall, upon request of the Equityholders Representative, facilitate
the payment of any Subsequent Payments to be made to former holders of Stock
Options, shares of Restricted Stock and Restricted Stock Units, through its or
its applicable Subsidiary’s payroll account, subject to all applicable payroll
Taxes and withholding Taxes, in which case, the Equityholders Representative
shall reimburse the Surviving Corporation for the employer portion of any
applicable payroll Taxes in connection with the foregoing payments.
(g)    In no event shall any Equityholder be entitled to receive interest on any
of the funds to be received in connection with the Merger.
2.5.    Other Payments by Parent at Closing. On the Closing Date, Parent shall
deliver the executed Promissory Note to the Equityholders Representative and
shall make the following payments by wire transfer of immediately available
funds:
(a)    on the Company’s behalf, to the appropriate third parties the aggregate
amount necessary to repay in full all Closing Bank Debt as set forth in the
Payoff Letters, such payments to be remitted to the accounts and in the amounts
specified in the Payoff Letters;
(b)    on the Company’s behalf, to the appropriate third parties, the aggregate
amount necessary to pay the Transaction Expenses (other than Transaction
Expenses payable to Employees) that shall have been determined as of the
Closing, such payments to be remitted to the accounts and in the amounts
specified by the Company not less than three (3) Business Days prior to the
Closing Date;

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(c)    to the Equityholders Representative, the Representative Holdback Amount
and, if applicable, the WC Estimated Surplus, such payments to be remitted to an
account or accounts specified by the Equityholders Representative not less than
three (3) Business Days prior to the Closing Date; and
(d)    (A) to the Company, for the benefit of and disbursement to the Option
Holders, the aggregate amount of the Initial Stock Option Cancellation Payments,
such payment to be remitted to the Company’s or its applicable Subsidiary’s
payroll account for further payment to the Option Holders pursuant to Section
2.4(e), (B) to the Company, for the benefit of and disbursement to the holders
of Restricted Stock, the aggregate amount of the Unpaid Class B Dividends, such
payment to be remitted to the Company’s or its applicable Subsidiary’s payroll
account for further payment to such Equityholders pursuant to Section 2.4(e),
(C) to the Company, for the benefit of and disbursement to the applicable
Employees, the aggregate amount of Transaction Expenses payable to such
Employees, such payment to be remitted to the Company’s or its applicable
Subsidiary’s payroll account for further payment to such Employees pursuant to
Section 2.4(e), (D) to the Company, for the benefit of and disbursement to the
holders of Restricted Stock, the aggregate amount equal to the Initial Per Share
Merger Consideration multiplied by the number of outstanding shares of
Restricted Stock held by such holder of Restricted Stock immediately prior to
the Effective Time, such payment to be remitted to the Company’s or its
applicable Subsidiary’s payroll account for further payment to the holders of
Restricted Stock pursuant to Section 2.4(e), (E) to the Company, for the benefit
of and disbursement to the holders of Restricted Stock Units, the aggregate
amount equal to the Initial Per Share Merger Consideration multiplied by the
number of outstanding Restricted Stock Units held by such holders of Restricted
Stock Units immediately prior to the Effective Time, such payment to be remitted
to the Company’s or its applicable Subsidiary’s payroll account for further
payment to the holders of Restricted Stock Units pursuant to Section 2.4(e), and
(F) to the Company for disbursement to the applicable Governmental Entity, all
withholding Taxes with respect to the Initial Stock Option Cancellation
Payments, the Unpaid Class B Dividends, the Transaction Expenses payable to
Employees, and the payments to the holders of Restricted Stock and Restricted
Stock Units.
2.6.    Closing Net Working Capital and Net Closing Cash Adjustments.
(a)    No less than four (4) Business Days prior to the anticipated Closing
Date, the Company shall prepare and deliver to Parent a statement (the
“Estimated Statement”), duly executed by the Chief Financial Officer of the
Company, setting forth in reasonable detail the Company’s good faith estimate of
the Closing Net Working Capital as of the anticipated Closing Date (the
“Estimated Closing Net Working Capital”) and of the Net Closing Cash as of the
anticipated Closing Date (the “Estimated Closing Cash”). The Estimated Statement
shall be based on the books and records of the Company and its Subsidiaries, and
shall be prepared in good faith and in accordance with the Accounting
Conventions.
(b)    Within seventy-five (75) days after the Closing Date, Parent shall
prepare and deliver to the Equityholders Representative a statement (the
“Closing Statement”) setting forth Parent’s determination of Closing Net Working
Capital and Net Closing Cash showing in reasonable detail any and all changes
reflected therein from the amounts reflected in the Estimated Statement of
Estimated Closing Net Working Capital and Estimated Closing Cash

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delivered pursuant to Section 2.6(a). The Closing Statement shall be based on
the books and records of the Company and its Subsidiaries and shall be prepared
in good faith and in accordance with the Accounting Conventions.
(c)    The Closing Statement shall be final and binding on the Parties unless
the Equityholders Representative, on behalf of the Equityholders, delivers to
Parent a written notice of disagreement with the Closing Statement within
seventy-five (75) days following the receipt thereof. Such written notice shall
describe the nature of any such disagreement in reasonable detail, identifying
the specific items as to which the Equityholders Representative disagrees and
shall be accompanied by reasonable supporting documentation. During such
seventy-five (75) day period, Parent shall cause the Surviving Corporation and
its Subsidiaries to provide the Equityholders Representative and the
Equityholders Representative’s advisors with on-site access and access via
telephone and e-mail communications and transmissions during regular business
hours and upon reasonable notice to all relevant books and records and employees
(including key accounting and finance personnel) of the Surviving Corporation
and its Subsidiaries to the extent necessary to review the matters and
information used to prepare and to support the Closing Statement, all in a
manner not unreasonably interfering with the business of the Surviving
Corporation and its Subsidiaries and if and to the extent that such access is
requested but not provided, such seventy-five (75) day review period shall be
extended on a day-for-day basis for each full day that such access is requested
but not provided. If the Equityholders Representative delivers a notice of
disagreement in a timely manner, then the Equityholders Representative, on
behalf of the Equityholders, and Parent shall attempt to resolve all such
matters identified in such notice. If the Equityholders Representative and
Parent are unable to resolve all such disagreements within thirty (30) days
after the receipt by Parent of the notice of disagreement (or such longer period
as may be agreed by Parent and the Equityholders Representative), then the
remaining disputed matters shall be promptly submitted to the Accounting
Arbitrator for binding resolution, and the Accounting Arbitrator shall be
directed by Parent and the Equityholders Representative to resolve the
unresolved objections as promptly as reasonably practicable. The Accounting
Arbitrator will consider only those items and amounts set forth on the Closing
Statement as to which Parent and the Equityholders Representative have disagreed
and shall resolve such disagreements in accordance with the terms and provisions
of this Agreement. The Accounting Arbitrator shall issue a written report
containing a final Closing Statement setting forth its determination of Closing
Net Working Capital and Net Closing Cash, which determination shall be final and
binding upon Parent, the Surviving Corporation, the Equityholders Representative
and the Equityholders. Any upfront or other fees or expenses charged by the
Accounting Arbitrator prior to the final determination shall be paid fifty
percent (50%) by Parent and fifty percent (50%) by the Equityholders
Representative, subject to the remaining provisions of this Section 2.6(c). The
final aggregate fees and expenses of the Accounting Arbitrator incurred in
connection with the determination of the disputed items (including any upfront
or other fees previously paid) shall be paid by Parent and by the Equityholders
Representative (on behalf of the Equityholders, to be paid from the
Representative Holdback Amount) based on the relative success of their positions
as compared to the final determination of the Accounting Arbitrator. By way of
example, if Parent has taken the position that the Closing Net Working Capital
was $1,000,000 less than the Estimated Closing Net Working Capital and the
Equityholders Representative has taken the position that the Closing Net Working
Capital was $500,000 greater than the Estimated Closing Net Working Capital (and
the parties had otherwise agreed on Net Closing Cash) and the Accounting
Arbitrator finally

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determines that the Closing Net Working Capital was equal to the Estimated
Closing Net Working Capital, then Parent shall ultimately pay two thirds (2/3)
of the fees and expenses of the Accounting Arbitrator and the Equityholders
Representative (on behalf of the Equityholders) shall ultimately pay one third
(1/3) of the fees and expenses of the Accounting Arbitrator. To the extent
either Parent or the Equityholders Representative has made payments to the
Accounting Arbitrator in excess of the amount of fees and expenses ultimately
determined to be payable by such Party, the other Party shall reimburse such
first Party in an amount equal to such excess. Parent and the Equityholders
Representative shall, and Parent shall cause the Surviving Corporation to,
cooperate fully with the Accounting Arbitrator and respond on a timely basis to
all requests for information or access to documents or personnel made by the
Accounting Arbitrator, all with the intent to fairly and in good faith resolve
all disputes relating to the Closing Statement as promptly as reasonably
practicable.
(d)    If the aggregate amount of Closing Net Working Capital plus Net Closing
Cash as finally determined in accordance with Section 2.6(c) is less than the
aggregate amount of Estimated Closing Net Working Capital plus Estimated Closing
Cash, then the amount of such difference (the “WC Deficiency”) shall be paid in
the following sequential manner: (i) to the extent there is a WC Estimated
Surplus, the Equityholders Representative shall pay to Parent the WC Deficiency
from the WC Estimated Surplus, and any remaining portion of the WC Estimated
Surplus shall be paid to the Equityholders pursuant to Section 2.6(e); (ii) if
the WC Deficiency exceeds the WC Estimated Surplus (if any) the amount of the
Promissory Note shall be reduced by the amount of the difference between the WC
Deficiency and the WC Estimated Surplus (if any) up to an amount equal to
$1,500,000 (and the Surviving Corporation and Equityholders Representative shall
amend the Promissory Note to reflect the reduced amount); (iii) to the extent
the WC Deficiency exceeds the combined amount of the WC Estimated Surplus (if
any) plus $1,500,000, then the Equityholders Representative shall pay to Parent
from the remaining Representative Holdback Amount an amount in cash equal to
such excess; and (iv) to the extent the WC Deficiency exceeds the combined
amount of the WC Estimated Surplus (if any) plus $1,500,000 plus the remaining
Representative Holdback Amount, then the Stockholder Parties shall pay (which
obligation shall be on a several basis based on their respective Indemnity Pro
Rata Share) to Parent an amount in cash equal to such excess. If the aggregate
amount of Closing Net Working Capital plus Net Closing Cash as finally
determined in accordance with Section 2.6(c) is greater than the aggregate
amount of Estimated Closing Net Working Capital plus Estimated Closing Cash,
then the amount of such difference shall be paid by Parent or the Surviving
Corporation to the Equityholders Representative (for further payment to the
Equityholders in accordance with Section 2.6(e)) and the Equityholders
Representative shall distribute the WC Estimated Surplus to the Equityholders in
accordance with Section 2.6(e). Any payments required to be made pursuant to
this Section 2.6(d) shall be made by wire transfer within five (5) Business Days
after the final determination of Closing Net Working Capital and Net Closing
Cash.
(e)    If Parent or the Surviving Corporation is obligated to make payments to
the Equityholders Representative pursuant to Section 2.6(d), then, subject to
Section 12.1(b), the Equityholders Representative shall disburse and pay the
aggregate amount paid to it pursuant to Section 2.6(d) to the Equityholders in
accordance with their respective Equity Ownership Percentages and, with respect
to the Stockholders, the payment instructions set forth in their respective
Letters of Transmittal.

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2.7.    Representative Holdback Amount and WC Estimated Surplus.
(a)    If and to the extent that any portion of the Representative Holdback
Amount remains unspent at the time that the final payment is made under the
Promissory Note, then, Subject to Section 12.1(b), the Equityholders
Representative shall pay over such remaining portion of the Representative
Holdback Amount at such time to the Equityholders in the same manner as if such
funds were being paid from payments received under the Promissory Note.
(b)    The Equityholders Representative shall retain the WC Estimated Surplus
(if any) on behalf of the Equityholders and shall distribute the WC Estimated
Surplus to the applicable parties pursuant to and in accordance with Section
2.6(d).
2.8.    Tax Withholding. Each of Parent, the Company, the Surviving Corporation
and any applicable Subsidiary thereof, as applicable, shall be entitled to
deduct and withhold from any amounts payable by it pursuant to this Agreement
any withholding Taxes or other amounts required by Law to be deducted and
withheld. To the extent that any such amounts are so deducted or withheld, such
amounts will be treated for all purposes of this Agreement as having been paid
to the person with respect to whom such deduction and withholding was made.
2.9.    Tax Deductions. It is the intent of the Parties that, to the extent
permitted by applicable Tax Law, all income Tax deductions with respect to, or
resulting from, the payment of any Transaction Expenses, the Initial Stock
Option Cancellation Payments, the payments to the holders of Restricted Stock
and Restricted Stock Units, the payment of the Closing Bank Debt at Closing
(including, for the avoidance of doubt, any Tax deductions that may be available
with respect to the acceleration of original issue discount, any deferred
underwriting fees or expenses, any deferred sponsor transaction fees and any
other deferred financing fees or costs in connection with the repayment of the
Closing Bank Debt) and any payments to the former holders of Stock Options,
shares of Restricted Stock and Restricted Stock Units in connection with the
Closing shall be deducted by the Company in a Pre-Closing Tax Period. The
Company shall take all such deductions in the final Tax Returns of the Company
for the Tax period ending on the Closing Date, and Parent shall not take any
action, or permit the Surviving Corporation to take any action, inconsistent
therewith.
ARTICLE III
REPRESENTATIONS AND WARRANTIES REGARDING THE COMPANY

Subject to such exceptions as are disclosed in the Disclosure Letter referencing
the appropriate Section or subsection of this ARTICLE III (or as may be
otherwise readily apparent as responsive to any other Section of this ARTICLE
III), the Company represents and warrants to Parent and Merger Sub as of the
date of this Agreement and as of the Closing as follows:
3.1.    Organization and Qualification of the Company. The Company is a
corporation duly organized, validly existing and in good standing under the Laws
of the State of Delaware. The Company has all requisite corporate power and
authority to own, lease and operate its properties and to carry on the Business.
The Company is duly qualified or licensed to do business and is in good standing
as a foreign corporation in each jurisdiction in which the conduct of its
business or the ownership, leasing, holding or use of its properties makes such

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qualification necessary, except such other jurisdictions where the failure to be
so qualified or licensed or in good standing would not reasonably be expected to
have a Company Material Adverse Effect. The Company has made available to Parent
a true, correct and complete copy of its Constitutional Documents, each as
amended to date, minute books and stock transfer records. The Company is not in
violation of its Constitutional Documents in any material respect.
3.2.    Organization and Qualification of the Subsidiaries. Section 3.2 of the
Disclosure Letter sets forth a true, correct and complete list of each
Subsidiary of the Company and indicates the type of entity and jurisdiction of
organization of each Subsidiary of the Company. Except for the Subsidiaries
listed on Section 3.2 of the Disclosure Letter, the Company does not have any
direct or indirect equity investment or other investment in any Person. Each
Subsidiary of the Company is duly organized, validly existing and in good
standing (to the extent applicable) under the Laws of its jurisdiction of
incorporation or formation. Each Subsidiary of the Company has all requisite
power and authority to own, lease and operate its properties and to carry on its
business. Each Subsidiary of the Company is duly qualified or licensed to do
business and is in good standing (to the extent applicable) as a foreign
organization in each jurisdiction in which the conduct of its business or the
ownership, leasing, holding or use of its properties makes such qualification
necessary, except such other jurisdictions where the failure to be so qualified
or licensed or in good standing would not reasonably be expected to have a
Company Material Adverse Effect. The Company has made available to Parent a
true, correct and complete copy of each of its Subsidiaries’ Constitutional
Documents, each as amended to date, minute books and stock transfer records.
None of the Company’s Subsidiaries is in violation of its Constitutional
Documents in any material respect.
3.3.    Capitalization.
(a)    Section 3.3(a) of the Disclosure Letter lists a true, correct and
complete list of (i) the authorized Equity Securities of the Company, (ii) the
number and kind of Equity Securities of the Company that are issued and
outstanding as of the date of this Agreement, (iii) the names of each of the
holders of such Equity Securities and the respective number and kind of Equity
Securities of the Company held by such holder and (iv) the equity holders of
each of the Company’s Subsidiaries and the percentage of each such Subsidiary’s
Equity Securities held by each such equity holder. All of the outstanding Equity
Securities of the Company and each of its Subsidiaries are duly authorized,
validly issued, fully paid and non-assessable and were not issued in violation
of, and are not subject to, any preemptive rights or in violation of any
applicable federal or state securities Laws. Except for rights granted to Parent
under this Agreement, there are no outstanding options, warrants, calls,
demands, stock appreciation rights, Contracts or other rights of any nature to
purchase, obtain or acquire, or otherwise relating to, or any outstanding
securities or obligations convertible into or exchangeable for, or any voting
agreements or any other similar contract, agreement, arrangement, commitment,
plan or understanding restricting or otherwise relating to the issuance, sale,
purchase, redemption, conversion, exchange, registration, voting, dividend,
ownership or transfer rights of any Equity Securities of the Company or any of
its Subsidiaries. There are no outstanding Equity Securities other than shares
of Common Stock, Restricted Stock Units and Stock Options. All outstanding
shares of Restricted Stock, all outstanding Restricted Stock Units and all
outstanding Stock Options will become fully vested prior to the Effective Time.
All of the outstanding Equity Securities of the Company and its Subsidiaries
have been issued in compliance in all material

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respects with all requirements of Laws and Contracts applicable to the Company
and the Subsidiaries and their respective Equity Securities. Except for the
Unpaid Class B Dividends, there are no accrued and unpaid dividends (whether or
not declared) with respect to any outstanding shares of Common Stock.
(b)    As of the date of this Agreement, there are outstanding Stock Options to
purchase 271,744 shares of Class B Common Stock granted under the Company Equity
Incentive Plan and 326,144 shares of Class B Common Stock remain reserved for
issuance under the Company Equity Incentive Plan. All of the Stock Options have
been granted to eligible current or former officers, employees, consultants or
directors of the Company and its Subsidiaries in the ordinary course of business
consistent with past practice pursuant to the Company Equity Incentive Plan,
and, in each case, initially exercisable for Class B Common Stock at an exercise
price equal to fair market value at the time of such grant. Section 3.3(b) of
the Disclosure Letter sets forth, with respect to each Stock Option, the name of
the holder, the date of grant, current exercise price, the vesting schedule, and
the number of shares of Class B Common Stock subject to such Stock Option.
(c)    As of the date of this Agreement, there are outstanding 422,400 shares of
Restricted Stock granted under the Company Equity Incentive Plan. All of the
shares of Restricted Stock have been granted to eligible current or former
officers, employees, consultants or directors of the Company and its
Subsidiaries in the ordinary course of business consistent with past practice
pursuant to the Company Equity Incentive Plan, and, in each case, represent
restricted shares of Class B Common Stock issued under the Company Equity
Incentive Plan. Section 3.3(c) of the Disclosure Letter sets forth, with respect
to each award of Restricted Stock, the name of the holder, the date of grant,
the vesting schedule or vesting contingencies, and the number of shares of
Restricted Stock subject to such award.
(d)    As of the date of this Agreement, there are outstanding 24,000 Restricted
Stock Units granted under the Company Equity Incentive Plan. All of the
Restricted Stock Units have been granted to eligible current or former officers,
employees, consultants or directors of the Company and its Subsidiaries in the
ordinary course of business consistent with past practice pursuant to the
Company Equity Incentive Plan, and, in each case, represent the right to receive
Class B Common Stock upon vesting. Section 3.3(d) of the Disclosure Letter sets
forth, with respect to each Restricted Stock Unit, the name of the holder, the
date of grant, the vesting schedule or vesting contingencies, and the number of
shares of Class B Common Stock subject to such Restricted Stock Unit.
3.4.    Authority. The Company has all requisite corporate power and authority
to execute and deliver this Agreement and to perform all of its obligations
hereunder and to comply with the terms, conditions and provisions hereof.
Subject to the Stockholder Approval, the execution, delivery and performance by
the Company of this Agreement and the consummation of the transactions
contemplated to be performed by it under this Agreement have been duly
authorized by all necessary and proper corporate action on the part of the
Company. This Agreement has been duly authorized, executed and delivered by the
Company and constitutes the legal, valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms, except as such
enforceability may be limited by bankruptcy,

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insolvency, reorganization, moratorium or similar Laws relating to or affecting
the enforcement of creditors’ rights in general and by general principles of
equity.
3.5.    No Conflict. The execution, delivery and performance by the Company of
this Agreement, the consummation by the Company and its Subsidiaries of the
transactions contemplated hereby and the compliance by the Company and its
Subsidiaries with the terms, conditions and provisions hereof does not and will
not, with or without the giving of notice or the lapse of time or both, (a)
result in the creation or imposition of any material Lien upon any of the
properties or assets of the Company or any of its Subsidiaries, (b) conflict
with the Company’s or any of its Subsidiaries’ respective Constitutional
Documents, each as amended to date, or (c) result in a material violation or
breach of the terms, conditions or provisions of, or constitute a material
default or event of default, or create a right of acceleration, termination or
cancellation or a loss of any material rights under (i) any of the terms,
conditions or provisions of any Material Contract, or (ii) any Law, License,
Judgment or other requirement to which the Company, any of its Subsidiaries or
any of their respective properties or assets are subject.
3.6.    Consents; Stockholder Approval. Section 3.6 of the Disclosure Letter
lists each material consent, waiver, approval, Judgment and authorization of,
and each registration, declaration and filing with, and each material notice to,
any Governmental Entity or other Person that is required by, or with respect to,
the Company or any of its Subsidiaries in connection with the execution and
delivery of this Agreement or the consummation of the transactions contemplated
hereby, except for (a) the Stockholder Approval, (b) the filing of the
Certificate of Merger with the Secretary of State of the State of Delaware, (c)
notices and filings required under the HSR Act and (d) any filings that are
required under any applicable federal or state securities Laws. The Stockholder
Approval is the only vote of the Stockholders required to adopt this Agreement
and approve the Merger. Pursuant to Section 3(d) of the Stockholder Agreement,
if this Agreement and the Merger are approved by Sphere, then Sphere will have
the right to require the stockholders party to such Stockholder Agreement to (x)
vote all of the shares of the Company’s capital stock owned by them in favor of
adopting this Agreement and approving the Merger and (y) waive any dissenters’
rights, appraisal rights or similar rights which they may have under Applicable
Law, including under Section 262 of the DGCL.
3.7.    Financial Statements.
(a)    Section 3.7(a) of the Disclosure Letter contains true, correct and
complete copies of (i) the audited consolidated balance sheets, audited
consolidated statements of operations and audited consolidated statements of
cash flows of KAO and its Subsidiaries for the fiscal years ended January 1,
2011, December 31, 2011 and December 29, 2012, (ii) the unaudited unconsolidated
balance sheet, unaudited unconsolidated statement of operations and unaudited
unconsolidated statement of cash flows of the Company for that fiscal year ended
December 29, 2012, (iii) the unaudited consolidated balance sheet of KAO and its
Subsidiaries and the unaudited unconsolidated balance sheet of the Company (the
“Balance Sheets”), each as of June 29, 2013 (the “Balance Sheet Date”) and the
related unaudited consolidated statements of operations and statements of cash
flows of KAO and its Subsidiaries and the related unaudited unconsolidated
statements of operations of the Company, each for the period then ended
(collectively, the “Financial Statements”).

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(b)    The Financial Statements have been prepared in accordance with GAAP
applied on a consistent basis throughout the periods indicated, except for the
absence of footnotes in the case of the unaudited interim Financial Statements.
The audited consolidated balance sheet of KAO and its Subsidiaries for the
fiscal year ended December 29, 2012 was prepared on a basis consistent with the
Accounting Conventions. The Financial Statements present fairly, in all material
respects, the consolidated financial position, results of operations and cash
flows of the Company and its Subsidiaries as of the dates and for the periods
indicated therein, subject, in the case of the unaudited interim financial
statements, to normal year-end adjustments. Except as set forth on the Balance
Sheets, neither the Company nor any of its Subsidiaries is obligated with
respect to, or has any Liability for, Indebtedness as of the Balance Sheet Date.
(c)    Section 3.7(c) of the Disclosure Letter under the heading “Letters of
Credit” sets forth a true, correct and complete list of the letters of credit
currently outstanding under the Revolving Credit Facility that have been issued
for the benefit of third parties in support of the business operations of the
Company and its Subsidiaries (the “Letters of Credit”). Other than the Letters
of Credit, neither the Company nor any of its Subsidiaries has issued to any
Person any letters of credit or other similar security agreements. With respect
to each Letter of Credit: (i) such Letter of Credit is legal, valid, binding,
enforceable, and in full force and effect; (ii) no party is in breach or
default, and no event has occurred that with notice or lapse of time would
constitute a breach of default, or permit termination, modification or
acceleration, under such Letter of Credit; (iii) no party has repudiated any
provision of such Letter of Credit; (iv) such Letter of Credit is sufficient for
the applicable contract or bid to which it related; and (v) Section 3.7(c) of
the Disclosure Letter under the heading “Letters of Credit Agreements” (the
“Letters of Credit Agreements”) sets forth the agreements to which the Company
or any of its Subsidiaries is a party that requires such Letter of Credit or
other similar security to be in place. True, correct and complete copies of the
Letters of Credit have been made available to Parent.
(d)    Section 3.7(d) of the Disclosure Letter contains a schedule prepared by
the Company of the calculation of Net Working Capital as of the end of the
accounting period set forth thereon (the “Net Working Capital Schedule”).  The
Net Working Capital Schedule was created from the underlying accounting records
of the Company and its Subsidiaries and was prepared in the ordinary course
consistent with past practice and the amounts reflected thereon are the same as
the corresponding amounts that appear on such accounting records as of July 26,
2013.
(e)    Neither the Company nor any of its Subsidiaries have any long term
Liabilities to their customers that would be required to be reflected or
reserved against on a consolidated balance sheet of the Company prepared in
accordance with GAAP or in the notes thereto other than those reflected in the
Balance Sheets.
3.8.    No Undisclosed Liabilities. Neither the Company nor any of its
Subsidiaries has any material Liabilities other than Liabilities (a) reflected
or reserved against on the Financial Statements or the notes thereto, (b)
incurred after the Balance Sheet Date in the ordinary course of business
consistent with past practice, (c) as contemplated by this Agreement or
otherwise in connection with the transactions contemplated hereby, (d) as set
forth on Section 3.8 of the Disclosure Letter, (e) for future performance under
Contracts to which the Company or one of its

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Subsidiaries is a party or by which it is bound and under the Company Employee
Plans (other than in each case Liabilities arising out of a violation thereof or
any noncompliance therewith), and (f) arising with respect to subject matters
specifically covered by other representations and warranties in this ARTICLE
III.
3.9.    Absence of Certain Changes. Since the Balance Sheet Date, (a) there have
not been any events, occurrences, changes, developments or circumstances which
would have, or reasonably be anticipated to have, a Company Material Adverse
Effect, and (b) neither the Company nor any of its Subsidiaries has taken any
action of the type referred to in Section 6.1.
3.10.    Assets and Properties.
(a)    The Company and its Subsidiaries have good and valid title to all of
their respective material owned assets and properties (whether real, personal or
mixed, or tangible or intangible) (including all owned assets and properties
reflected on the Balance Sheets, other than assets and properties disposed of in
the ordinary course of business since the Balance Sheet Date) free and clear of
any Liens, other than Permitted Liens.
(b)    Section 3.10(b) of the Disclosure Letter contains a true, correct and
complete list of each lease or license pursuant to which the Company or any of
its Subsidiaries leases or licenses the use of any personal property entered
into (i) prior to the Balance Sheet Date that provides for annual rental
payments of $250,000 or more and (ii) after the Balance Sheet Date that provides
for annual rental payments of $100,000 or more (each, a “Personal Property
Lease”). With respect to each Personal Property Lease: (a) such Personal
Property Lease is valid and binding on the Company and any of its Subsidiaries
party thereto and, to the Company’s Knowledge, each other party thereto, and is
in full force and effect, (b) there is no material breach or material default
under such Personal Property Lease by the Company or any of its Subsidiaries or,
to the Company’s Knowledge, any other party thereto, (c) no event has occurred
that with or without the lapse of time or the giving of notice or both would
constitute a material breach or material default under such Personal Property
Lease by the Company or any of its Subsidiaries or, to the Company’s Knowledge,
any other party thereto and (d) the Company or one of its Subsidiaries that is
either the tenant or licensee named under such Personal Property Lease has a
good and valid leasehold interest in the personal property that is subject to
such Personal Property Lease and is in possession of the properties purported to
be leased or licensed thereunder.
3.11.    Real Property; Real Property Leases.
(a)    Section 3.11(a) of the Disclosure Letter contains a true, correct, and
complete list of all real estate owned by the Company or any of its Subsidiaries
(the “Owned Real Property”) including with respect to each parcel of Owned Real
Property the street address, the beneficial owner and the current use of the
property. With respect to each parcel of Owned Real Property: (a) the Company or
one of its Subsidiaries has good and marketable indefeasible fee simple title to
such Owned Real Property and to all of the buildings, structures and other
improvements thereon free and clear of all Liens other than Permitted Liens, and
(ii) there are no outstanding agreements, options, rights of first offer or
rights of first refusal on the part of any Person to purchase such Owned Real
Property.

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(b)    Section 3.11(b) of the Disclosure Letter contains a true, correct and
complete list of each lease, sublease, license or similar agreement pursuant to
which the Company or any of its Subsidiaries is lessee, sublessee or licensee
of, or holds or operates, any real property owned by any third Person (the
“Leased Real Property”), and any amendments, extensions or renewals thereto
(each, a “Real Property Lease”). With respect to each Real Property Lease: (a)
such Real Property Lease is valid and binding on the Company and any of its
Subsidiaries party thereto and, to the Company’s Knowledge, each other party
thereto, and is in full force and effect, (b) there is no material breach or
material default under such Real Property Lease by the Company or any of its
Subsidiaries party thereto or, to the Company’s Knowledge, any other party
thereto, (c) no event has occurred that with or without the lapse of time or the
giving of notice or both would constitute a material breach or material default
under such Real Property Lease by the Company or any of its Subsidiaries party
thereto or, to the Company’s Knowledge, any other party thereto and (d) the
Company or one of its Subsidiaries that is either the tenant or licensee named
under such Real Property Lease has a good and valid leasehold interest in each
parcel of real property that is subject to such Real Property Lease and is in
possession of the properties purported to be leased or licensed thereunder.
Except as expressly provided in the Real Property Leases, there are no security
deposits under the Real Property Leases. The consummation of the transactions
contemplated by this Agreement will not result in any loss or impairment of any
of the Company’s or its Subsidiaries’ material rights, or require the delivery
of notice to, or consent from, any Person, under any of the Real Property
Leases.
(c)    Neither the Company nor any of its Subsidiaries is a party to any lease
that is required to be recorded as a capitalized lease under GAAP.
(d)    The Real Property constitutes all of the real property that the Company
and the Subsidiaries (or their Affiliates) own, lease, operate or sublease in
connection with the operation of the Business. All public utilities, including
water, sewer, gas, electric, telephone and drainage facilities, give adequate
service to the Real Property, and each parcel of the Real Property has
sufficient access to and from publicly dedicated streets for the conduct of the
Business. True, correct and complete copies of (i) all deeds and other
instruments (as recorded) by which the Company acquired the Owned Real Property,
(ii) the Real Property Leases, and (iii) all title insurance policies, title
opinions or commitments, surveys, abstracts, subordination, non-disturbance, and
attornment agreements (SNDAs), and appraisals prepared, performed or entered
into after April 5, 1999 that are in the Company or its Subsidiaries’ possession
with respect to the Real Property have been made available.
(e)    (i) Since January 1, 2012 there have not been actual, threatened or
imminent changes in the zoning of any parcel of the Real Property or any part
thereof materially and adversely affecting the current use, occupancy or value
thereof and (ii) there is no pending or, to the Knowledge of the Company,
threatened condemnation, expropriation, requisition (temporary or permanent) or
similar proceeding with respect to any parcel of Real Property or any part
thereof that would impair the existing use of the Real Property. Except for the
Permitted Liens, none of the Company or any of its Subsidiaries has assigned,
transferred or pledged any interest in any of the Real Property.
(f)    All buildings, structures, facilities and improvements located on the
Real Property, including buildings, structures, facilities and improvements that
are under construction

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(collectively “Improvements”) comply in all material respects with valid and
current certificates of occupancy or similar permits to the extent required by
law for the use thereof, and the Improvements and the conduct of the Business on
the Real Property conform in all material respects with all requirements of Law.
3.12.    Intellectual Property.
(a)    Section 3.12(a) of the Disclosure Letter lists all Company Intellectual
Property that is registered or pending with any Governmental Entity or
authorized private registrar in any jurisdiction (collectively, “Intellectual
Property Registrations”), including registered trademarks, domain names and
copyrights, issued and reissued patents, patent rights and pending applications
for any of the foregoing.
(b)    The Company or one of its Subsidiaries owns all right, title and interest
in and to the Company Intellectual Property, free and clear of Liens.
(c)    To the Company’s Knowledge, no Employees or current or former independent
contractors of the Company or any of its Subsidiaries own any Intellectual
Property relating to the Business developed or produced by such Employee or
contractor while employed or engaged by the Company or any of its Subsidiaries.
(d)    Section 3.12(d) of the Disclosure Letter lists all licenses, sublicenses
and other agreements (other than those relating to off-the-shelf software
generally available to the public) whereby the Company or any of its
Subsidiaries is granted material rights, interests and authority, whether on an
exclusive or non-exclusive basis, with respect to any Intellectual Property for
which the Company or one of its Subsidiaries holds exclusive or non-exclusive
rights or interests granted by or through a license from other Persons that is
used in or necessary for the Business. All such agreements are valid, binding
and enforceable between the Company or its Subsidiary party thereto and the
other parties thereto, and the Company or such Subsidiary and such other parties
are in compliance in all material respects with the terms and conditions of such
agreements. The Company has made available true, correct and complete copies of
all such agreements.
(e)    To the Company’s Knowledge, the Company Intellectual Property does not
infringe the Intellectual Property of any third party and is not being infringed
by any third party. Neither the Company nor any of its Subsidiaries is a party
to any claim, suit or other action that challenges the validity, enforceability
or ownership of, or the right to use, sell or license the Company Intellectual
Property and, to the Company’s Knowledge, no such claim, suit or other action is
threatened against any the Company or any of its Subsidiaries.
3.13.    Contracts.
(a)    Section 3.13(a) of the Disclosure Letter lists all of the following
Contracts (or group of related Contracts) to which the Company or any of its
Subsidiaries are a party or by which any of them are bound that:

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(i)    during the year ended December 29, 2012 resulted in, or during the year
ending December 28, 2013, is reasonably expected to result in, annual aggregate
payments or revenue to the Company and its Subsidiaries of at least $250,000;
(ii)    during the year ended December 29, 2012 resulted in, or during the year
ending December 28, 2013 is reasonably expected to result in, annual aggregate
payments or expenditures by the Company and its Subsidiaries of at least
$500,000 and differs in any material respect from the form and content of the
Company’s standard form supplier agreement described in Section 3.13(a)(ii) of
the Disclosure Letter;
(iii)    is an employment agreement with any Employee or an independent
contractor agreement with an independent contractor of the Company or any of its
Subsidiaries that provides for annual compensation in excess of $100,000 or that
cannot be terminated at will without penalty or on written notice of ninety (90)
days or less or is a severance pay practice or agreement with respect to any
Employee;
(iv)    contains any covenant limiting the freedom of the Company or any of its
Subsidiaries to engage in any line of business or in any geographic territory or
to compete with any Person, or which grants to any Person any exclusivity to any
geographic territory, any customer, or any product or service;
(v)    involves future payments for capital expenditures in excess of $250,000
in the aggregate for any single project or related series of projects;
(vi)    is not already fully performed or otherwise contains outstanding
obligations, warranties or rights of the Company or any of its Subsidiaries
relating to the direct or indirect acquisition or disposition of assets, capital
stock or other ownership interest or any other interest in any business
enterprise outside the ordinary course of the Company’s or any of its
Subsidiaries’ businesses;
(vii)    relates to Indebtedness for borrowed money by the Company or any of its
Subsidiaries;
(viii)    is a joint venture, partnership, strategic alliance or other Contract
involving the sharing of profits, losses, costs or liabilities with any Person;
(ix)    grants any so-called “most favored nation” or similar rights;
(x)    is with any current or former director, officer or employee of the
Company or any of its Subsidiaries or any Stockholder or any Affiliate of any
Stockholder or pursuant to which the Company or any of its Subsidiaries has
advanced or loaned any amount to any such Person, other than business travel
advances in the ordinary course of business consistent with past practice in
amounts less than $10,000;
(xi)    would or would reasonably be likely to prohibit or materially delay the
Merger or the other transactions contemplated hereby or that would accelerate
payment obligations, performance deadlines, or modify or accelerate any other
material obligation due to the Merger or the other transactions contemplated
hereby;

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(xii)    restricts the ability of the Company or any of its Subsidiaries to
assert any legal proceedings against any Person; or
(xiii)    is with a Governmental Entity;
(b)    Each Contract that is required to be listed on Section 3.13(a) of the
Disclosure Letter, (each, a “Material Contract”) is valid and binding on the
Company and any of its Subsidiaries party thereto and, to the Company’s
Knowledge, the other parties thereto, and is in full force and effect and,
except for those Material Contracts that by their terms will expire prior to the
Closing, will continue in full force and effect after the Closing, in each case
without the Consent of any other Person other than the Consents set forth on
Section 3.5 of the Disclosure Letter. There is no material breach or material
default under any Material Contract by the Company or any of its Subsidiaries
party thereto or, to the Company’s Knowledge, any other party thereto and no
event has occurred that with or without the lapse of time or the giving of
notice or both would constitute a material breach or material default under any
Material Contract by the Company or any of its Subsidiaries party thereto or, to
the Company’s Knowledge, any other party thereto. The Company has made available
true, correct and complete copies of each Material Contract.
3.14.    Litigation. There are no material Legal Actions pending or, to the
Company’s Knowledge, threatened against or naming as a party thereto the Company
or any of its Subsidiaries, any of their respective properties or assets or any
of their employees, officers, directors or managers in their capacity as such.
None of the Company, any of its Subsidiaries, or their respective properties is
subject to any Judgment that materially impairs the Company’s or such
Subsidiary’s ability to operate the Business or that requires any future
payments. Neither the Company nor any of its Subsidiaries are party to any
Contract or subject to any Judgment that relates to any settlement involving
future payments or providing behavioral remedies or admissions of criminal
conduct.
3.15.    Compliance with Laws; Permits.
(a)    The Company and each of its Subsidiaries are, and since January 1, 2009,
have been, in material compliance with all Applicable Laws. Since January 1,
2009, neither the Company, nor any of its Subsidiaries has received any written,
or to the Company’s Knowledge, verbal notice or follow-up communication from any
Governmental Entity regarding any actual, alleged, or potential (i) non-routine
administrative, civil or criminal investigation, inquiry or audit (other than
Tax audits) relating to the Company or any of its Subsidiaries, or (ii)
noncompliance with any Applicable Law or Judgment.
(b)    All material Permits required for the Company and its Subsidiaries to
conduct the Business have been obtained and are valid and in full force and
effect. All fees and charges with respect to such Permits have been paid in
full. Section 3.15(b) of the Disclosure Letter lists all current material
Permits issued to the Company and its Subsidiaries, including the names of the
Permits and their respective dates of issuance and expiration. Neither the
transactions contemplated by this Agreement nor any other event has occurred
that, with or without notice or lapse of time or both, would or would reasonably
be expected to result in the

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revocation, suspension, lapse or limitation of any Permit set forth on Section
3.15(b) of the Disclosure Letter.
3.16.    Insurance. Section 3.16 of the Disclosure Letter sets forth all
material insurance policies covering the assets, business, equipment,
properties, operations, Employees, directors or managers (as applicable), and
officers of the Company or any of its Subsidiaries. There is no claim by the
Company or any of its Subsidiaries pending under any of such policies as to
which coverage has been questioned, denied or disputed or that the Company has a
reason to believe will be denied or disputed by the underwriters of such
policies or bonds and there is no pending claim that will exceed the policy
limits. All premiums due and payable under all such policies and bonds have been
paid (or if installment payments are due, will be paid if incurred prior to the
Closing) and the Company and its Subsidiaries are otherwise in material
compliance with the terms of such policies.
3.17.    Environmental Matters.
(a)    The Company and its Subsidiaries (i) are in compliance in all material
respects with all applicable Environmental Laws and with the terms and
conditions of all Licenses required under applicable Environmental Laws (all of
which are set forth on Section 3.15(b) the Disclosure Letter), and (ii) have not
received any written notice from any Governmental Entity or other Person of any
pending investigations or actual or threatened liabilities of the Company or any
of its Subsidiaries under any applicable Environmental Laws
(b)    No real property currently or formerly owned, operated or leased by the
Company or any of its Subsidiaries is listed on, or has been proposed for
listing on, the National Priorities List (or CERCLIS) under CERCLA, or, to the
Company’s Knowledge, any similar state list.
(c)    Neither the Company nor any of its Subsidiaries has received any notice
that any of the Real Property (including soils, groundwater, surface water,
buildings and other structure located on any Real Property) has been
contaminated with, or impacted by, any Hazardous Material that could reasonably
be expected to result in an material Environmental Claim against, or a material
violation of Environmental Law or term of any material Permit by, the Company or
any of its Subsidiaries.
(d)    There are no active or abandoned aboveground or underground storage tanks
owned or operated by the Company or any of its Subsidiaries. Neither the Company
nor any of its Subsidiaries has received any notice regarding potential
Liabilities with respect to any off site Hazardous Materials treatment, storage,
recycling, or disposal facilities or locations used by the Company or any of its
Subsidiaries. Neither the Company nor any of its Subsidiaries has retained or
assumed, by contract or operation of Law, any Liabilities of third parties under
Environmental Law.
(e)    The Company has made available any and all environmental reports,
studies, audits, site assessments, risk assessments, remedial activities and
other similar documents with respect to the business or assets of the Company or
any of its Subsidiaries that are in the possession or control of the Company or
any of its Subsidiaries related to compliance

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with Environmental Laws, Environmental Claims (including any related notices) or
the Release of Hazardous Materials.
3.18.    Employment Matters.
(a)    The Company has made available to Parent a list of all full or part-time
Key Employees and such list also sets forth for each such Key Employee the
following: (i) name; (ii) title or position (including whether full or part
time); (iii) hire date; (iv) current annual base compensation rate; and
(v) commission, bonus or other incentive-based compensation.
(b)    Neither the Company nor any of its Subsidiaries is, or has been, a party
to any Contract regarding collective bargaining or other Contract with or to any
labor union, association, trade union, works council or labor organization
(collectively, “Union”) representing any employee of the Company or any of its
Subsidiaries, nor does any Union or collective bargaining agent represent any
Employee. No Union or other collective bargaining agent has been recognized or
certified as the collective bargaining representative of any group or unit of
Employees. There are no unfair labor practice charges or complaints pending or,
to the Company’s Knowledge, threatened, against the Company or any of its
Subsidiaries. Since January 1, 2009, there has not been any labor strike,
slow-down, work stoppage, walk-out, boycott, corporate campaign, “work to rule”
campaign, handbilling, picket, arbitration or other concerted labor activity
involving the Company or any of its Subsidiaries, and no such labor strike,
slow-down, work stoppage, walk-out, boycott, corporate campaign, “work to rule”
campaign, handbilling, picket, arbitration or other concerted labor activity is
now pending or, to the Company’s Knowledge, threatened, against the Company or
any of its Subsidiaries. Neither the Company nor any of its Subsidiaries has any
duty to bargain with any Union. Neither the Company nor any of its Subsidiaries
is or, since January 1, 2009, has been the subject of any organizational
efforts, or threatened organizational efforts, by any Union or other collective
bargaining association with respect to any Employee.
(c)    The Company and each of its Subsidiaries is and has been in compliance in
all material respects with all Applicable Laws pertaining to employment and
employment practices, including all Laws relating to labor relations, unfair
labor practices, equal employment opportunities, fair employment practices,
employment discrimination, harassment, retaliation, reasonable accommodation,
affirmative action, immigration, disability rights or benefits, immigration,
wages, hours, overtime compensation, child labor, hiring, promotion and
termination of employees, posting requirements, working conditions, meal and
break periods, rest periods, labor relations, data privacy, data protection,
privacy, reductions in force, plant closings, mass layoffs, pay equity, health
and safety, workers’ compensation, leaves of absence, unemployment insurance,
and the collection and payment of withholding and/or social security taxes and
other applicable taxes, or any other employment related matter arising under
Applicable Laws.
(d)    There are no Legal Actions against the Company or any of its Subsidiaries
pending, or to the Company’s Knowledge, threatened to be brought or filed, by or
with any Governmental Entity or arbitrator in connection with the employment of
any current or former applicant, employee, consultant or independent contractor
of the Company or any of its Subsidiaries, including any Legal Action relating
to labor relations, unfair labor practices, equal

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employment opportunities, fair employment practices, employment discrimination,
harassment, retaliation, reasonable accommodation, affirmative action,
immigration, disability rights or benefits, immigration, wages, hours, overtime
compensation, child labor, hiring, promotion and termination of employees,
posting requirements, working conditions, meal and break periods, rest periods,
labor relations, data privacy, data protection, privacy, reductions in force,
plant closings, mass layoffs, pay equity, health and safety, workers’
compensation, leaves of absence, unemployment insurance, and the collection and
payment of withholding and/or social security taxes and other applicable taxes,
or any other employment related matter arising under Applicable Laws.
(e)    All individuals characterized and treated by the Company as independent
contractors or consultants are properly treated as independent contractors under
all Applicable Laws. All Employees classified as exempt under the Fair Labor
Standards Act and Applicable Law regarding wages and hours are properly
classified as such. Neither the Company nor any of its Subsidiaries has incurred
any liability or potential liability under the Fair Labor Standards Act or
Applicable Law regarding wages and hours. Each nonexempt Employee under the Fair
Labor Standards Act and Applicable Law regarding wages and hours has been paid
all overtime compensation consistent with Applicable Laws.
(f)    Since January 1, 2009, neither the Company nor any of its Subsidiaries
has implemented any plant closing or layoff of employees that could implicate
the WARN Act, and neither Company nor its Subsidiaries has any plans to
undertake any action in the future that would trigger the WARN Act.
(g)    Neither the Company nor any of its Subsidiaries employ or utilize leased
employees.
(h)    Neither the Company nor any of its Subsidiaries are (i) a government
contractor subject to the provisions of Executive Order 11246 and similar or
related state and local Laws or (ii) party to any Contract that constitutes or
relates to an affirmative action plan or program as defined by Executive Order
11246 or similar or related state and local Laws.
(i)    To the Company’s Knowledge, no executive, manager, Key Employee, or group
of Employees, has given any notice of termination of employment, or notice of
any intent to terminate employment, with the Company or any of its Subsidiaries.
3.19.    Employment Benefit Plans.
(a)    Section 3.19(a) of the Disclosure Letter sets forth a true, correct and
complete list of each existing Company Employee Plan. None of the Company
Employee Plans is subject to Title IV of ERISA or Section 412 of the Code and
neither the Company, any of its Subsidiaries nor any ERISA Affiliate has, during
any time in the six (6)-year period preceding the Closing Date, contributed to,
sponsored, maintained or administered any “employee pension benefit plan” within
the meaning of Section 3(2) of ERISA that is or was subject to Title IV of ERISA
or Section 412 of the Code. None of the Company, any of its Subsidiaries or any
Affiliate is required, or has during any time in the six (6)-year period
preceding the Closing Date been required, to contribute to or has incurred any
withdrawal liability in respect of any

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“multiemployer plan” (as defined in Section 4001(a)(3) of ERISA). Each Company
Employee Plan (and each related trust, insurance contract or fund) is, and has
been administered and operated, in compliance in all material respects with its
terms and with all Applicable Law. There are no pending or, to the Company’s
Knowledge, threatened, claims by or on behalf of any of the Company Employee
Plans, by any employee or beneficiary covered under any such Company Employee
Plan, or otherwise involving any such Company Employee Plan (other than ordinary
course claims for benefits). Neither the Company nor any of its Subsidiaries is
a party to or participates in or contributes to any scheme, agreement, or
arrangement (whether legally enforceable or not) for the provision of any
pension, retirement or similar benefits for any Employee or for the widow,
widower, surviving civil partner, child or dependent of any Employee.
(b)    With respect to each Company Employee Plan, the Company has made
available true, correct and complete copies of each of the following: (i) where
the Company Employee Plan has been reduced to writing, the plan document
together with all amendments; (ii) where the Company Employee Plan has not been
reduced to writing, a written summary of all material plan terms; (iii) where
applicable, copies of any trust agreements or other funding arrangements,
custodial agreements, insurance policies and contracts, administration
agreements and similar agreements, and investment management or investment
advisory agreements, now in effect or required in the future as a result of the
transactions contemplated by this Agreement or otherwise; (iv) copies of any
summary plan descriptions, summaries of material modifications, employee
handbooks and any other written communications (or a description of any oral
communications) relating to any Company Employee Plan; (v) in the case of any
Company Employee Plan that is intended to be qualified under Section 401(a) of
the Code, a copy of the most recent determination, opinion or advisory letter
from the Internal Revenue Service; (vi) in the case of any Company Employee Plan
for which a Form 5500 is required to be filed, a copy of the most recently filed
Form 5500, with schedules attached; (vii) actuarial valuations and reports
related to any Company Employee Plans with respect to the two (2) most recently
completed plan years; and (viii) copies of material notices, letters or other
correspondence from the Internal Revenue Service, Department of Labor or Pension
Benefit Guaranty Corporation relating to the Company Employee Plan.
(c)    Each Company Employee Plan has been established, administered and
maintained in accordance with its terms and in material compliance with all
Applicable Laws (including ERISA and the Code). Each Company Employee Plan that
is intended to be qualified under Section 401(a) of the Code (a “Qualified
Benefit Plan”) is so qualified and has received a favorable and current
determination letter from the Internal Revenue Service, or with respect to a
prototype plan, can rely on an opinion letter from the Internal Revenue Service
to the prototype plan sponsor, to the effect that such Qualified Benefit Plan is
so qualified and that the plan and the trust related thereto are exempt from
federal income taxes under Sections 401(a) and 501(a), respectively, of the
Code. There is no pending or, to the Company’s Knowledge, threatened Legal
Proceeding (i) relating to the revocation of any such determination letter from
the Internal Revenue Service or the unavailability of reliance on such opinion
letter from the Internal Revenue Service or (ii) that could subject the Company
or any of its Subsidiaries to a penalty under Section 502 of ERISA or to a tax
or penalty under Section 4975 of the Code. All benefits, contributions and
premiums relating to each Company Employee Plan have been timely paid in
accordance with the terms of such Company Employee Plan and all Applicable Laws
and

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accounting principles, and all benefits accrued under any unfunded Company
Employee Plan have been paid, accrued or otherwise adequately reserved to the
extent required by, and in accordance with, GAAP.
(d)    Neither the Company nor any of its ERISA Affiliates has (i) incurred or
reasonably expects to incur, either directly or indirectly, any material
Liability under Title I or Title IV of ERISA or related provisions of the Code
or foreign Law relating to employee benefit plans; (ii) failed to timely pay
premiums to the Pension Benefit Guaranty Corporation; (iii) withdrawn from any
Qualified Benefit Plan; or (iv) engaged in any transaction which would give rise
to Liability under Section 4069 or Section 4212(c) of ERISA.
(e)    With respect to each Company Employee Plan (i) no such plan is a
“multiple employer plan” within the meaning of Section 413(c) of the Code or a
“multiple employer welfare arrangement” (as defined in Section 3(40) of ERISA);
(ii) no Legal Action has been initiated by the Pension Benefit Guaranty
Corporation to terminate any such plan or to appoint a trustee for any such
plan; (iii) no such plan is subject to the minimum funding standards of Section
302 of ERISA or Section 412 of the Code and no Company Employee Plan has failed
to satisfy the minimum funding standards of Section 302 of ERISA or Section 412
of the Code; and (iv) no “reportable event,” as defined in Section 4043 of
ERISA, has occurred with respect to any such Company Employee Plan.
(f)    Except as required by Applicable Law, no provision of any Company
Employee Plan or collective bargaining agreement could reasonably be expected to
result in any limitation on the Surviving Corporation or any of its Affiliates
from amending or terminating any Company Employee Plan.
(g)    Except as required under Section 601 et. seq. of ERISA or other
Applicable Law, no Company Employee Plan provides post-termination or retiree
welfare benefits to any individual for any reason, and neither the Company, any
of its Subsidiaries nor any of its ERISA Affiliates has any Liability to provide
post-termination or retiree welfare benefits to any individual or ever
represented, promised or contracted to any individual that such individual would
be provided with post-termination or retiree welfare benefits.
(h)    There is no pending or, to the Company’s Knowledge, threatened Legal
Action relating to a Company Employee Plan (other than routine claims for
benefits), and no Company Employee Plan has since January 1, 2009 been the
subject of an examination or audit by a Governmental Entity or the subject of an
application or filing under or is a participant in, an amnesty, voluntary
compliance, self-correction or similar program sponsored by any Governmental
Entity.
(i)    There has been no amendment to, announcement by the Company or any of its
Affiliates relating to, or change in employee participation or coverage under,
any Company Employee Plan or collective bargaining agreement that would
materially increase the annual expense of maintaining such plan above the
current level of expense with respect to any director, officer or employee, as
applicable.

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(j)    Section 3.19(j) of the Disclosure Letter lists each agreement, contract,
plan or other arrangement (whether or not written and whether or not a Company
Employee Plan) to which the Company or any of its Affiliates is a party that is
a “nonqualified deferred compensation plan” within the meaning of Code Section
409A and the Treasury Regulations promulgated thereunder. Each such nonqualified
deferred compensation plan complies with and has been operated and administered
in accordance with the requirements of Code Section 409A, the Treasury
Regulations promulgated thereunder and any other Internal Revenue Service
guidance issued thereunder. As of immediately prior to the Effective Time, each
outstanding Stock Option is exempt from Code Section 409A.
(k)    Each individual who is classified by the Company or one of its
Subsidiaries as an independent contractor has been properly classified for
purposes of participation and benefit accrual under each Company Employee Plan.
(l)    Neither the execution of this Agreement nor any of the transactions
contemplated by this Agreement will (either alone or upon the occurrence of any
additional or subsequent events): (i) entitle any current or former director,
officer, employee of the Company or any of its Subsidiaries to severance pay or
any other payment; (ii) accelerate the time of payment, funding or vesting of,
or increase the amount of, compensation due to any such individual; (iii) limit
or restrict the right of the Company to merge, amend or terminate any Company
Employee Plan; (iv) increase the amount payable under or result in any other
material obligation pursuant to any Company Employee Plan; or (v) result in
“excess parachute payments” within the meaning of Section 280G(b) of the Code
that have not previously been disclosed to Parent.
3.20.    Taxes.
(a)    The Company and each of its Subsidiaries has timely filed all material
Tax Returns required to be filed by it. All such Tax Returns were true, correct
and complete in all material respects and all Taxes due and owing by the Company
and each of its Subsidiaries (whether or not shown on any such Tax Return) have
been paid or adequate reserves therefor have been established on the Balance
Sheets in accordance with GAAP. The Company has made available true, correct and
complete copies of all federal income Tax Returns, examination reports, and
statements of deficiencies assessed against or agreed to by the Company or any
of its Subsidiaries filed or received since January 1, 2009.
(b)    Neither the Company nor any of its Subsidiaries has received from any
foreign, federal, state, or local taxing authority (including jurisdictions
where the Company has not filed Tax Returns) any (i) written notice indicating
an intent to open an audit or other review, (ii) request for information related
to Tax matters, or (iii) notice of deficiency or proposed adjustment for any
amount of Tax proposed, asserted, or assessed by any taxing authority against
the Company or any of its Subsidiaries that has not been resolved. The Company
has disclosed on its or its Subsidiaries’ federal income Tax Returns all
positions taken therein that could give rise to a substantial understatement of
federal income Tax within the meaning of Code Section 6662. No extensions or
waivers of statutes of limitations have been given or requested with respect to
any Taxes of the Company or any of its Subsidiaries.

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(c)    There is no audit, examination, claim, assessment, levy, deficiency,
administrative or judicial proceeding, lawsuit or refund Legal Action pending
or, to the Company’s Knowledge, threatened, with respect to any Taxes for which
the Company or any of its Subsidiaries are, or might otherwise be, liable, and
no taxing authority has given notice of the commencement of any audit,
examination or deficiency Legal Action with respect to any such Taxes. The
Company has made available to Parent true, correct and complete copies of all
examination reports, closing agreements and statements of deficiencies assessed
against or agreed to by the Company or any of its Subsidiaries filed or
received. There are no outstanding agreements or waivers extending the statutory
period of limitations applicable to any claim for, or the period for the
collection or assessment of, Taxes of the Company or any of its Subsidiaries due
for any taxable period.
(d)    Neither the Company nor any of its Subsidiaries are liable, nor does the
Company nor any of its Subsidiaries have any potential Liability, for the Taxes
of another Person (i) under any applicable Tax Law, or (ii) by Contract,
indemnity or otherwise.
(e)    The Company and its Subsidiaries have withheld and paid each Tax required
to have been withheld and paid in connection with amounts paid or owing to any
employee, independent contractor, creditor, customer, shareholder or other
party, and complied with all information reporting and backup withholding
provisions of Applicable Law.
(f)    All deficiencies asserted, or assessments made, against the Company or
any of its Subsidiaries as a result of any examinations by any taxing authority
have been fully paid.
(g)    There are no Liens for Taxes (other than for current Taxes not yet due
and payable) upon the assets of the Company or any of its Subsidiaries.
(h)    Neither the Company nor any of its Subsidiaries is a party to, or bound
by, any Tax indemnity, Tax-sharing or Tax allocation agreement.
(i)    No private letter rulings, technical advice memoranda or similar
agreement or rulings have been requested, entered into or issued by any taxing
authority with respect to the Company or any of its Subsidiaries.
(j)    Neither the Company nor any of its Subsidiaries has been a member of an
affiliated, combined, consolidated or unitary Tax group for Tax purposes other
than the current consolidated group of which the Company is the parent.
(k)    Neither the Company nor any of its Subsidiaries has agreed to make, nor
is it required to make, any adjustment under Sections 481(a) or 263A of the Code
or any comparable provision of state, local or foreign Tax Laws by reason of a
change in accounting method or otherwise. Neither the Company nor any of its
Subsidiaries has taken any action that could defer a Liability for Taxes of the
Company or any of its Subsidiaries from any Pre-Closing Tax Period to any
Post-Closing Tax Period.
(l)    Neither the Company nor any of its Subsidiaries is a U.S. real property
holding company (as defined in Section 897(c)(2) of the Code) during the
applicable period

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specified in Section 897(c)(1)(A)(ii) of the Code. No Stockholder is a “foreign
person” as that term is used in Treasury Regulations Section 1.1445-2.
(m)    Neither the Company nor any of its Subsidiaries has been a “distributing
corporation” or a “controlled corporation” in connection with a distribution
described in Section 355 of the Code.
(n)    Neither the Company nor any of its Subsidiaries is, or has been, a party
to, or a promoter of, a “reportable transaction” or any “listed transaction,” as
defined in the Code or Treasury Regulations.
(o)    Neither the Company nor any of its Subsidiaries is a party to any
agreement, contract, arrangement or plan that has resulted or could result,
separately or in the aggregate, in the payment of any “excess parachute payment”
within the meaning of Code §280G (or any corresponding provision of state, local
or foreign Tax law).
(p)    Neither the Company nor any of its Subsidiaries owns an interest in any
(i) domestic international sales corporation, (ii) foreign sales corporation, or
(iii) passive foreign investment company, each within the meaning of the Code.
3.21.    Ownership of Assets. All of the buildings, plants, structures,
furniture, fixtures, Improvements, machinery, equipment, vehicles and other
items of tangible and intangible personal property owned or leased by the
Company and its Subsidiaries constitute all of the tangible and intangible
personal property used by the Company and its Subsidiaries to conduct the
business and operations of the Company and its Subsidiaries. The disclosures set
forth on Section 3.21 of the Disclosure Letter shall not have any effect or be
deemed an exception to this Section 3.21 for purposes of ARTICLE IX.
3.22.    Customers; Suppliers. Section 3.22 of the Disclosure Letter sets forth
the names of the Company’s and its Subsidiaries’ (a) ten (10) largest customers,
measured by dollar volume of sales (during each of calendar year 2012 and 2013
to date) and (b) twenty (20) largest suppliers, measured by dollar volume of
purchases (during each of calendar year 2012 and 2013 to date). No customer or
supplier set forth or required to be set forth on Section 3.22 of the Disclosure
Letter has provided written or, to the Company’s Knowledge, oral notice of such
customer’s or supplier’s intention to cease or substantially reduce the use or
supply of products, goods, or services of or to the Business. Since the Balance
Sheet Date and through the date of this Agreement, there has not been any
discontinuance of, or material change in, the discount to “jobber” pricing for
any applicable products or services supplied or provided by any supplier set
forth or required to be set forth on Section 3.22 of the Disclosure Letter and
no such supplier has provided any written, or to the Company’s Knowledge, oral
notice of any such discontinuance or material change.
3.23.    Bank Accounts; Powers of Attorney.
(a)    Section 3.23(a) of the Disclosure Letter sets forth a true, correct and
complete list of (including name of bank, address, account number and title) of
all bank accounts and safe deposit boxes utilized by the Company and its
Subsidiaries and persons authorized to sign or otherwise act with respect
thereto.

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(b)    Section 3.23(b) of the Disclosure Letter sets forth a complete and
correct list of all Persons holding a general or special power of attorney
granted by the Company or any of its Subsidiaries.
3.24.    Interested Party Transactions. No officer, director, employee,
stockholder or Affiliate of the Company or any of its Subsidiaries, or, to the
Company’s Knowledge, any individual related by blood, marriage or adoption to
any such individual, or, to the Company’s Knowledge, any entity in which any
such Person or individual owns any material beneficial interest, (a) is a party
to any Contract or transaction with the Company or any of its Subsidiaries
(other than employment agreements included in the Material Contracts or the
ownership of Equity Interests in the Company as set forth on Sections 3.3(a),
3.3(b) and 3.3(c) of the Disclosure Letter), (b) has any direct legal interest
in any tangible or intangible asset or property used by the Company or its
Subsidiaries, (c) has any direct or indirect ownership interest in any Person
with which the Company or any of its Subsidiaries has a business relationship or
any Person that competes with the Company or any of its Subsidiaries except for
stock ownership of less than three percent (3%) in publicly traded companies or
Contracts entered into in the ordinary course of business consistent with past
practice on non-exclusive arm’s length terms with a portfolio company of a
Stockholder Party, or (d) is directly or indirectly indebted to the Company or
any of its Subsidiaries, and neither the Company nor any of its Subsidiaries is
indebted (or committed to make loans or extend or guarantee credit) to any such
Person, whether directly or indirectly.
3.25.    Brokers’ and Finders’ Fees. Except for the fees and expenses of Robert
W. Baird & Co. Incorporated and UBS Securities, LLC, which will be paid at
Closing as Transaction Expenses, no investment banker, broker, finder or other
intermediary is entitled to any fee or commission in connection with the
transactions contemplated by this Agreement based on arrangements made on behalf
of the Company or any of its Subsidiaries.
3.26.    No Other Representations. Except for the representations and warranties
made in this ARTICLE III or in ARTICLE IV or in the Transaction Documents,
neither the Company, any Stockholder Party nor any other Person (including any
Subsidiary, any Equityholder or any director, officer, manager, employee,
Affiliate, advisor, agent or other representative of the Company, any Subsidiary
or any Equityholder) makes or has made to Parent or any other Person any
representation or warranty, express or implied, relating or with respect to this
Agreement, the transactions contemplated thereby, the Company or its
Subsidiaries or their business, operations, properties, and liabilities or
obligations, whether arising by statute or otherwise in law, including any
implied warranty of merchantability, fitness for a particular purpose or
otherwise. Except in the case of fraud or willful misconduct, neither the
Company, any Subsidiary, any Equityholder nor any of their respective
stockholders, directors, officers, managers, employees, Affiliates, advisors,
agents or other representatives, will have or be subject to any liability to
Parent or any other Person resulting from the use by Parent or its
Representatives of any financial information, financial projections, forecasts,
budgets or any other document or information furnished to Parent or any other
Person (including information in the “data site” maintained by the Company or
provided in any formal or informal management presentation); provided, however,
that the foregoing is not intended to limit Parent’s or the Surviving
Corporation’s rights to recovery set forth in Article IX based on any breach of
any of the representations and warranties expressly made by the Company in this
ARTICLE III.

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ARTICLE IV
REPRESENTATIONS AND WARRANTS OF THE STOCKHOLDER PARTIES

Each Stockholder Party hereby represents and warrants as to itself, himself or
herself to Parent and Merger Sub as of the date of this Agreement and as of the
Closing as follows:
4.1.    Organization and Qualification of Stockholder Party. Such Stockholder
Party is duly organized, validly existing and in good standing (to the extent
applicable) under the Laws of its jurisdiction of incorporation or formation.
Such Stockholder Party has all requisite power and authority to own its
properties and to carry on its business as now being conducted and is duly
qualified to do business and is in good standing in each jurisdiction in which
the conduct of its business or the ownership, leasing, holding or use of its
properties makes such qualification necessary, except such jurisdictions where
the failure to be so qualified or licensed or in good standing would not have a
Stockholder Material Adverse Effect.
4.2.    Ownership. Section 3.3(a) of the Disclosure Letter sets forth for such
Stockholder Party the Equity Securities of the Company held of record by such
Stockholder Party. Such Stockholder Party has valid and marketable title to all
such Equity Securities free and clear of any Liens.
4.3.    Authority. Such Stockholder Party has all requisite power and authority
to execute and deliver this Agreement and to perform all of such Stockholder
Party’s obligations hereunder. The execution, delivery and performance by such
Stockholder Party of this Agreement and the consummation of the transactions
contemplated to be performed by such Stockholder Party under this Agreement have
been duly authorized by all necessary and proper corporate action on the part of
such Stockholder Party. This Agreement constitutes the legal, valid and binding
obligation of such Stockholder Party, enforceable against it in accordance with
its terms, except as such enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar Laws relating to or affecting
the enforcement of creditors’ rights in general and by general principles of
equity.
4.4.    No Conflict. The execution, delivery or performance by such Stockholder
Party of this Agreement, the consummation by such Stockholder Party of the
transactions contemplated hereby and the compliance by such Stockholder Party
with the terms, conditions and provisions hereof does not and will not, with or
without the giving of notice or the lapse of time or both, conflict with, result
in a breach of the terms, conditions or provisions of, or constitute a default,
an event of default or an event creating rights of acceleration, termination or
cancellation or a loss of rights under (a) such Stockholder Party’s
Constitutional Documents, each as amended to date; (b) any of the terms,
conditions or provisions of any material Contract with such Stockholder Party;
or (c) any Law, License, Judgment, or other requirement to which such
Stockholder Party or any of such Stockholder Party’s properties or assets, are
subject.
4.5.    No Legal Actions. There is no Legal Action pending or, to the knowledge
of such Stockholder Party, threatened, against or affecting such Stockholder
Party or any of such Stockholder Party’s properties or assets that could
reasonably be expected to have a Stockholder Material Adverse Effect.

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4.6.    Brokers’ and Finders’ Fees. Except as set forth in Section 3.25, no
investment banker, broker, finder or other intermediary is entitled to any fee
or commission payable by the Company in connection with the transactions
contemplated by this Agreement based on arrangements made on behalf of such
Stockholder Party.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB

Parent and Merger Sub hereby represent and warrant to the Company as of the date
of this Agreement and as of the Closing as follows:
5.1.    Organization of Parent and Merger Sub. Parent and Merger Sub are each
corporations duly organized, validly existing and in good standing under the
Laws of the State of Delaware. Each of Parent and Merger Sub has all requisite
corporate power and authority to own its properties and to carry on its business
as now being conducted and is duly qualified to do business and is in good
standing in each jurisdiction in which the conduct of its business or the
ownership, leasing, holding or use of its properties makes such qualification
necessary, except such jurisdictions where the failure to be so qualified or
licensed or in good standing would not have a Parent Material Adverse Effect.
5.2.    Authority. Each of Parent and Merger Sub has all requisite corporate
power and authority to execute and deliver this Agreement and to perform all of
its obligations hereunder. The execution, delivery and performance by each of
Parent and Merger Sub of this Agreement and the consummation of the transactions
contemplated to be performed by them under this Agreement have been duly
authorized by all necessary and proper corporate action on its part. This
Agreement constitutes the legal, valid and binding obligation of Parent and
Merger Sub, enforceable against them in accordance with its respective terms,
except as such enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar Laws relating to or affecting the
enforcement of creditors’ rights in general and by general principles of equity.
5.3.    No Conflict. The execution, delivery or performance by Parent and Merger
Sub of this Agreement, the consummation by Parent and Merger Sub of the
transactions contemplated hereby and the compliance by Parent and Merger Sub
with the terms, conditions and provisions hereof does not and will not, with or
without the giving of notice or the lapse of time or both, (a) conflict with
Parent’s or Merger Sub’s respective Constitutional Documents, each as amended to
date, or (b) result in a material breach of the terms, conditions or provisions
of, or constitute a material default, a material event of default or an event
creating rights of acceleration, termination or cancellation or a loss of
material rights under (i) any of the terms, conditions or provisions of any
material Contract with Parent or Merger Sub, or (ii) any Law, License, Judgment
or other requirement to which Parent or Merger Sub, or any of their respective
properties or assets are subject.
5.4.    Consents; Stockholder Approval. No consent, waiver, approval, Judgment
or authorization of, or registration, declaration or filing with, or notice to
any Governmental Entity or other Person is required by, or with respect to,
Parent or Merger Sub in connection with the execution and delivery of this
Agreement or the consummation of the transactions contemplated hereby, except
for (a) the affirmative vote of Parent, as the sole stockholder of Merger Sub,

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which shall be given immediately following the execution of this Agreement, (b)
the filing of the Certificate of Merger with the Secretary of State of the State
of Delaware, (c) notices and filings as may be required under the HSR Act and
(d) any filings that are required under any applicable federal or state
securities Laws. Without limiting the generality of the foregoing, no vote or
consent of the holders of any class or series of capital stock of Parent is
necessary to approve this Agreement or the Merger.
5.5.    No Legal Actions. There is no Legal Action pending or, to the knowledge
of Parent, threatened, against or affecting Parent or Merger Sub or any of their
properties or assets that could reasonably be expected to have a Parent Material
Adverse Effect.
5.6.    Ownership and Activities of Merger Sub. Parent owns all of the issued
and outstanding shares of capital stock of Merger Sub. Merger Sub was formed
solely for the purpose of engaging in the transactions contemplated by this
Agreement and, except for obligations or liabilities incurred in connection with
its incorporation or organization and the transactions contemplated by this
Agreement, Merger Sub has not incurred, directly or indirectly, any obligations
or liabilities or engaged in any business activities of any type or kind
whatsoever or entered into any agreements or arrangements with any Person.
5.7.    Financing. Parent has, as of the date of this Agreement, and will have
at the Effective Time, sufficient funds and/or the ability to borrow sufficient
funds to pay the amounts required to be paid by Parent pursuant to Sections 2.3,
2.4 and 2.5 and to pay all related fees and expenses to be paid by Parent at
Closing. Parent’s and Merger Sub’s obligations under this Agreement are not
subject to any condition regarding Parent’s or Merger Sub’s ability to obtain
financing to enable Parent to meet its obligations hereunder.
5.8.    Solvency. Assuming the satisfaction of the conditions set forth in
Section 7.2(a), immediately after giving effect to the consummation of the
Merger and the other transactions contemplated by this Agreement, the Surviving
Corporation (on a consolidated basis with its Subsidiaries) (i) will be able to
pay its debts (including a reasonable estimate of the amount of all contingent
liabilities) as they become due and payable, (ii) will own property which has a
fair saleable value greater than the amounts required to pay its debts
(including a reasonable estimate of the amount of all contingent liabilities),
and (iii) will have adequate capital to carry on its business. No transfer of
property is being made and no obligation is being incurred in connection with
the transactions contemplated by this Agreement with the intent to hinder, delay
or defraud current creditors of the Company or any of its Subsidiaries, or
creditors of the Surviving Corporation or any of its Subsidiaries.
5.9.    Acknowledgment. Parent and Merger Sub acknowledge that (a) except for
the representations and warranties made by the Company in ARTICLE III or in any
Transaction Documents, neither the Company nor any other Person (including any
Subsidiary, any Equityholder or any director, officer, manager, employee,
Affiliate, advisor, agent or other representative of the Company, any Subsidiary
or any Equityholder) makes or has made to Parent or any other Person any
representation or warranty, express or implied, relating or with respect to this
Agreement, the transactions contemplated thereby, the Company or its
Subsidiaries or their business, operations, properties, and liabilities or
obligations, whether

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arising by statute or otherwise in law, including any implied warranty of
merchantability, fitness for a particular purpose or otherwise.
5.10.    Brokers’ and Finders’ Fees. No investment banker, broker, finder or
other intermediary is entitled to any fee or commission payable by the Company
or any Equityholder in connection with the transactions contemplated by this
Agreement based on arrangements made on behalf of Parent or Merger Sub.
5.11.    No Other Representations. Except for the representations and warranties
contained in this ARTICLE V or in any other Transaction Document, neither Parent
nor Merger Sub, nor any other Person acting on their behalf, makes or has made
any representation or warranty, express or implied. Neither Parent nor Merger
Sub has made any representation or warranty, expressed or implied, as to the
accuracy or completeness of any information regarding Parent or Merger Sub or
otherwise, other than those representations and warranties expressly made in
this ARTICLE.
ARTICLE VI
COVENANTS

6.1.    Conduct of Business. Until the earlier to occur of the Closing and the
termination of this Agreement in accordance with its terms, except as (a)
expressly contemplated by this Agreement, (b) set forth on Section 6.1 of the
Disclosure Letter, or (c) consented to in writing by Parent (which consent shall
not be unreasonably withheld or delayed), the Company shall, and shall cause
each of its Subsidiaries to (1) carry on their respective businesses in the
ordinary course in all material respects consistent with past practice, (2) use
commercially reasonable efforts to keep its business and operations intact,
retain its present officers and employees and preserve its material rights,
franchises, goodwill and relations with its clients, customers, lessors,
suppliers and others with whom it does business so that they will be preserved
after the Closing, (3) use commercially reasonable efforts to conduct their
business in material compliance with all Applicable Laws, and (4) use
commercially reasonable efforts to conduct their business in accordance with the
terms and conditions of any Material Contract. Without limiting the generality
of the foregoing, except as (a) expressly contemplated by this Agreement, (b)
set forth on Section 6.1 of the Disclosure Letter or (c) consented to in writing
by Parent, the Company shall not, and shall not permit any of its Subsidiaries
to directly or indirectly:
(i)    amend the Company’s or any of its Subsidiaries’ respective Constitutional
Documents or any of their outstanding securities;
(ii)    declare or set aside any dividend that is not paid prior to the Closing;
(iii)    adjust split, combine, subdivide or reclassify any Equity Interests of
the Company or any of its Subsidiaries;
(iv)    except for the issuance of the Reserved Equity Interests, a true and
complete list of which, as of the date of this Agreement, has been made
available to Parent, and as provided in the Company Equity Incentive Plan,
authorize for issuance, issue, sell, deliver, transfer, dispose of or encumber
or agree or commit to any such actions, any Equity Interests in

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the Company or any of its Subsidiaries, or any security convertible into,
exchangeable for, or evidencing the right to subscribe for or acquire, any
Equity Interests in the Company or any of its Subsidiaries;
(v)    redeem, purchase or otherwise acquire, or offer to redeem, purchase or
otherwise acquire any Equity Interest of the Company or any of its Subsidiaries;
(vi)    sell, lease, transfer, license, mortgage, pledge or otherwise dispose of
or encumber, except for any Permitted Liens, any of the properties or assets
(including Equity Interests of any Person) of the Company or any of its
Subsidiaries other than sales of properties or assets (other than Equity
Securities in any Subsidiaries of the Company) with a fair market value of less
than $250,000 in the ordinary course of business consistent with past practice;
(vii)    make or commit to make any capital expenditures in excess of $50,000 in
the aggregate;
(viii)    acquire or agree to acquire any business or Person in any manner,
including by merging or consolidating with such business or Person, or acquiring
or agreeing to acquire the Equity Interests or assets of such business or
Person;
(ix)    adopt a plan of complete or partial liquidation, dissolution, merger,
consolidation, restructuring, recapitalization or other reorganization of the
Company or any of its Subsidiaries;
(x)    change its auditor or change its methods of accounting in effect as of
the date of this Agreement except as required by changes in GAAP;
(xi)    make, change or revoke any material Tax election, amend any material Tax
Return, settle or compromise any material income Tax liability, Tax claim or Tax
assessment, adopt or change any of its methods of accounting with respect to
Taxes, enter into any closing agreement, settle, compromise or consent to any
Tax claim, take any affirmative action to surrender any right to claim a refund
of Taxes, or consent to any extension or waiver of the limitation period
applicable to any Tax claim;
(xii)    settle, pay, discharge or compromise, or agree to settle, pay,
discharge or compromise, any Legal Action, except for any such settlement or
compromise in the ordinary course of business consistent with past practice that
is not material to the operations or financial condition of the Company and its
Subsidiaries taken as a whole and does not include any equitable relief
applicable to any period of time after the Closing;
(xiii)    (i) enter into, amend, modify or renew any Contract regarding
employment, consulting, severance or similar arrangements with any of its
directors or officers or Key Employees, (ii) grant any salary, wage or other
increase in compensation to any Key Employee or to any other Employees other
than in the ordinary course of business consistent with past practice, or (iii)
modify any employee benefit under a Company Employee Plan except as may be
required by Law, provided that the Company may take all actions necessary to
terminate or cause to lapse, immediately prior to the Effective Time, any
repurchase rights of the Company that remain applicable to any shares of Common
Stock;

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(xiv)    pay any severance or termination pay to any officers, directors or
managers (as applicable), or employees of the Company or any of its Subsidiaries
other than in the ordinary course of business consistent with past practice or
as required by Contracts existing as of the date of this Agreement;
(xv)    establish, adopt, enter into, or terminate any Company Employee Plan
other than as required by this Agreement.
(xvi)    enter into any material transaction or arrangement with, or for the
benefit of, any Affiliate or any directors, former directors, officers or
stockholders of any Affiliate;
(xvii)    hire or terminate any Key Employee;
(xviii)    effect or permit a “mass layoff” or “plant closing” as those terms
are defined under the WARN Act or engage in any action or conduct that triggers
application of the WARN Act;
(xix)    recognize any labor union or any other association as the bargaining
representative of the Employees;
(xx)    enter into any collective bargaining agreement, or negotiations for a
collective bargaining agreement, with any labor union or other association with
respect to the Employees;
(xxi)    enter into any agreement or arrangement that limits or otherwise
restricts the Company or any of its Subsidiaries or any of their present or
future Affiliates or any successor thereto from engaging or competing in any
line of business and/or in any location;
(xxii)    enter into, amend, modify or terminate any Material Contract or Real
Property Lease or otherwise waive, release or assign any material rights, claims
or benefits thereunder, except with respect to Material Contracts disclosed or
required to be disclosed under clauses (i), (ii), (v), or (vii) of Section
3.13(a) of the Disclosure Letter in the ordinary course of business consistent
with past practice;
(xxiii)    do any act or knowingly omit to do any act whereby any material
Company Intellectual Property may become invalidated, abandoned, unmaintained,
unenforceable or dedicated to the public domain;
(xxiv)    fail to maintain in full force and effect any policies or binders of
insurance coverage in effect as of the date hereof; or
(xxv)    agree, authorize or commit to do any of the foregoing.
6.2.    Access to Information; Confidentiality. Until the earlier to occur of
the Closing and the termination of this Agreement in accordance with its terms,
Parent and its Representatives (including any financing sources and their
respective representatives) shall continue to have reasonable access during
normal business hours to the facilities, books and

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records (consistent with Applicable Law regarding privacy) of the Company and
its Subsidiaries to conduct such inspections (including non-invasive
environmental due diligence activities) as Parent may reasonably request. Any
inspection pursuant to this Section 6.2 will be conducted in such a manner so as
not to interfere unreasonably with the conduct of the Business and in no event
will any provision hereof be interpreted to require the Company or its
Subsidiaries to permit any inspection, or to disclose any information, that the
Company and its legal representatives determine in good faith may waive any
attorney-client or similar privilege that it or its Subsidiaries may hold or
conflict with any of its obligations, or the obligations of its Subsidiaries, to
a third party with respect to confidentiality. The foregoing notwithstanding,
neither Parent nor Merger Sub, nor any of their respective Representatives,
shall contact any Employee, landlord, customer, supplier or shareholder of the
Company or of any of its Subsidiaries (other than such Persons set forth on
Section 6.2 of the Disclosure Letter) without the prior written consent of the
Company (which consent shall not be unreasonably withheld, conditioned or
delayed); it being acknowledged that any and all such contacts will be arranged
by and coordinated with the Company and the Company shall cooperate in good
faith with Parent to facilitate such contact as may be reasonably requested by
Parent. All information exchanged pursuant to this Section 6.2 shall be subject
to that certain Confidentiality Agreement between Parent and the Company dated
as of January 7, 2013 (the “Confidentiality Agreement”).
6.3.    Satisfaction of Closing Conditions; Regulatory Matters.
(a)    Until the earlier to occur of the Closing and the termination of this
Agreement in accordance with its terms, and subject to the terms and conditions
of this Agreement, each of the Company and Parent shall use commercially
reasonable efforts to take or cause to be taken as promptly as reasonably
practicable all actions and to do or cause to be done as promptly as reasonably
practicable all things necessary under the terms of this Agreement or under
Applicable Law to cause the satisfaction of the conditions set forth in ARTICLE
VII and to consummate the transactions contemplated by this Agreement, including
using their respective commercially reasonable efforts to obtain all Consents of
all Governmental Entities or third parties that may be or become necessary in
connection with its execution and delivery of, and the performance of its
obligations pursuant to, this Agreement, and the Parties shall cooperate with
each other with respect to each of the foregoing; provided, however, that (i)
such use of commercially reasonable efforts shall not require any Party to make
any payment to obtain any Consent from a Governmental Entity or other third
party required in order to consummate the transactions contemplated hereby
(other than in connection with the HSR Filing), and (ii) neither the Company nor
any of its Subsidiaries shall agree orally or in writing to any agreement or
understanding affecting the Company, any of its Subsidiaries, or any of their
respective assets as a condition for obtaining any Consents from any
Governmental Entity or other third party without obtaining the prior written
consent of Parent.
(b)    The Company shall give (or shall cause its Subsidiaries to give) any
notices to third parties, and use, and cause its Subsidiaries to use,
commercially reasonable efforts to obtain any third-party consents, (i)
necessary to consummate the transactions contemplated hereby or (ii) required to
prevent a Company Material Adverse Effect from occurring prior to or after the
Closing; provided, however, that the Company and Parent shall coordinate and
reasonably cooperate in determining whether any actions, notices, consents,
approvals, or waivers are required to be given or obtained, or should be given
or obtained, from

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parties to any Material Contract in connection with the consummation of the
transactions contemplated hereby and seeking any such actions, notices,
consents, approvals, or waivers.
(c)    From the date hereof until the Closing Date, each of Parent and the
Company shall promptly notify the other in writing of any pending, or to the
Company’s Knowledge or the knowledge of Parent (as the case may be), threatened
action, suit, arbitration, or other proceeding or investigation by any
Governmental Entity or any other Person (i) challenging or seeking material
damages in connection with the transactions contemplated hereby or (ii) seeking
to restrain or prohibit the consummation of the transactions contemplated hereby
or otherwise limit in any material respect the right of Merger Sub to own or
operate all or any portion of the business or assets of the Company or any of
its Subsidiaries.
(d)    Parent and the Company agree to file a Notification and Report Form and
documentary materials in respect of the transactions contemplated by this
Agreement with the United States Federal Trade Commission and the Antitrust
Division of the United States Department of Justice as promptly as practicable
after the date hereof and in no event more than ten (10) Business Days after the
date of this Agreement (the “HSR Filing”). All filing fees payable with respect
to such filings shall be paid by Parent. Parent and the Company agree to
promptly file any other report required by any other Governmental Entity
relating to antitrust matters, and to promptly make any other filings or
submissions required under the HSR Act. The Company and Parent shall furnish to
the other such necessary information and reasonable assistance as the other may
request in connection with its preparation of any filing or submission which is
necessary under the HSR Act. Each of the Company and Parent shall promptly
inform the other Party of any material communication received by such Party from
any Governmental Entity in respect of the HSR Filing. Each of the Company and
Parent shall (i) use its commercially reasonable efforts to comply as
expeditiously as possible with all requests of any Governmental Entity for
additional information and documents requested under the HSR Act; and (ii) not
(A) extend any waiting period under the HSR Act, or (B) enter into any agreement
with any Governmental Entity not to consummate the transactions contemplated by
this Agreement, except, in each case, with the prior consent of the other.
(e)    Subject to Applicable Law and any applicable confidentiality
restrictions, Parent and its counsel, on the one hand, and the Company and its
counsel, on the other hand, shall have the right to review (in advance to the
extent practicable) any information relating to the other that appears in any
filing made with, or written materials submitted to, any Governmental Entity in
connection with the Merger or the other transactions contemplated by this
Agreement, provided, however, that nothing contained herein shall be deemed to
provide any Party with a right to review any such information provided to any
Governmental Entity on a confidential basis (including valuation material) in
connection with the Merger or the other transactions contemplated by this
Agreement. The Parties may also, as each deems reasonably necessary, designate
any competitively sensitive material provided to the other under this Section
6.3 and Section 6.2 as “outside counsel only.” Such materials and the
information contained therein shall be given only to the outside legal counsel
of the recipient and will not be disclosed by such outside counsel to employees,
officers, or directors of the recipient unless express permission is obtained in
advance from the source of the materials or its legal counsel.

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(f)    Notwithstanding the foregoing, nothing in this Section 6.3 shall require,
or be construed to require, Parent, Merger Sub, or any of their respective
Affiliates to agree to (i) sell, hold separate, divest, discontinue or limit,
before or after the Closing Date, any assets, businesses or interests of Parent,
Merger Sub, the Company (pre-Closing), the Surviving Corporation (post-Closing)
or any of their respective Affiliates; (ii) any conditions relating to, or
changes or restrictions in, the operations of any such assets, businesses or
interests which, in either case, could reasonably be expected to result in a
Company Material Adverse Effect or materially and adversely impact the economic
or business benefits to Parent of the transactions contemplated by this
Agreement; or (iii) any material modification or waiver of the terms and
conditions of this Agreement.
6.4.    Indemnification of Officers and Directors.
(a)    The Surviving Corporation shall, and shall cause each of its Subsidiaries
to, indemnify and hold harmless each present and former director or manager (as
applicable), officer, fiduciary and agent of the Company and of each of its
Subsidiaries (collectively, “Covered Persons”), respectively, to the same extent
as such Covered Persons are indemnified as of the date hereof by the Company and
each such Subsidiary pursuant to the Constitutional Documents of the Company and
each such Subsidiary, respectively, against all costs and expenses (including
attorneys’ fees and expenses), judgments, fines, losses, claims, damages,
liabilities and settlement amounts paid in connection with any Legal Action
(whether such Legal Action arises before or after the Effective Time but with
respect to any act or omission of such Covered Person occurring prior to the
Effective Time) arising out of or pertaining to any action or omission in their
capacity as an officer, director or manager (as applicable), fiduciary or agent
of the Company or one of its Subsidiaries prior to the Effective Time, and which
Legal Action is first filed, brought and asserted before the date that is six
(6) years after the Effective Time. In the event of any such Legal Action, the
Surviving Corporation shall, and shall cause each of its Subsidiaries to,
advance, pay or reimburse the fees and expenses of counsel selected by the
Covered Persons to the same extent and in the same manner as provided under the
Constitutional Documents of the Company and each such Subsidiary, respectively,
as of the date hereof and to cooperate in the defense of any such Legal Action
with such counsel; provided that such counsel is reasonably satisfactory to the
Surviving Corporation; and provided, further, that in the event that any claim
for indemnification or for the advancement, payment or reimbursement of expenses
is asserted or made within such six (6)-year period, all rights to
indemnification or the advancement, payment or reimbursement of expenses in
respect of such claim shall continue until the disposition of such claim.
(b)    Without limiting the obligations set forth in Section 6.4(a), for a
period of six (6) years following the Effective Time, (i) the Surviving
Corporation shall not, and shall cause each of its Subsidiaries not to, make any
changes to the provisions of their Constitutional Documents or to the provisions
of the employment agreements and indemnification agreements with Covered Persons
listed respectively in Sections 3.13(a)(iii) and 3.13(a)(x) the Disclosure
Letter or provided to Parent prior to the date hereof, in each case relating to
the indemnification and exculpation of any Covered Person, that would adversely
affect the right of such Covered Person to claim indemnification from the
Surviving Corporation or its Subsidiaries under the terms of such Constitutional
Documents, employment agreements or indemnification agreements as in effect on
the date hereof for acts taken prior to the Effective Time, and (ii) the
Surviving

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Corporation shall, and shall cause each of its Subsidiaries to, honor all such
indemnification and exculpation obligations thereunder (including with respect
to the advancement of expenses).
(c)    At or prior to the Closing, the Company shall purchase a prepaid
noncancellable run-off directors’ and officers’ liability insurance policy
covering the Covered Persons for a period of six (6) years following the Closing
Date with coverage in an amount and scope at least as favorable as the existing
coverage of the Company and its Subsidiaries as of the date of this Agreement
with a deductible not more than the deductible under the existing coverage.
(d)    The provisions of this Section 6.4 are intended to be for the benefit of,
and will be enforceable by, as applicable, each Covered Person and the
representatives of each Covered Person. For a period of six (6) years following
the Closing, in the event the Surviving Corporation or any of its Subsidiaries
merges or consolidates with or transfers or assigns all or substantially all of
its assets to any other Person, then proper provision shall be made by the
Surviving Corporation so that such continuing or surviving corporation or entity
or transferee of such assets, as the case may be, shall assume all of the
applicable obligations set forth in this Section 6.4.
(e)    The rights under this Section 6.4 shall be in addition to any rights that
any Covered Person may have at common law or otherwise and shall remain in full
force and effect following the Closing.
6.5.    Employees; Benefit Plans.
(a)    Parent shall provide to the employees of the Surviving Corporation and
its Subsidiaries benefit plans, programs and arrangements with benefits (other
than equity-based awards) that are substantially similar in the aggregate to
those provided to similarly situated employees of Parent as of the Closing Date.
For purposes of determining eligibility to participate or levels of benefits or
entitlement to benefits under Parent’s or the Surviving Corporation’s benefit
plans, programs and arrangements (“Parent Benefit Plans”), each such employee
shall be credited with his or her years of service with the Company or its
Subsidiaries prior to the Closing Date (except to the extent such service credit
would result in a duplication of benefits for the same period of service) and
any pre-existing condition, actively-at-work, or similar requirement under any
such benefit plans, programs or arrangements shall be waived by the plan sponsor
with respect to such employees to the extent allowed thereunder and under
Applicable Law.
(b)    The Company shall permit Parent and its Representatives to perform due
diligence with respect to the 401(k) plan of the Company and its Subsidiaries
(the “401(k) Plan”), including providing Parent with (i) access to all benefit
plan administrators, record keepers, custodians, agents and advisers, (ii)
evidence of the 401(k) Plan’s tax-qualified status and timely IRS Form 5500
filings, (iii) such documentation that will allow Parent to determine the
amount, if any, of fees, loads or other charges that will be triggered by the
ceasing of new contributions to the 401(k) Plan or otherwise by virtue of the
transactions contemplated hereby and (iv) such other documentation as Parent
shall reasonably request with respect to the 401(k) Plan. If, and only if,
requested in writing by Parent at least five (5) Business Days prior to the

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Closing Date, the Company shall, and shall cause its Subsidiaries to, take all
actions necessary or appropriate to terminate the 401(k) Plan not later than the
day prior to the Closing Date and, in connection therewith, the Company shall,
not later than the day prior to the Closing Date:
(i)    (1) amend the 401(k) Plan to fully vest all accounts of all participants
in the 401(k) Plan and to provide for the distribution of all such accounts, and
(2) amend the 401(k) Plan to bring it into compliance with current Applicable
Law (the form and substance of which amendments shall be subject to the prior
review of Parent); and
(ii)    deliver to Parent a duly executed plan amendment and resolutions of the
Company’s board of directors reflecting the termination of the 401(k) Plan and
such related amendments to the 401(k) Plan (the form and substance of which
documents shall be subject to the prior review of Parent).
(c)    Nothing in this Section 6.5 shall (i) create any third-party beneficiary
or other rights in any Employee or other service provider of the Company or any
of its Subsidiaries, including rights in respect of any benefits that may be
provided, directly or indirectly, under any Company Benefit Plan or Parent
Benefit Plan, (ii) be construed as an amendment, waiver or creation of or
limitation on the ability to amend or terminate any Company Benefit Plan or
Parent Benefit Plan, or (iii) be interpreted as requiring the Company, the
Surviving Corporation, Parent or any Affiliate of any of the foregoing to
continue to employ any particular Employee or other service provider of the
Company or any of its Subsidiaries for any specified period of time.
6.6.    Preservation of Records. Parent agrees that it shall not, for a period
of at least six (6) years following the Closing Date, destroy or cause to be
destroyed, or permit the Surviving Corporation or any of its Subsidiaries to
destroy or cause to be destroyed, any material books or records relating to the
pre-Closing operations of the Company or any of its Subsidiaries without first
obtaining the consent of the Equityholders Representative (or providing to the
Equityholders Representative notice of such intent and a reasonable opportunity
to copy such books or records, at the Equityholders’ expense, at least thirty
(30) days prior to such destruction).
6.7.    Outstanding Letters of Credit. Parent acknowledges and agrees that the
violation of any Letters of Credit Agreement as a result of any failure of
Parent to replace any Letter of Credit in connection with the termination of the
Revolving Credit Facility shall not constitute a breach of any representation or
warranty under this Agreement, cause any condition precedent set forth in
Section 7.2 not to be satisfied or give rise to any claim for indemnification
under Section 9.2(a).
6.8.    Director Resignations. Prior to the Closing Date, the Company shall
cause each member of the Board and the board of directors or managers of its
Subsidiaries to execute and deliver a letter, which shall not be revoked or
amended prior to the Closing, effectuating his or her resignation as a member of
the Board or board of directors or managers of one of its Subsidiaries, as the
case may be, effective immediately prior to, and conditional on, the Closing.
6.9.    Notice of Certain Events. From the date hereof until the Closing, the
Company shall give prompt written notice to Parent, and Parent shall give prompt
written notice to the Company, of the following:

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(a)    Any fact, circumstance, event or action the existence, occurrence or
taking of which (i) has had, or could reasonably be expected to have,
individually or in the aggregate, with respect to the Company, a Company
Material Adverse Effect, or, with respect to Parent, a Parent Material Adverse
Effect (ii) has resulted in, or could reasonably be expected to result in, any
representation or warranty made by such Party not being true and correct in any
material respect or (iii) has resulted in, or could reasonably be expected to
result in, the failure of any of the conditions of such Party set forth in
Section 7.1, Section 7.2 or Section 7.3 to be satisfied.
(b)    Any notice or other communication to such Party from any Person alleging
that the consent of such Person is or may be required in connection with the
transactions contemplated by this Agreement.
(c)    Any notice or other communication to such Party from any Governmental
Entity in connection with the transactions contemplated by this Agreement.
(d)    Any Legal Actions commenced or, to the Company’s Knowledge or Parent’s
knowledge, threatened against, relating to or involving or otherwise affecting
such Party that, if pending on the date of this Agreement, would have been
required to have been disclosed pursuant to Sections 3.14, 4.5 or 5.5 that
relates to the consummation of the transactions contemplated by this Agreement.
Parent’s or the Company’s receipt of information pursuant to this Section 6.9
shall not operate as a waiver or otherwise affect any representation, warranty
or agreement given or made by the Company or Parent, respectively, in this
Agreement and shall not be deemed to amend or supplement the Disclosure Letter.
6.10.    No Solicitation of Other Bids.
(a)    Neither the Company nor any Stockholder Party shall, and shall not
authorize or permit any of their respective Affiliates or Representatives to,
directly or indirectly, (i) encourage, solicit, initiate, facilitate or continue
inquiries regarding an Acquisition Proposal; (ii) enter into discussions or
negotiations with, or provide any information to, any Person concerning a
possible Acquisition Proposal; or (iii) enter into any agreements or other
instruments (whether or not binding) regarding an Acquisition Proposal. The
Company and each Stockholder Party shall immediately cease and cause to be
terminated, and shall cause its Affiliates and all of its and their
Representatives to immediately cease and cause to be terminated, all existing
discussions or negotiations with any Persons conducted heretofore with respect
to, or that could lead to, an Acquisition Proposal.
(b)    The Company and each Stockholder Party agrees that the rights and
remedies for noncompliance with this Section 6.10 shall include having such
provision specifically enforced by any court having equity jurisdiction, it
being acknowledged and agreed that any such breach or threatened breach shall
cause irreparable injury to Parent and that money damages would not provide an
adequate remedy to Parent.

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6.11.    Employee Non-Solicit.
(a)    Each Stockholder Party agrees that during the period ending on the third
(3rd) anniversary of the Closing Date, such Stockholder Party shall not, and
shall cause its Affiliates (other than those of its portfolio companies that
have not been (i) provided any employee information or other confidential
information relating to the Company and its Subsidiaries, or (ii) purposely
influenced or caused to engage in conduct that would otherwise violate this
Section 6.11(a)) not to, in any manner, directly or indirectly, induce or
attempt to induce any member of the senior management team or department head of
the Company or any of its Subsidiaries or any Key Employee to terminate or
abandon his or her employment or engagement for any purpose whatsoever.
Notwithstanding the foregoing, nothing contained herein shall preclude the
hiring of any such Person (i) who responds to a general solicitation of
employment through an advertisement not targeted specifically at the Company or
any of its Subsidiaries or their respective employees, (ii) who contacts a
Stockholder Party on his or her own initiative without any solicitation by such
Stockholder Party or (iii) who has been terminated by the Company or any of its
Subsidiaries after the Closing or who has not been employed by the Company or
any of its Subsidiaries, in each case for a period of at least six (6) months
prior to such solicitation.
(b)    If, at any time of enforcement of this Section 6.11, a court or an
arbitrator holds that the restrictions stated herein are unreasonable under
circumstances then existing, the Parties agree that the maximum period, scope or
geographical area reasonable under such circumstances shall be substituted for
the stated period, scope or area and that the court or arbitrator shall be
allowed to revise the restrictions contained herein to cover the maximum period,
scope and area permitted by Applicable Law.
(c)    Without limiting the right of Parent to pursue all other legal and
equitable rights available to it for violation of this Section 6.11 by any of
the Stockholder Parties or their Affiliates, it is agreed that other remedies
cannot fully compensate Parent or the Surviving Corporation for such a violation
and that Parent and the Surviving Corporation shall each be entitled to
injunctive relief to prevent violation or continuing violation thereof.
6.12.    Transfer of Common Stock; Voting; Company Stockholder Approval.
(a)    Each Stockholder Party covenants that prior to the Closing, such
Stockholder Party shall not (i) sell, transfer, mortgage, pledge, otherwise
dispose of or suffer to be imposed any Lien on any share of Common Stock held by
such Stockholder Party or (ii) grant to any Person (other than Parent) any proxy
or other right to vote any shares of Common Stock held by such Stockholder Party
or over which such Stockholder Party exercises voting power.
(b)    In order to consummate the Merger, the Company, acting through its board
of directors, shall, in accordance with Applicable Law, use its commercially
reasonable efforts to obtain, prior to the close of business on the second (2nd)
Business Day following the date of this Agreement, pursuant to an executed
written consent, the Stockholder Approval. Promptly following receipt of such
written consent, the Company shall cause its Secretary to deliver a copy of such
written consent to Parent.

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(c)    Each Stockholder Party hereby irrevocably waives any dissenters’ rights,
appraisal rights or similar right that they may have under Applicable Law,
including under Section 262 of the DGCL, in connection with the Merger and
agrees not to assert any demands for appraisal with respect to the shares of
Common Stock held by such Stockholder Party. Upon approving the Merger, Sphere
covenants to exercise its Drag-Along Right (as defined in the Stockholder
Agreement) pursuant to and in accordance with the Section 3(c) of the
Stockholder Agreement requiring the stockholders party to the Stockholder
Agreement to: (x) vote all of the shares of the Company’s capital stock owned by
them in favor of adopting this Agreement and approving the Merger and (y) waive
any dissenters’ rights, appraisal rights or similar rights which they may have
under Applicable Law, including under Section 262 of the DGCL.
6.13.    Bonus Payments. The Surviving Corporation shall maintain the management
bonus plan of the Company for fiscal year 2013 as in effect as of the date
hereof and shall perform its obligations to pay bonuses thereunder to the
Persons eligible for bonuses under such plan in accordance with the terms of
such plan, which Persons and terms have been made available to Parent. The
aggregate amount of all such bonuses awarded under such plan shall not be less
than the aggregate amount accrued for such bonuses and included in the
calculation of Closing Net Working Capital, as finally determined pursuant to
Section 2.6(c), and all such bonuses awarded shall be paid to the recipients no
later than seventy-five (75) days following the Closing.
6.14.    NTP Payments. The Surviving Corporation shall cause KAO to perform its
obligations to cause NTP to make the NTP Payments when due pursuant to and in
accordance with the NTP SPA.
6.15.    Access to Assets. Each of the Stockholder Parties shall at all times
following the Closing maintain funds, or access to capital commitments from its
fund investors, sufficient to meet its indemnification obligations under this
Agreement.
6.16.    Section 280G of the Code. Prior to the Closing, the Company shall take
such actions, in a manner reasonably satisfactory to Parent, as may be necessary
to cause a stockholder vote, that if approved, would cause all payments made to
any “disqualified individual” who has signed a 280G waiver that would otherwise
constitute “excess parachute payments” under Section 280G of the Code as a
result of the Merger to satisfy the stockholder approval exemption under Section
280G(b)(5)(A)(ii) of the Code, including providing a form of waiver of payments
or benefits to each individual who is a “disqualified individual” of the Company
and that may otherwise be entitled to receive “excess parachute payments” as a
result of the Merger (as those terms are defined under Section 280G of the Code)
(a “280G Waiver”), preparing a Section 280G of the Code disclosure statement,
and seeking the execution of the 280G Waiver and the requisite stockholder
approval.
6.17.    Transfer of Title. The Company shall use its commercially reasonable
efforts to transfer to the Company or one of its Subsidiaries the title of any
Owned Real Property that is not currently recorded in the name of the Company or
any of its Subsidiaries, which is set forth on Section 3.21 of the Disclosure
Letter, and to record with each applicable Governmental Entity each new deed
reflecting the Company or one of its Subsidiaries as the legal owner of such
Owned Real Property as a result of such transfer of title, in each case prior to
the Closing. If any

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such transfer or recording has not been completed prior to the Closing, the
Equityholders Representative shall use its commercially reasonable efforts
following the Closing to effect such transfer or recording as promptly as
reasonably practicable following the Closing.
6.18.    Closing Bank Debt. The Company shall obtain, prior to the Closing, a
payoff letter or payoff letters with respect to the Closing Bank Debt, in form
and substance reasonably acceptable to the Purchaser (the “Payoff Letters”),
which Payoff Letters shall indicate (a) the amount of Closing Bank Debt that is
to be repaid to the lenders thereunder at the Closing, and (b) that upon
repayment of such amount that (i) the Company and its Subsidiaries shall be
relieved of any obligations thereunder, (ii) the Senior Credit Facilities and
related agreements shall be terminated (except for provisions thereunder that
customarily survive termination), and (iii) all of the Company’s and its
Subsidiaries’ assets and properties shall be free from any and all Liens
(including mortgages) related thereto upon repayment of such amount.
6.19    Stockholder Termination of Agreements. Each Stockholder Party and the
Surviving Corporation agree that, effective as of the Closing, all agreements
between such Stockholder Party or any of its Affiliates and the Surviving
Corporation and its Subsidiaries shall be terminated and each party thereto
shall be released from any and all obligations, claims, and causes of action
against the other party thereto, except in each case for payments which are
specified, or any obligations that are required to be performed on or after the
Closing Date under, in each case, (i) this Agreement, the Promissory Note or the
Mortgage or (ii) the Freight Bill Processing and Services Agreement, dated
August 1, 2011, by and between KAO and Data2Logistics, LLC or the Sales Quote
and Marketing Agreement for American Racing Custom Wheels, dated as of January
31, 2013, between KAO and American Racing Custom Wheels.
6.20.    Further Assurances. Following the Closing, each of the Parties shall,
and shall cause their respective Affiliates to, execute and deliver such
additional documents, instruments, conveyances and assurances and take such
further actions as may be reasonably required to carry out the provisions hereof
and give effect to the transactions contemplated by this Agreement.
ARTICLE VII
CONDITIONS PRECEDENT TO THE CLOSING

7.1.    Conditions to Each Party’s Obligations. The obligations of the Company,
on the one hand, and Parent and Merger Sub, on the other hand, to consummate the
Merger are subject to the fulfillment, on or before the Closing Date, of the
following conditions:
(a)    The waiting period under the HSR Act applicable to the transactions
contemplated by this Agreement shall have expired or early termination shall
have been granted;
(b)    No Governmental Entity of competent jurisdiction shall have enacted,
issued, promulgated, enforced or entered any temporary restraining order,
initial or permanent injunction or other Judgment or other legal restraint or
prohibition that is in effect and prevents, enjoins or otherwise prohibits the
consummation of the Merger; and
(c)    The Stockholder Approval shall have been obtained.

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7.2.    Conditions to the Obligation of Parent and Merger Sub. The obligation of
Parent and Merger Sub to consummate the Merger is subject to the satisfaction,
on or before the Closing Date, of each of the following further conditions, any
one or more of which may be waived in writing by Parent:
(a)    The representations and warranties contained in Section 3.1 (Organization
and Qualification of the Company), Section 3.2 (Organization and Qualification
of Subsidiaries), Section 3.3 (Capitalization), Section 3.4 (Authority), Section
3.6 (Consents; Stockholder Approval), Section 3.25 (Brokers’ and Finders’ Fees),
Section 4.1 (Organization and Qualification of Stockholder Parties), Section 4.2
(Ownership), Section 4.3 (Authority) and Section 4.6 (Brokers’ and Finders’
Fees) shall be true and correct in all respects at and as of the date hereof and
at and as of the Closing Date as if made at and as of the Closing Date (except
to the extent such representations and warranties speak as of an earlier date,
in which case such representation and warranty shall be true and correct as of
such earlier date or dates). All other representations and warranties of the
Company contained in this Agreement and in any certificate or other writing
delivered by the Company pursuant hereto shall be true and correct in all
respects (disregarding any “material,” “in all material respects,” “Company
Material Adverse Effect,” or similar qualifications contained therein) at and as
of the date hereof and at and as of the Closing Date, as if made at and as of
such date (except to the extent such representations and warranties speak as of
a specific date, in which case such representation and warranty shall be true
and correct as of such earlier date or dates) and except for those failures to
be so true and correct as would not reasonably be expected to have, in the
aggregate, a Company Material Adverse Effect and Parent shall have received a
certificate signed on behalf of the Company by the Chief Executive Officer of
the Company to the foregoing effect.
(b)    The Company shall have performed and complied in all material respects
with all of its obligations hereunder required to be performed or complied with
by it on or prior to the Closing Date and Parent shall have received a
certificate signed on behalf of the Company by the Chief Executive Officer of
the Company to the foregoing effect.
(c)    The Company shall have obtained and delivered to Parent the Consents set
forth on Section 7.2(c) of the Disclosure Letter.
(d)    Parent shall have received from the Company (i) a certificate of good
standing of the Company as of a recent date from the Secretary of State of the
State of Delaware; and (ii) certificates of good standing of each of the
Company’s Subsidiaries as of a recent date from the applicable Secretary of
State of its jurisdiction of incorporation or organization.
(e)    Parent shall have received from the Company certified copies of the
certificate of incorporation of the Company and the certificates of
incorporation or formation of its Subsidiaries, in each case dated as of a
recent date.
(f)    Parent shall have received a certificate of the Secretary of the Company
certifying true and complete copies of (i) the by-laws of the Company, as in
effect on the Closing Date; (ii) the resolutions of the Board authorizing the
execution, delivery and performance of this Agreement and the transactions
contemplated hereby; and (iii) the Stockholder Approval.

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(g)    The Transaction Documents that the Company or any of its Subsidiaries or
any Stockholder Party is party to shall have been executed and delivered by the
Company and such Subsidiaries and Stockholder Parties and true and complete
copies thereof shall have been delivered to Parent.
(h)    Parent shall have received customary pay-off letters or similar
acknowledgments of the discharge of the Closing Bank Debt and any other
Indebtedness of the Company and its Subsidiaries to be paid off at Closing,
setting forth the amount owed as of the Closing Date and indicating that upon
payment of such amount, such Indebtedness will be discharged in full and all
related Liens, including mortgage Liens (other than Permitted Liens) will be
released and removed.
(i)    The Company shall have delivered to Parent a certificate pursuant to
Treasury Regulations Section 1.1445-2(b) that each Stockholder is not a foreign
person within the meaning of Section 1445 of the Code.
(j)    No Company Material Adverse Effect or Stockholder Material Adverse Effect
shall have occurred since the date of this Agreement, nor shall any event or
events have occurred that, individually or in the aggregate, with or without the
lapse of time, could reasonably be expected to result in a Company Material
Adverse Effect or Stockholder Material Adverse Effect.
7.3.    Conditions to the Obligation of the Company. The obligation of the
Company to consummate the Merger is subject to the satisfaction, on or before
the Closing Date, of each of the following further conditions, any one or more
of which may be waived in writing by the Company:
(a)    The representations and warranties of Parent and Merger Sub contained in
Section 5.1 (Organization of Parent and Merger Sub), Section 5.2 (Authority),
and Section 5.10 (Brokers’ and Finders’ Fees) shall be true and correct in all
respects at and as of the date hereof and at and as of the Closing Date as if
made at and as of the Closing Date (except to the extent such representation and
warranty speaks as of an earlier date, in which case such representation and
warranty shall be true and correct as of such earlier date or dates). All other
representations and warranties of Parent and Merger Sub contained in this
Agreement and in any certificate or other writing delivered by Parent or Merger
Sub pursuant hereto shall be true and correct in all respects (disregarding any
“material,” “in all material respects,” “Material Adverse Effect,” or similar
qualifications contained therein) at and as of the date hereof and at and as of
the Closing Date, as if made at and as of such date, except to the extent such
representations and warranties speak as of a specific date and except for those
failures to be so true and correct as would not reasonably be expected to have,
in the aggregate, a Parent Material Adverse Effect and the Company shall have
received a certificate signed on behalf of Parent and Merger Sub by the Chief
Executive Officer of Parent to the foregoing effect.
(b)    Parent and Merger Sub shall have performed and complied in all material
respects with all of their respective obligations hereunder required to be
performed or complied with by them on or prior to the Closing Date and the
Company shall have received a certificate

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signed on behalf of Parent and Merger Sub by the Chief Executive Officer of
Parent to the foregoing effect.
(c)    No Parent Material Adverse Effect shall have occurred since the date of
this Agreement, nor shall any event or events have occurred that, individually
or in the aggregate, with or without the lapse of time, could reasonably be
expected to result in a Parent Material Adverse Effect.
(d)    The Company shall have received a certificate of the Secretary of Parent
certifying true and complete copies of the resolutions of the board of directors
of Parent authorizing the execution, delivery and performance of this Agreement
and the transactions contemplated hereby.
(e)    The Company shall have received from Parent certificates of good standing
of Parent and Merger Sub as of a recent date from the Secretary of State of the
State of Delaware.
(f)    The Transaction Documents that Parent or Merger Sub are party to shall
have been executed and delivered by Parent or Merger Sub and true and complete
copies thereof shall have been delivered to the Company.
ARTICLE VIII
TERMINATION

8.1.    Termination. This Agreement may be terminated and the Merger abandoned
at any time prior to the Closing (in all cases, by action of the respective
boards of directors of the terminating Party or Parties) regardless of whether
this Agreement and/or the Merger have been approved by the Stockholders:
(a)    by written agreement of the Company and Parent;
(b)    by either Parent or the Company if:
(i)    the Closing has not occurred by January 31, 2014 (or such later date as
shall be mutually agreed to in writing by the Company, the Equityholders
Representative and Parent) (the “Outside Date”), provided, however, that the
right to terminate this Agreement under this Section 8.1(b)(i) shall not be
available to any Party whose action or failure to fulfill any obligation
hereunder has been the cause of, or resulted in, the failure of the Closing to
occur on or before the Termination Date and such action or failure constitutes a
breach of this Agreement;
(ii)    if a court of competent jurisdiction or other Governmental Entity shall
have issued a final non-appealable order or taken any other action prohibiting
the consummation of the Merger; provided, however, that the terms of this
Section 8.1(b)(ii) shall not be available to the terminating Party (A) if such
order or action was caused by the action or the failure to act of the
terminating Party and such action or failure constitutes a breach of this
Agreement by such Party or (B) such terminating Party did not use its
commercially reasonable

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efforts to oppose any such order or action or to have such governmental order
vacated or made inapplicable to this Agreement; or
(iii)    there shall be any Law enacted, promulgated or issued or deemed
applicable to the Merger by any Governmental Entity that in the opinion of
counsel of the terminating Party would make consummation of the Merger illegal.
(c)    by Parent if:
(i)    there shall have been any action taken, or any Law enacted, promulgated
or issued or deemed applicable to the Merger, by any Governmental Entity, which
would (A) prohibit Parent’s or the Surviving Corporation’s ownership or
operation of any portion of the business of the Surviving Corporation, or
(B) compel Parent, the Company (pre-Closing) or the Surviving Corporation
(post-Closing) to dispose of or hold separate, as a result of the Merger, any
material portion of the business or assets of the Company, the Surviving
Corporation or Parent;
(ii)    it is not in material breach of its obligations under this Agreement,
there has been a breach of any representation, warranty, covenant or agreement
contained in this Agreement on the part of the Company and, as a result of such
breach, the conditions set forth in Sections 7.1 or 7.2, as the case may be,
would not then be satisfied; provided, however, that if such breach is curable
by the Company prior to the Outside Date through the exercise of its
commercially reasonable efforts, then Parent may not terminate this Agreement
under this Section 8.1(c)(ii) prior to the earlier of the Outside Date or that
date which is fifteen (15) days following the Company’s receipt of written
notice from Parent of such breach, it being understood that Parent may not
terminate this Agreement pursuant to this Section 8.1(c)(ii) if such breach by
the Company is cured within such fifteen (15)-day period so that such conditions
would then be satisfied; or
(iii)    the Company has not delivered evidence that the Stockholder Approval
has been obtained within twenty four (24) hours from the execution of this
Agreement provided that the Company has not delivered evidence of the
Stockholder Approval at the time of written notice of termination by Parent.
(d)    by the Company if it is not in material breach of its obligations under
this Agreement and there has been a breach of any representation, warranty,
covenant or agreement contained in this Agreement on the part of Parent or
Merger Sub and as a result of such breach the conditions set forth in Sections
7.1 or 7.3, as the case may be, would not then be satisfied; provided, however,
that if such breach is curable by Parent prior to the Outside Date through the
exercise of its commercially reasonable efforts, then the Company may not
terminate this Agreement under this Section 8.1(d) prior to the earlier of the
Outside Date or that date which is fifteen (15) days following Parent’s receipt
of written notice from the Company of such breach, it being understood that the
Company may not terminate this Agreement pursuant to this Section 8.1(d) if such
breach by Parent is cured within such fifteen (15)-day period so that such
conditions would then be satisfied.

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8.2.    Effect of Termination. Except as otherwise set forth in this Section
8.2, any termination of this Agreement under Section 8.1 will be effective
immediately upon the delivery of written notice of such termination by the
terminating Party to the other Parties. In the event of the termination of this
Agreement as provided in Section 8.1, this Agreement shall be of no further
force or effect, except that (a) this Section 8.2 and ARTICLE XII shall survive
the termination of this Agreement, and (b) nothing herein shall relieve any
Party from liability for any breach of this Agreement prior to such termination.
No termination of this Agreement shall affect the obligations of the parties to
the Confidentiality Agreement, all of which obligations shall survive the
termination of this Agreement.
ARTICLE IX
INDEMNIFICATION

9.1.    Survival of Representations and Warranties.
(a)    The representations and warranties regarding the Company set forth in
Article III (including the Disclosure Letter) or in any certificate, document or
other instrument delivered by or on behalf of the Company pursuant to or in
connection with this Agreement shall survive the execution and delivery of this
Agreement and the Closing and shall terminate at 5:00 p.m. Eastern time on the
eighteen (18) month anniversary of the Closing Date, except that:
(i)    The Company Fundamental Representations shall continue until ninety (90)
days following the expiration of the applicable statutes of limitation, if any,
applicable to the matters addressed therein;
(ii)    with respect to any claim for Losses made by an Indemnified Party to the
Equityholders Representative in accordance with this Agreement prior to such
termination, in which case the applicable representations and warranties that
are the subject of such claim shall continue to survive solely as to the
specific matters as to which the claim is asserted until such claim is fully
resolved as provided herein.
(b)    The representations and warranties of the Stockholder Parties set forth
in Article IV (including the Disclosure Letter) or in any certificate, document
or other instrument delivered by or on behalf of a Stockholder Party pursuant to
or in connection with this Agreement shall survive the execution and delivery of
this Agreement and the Closing and shall terminate at 5:00 p.m. Eastern time on
the eighteen (18) month anniversary of the Closing Date, except that:
(i)    the representations and warranties set forth in Sections 4.1, 4.2, 4.3
and 4.6 shall continue until ninety (90) days following the expiration of the
applicable statutes of limitation, if any, applicable to the matters addressed
therein; and
(ii)    with respect to any claim for Losses made by Parent or the Surviving
Corporation to a Stockholder Party in accordance with this Agreement prior to
such termination, in which case the applicable representations and warranties
that are the subject of such claim shall continue to survive solely as to the
specific matters as to which the claim is asserted until such claim is fully
resolved as provided herein.

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(c)    The representations and warranties of Parent and Merger Sub set forth in
Article V or in any certificate, document or other instrument delivered by or on
behalf of Parent or Merger Sub pursuant to or in connection with this Agreement
shall survive the Parties’ investigation, execution and delivery of this
Agreement and the Closing and terminate at 5:00 p.m. Eastern time on the
eighteen (18) month anniversary of the Closing Date, except that:
(i)    the representations and warranties set forth in Sections 5.1, 5.2, and
5.10 shall continue until ninety (90) days following the expiration of the
applicable statutes of limitation, if any, applicable to the matters addressed
therein; and
(ii)    with respect to any claim for Losses made by an Indemnified Party to
Parent in accordance with this Agreement prior to such termination, in which
case the applicable representations and warranties that are the subject of such
claim shall continue to survive solely as to the specific matters as to which
the claim is asserted until such claim is fully resolved as provided herein.
9.2.    Indemnification.
(a)    Subject to the other provisions of this ARTICLE IX, Parent and the
Surviving Corporation shall be indemnified as provided in Section 9.3(a) from
and against any and all Losses incurred, suffered or paid by Parent or the
Surviving Corporation directly or indirectly as a result of, with respect to, in
connection with, or arising from:
(i)    any breach of any representation or warranty regarding the Company set
forth in Article III or any certificate delivered by or on behalf of the Company
pursuant hereto or thereto;
(ii)    any breach by the Company of, or failure by the Company to perform,
fulfill or comply with any covenant set forth herein to be performed, fulfilled
or complied with by the Company prior to the Effective Time;
(iii)    any Transaction Expenses or any Indebtedness of the Company that are
not taken into account in determining the Net Initial Equity Consideration;
(iv)    any Legal Action instituted by a Stockholder, Option Holder, or holder
of Restricted Stock or Restricted Stock Units (or any Person claiming to be such
a Person), including pursuant to Section 2.2, against Parent or the Surviving
Corporation relating to any action, misrepresentation or omission, occurring on
or prior to the Closing Date, by the Company or any of its Subsidiaries or any
of their Representatives relating to this Agreement, the Transaction Documents
and the transactions contemplated hereby and thereby; or
(v)    any act done or omitted hereunder by the Equityholders Representation
while acting in bad faith.
(b)    Subject to the other provisions of this ARTICLE IX, each Stockholder
Party shall indemnify, defend and hold harmless Parent and the Surviving
Corporation against any and all Losses incurred or suffered by any of them
directly or indirectly as a result of, with respect to, in connection with, or
arising from:

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(i)    any breach of any representation or warranty of such Stockholder Party
contained in Article IV or any certificate delivered by or on behalf of such
Stockholder Party pursuant hereto or thereto; or
(ii)    any breach by such Stockholder Party of, or failure by such Stockholder
Party to perform, fulfill or comply with any covenant set forth herein to be
performed, fulfilled or complied with by such Stockholder Party.
(c)    Subject to the other provisions of this ARTICLE IX, Parent shall
indemnify, defend and hold harmless the Equityholders Group Members against any
and all Losses incurred or suffered by any of them directly or indirectly as a
result of, with respect to, in connection with, or arising from:
(i)    any breach of any representation or warranty of Parent or Merger Sub set
forth in Article V or any certificate delivered by or on behalf of Parent or
Merger Sub pursuant hereto or thereto; or
(ii)    any breach by Parent or Merger Sub of, or failure by such Parent or
Merger Sub to perform, fulfill or comply with any covenant set forth herein to
be performed, fulfilled or complied with by Parent or Merger Sub.
(d)    For purposes of this Article IX, if any representation or warranty of a
Party contained in this Agreement, or in any certificate delivered hereunder is
qualified in any respect by materiality, in all material respects, Material
Adverse Effect or words of like import, such materiality, in all material
respects, or Material Adverse Effect qualifiers or other qualifiers of like
import shall be ignored in determining whether a breach of any representation or
warranty has occurred and in determining the amount of any resulting Loss.
9.3.    Limitations.
(a)    Any indemnification for Losses by Parent or the Surviving Corporation
pursuant to Section 9.2(a) or Section 10.1(a) shall first be required to be
recovered by a reduction in amounts owed under the Promissory Note. If and to
the extent that it is not possible to satisfy any Losses by reducing the amounts
owed under the Promissory Note at any time for any reason and the Equityholders
Representative has not satisfied such Losses by paying to Parent or the
Surviving Corporation funds in the amount of such Losses that were withheld by
it from Equityholders pursuant to Section 12.1(b), then the Stockholder Parties
shall indemnify, defend and hold harmless Parent and the Surviving Corporation
for such Losses severally based on their respective Indemnity Pro Rata Shares.
(b)     No claims shall be made by Parent or the Surviving Corporation for
indemnification pursuant to Section 9.2(a)(i) unless and until the aggregate
amount of Losses (other than Losses incurred as a result of inaccuracies or
breaches of the Company Fundamental Representations) for which Parent and the
Surviving Corporation are entitled to seek to be indemnified pursuant to
Section 9.2(a)(i) exceeds $3,500,000, at which time Parent and the Surviving
Corporation shall be entitled to indemnification for the amount in excess of
such amount, subject to the other limitations set forth in this ARTICLE IX.

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(c)    From and after the time that the claims made by Parent and the Surviving
Corporation for indemnification exceed $3,500,000, no claims for indemnification
may be made by Parent or the Surviving Corporation pursuant to Section 9.2(a)(i)
for any individual item or series of related items where the Losses (other than
Losses incurred as a result of inaccuracies or breaches of the Company
Fundamental Representations) with respect to such item or series of related
items (in the aggregate ) are less than $50,000.
(d)    Notwithstanding anything to the contrary in this Agreement, the aggregate
amount of any and all payments required to be made by all Equityholders pursuant
to this ARTICLE IX (other than any amounts owed as a result of a breach of
Section 10.5(b)) and ARTICLE X, by means of a reduction of the principal amount
of the Promissory Note in accordance with this Agreement or otherwise, shall not
exceed Forty Five Million Dollars ($45,000,000), and Parent and the Surviving
Corporation shall not be entitled to any indemnification under this ARTICLE IX
and ARTICLE X in excess of such amount.
(e)    All indemnification payments made pursuant to this ARTICLE IX shall be
made on an after-tax basis. Accordingly, in determining the Losses incurred or
suffered by an Indemnified Party hereunder, the amount of such Losses shall be
(i) increased to take into account any additional Tax cost incurred by such
Indemnified Party arising from the receipt of applicable indemnification
payments hereunder and (ii) decreased to take into account any deduction, credit
or other Tax benefit actually realized by such Indemnified Party with respect to
the receipt of applicable indemnification payments hereunder. In computing the
amount of any such Tax cost or Tax benefit, the Indemnified Party shall be
deemed to recognize all other items of income, gain, loss, deduction or credit
before recognizing any item arising from the receipt of applicable
indemnification payments hereunder or the incurrence or payment relating to any
Losses; provided that, if any such Tax cost or Tax benefit is not realized in
the taxable period during which the Indemnifying Party makes an indemnification
payment or the Indemnified Party incurs any Losses, the Parties shall thereafter
make payments to one another at the end of each subsequent taxable period to
reflect the net Tax costs or Tax benefits realized by the Parties in each such
subsequent taxable period.
(f)    Any Indemnified Party that becomes aware of any Losses for which it seeks
indemnification under this ARTICLE IX shall be required to use commercially
reasonable efforts to mitigate such Losses, including seeking all available
insurance; provided that the Indemnified Party shall not be required to initiate
litigation against any then-current customer, supplier, vendor or other Person
(in each case, other than an insurance provider) having a business relationship
with such Indemnified Party or any of its Affiliates.
(g)    The Losses suffered by any Indemnified Party shall be calculated after
giving effect to any insurance proceeds actually recovered by the Indemnified
Party from insurance providers under available insurance policies, net of (i)
all out-of-pocket costs and expenses relating to collection from such insurers,
(ii) any deductibles associates therewith and (iii) any increase in premiums
resulting therefrom.
(h)    Notwithstanding the fact that any Indemnified Party may have the right to
assert claims for indemnification under or in respect of more than one provision
of this Agreement in respect of any fact, event, condition or circumstance, no
Indemnified Party shall be

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entitled to recover the amount of any Losses suffered by such Indemnified Party
more than once, regardless of whether such Losses may be as a result of a breach
of more than one representation, warranty or covenant. Without limiting the
generality of the foregoing, no Indemnified Party shall be able to recover any
Loss for which it is otherwise entitled to indemnification under this Agreement
if such Loss has already been taken into account in determining the Closing Net
Working Capital pursuant to Section 2.6.
(i)    Except for claims for injunctive and other equitable relief, the sole and
exclusive remedy of any Indemnified Party for money damages for any matters
relating to this Agreement or the consummation of the transactions contemplated
hereby shall be the rights to indemnification set forth in this ARTICLE IX. No
officer, director, manager, employee, Affiliate, advisor or other representative
of the Company or any of its Subsidiaries shall have any Liability under or with
respect to this Agreement solely in their capacity as such.
(j)    No party shall be entitled to be indemnified hereunder with respect to
any Losses that are in the nature of exemplary or punitive damages (except to
the extent such damages are awarded in a Third-Party Claim).
(k)    The limitations on indemnification contained in this Section 9.3 shall
not apply in the case of fraud or willful misconduct of the Indemnifying Party.
9.4.    Procedures.
(a)    If any Party believes at any time that it is entitled to be indemnified
under this ARTICLE IX, such Party (the “Indemnified Party”) shall promptly
deliver to (i) the Equityholders Representative, in the case of claims for
indemnification being asserted by Parent or the Surviving Corporation, and
(ii) Parent, in the case of claims for indemnification being asserted by the
Equityholders Representative, a certificate (a “Claim Certificate”) that
(x) states that the Indemnified Party has paid or properly incurred Losses and
the amount thereof, or reasonably anticipates that it may or will incur Losses,
for which such Indemnified Party is entitled to indemnification under this
Agreement, and the estimated amount thereof, and (y) specifies in reasonable
detail, to the extent practicable, each individual item of Loss included in the
amount so stated, the date (if any) such item was paid or properly incurred, the
basis for any anticipated liability and the nature of the misrepresentation,
default, breach of warranty or breach of covenant or claim to which each such
item is related and, to the extent computable, the computation of the amount to
which such Indemnified Party claims to be entitled hereunder; provided, however,
that no delay on the part of the Indemnified Party in delivering a Claim
Certificate shall diminish the rights of the Indemnified Party to be indemnified
hereunder except to the extent that the delay shall increase the amount of such
claim or Loss, and then only to such extent.
(b)    If the Equityholders Representative, in the case of indemnification
claims by Parent or the Surviving Corporation, or Parent, in the case of
indemnification claims by the Equityholders Representative (in either case, the
“Indemnifying Party”) objects to a claim of an Indemnified Party in respect of
any claim or claims specified in any Claim Certificate, the Indemnifying Party
shall deliver a written notice to such effect to the Indemnified Party within
thirty (30) days after receipt of the Claim Certificate by the Indemnifying
Party. Thereafter, the

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Indemnifying Party and the Indemnified Party shall attempt in good faith to
agree upon their respective rights within thirty (30) days after receipt by the
Indemnified Party of such written objection with respect to each of such claims
to which the Indemnifying Party has objected. If the Indemnified Party and the
Indemnifying Party agree with respect to any of such claims, the Indemnified
Party and the Indemnifying Party shall promptly prepare and sign a memorandum
setting forth such agreement. If, as a result of such agreement, Parent is
entitled to have the principal amount of the Promissory Note reduced, the
Equityholders Representative shall promptly execute an amendment to the
Promissory Note reflecting such reduction. Should the Indemnified Party and the
Indemnifying Party fail to agree as to any particular item or items or amount or
amounts, then the Indemnified Party shall be entitled to pursue its available
remedies for resolving the claim for indemnification.
9.5.    Third-Party Claims.
(a)    If a claim for indemnification under this ARTICLE IX is based on, or
results from, a claim by a third party for which an Indemnified Party would be
entitled to indemnification hereunder (a “Third-Party Claim”), such Indemnified
Party shall deliver notice thereof to the Indemnifying Party promptly after
receipt by such Indemnified Party of written notice of the Third-Party Claim,
which (i) in the case of a claim for indemnification by Parent or the Surviving
Corporation shall be delivered to the Equityholders Representatives and (ii) in
the case of a claim for indemnification by the Equityholders Representative
shall be delivered to Parent, describing in reasonable detail the facts giving
rise to any claim for indemnification hereunder, the amount or method of
computation of the amount of such claim (if known) and such other information
with respect thereto as the Indemnifying Party may reasonably request. Any
failure or delay in providing such notice, however, shall not release the
Indemnifying Party from any of its obligations under this Article IX except to
the extent that the Indemnifying Party is prejudiced by such failure or delay.
(b)    The Indemnifying Party shall have the right, upon written notice to the
Indemnified Party within fifteen (15) Business Days of receipt of notice from
the Indemnified Party of such Third Party Claim, to assume the defense thereof
at the expense of the Indemnifying Party with counsel selected by the
Indemnifying Party and reasonably satisfactory to the Indemnified Party so long
as: (i) the Indemnifying Party acknowledges in such notice that any Losses that
the Indemnified Party may suffer resulting from, arising out of, relating to, in
the nature of or caused by the Third-Party Claim constitute Losses that are
indemnifiable by the Indemnifying Party under this Article IX; (ii) the
Third-Party Claim involves only money damages and does not seek an injunction or
other equitable relief; (iii) an adverse judgment or settlement would not or
would not reasonably be likely to establish a precedent adverse to the business
of the Indemnified Party; (iv) the Indemnifying Party conducts the defense of
the Third-Party Claim actively and diligently; and (v) the Indemnifying Party
agrees to keep the Indemnified Party apprised of all developments relating to
the Third-Party Claim.
(c)    If the Indemnifying Party assumes the defense of such Third-Party Claim
and is conducting the defense of the Third-Party Claim in accordance with
Section 9.5(b): (i) the Indemnified Party shall have the right to employ
separate counsel and to participate in the defense thereof, but the fees and
expenses of such counsel shall be at the expense of the Indemnified Party;
provided that, if in the reasonable opinion of counsel for the Indemnified

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Party, there is a conflict of interest between the Indemnified Party and the
Indemnifying Party (other than simply arising from the indemnification
obligation hereunder), the Indemnifying Party shall be responsible for the
reasonable fees and expenses of one counsel to such Indemnified Party in
connection with such defense; (ii) the Indemnified Party shall cooperate with
the Indemnifying Party in such defense and make available to the Indemnifying
Party all witnesses, pertinent records, materials and information in the
Indemnified Party’s possession or under the Indemnified Party’s control relating
thereto as is reasonably required by the Indemnifying Party; (iii) the
Indemnified Party shall not admit any liability with respect to, or settle,
compromise or discharge, or offer to settle, compromise or discharge, such
Third-Party Claim without the Indemnifying Party’s prior written consent
(provided that if the Indemnifying Party does not provide its consent to a
settlement, compromise or discharge agreed to or recommended by the Indemnified
Party, then the monetary indemnification limitations set forth in Section 9.3(d)
shall not apply to any Losses resulting from such Third-Party Claim, and the
amount of any difference between any such Losses and the proposed settlement
amount shall not be considered in determining whether the monetary limitations
set forth in Section 9.3(d) have been exceeded; and (iv) the Indemnifying Party
shall not admit any liability with respect to, or settle, compromise or
discharge, or offer to settle, compromise or discharge, such Third-Party Claim
without the Indemnified Party’s prior written consent, which consent shall not
be unreasonably withheld, conditioned or delayed with respect to a settlement,
compromise or discharge agreed to or recommended by the Indemnifying Party that
consists solely of the payment of a monetary amount of $4,500,000 or greater
(provided that if the Indemnified Party does not provide its consent to a
settlement, compromise or discharge that is agreed to or recommended by the
Indemnifying Party and that consists solely of the payment of a monetary amount,
then the Indemnified Party shall be responsible for, and the Indemnifying Party
shall have no indemnification obligations with respect to, all Losses resulting
from such Third-Party Claim that are in excess of such monetary amount).
(d)    In the event any of the conditions in Section 9.5(b) is or becomes
unsatisfied, the Indemnified Party may defend against (with the Indemnifying
Party responsible for the reasonable fees and expenses of counsel to the
Indemnified Party) in connection with such defense, and consent to the entry of
any judgment on or enter into any settlement with respect to, the Third-Party
Claim in any manner the Indemnified Party may reasonably deem appropriate (and
the Indemnified Party need not consult with, or obtain any consent from, any
Indemnifying Party in connection therewith).
9.6.    Purchase Price Adjustment. Parent, the Surviving Corporation and the
Equityholders Representative (on behalf of the Equityholders) agree to treat
each indemnification payment pursuant to this ARTICLE IX as an adjustment to the
consideration being paid to the Equityholders for all Tax purposes and shall
take no position contrary thereto unless required to do so by applicable Tax
Law.
9.7.    Fraud and Willful Misconduct. For the avoidance of doubt, nothing in
this ARTICLE IX shall limit any Indemnified Party’s right to bring an action in
a court of law or equity alleging fraud or willful misconduct in connection with
the transactions contemplated hereby that are otherwise available to such
Indemnified Party and to recover Losses from any other Party hereto awarded by
such court with respect thereto and the survival expiration periods

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set forth in Section 9.1 and the limitations set forth in Section 9.3 shall not
apply with respect to any such action.
ARTICLE X
TAX MATTERS

10.1.    Tax Indemnity.
(a)    Parent and the Surviving Corporation shall be indemnified as provided in
Section 9.3(a) from and against, without duplication, any loss, claim,
liability, expense or other damage attributable to (a) all Taxes (or the
nonpayment thereof) of the Company or any of its Subsidiaries for all
Pre-Closing Tax Periods, (b) all Taxes of any member of an affiliated,
consolidated, combined or unitary group of which the Company or any of its
Subsidiaries (or any predecessor of any of the foregoing) is or was a member on
or prior to the Closing Date, including pursuant to Treasury Regulation
§1.1502-6 or any analogous or similar state, local, or foreign law or
regulation, and (c) any and all Taxes of any person imposed on the Company or
any of its Subsidiaries as a transferee or successor, by contract or pursuant to
any law, rule, or regulation, which Taxes relate to an event or transaction
occurring before the Closing: provided, however, that no such indemnification
shall be available for (1) any Tax to the extent such Tax relates to any
Post-Closing Tax Period; (2) any Tax to the extent such Tax is taken into
account in the computation of the Per Share Merger Consideration; or (3) any Tax
to the extent the Tax resulted from any breach by Parent of any covenant or
other agreement in this ARTICLE X.
(b)    Parent shall be responsible for and indemnify the Equityholders from and
against all Taxes (or the nonpayment thereof) of the Company or any of its
Subsidiaries for all Post-Closing Tax Periods.
(c)    For the avoidance of doubt, the Equityholders shall be entitled to
receive the benefit (whether realized by refund of Taxes or by credit against
Taxes of Parent, the Company or any of its Subsidiaries) attributable to any
deductions allowed to the Surviving Corporation for the Transaction Expenses,
plus any actual interest collected on any such refund or credits attributable to
such deductions, received from the applicable Taxing authority; provided,
however, that the Stockholder Parties shall indemnify and hold harmless (on a
several basis based on their respective Indemnity Pro Rata Share) Parent and the
Surviving Corporation for any excess payment made by Parent or the Surviving
Corporation to the Equityholders Representative (for further distribution to the
Equityholders, subject to Section 12.1(b)) with respect to any such deduction
claimed. The Surviving Corporation shall, and shall cause its Subsidiaries to,
cooperate with the Equityholders Representative in obtaining any refunds or
credits which the Equityholders are entitled to receive the benefit of. Such
cooperation shall include (i) informing the Equityholders Representative if and
to the extent that Parent, the Company or any Subsidiary of the Company becomes
aware of the possible availability of any such refund or credit, (ii) filing
claims (including filing carryback claims and claims for the overpayment of
estimated taxes on Internal Revenue Service Form 4466 and equivalent State
forms) or amended Tax Returns at the request of the Equityholders Representative
to obtain any such refund or credit and (iii) paying the amount of such credit
or refund over to the Equityholders Representative (for further payment to the
Equityholders in accordance with their respective Equity Ownership Percentages
and the payment instructions set forth in their

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respective Letters of Transmittal) by wire transfer within five (5) Business
Days after the receipt thereof.
10.2.    Responsibility for Filing Tax Returns.
(a)    The Surviving Corporation shall prepare and file, or cause to be prepared
and filed, at its sole cost and expense, all income Tax Returns of the Company
or its Subsidiaries for any Pre-Closing Tax Period or Straddle Period that are
filed or due (after taking into account all appropriate extensions) after the
Closing Date. Such income Tax Returns shall be prepared on a basis consistent
with existing procedures and practices and accounting methods and by KPMG. At
least forty-five (45) days prior to the due date of each such Tax Return, the
Surviving Corporation shall submit a draft of such Tax Return to the
Equityholders Representative for its review and comment. The Surviving
Corporation and the Equityholders Representative shall cooperate in the
preparation and filing of such tax return and the Surviving Corporation shall
give good faith consideration to any comments made by the Equityholders
Representative and shall make all changes (including making or refraining from
making any election) requested by the Equityholders Representative that are
consistent with applicable Law and are necessary to implement the provisions of
Section 2.9 or otherwise maximize the deductions taken in such returns.
(b)    For purposes of preparing all Tax Returns, and for purposes of
determining whether to make (or not to make) certain Tax elections, the
Stockholder Parties, the Equityholders Representative and Parent agree to use
the following conventions (and to cause the Company and Parent’s other
Affiliates to use the following conventions):
(i)    Any tax deductions resulting from the payment or accrual of an amount in
a Pre-Closing Tax Period shall be treated as occurring on the Closing Date and
no Party shall make any election under Treasury Regulation Section
1.1502-76(b)(1)(ii)(B) (or any similar provision of state, local, or non-U.S.
applicable Law) to apply the “next day rule” to such deductions.
(ii)    Any gains, income, deductions, losses, or other items resulting from
transactions outside of the ordinary course of business and not contemplated by
this Agreement occurring on the Closing Date at the direction of Parent, but
after the Closing, shall be treated as occurring on the day after the Closing
Date and each Party shall utilize the “next day rule” in Treasury Regulation
Section 1.1502-76(b)(1)(ii)(B) (or any similar provision of state, local, or
non-U.S. applicable Law) for purposes of reporting such items on applicable Tax
Returns.
(iii)    No Party shall make an election under Treasury Regulation Section
1.1502-76(b)(2)(ii) (or any similar provision of state, local, or non-U.S.
applicable Law) to ratably allocate items incurred by the Company or any of its
Subsidiaries.
(iv)    To the extent permissible under applicable Laws, to elect to have the
Tax year of the Company end on the Closing Date and, if such election is not
permitted or required in a jurisdiction such that the Company is required to
file a Tax Return for a Straddle Period, the Parties agree to use the following
conventions for determining the amount of Taxes

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attributable to the portion of the Straddle Period ending on the Closing Date:
(a) in the case of Income Taxes, Taxes imposed on sales or receipts, and Taxes
imposed on payments, the amount attributable to such portion shall be determined
as if the Company filed a separate Tax Return with respect to such Taxes for the
portion of the Straddle Period ending as of the end of the day on the Closing
Date using a “closing of the books methodology”; and (b) in the case of all
other Taxes, the amount attributable to the portion of the Straddle Period
ending on the Closing Date shall be determined by multiplying the Taxes for the
entire Straddle Period by a fraction, the numerator of which is the number of
calendar days in the portion of the Straddle Period ending on the Closing Date
and the denominator of which is the number of calendar days in the entire
Straddle Period. For purposes of clause (a), any item determined on an annual or
periodic basis (including amortization and depreciation deductions) shall be
allocated to the portion of the Straddle Period that ends on the Closing Date
based on the relative number of days in such portion as compared to the number
of days in the entire Straddle Period. Notwithstanding anything to the contrary
herein, any estimated payments or payments from a prior tax period that are
applied to a Straddle Period shall be applied entirely to the portion of the
Straddle Period ending on the Closing Date.
(c)    Parent, the Company, the Equityholders Representative and the Stockholder
Parties shall cooperate fully, as and to the extent reasonably requested by the
other party, in connection with the filing of Tax Returns pursuant to this
ARTICLE X and any audit, litigation or other proceeding with respect to Taxes
(including Tax Contests). Such cooperation shall include the retention for the
full period of any statute of limitations and (upon the other Party’s request)
the provision of records and information that are reasonably relevant to any
such Tax Return, audit, litigation or other proceeding and making employees
available on a mutually convenient basis to provide additional information and
explanation of any material provided hereunder. The Company and the
Equityholders agree (A) to retain all books and records with respect to Tax
matters pertinent to the Company and its Subsidiaries relating to any Taxable
period beginning before the Closing Date until the expiration of the statute of
limitations (and, to the extent notified by Parent or the Equityholders, any
extensions thereof) of the respective Taxable periods, and to abide by all
record retention agreements relating to Taxes entered into with any taxing
authority, and (B) to give the other Party reasonable written notice prior to
transferring, destroying or discarding any such books and records and, if the
other party so requests, the Company or the Equityholders, as the case may be,
shall allow the other party to take possession of such books and records.
10.3.    Tax Contests.
(a)    If any taxing authority issues to the Company or any of its Subsidiaries
(1) a notice of its intent to audit or conduct another legal proceeding with
respect to a Tax Return or Taxes of the Company for any Pre-Closing Tax Period
or Straddle Period or (2) a notice of deficiency for Taxes for any such period,
Parent or the Company shall notify the Equityholders Representative of its
receipt of such communication from the taxing authority within twenty (20) days
of receipt. Such notice shall be accompanied by a copy of any written notice or
other document received from the applicable taxing authority.
(b)    Except as otherwise provided in this Section 10.3, the Surviving
Corporation shall have the sole right to control, at its expense, the contest of
any audit or other

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Legal Proceedings in respect of any Taxes or Tax Returns of the Company or any
of its Subsidiaries (a “Tax Contest”). The Equityholders Representative may, at
its expense, participate in any such Tax Contest. No Tax Contest relating to a
Pre-Closing Tax Period or a Straddle Period may be settled by the Surviving
Corporation without Equityholders Representative’s prior written consent if such
settlement involves a matter for which Parent is seeking indemnification
hereunder or a matter that is the subject of Section 10.5(b); provided, however,
that no such consent by the Equityholders Representative shall be unreasonably
withheld or delayed.
(c)    In connection with any Tax Contest in which a Person elects to
participate but does not have the right to control, (1) the participating Person
shall notify the controlling Person of such intent, (2) the controlling Person
shall take all actions necessary to allow the participating Person (and its
counsel) to fully participate in such Tax Contest, (3) the controlling Person
(and its counsel) shall consult with the participating Person (and its counsel)
regarding the conduct of such Tax Contest and vice versa, (4) the controlling
Person shall timely provide the participating Person with copies of all
correspondence and other documents received regarding the Tax Contest from the
applicable taxing authority, and (5) the controlling Person shall permit the
participating Person to review and comment on any correspondence and other
documents that will be provided to the taxing authority with respect to such Tax
Contest to the extent that such correspondence or other documents may reasonably
be expected to have an impact on the participating Person.
(d)    In connection with any Tax Contest in which a Person has the right to
participate but elects not to do so, the controlling Person nevertheless shall
keep such Person reasonably informed regarding the status of such Tax Contest.
10.4.    Assistance and Cooperation. The Equityholders Representative and Parent
shall furnish or cause to be furnished to each other, upon request, as promptly
as practicable, such information (including access to books and records) and
assistance relating to the Company and its Subsidiaries as is reasonably
requested for the filing of any Tax Returns, for the preparation of any audit,
for the filing of Tax refund claims or amended Tax Returns and for the
prosecution or defense of any Tax claim. Parent shall, and shall cause the
Surviving Corporation and its Subsidiaries to, preserve and keep all books and
records with respect to Taxes and Tax Returns of the Company and its
Subsidiaries until the expiration of the applicable statute of limitations. Any
information obtained under this Section 10.4 shall be kept confidential except
(a) as may be otherwise necessary in connection with the filing of Tax Returns
or claims for refund or in conducting an audit or other proceeding or (b) with
the consent of the party in possession of such information.
10.5.    Transfer Taxes.
(a)    Any and all transfer, documentary, sales, use, stamp, registration and
other Taxes and fees payable in connection with the consummation of the
transactions contemplated by this Agreement (which for the avoidance of doubt do
not include any such transfer or other Taxes referenced under Section 10.5(b))
shall be split equally between Parent, on the one hand, and the Equityholders,
on the other hand, and shall be paid by Parent and the Equityholders
Representative (on behalf of the Equityholders) when due, and Parent shall, at
its own expense,

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file all necessary Tax Returns and other documentation with respect to all such
transfer, documentary, sales, use, stamp, registration and other Taxes and fees,
and, if required by Law, the Equityholders Representative, on behalf of the
Equityholders, shall join in the execution of any such Tax Returns and
documentation.
(b)    Any and all transfer, documentary, sales, use, stamp, registration and
other Taxes and fees payable by the Company or any of its Subsidiaries relating
to the transfer of title of any Owned Real Property to the Company or any of its
Subsidiaries, or any filing or recording made by the Company or any of its
Subsidiaries to reflect the Company or any of its Subsidiaries as the legal
owner of any Owned Real Property, shall be paid by the Equityholders
Representative (on behalf of the Equityholders) when due, and the Equityholders
Representative shall, at its own expense, file all necessary Tax Returns and
other documentation with respect to all such transfer, documentary, sales, use,
stamp, registration and other Taxes and fees, and, if required by Law, the
Surviving Corporation and any applicable Subsidiary shall join in the execution
of any such Tax Returns and documentation.
10.6.    Treatment of Payments. All amounts paid under this ARTICLE X shall, to
the extent permitted by Law, be treated for all purposes as adjustments to the
consideration payable to the Equityholders hereunder.

ARTICLE XI
DEFINITIONS; CONSTRUCTION

11.1.    Definitions. For the purposes of this Agreement:
“280G Waiver” is defined in Section 6.16.
“401(k) Plan” is defined in Section 6.5(b).
“Accounting Arbitrator” means Grant Thornton LLP.
“Accounting Conventions” means the illustrative calculation and the accounting
principles, procedures, practices, policies and calculations set forth on
Section 11.1(a) of the Disclosure Letter.
“Acquisition Date” means March 31, 2011.
“Acquisition Proposal” means any inquiry, proposal or offer from any Person
(other than Parent or any of its Affiliates) concerning or relating to (a) a
merger, consolidation, liquidation, recapitalization, share exchange or other
business combination transaction involving the Company or any of its
Subsidiaries; (b) the issuance or acquisition of shares of capital stock or
other Equity Securities of the Company or any of its Subsidiaries; or (c) the
sale, lease, exchange or other disposition of any significant portion of the
Company’s or any of its Subsidiaries’ properties or assets.
“Affidavit of Loss” is defined in Section 2.4(d).

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“Affiliate” means, with respect to the Person to which it refers, a Person that
directly or indirectly, through one or more intermediaries, controls, is
controlled by or is under common control with, such Person. For the purpose of
this definition, the term “control” of a Person means the power to direct, or
cause the direction of, the management and policies of such Person, whether
through the ownership of voting securities, by contract or otherwise, and the
terms and phrases “controlling,” “controlled by” and “under common control” have
correlative meanings.
“Agreement” is defined in the Preamble.
“Applicable Law” means, with respect to any Person, any Law that is binding upon
or applicable to such Person, as amended unless expressly specified otherwise.
“Balance Sheets” is defined in Section 3.7(a).
“Balance Sheet Date” is defined in Section 3.7(a).
“Board” is defined in Recital B.
“Business” means the distribution and marketing of automotive aftermarket parts
and accessories as conducted by the Company and its Subsidiaries.
“Business Day” means any day of the year on which national banking institutions
in the State of New York are open to the public for conducting business and are
not required to close.
“CERCLA” means the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended.
“Certificate” means a certificate evidencing shares of Common Stock.
“Certificate of Merger” is defined in Section 1.3.
“Claim Certificate” is defined in Section 9.4(a).
“Class A Common Stock” means the Company’s Class A Common Stock, par value $0.01
per share.
“Class B Common Stock” means the Company’s Class B Common Stock, par value $0.01
per share.
“Closing” is defined in Section 1.2.
“Closing Bank Debt” means the outstanding obligations of the Company and its
Subsidiaries as of immediately prior to the Effective Time under the Senior
Credit Facilities (including any interest, fees or penalties (including
prepayment penalties) accrued or owed with respect thereto).
“Closing Date” is defined in Section 1.2.

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“Closing Net Working Capital” is defined on Section 2.6 of the Disclosure
Letter.
“Closing Statement” is defined in Section 2.6(b).
“Code” means the United States Internal Revenue Code of 1986, as amended.
“Common Stock” means the Class A Common Stock and the Class B Common Stock
(including Restricted Stock).
“Company” is defined in the Preamble.
“Company Employee Plan” means any plan, program, policy, practice, contract,
agreement or other arrangement (written or oral) providing for deferred
compensation, profit sharing, bonus, severance, change-of-control payments,
termination pay, performance awards, stock option, share appreciation right or
other stock-related awards, fringe benefits, group or individual health, dental,
medical, life insurance, survivor benefit or other welfare, pension or other
employee benefits or remuneration of any kind, whether formal or informal,
funded or unfunded, including each “employee benefit plan” within the meaning of
Section 3(3) of ERISA, whether or not subject to ERISA, which is or has been
maintained, contributed to, or required to be contributed to, by the Company or
any of its Subsidiaries or ERISA Affiliates for the benefit of any Employee, or
pursuant to which the Company or any of its Subsidiaries has or may have any
liability, contingent or otherwise.
“Company Equity Incentive Plan” means the Keystone Automotive Holdings, Inc.
Stock Incentive Plan.
“Company Fundamental Representations” means the representations and warranties
set forth in Sections 3.1 through 3.4, 3.20 and 3.25.
“Company Intellectual Property” means any Intellectual Property that is owned by
the Company or one of its Subsidiaries.
“Company Material Adverse Effect” means a material adverse effect on the
Business, assets, properties, Liabilities, capitalization, operations, or
condition (financial or otherwise) of the Company and its Subsidiaries, taken as
a whole; provided, however, that none of the following will be deemed, either
alone or in combination, to constitute, and none of the following will be taken
into account in determining whether there has been or will be, a Company
Material Adverse Effect: (i) events, changes, developments or circumstances
relating to the industries or the markets in which the Company and its
Subsidiaries operate, including changes resulting from weather or natural
conditions, (ii) events, changes, developments, conditions or circumstances that
effect the United States economy generally, (iii) an outbreak or escalation of
war, armed hostilities, acts of terrorism, political instability or other
national or international calamity, crisis or emergency, or any governmental or
other response to any of the foregoing, in each case, whether occurring within
or outside the United States, (iv) changes in Law or GAAP, (v) any change,
effect, circumstance or event arising from the announcement of this Agreement or
(vii) any action or omission of the Company or any of its Subsidiaries prior to
the Closing Date contemplated by this Agreement or taken with the prior written
consent of Parent, as long as, in the case of the foregoing clauses (i) through
(iv), such change,

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circumstance, event or effect has not had, or would not reasonably be expected
to have, a materially disproportionate adverse impact on the Company and its
Subsidiaries, taken as a whole, relative to other Persons operating in the
industry sector or sectors in which the Company and its Subsidiaries operate.
“Company’s Knowledge” (including any derivation thereof such as “known” or
“knowing”) means the actual or constructive knowledge of any of Edward Orzetti,
Rich Paradise, Kevin Canavan or Rudy Esteves.
“Confidentiality Agreement” is defined in Section 6.2.
“Consents” means approvals, consents (including negative consents), waivers,
filings, authorizations, Licenses, notices, reports or similar items.
“Constitutional Documents” means, as to any Person, the constitutional or
organizational documents of such Person, including any charter, certificate or
articles of incorporation, certificate of formation, articles of association,
bylaws, trust instrument, partnership agreement, limited liability company or
operating agreement or similar document.
“Contract” means any written or oral agreement, contract, outstanding purchase
orders, mortgage, indenture, lease, license, instrument, document, obligation or
commitment that is legally binding, including all amendments, modifications and
supplements thereto; provided, however, that the term “Contract” does not
include purchase orders received in the ordinary course of business.
“Covered Persons” is defined in Section 6.4(a).
“DGCL” is defined in Recital A.
“Disclosure Letter” is the Disclosure Letter, dated as of the date of this
Agreement and delivered herewith to Parent.
“Dissenting Shares” is defined in Section 2.2.
“Effective Time” is defined in Section 1.3.
“Employee” means any current, former, or retired employee of the Company or any
of its Subsidiaries.
“Environmental Claim” means any Legal Action, Judgment, lien, fine, penalty, or,
as to each, any settlement or judgment arising therefrom, by or from any Person
alleging Liability of whatever kind or nature (including Liability or
responsibility for the costs of enforcement proceedings, investigations,
cleanup, governmental response, removal or remediation, natural resources
damages, property damages, personal injuries, medical monitoring, penalties,
contribution, indemnification and injunctive relief) arising out of, based on or
resulting from: (a) the presence, Release of, or exposure to, any Hazardous
Materials; or (b) any actual or alleged non-compliance with any Environmental
Law or term or condition of any Permit.

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“Environmental Law” means any and all Applicable Laws and Licenses issued,
promulgated or entered into by any Governmental Entity relating to the
environment, the protection or preservation of human health or safety, including
the health and safety of employees, the regulation, manufacture, packaging,
transportation, storage, import, export, or disposal of chemical substances,
mixtures, articles, or petroleum products, the preservation or reclamation of
natural resources, or the treatment, storage, disposal, management, Release or
threatened Release of Hazardous Materials, in each case as in effect on the date
hereof and as may be issued, promulgated or amended from time to time.
“Equityholders” means the Stockholders, the holders of any Restricted Stock
Units and the Option Holders.
“Equityholders Representative” is defined in the Preamble.
“Equity Interest” means, with respect to any Person, any outstanding Equity
Securities, subscriptions, options, calls, warrants or other rights to acquire
Equity Securities whether or not currently exercisable.
“Equity Ownership Percentage” means, for each Equityholder, an amount equal to
the fraction, expressed as a percentage (rounded to six decimal places), the
numerator of which is the sum of (a) the number of shares of Common Stock held
by such Equityholder immediately prior to the Effective Time (including any
shares of Class B Common Stock issuable upon settlement of the Restricted Stock
Units), if any, plus, (b) the number of shares of Class B Common Stock that are
the subject of Stock Options held by such Equityholder immediately prior to the
cancellation of such Stock Options as contemplated by this Agreement, if any,
and the denominator of which is the number of Fully Diluted Shares Outstanding.
“Equity Securities” means, with respect to any Person, any of its capital stock,
partnership interests (general or limited), limited liability company interests,
trust interests or other securities which entitle the holder thereof to
participate in the earnings of such Person or to receive dividends or
distributions on liquidation, winding up or dissolution of such Person, or to
vote for the election of directors or other management of such Person, or to
exercise other rights generally afforded to stockholders of a corporation.
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.
“ERISA Affiliate” means any Person that, together with the Company or any of its
Subsidiaries, would be treated as a single employer under Section 414 of the
Code or Section 4001 of ERISA and the regulations thereunder within the past 7
years.
“Estimated Closing Cash” is defined in Section 2.6(a).
“Estimated Closing Net Working Capital” is defined in Section 2.6(a).
“Estimated Statement” is defined in Section 2.6(a).
“Exercise Price” means, with respect to any outstanding Stock Option, the
aggregate amount that would be required to be paid in order to exercise such
Stock Option.

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“Financial Statements” is defined in Section 3.7(a).
“Fully Diluted Shares Outstanding” means, excluding treasury shares, the sum of
(a) the number of shares of Common Stock outstanding immediately prior to the
Effective Time (including shares of Restricted Stock, without regard to any
voting restrictions), plus (b) the number of shares of Common Stock issuable in
settlement of any outstanding Restricted Stock Units), plus (c) the number of
shares of Class B Common Stock that would be issuable upon exercise of all Stock
Options outstanding immediately prior to the Effective Time (without regard to
any vesting restrictions).
“GAAP” means generally accepted accounting principles in the United States as in
effect on the date of this Agreement.
“Governmental Entity” means any court, administrative agency, department,
commission, board, bureau, or other federal, state, county, local or foreign
governmental entity, instrumentality, agency or commission.
“Hazardous Material” means those materials, substances, biogenic materials,
articles, or wastes that are regulated by, or form the basis of liability under,
any Environmental Law, including PCBs, pollutants, solid wastes, explosive,
radioactive or regulated materials or substances, hazardous or toxic materials,
substances, wastes or chemicals, mixtures of chemical substances, special
materials, petroleum (including crude oil or any fraction thereof) or petroleum
distillates, asbestos or asbestos containing materials, materials listed in 49
C.F.R. Section 172.101 and materials defined as hazardous substances pursuant to
Section 101(14) of CERCLA.
“HSR Act” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended.
“HSR Filing” is defined in Section 6.3(d).
“Improvements” is defined in Section 3.11(f).
“Indebtedness” of any Person means (a) all indebtedness for borrowed money,
(b) all obligations issued, undertaken or assumed as the deferred purchase price
of property or services (in each case, whether or not matured or payable), other
than trade accounts arising in the ordinary course of business consistent with
past practice, (c) all obligations evidenced by notes, bonds, debentures or
similar instruments, including obligations so evidenced incurred in connection
with the acquisition of property, assets or businesses, (d) all indebtedness
created or arising under any conditional sale or other title retention
agreement, or incurred as financing, in either case with respect to property
acquired by such Person, (e) all obligations of such Person under any interest
rate, currency or other hedging agreement, (f) all obligations of such Person as
lessee under arrangements entered into after the Balance Sheet Date, which
should be capitalized in accordance with GAAP, (g) without duplication, all
indebtedness referred to in clauses (a) through (f) above secured by (or for
which the holder of such Indebtedness has an existing right, contingent or
otherwise, to be secured by) any Lien upon or in property (including accounts
and contracts rights) owned by such Person, whether or not such Person has
assumed or become liable for the payment of such Indebtedness, and (h) without
duplication, all agreements,

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undertakings or arrangements by which such Person guarantees, endorses or
otherwise becomes or is contingently liable for (by direct or indirect,
contingent or otherwise, agreement to provide funds for payment, to supply funds
to, or otherwise to invest in, a debtor, or otherwise assure a creditor against
loss) the Indebtedness of any other Person, or guarantees the payment of
dividends or other distributions upon the equity securities or interests of any
other Person; provided, however, that Indebtedness does not include (w) any
amounts accrued for financing fees, (x) any obligation to indemnify a Person
pursuant to the Company’s and its Subsidiaries’ Constitutional Documents or
insurance policies or reimburse ordinary business expenses, (y) any
reimbursement obligations with respect to surety bonds, letters of credit,
bankers’ acceptances and similar instruments (in each case, whether or not
matured), or (z) any individual cash account balances that are in an overdraft
position (i.e. negative cash), if any, which previously had been recorded under
GAAP as indebtedness on the Balance Sheets.
“Indemnified Party” is defined in Section 9.4(a).
“Indemnifying Party” is defined in Section 9.4(b).
“Indemnity Pro Rata Share” means, as to Sphere 70.90%, and to Cetus Capital,
LLC, 29.10%.
“Initial Per Share Merger Consideration” means an amount equal to (i) the sum of
(A) the Net Initial Equity Consideration, plus (B) the aggregate amount of the
Exercise Prices of the Stock Options that are outstanding immediately prior to
the cancellation and settlement thereof in accordance with Section 2.3(a),
divided by (ii) the number of Fully Diluted Shares Outstanding.
“Initial Stock Option Cancellation Payment” means, with respect to any
outstanding Stock Option, an amount in cash equal to (i) the product of (A) the
Initial Per Share Merger Consideration multiplied by (B) the total number of
shares of Class B Common Stock issuable upon exercise of such Stock Option
immediately prior to the cancellation thereof, minus (ii) the Exercise Price of
such Stock Option.
“Intellectual Property” means all of the following and similar intangible
property and related proprietary rights, interests and protections, however
arising, pursuant to the Laws of any jurisdiction throughout the world:
(a) trademarks, service marks, trade names, brand names, logos, trade dress and
other proprietary indicia of goods and services, whether registered or
unregistered, and all registrations and applications for registration of such
trademarks, including intent-to-use applications, all issuances, extensions and
renewals of such registrations and applications and the goodwill connected with
the use of and symbolized by any of the foregoing; (b) internet domain names,
whether or not trademarks, registered in any top-level domain by any authorized
private registrar or Governmental Entity and all related user accounts and
social networking pages; (c) original works of authorship in any medium of
expression, whether or not published, all copyrights (whether registered or
unregistered), all registrations and applications for registration of such
copyrights, and all issuances, extensions and renewals of such registrations and
applications; (d) confidential information, formulas, designs, devices,
technology, know-how, research and development, inventions, methods, processes,
compositions and other trade secrets, whether or not patentable; and
(e) patented and patentable designs and

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inventions, all design, plant and utility patents, letters patent, utility
models, pending patent applications and provisional applications and all
issuances, divisions, continuations, continuations-in-part, reissues,
extensions, reexaminations and renewals of such patents and applications.
“Intellectual Property Registrations” is defined in Section 3.12(a).
“Judgment” means, with respect to any Person, any order, injunction, judgment,
stipulation, award, decision, decree, verdict, ruling or other similar
requirement enacted, adopted, entered, issued, made, rendered, promulgated or
applied by a Governmental Entity or arbitrator that is binding upon or
applicable to such Person.
“KAO” means Keystone Automotive Operations, Inc., a Pennsylvania corporation.
“Key Employee” means any Employee with annual base compensation in excess of
$100,000.
“Law” means any federal, state, foreign or local law, statute, ordinance, annex,
rule, order, regulation, writ, injunction, directive, judgment, treaty, decree
or administrative or judicial decision.
“Leased Real Property” is defined in Section 3.11(b).
“Legal Action” means any action, suit, proceeding, lawsuit, arbitration, notice
of violation, litigation, citation or known investigation, in each case of any
nature, civil, criminal, administrative, regulatory or otherwise, in Law or in
equity, by or before any court, tribunal, arbitrator or other Governmental
Entity.
“Letter of Transmittal” is defined in Section 2.4(a).
“Letters of Credit” is defined in Section 3.7(c).
“Letters of Credit Agreement” is defined in Section 3.7(c).
“Liability” means any liability or other similar obligation (whether known or
unknown, asserted or unasserted, fixed, absolute or contingent, matured or
unmatured, determined or determinable, accrued or unaccrued, liquidated or
unliquidated).
“Licenses” means all Consents, licenses, permits, certificates, variances,
exemptions, franchises and other approvals or authorizations issued, granted,
given, required or otherwise made available by any Governmental Entity.
“Lien” means any lien, pledge, mortgage, deed of trust, security interest,
claim, charge, hypothecation, option to purchase or lease or otherwise acquire
any interest, conditional sales or other title retention agreement, adverse
claim of ownership or use, title defect, title exception, easement, right of
way, proxy, voting trust or agreement, transfer restriction under any
stockholder or similar agreement, or encumbrance of any nature whatsoever.

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“Losses” shall mean, without duplication for purposes of recovery, losses,
Liabilities, damages, penalties, costs and expenses, including reasonable
attorneys’ fees and expenses, settlement payments, awards, judgments, fines,
deficiencies and expenses of investigation and defense.
“Material Contract” is defined in Section 3.13(b).
“Merger” is defined in Recital A.
“Merger Sub” is defined in the Preamble.
“Mortgage” means the Mortgage, by and between KAO and the Equityholders
Representative, in substantially the form of Exhibit B attached hereto.
“Net Closing Cash” means the consolidated cash and cash equivalents of the
Company and its Subsidiaries as of the close of business on the Closing Date
(without giving effect to any increases or decreases in cash and cash
equivalents in connection with the Closing), prepared in accordance with the
illustrative calculation and the accounting principles, procedures, practices,
policies and calculations set forth on Section 2.6(a) of the Disclosure Letter.
For the avoidance of doubt, Net Closing Cash shall include any cash or cash
equivalents held by the Company or any of its Subsidiaries with respect to the
Unpaid Class B Dividends and shall include any individual cash account balances
that are in an overdraft position (i.e. negative cash), if any, which previously
has been recorded under GAAP as indebtedness on the Balance Sheets.
“Net Initial Equity Consideration” means an amount determined in accordance with
the calculation set forth on Section 11.1(b) of the Disclosure Letter.
“Net Working Capital Schedule” is defined in Section 3.7(d).
“NTP Payments” means the deferred payments required to be paid to Messrs.
Gregory M. Boyd, Robert L. Morter and Steven M. Whitrock under Section
1.4(a)(iv) and (v) of the NTP SPA.
“NTP SPA” means that certain Stock Purchase Agreement, dated October 14, 2011,
by and among NTP Distribution, Inc., KAO, and Messrs. Gregory M. Boyd, Robert L.
Morter, and Steven M. Whitrock.
“Option Consent Agreement” means the Option Consent Agreements to be entered
into between the Company and the Option Holders in a form satisfactory to the
Company and Parent.
“Option Holders” means the holders of the outstanding Stock Options.
“Outside Date” is defined in Section 8.1(b)(i).
“Owned Real Property” is defined in Section 3.11(a).
“Parent” is defined in the Preamble.

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“Parent Benefit Plans” is defined in Section 6.5(a).
“Parent Material Adverse Effect” means any event, circumstance, change,
occurrence, state of facts, development or effect that, individually or in the
aggregate would prevent or materially impair the ability of Parent or Merger Sub
to consummate the Merger.
“Parties” means Parent, Merger Sub, the Company, the Stockholder Parties and the
Equityholders Representative and “Party” means any of the Parties.
“Payoff Letters” is defined in Section 6.18.
“Permits” means a permit, license, approval, franchise, certificate, waiver,
consent, exemption, registration or authority of any Governmental Entity.
“Permitted Liens” means, with respect to any Person, (i) Liens for Taxes, if
such Taxes are not yet due and payable or the Person is contesting them in good
faith and has established adequate reserves for them; (ii) unrecorded workmen’s,
repairmen’s or other similar Liens incurred in the ordinary course of business
in respect of obligations which are not overdue, (iii) imperfections of title
and encumbrances, if any, as are not substantial in character, amount or extent
and do not individually or in the aggregate, impair the continued use,
occupancy, value or marketability of title of the property to which they relate,
assuming that the property is used on substantially the same basis as such
property is currently being used by the Company and its Subsidiaries,
(iv) pledges or deposits made in the ordinary course of business consistent with
past practice in connection with worker’s compensation, unemployment insurance
or other programs required by Applicable Law, and (v) Liens against or affecting
leased property which is not a violation of the lease for such property and is
not a result of actions of the Company or any of its Subsidiaries.
“Per Share Merger Consideration” is defined in Section 2.1(a).
“Person” means any individual, corporation, partnership, limited liability
company, firm, joint venture, association, joint-stock company, trust,
unincorporated organization, Governmental Entity or other entity.
“Personal Property Lease” is defined in Section 3.10(b).
“Post-Closing Tax Period” means (a) any taxable period beginning after the
Closing Date and (b) the portion of any Straddle Period beginning after the
Closing Date.
“Pre-Closing Tax Period” means (a) any taxable period ending on or before the
Closing Date and (b) the portion of any Straddle Period ending on the Closing
Date.
“Promissory Note” means a Secured Promissory Note to be delivered by Parent to
the Equityholders Representative at Closing in substantially the form of Exhibit
A attached hereto.
“Qualified Benefit Plan” is defined in Section 3.19(c).
“Real Property” means the Owned Real Property and the Leased Real Property.

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“Real Property Lease” is defined in Section 3.11(b).
“Release” means any spilling, leaking, pumping, pouring, emitting, emptying,
discharging, injecting, escaping, leaching, dumping, or disposing into the
environment (including the abandonment or discarding of barrels, containers, and
other closed receptacles containing any Hazardous Substance, pollutant,
contaminant, chemical substance, or mixtures of chemical substances).
“Representative Holdback Amount” means One Million Five Hundred Thousand Dollars
($1,500,000).
“Representatives” means, with respect to a Person, such Person’s directors,
managers, officers, employees, accountants, legal counsel, advisors, agents,
regulatory, compliance or environmental consultants and other representatives.
“Reserved Equity Interests” means the additional Equity Interests required to be
granted in connection with the transactions contemplated by this Agreement
pursuant to Section 12 of the Company Equity Incentive Plan.
“Restricted Stock” means the outstanding restricted shares of Class B Common
Stock issued under the Company Equity Incentive Plan (including any Reserved
Equity Interests that are issued as Restricted Stock).
“Restricted Stock Unit Consent Agreement” means the Restricted Stock Unit
Consent Agreement to be entered into between the Company and the holders of
Restricted Stock Units in a form satisfactory to the Company and Parent.
“Restricted Stock Units” means the Restricted Stock Units granted pursuant to
the Company Equity Incentive Plan (including any Reserved Equity Interests that
are issued as Restricted Stock Units).
“Revolving Credit Facility” means the credit facility provided to the Company
and its Subsidiaries pursuant to that certain Amended and Restated Revolving
Credit Agreement, dated as of August 15, 2013, among the Company, a Subsidiary
of the Company, certain lenders party thereto and Bank of America, N.A., as
Administrative Agent, Issuing Bank and Swingline Lender.
“Senior Credit Facilities” means the Revolving Credit Facility and the credit
facilities provided to the Company and its Subsidiaries pursuant to that certain
Term Loan Credit Agreement and that certain Term Loan Credit Agreement (Second
Lien), each dated as of August 15, 2013, and each among the Company, a
Subsidiary of the Company, various lenders and UBS AG, Stamford Branch, in its
capacity as administrative agent.
“Sphere” means Sphere Capital, LLC-Series A, a Delaware limited liability
company.
“Stockholder Approval” means the irrevocable adoption of this Agreement by
Stockholders (whether at a special meeting of the Stockholders or by written
consent) holding more than 50% of the outstanding shares of Common Stock.

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“Stockholder Material Adverse Effect” means any event, circumstance, change,
occurrence, state of facts, development or effect that, individually or in the
aggregate would prevent or materially impair the ability of a Stockholder to
perform its obligations under this Agreement.
“Stockholder Parties” is defined in the Preamble.
“Stockholders” means the holders of shares of Common Stock.
“Stockholder Agreement” means the Stockholder Agreement, dated as of March 30,
2011, by and among the Company and certain of its stockholders party thereto.
“Stock Options” means the options to purchase shares of Class B Common Stock
granted pursuant to the Company Equity Incentive Plan (including any Reserved
Equity Interests that are issued as options to purchase shares of Class B Common
Stock).
“Straddle Period” means any taxable period that begins on or before the Closing
Date and ends after the Closing Date.
“Subsequent Payments” means the payments made (A) under the Promissory Note,
when and as provided therein, (B) from the Representative Holdback Amount, when
and as provided in Section 2.7, (C) in connection with the final determination
of Closing Net Working Capital and Net Closing Cash, when and as provided in
Section 2.6(d), and (D) in connection with the receipt of any Tax Refunds or
other Tax related payments, when and as provided in Section 10.1(c).
“Subsidiary” of any Person means (a) a corporation of which such Person owns or
controls such number of the voting securities which is sufficient to elect at
least a majority of its Board of Directors or (b) a partnership or limited
liability company of which such Person (either alone or through or together with
any other Subsidiary) is the general partner or managing entity.
“Surviving Corporation” is defined in Section 1.1.
“Target Closing Net Working Capital” means $135,700,000.
“Tax” means (a) any federal, state, local, or foreign tax, charge, duty, fee,
escheat or unclaimed property, levy or other assessment, including income, gross
receipts, license, payroll, employment, excise, severance, stamp, occupation,
premium, windfall profits, environmental (including taxes under Section 59A of
the Code), customs duties, capital stock, franchise, profits, withholding,
social security (or similar), unemployment, disability, real or personal
property, sales, use, transfer, registration, value added, alternative or add-on
minimum, estimated, or other tax of any kind whatsoever, whether disputed or
not, imposed by any taxing authority, and including any interest, penalty, or
addition thereto, (b) any liability for the payment of any amount imposed on any
Person of the type described in clause (a) as a result of being or having been a
member of an affiliated, consolidated, combined, unitary or similar group for
Tax purposes, and (c) any liability for the payment of any amount imposed on any
Person of a type described in clause (a) or clause (b) as a transferee or
successor or as a result of any existing express or implied indemnification
agreement or arrangement.

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“Tax Contest” is defined in Section 10.3(b).
“Tax Returns” means all returns, declarations, reports, claims for refund,
information statements and other documents relating to Taxes, including all
schedules and attachments thereto, and including all amendments thereof.
“Third-Party Claim” is defined in Section 9.5(a).
“Transaction Documents” means the Letters of Transmittal, the Promissory Note,
the Mortgage, the Option Consent Agreements, the Restricted Stock Unit Consent
Agreement and the letter agreement, dated as of the date hereof, between Sphere
and Parent.
“Transaction Expenses” means (i) all fees, costs and expenses (including
investment bankers and financial advisors, attorneys’ and accountants’
reasonable fees, costs and expenses) incurred by the Company (on behalf of the
Company or any Equityholder) in connection with the transactions contemplated by
this Agreement and (ii) the change of control bonus payments payable to Don
Wittkopp, Tom Berger and Martha Asselin in the cumulative amount of $100,000,
plus all applicable payroll Taxes and withholding Taxes. For the avoidance of
doubt, Transaction Expenses shall not include any payments made to the Option
Holders or the holders of Restricted Stock Units in connection with the
cancellation of the Stock Options and the Restricted Stock Units, but shall
include the cost of the run-off directors’ and officers’ liability insurance
policy purchased in accordance with Section 6.4(c).
“Union” is defined in Section 3.18(b).
“Unpaid Class B Dividends” means the aggregate unpaid amount of the dividends
declared by the Company with respect to the outstanding shares of Class B Common
Stock, which aggregate amount, as of the date of this Agreement, is $7,770,495.
“WARN Act” means the Worker Adjustment and Retraining Notification Act of 1988,
and any other similar Applicable Law of any state, locality or other
Governmental Entity.
“WC Deficiency” is defined in Section 2.6(d).
“WC Estimated Surplus” means the amount, if any, by which the Estimated Closing
Net Working Capital is greater than the Target Closing Net Working Capital.
11.2.    Construction.
(a)    Any rule of construction to the effect that ambiguities are to be
resolved against the drafting Party shall not be applied in the construction or
interpretation of this Agreement.
(b)    The words “include” and “including” and variations thereof shall not be
deemed to be terms of limitation, but rather shall be deemed to be followed by
the words “without limitation”.

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(c)    Except as otherwise indicated, all references in this Agreement to
“Articles”, “Sections”, “Exhibits” and “Schedules” are intended to refer to the
Articles and Sections of this Agreement, and to the Exhibits and Schedules to
this Agreement, including the Disclosure Letter, as the context may require. All
such Exhibits and Schedules, including the Disclosure Letter, shall be deemed a
part of, and are hereby incorporated by this reference into, this Agreement.
(d)    As used in this Agreement, a document shall be deemed to have been “made
available” to Parent if, prior to the date of this Agreement and through the
date of this Agreement, such document has been made available for viewing by
Parent in the electronic data room established by the Company in connection with
the transactions contemplated by this Agreement.
(e)    The table of contents and headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
ARTICLE XII
GENERAL PROVISIONS

12.1.    Equityholders Representative; Power of Attorney.
(a)    The Company hereby initially appoints Sphere as the Equityholders
Representative, as the true and lawful agent and attorney-in-fact of the
Equityholders to take any action (or refrain from taking any action) on behalf
of the Equityholders that is contemplated to be taken by the Equityholders
Representative in that capacity by this Agreement, including to (i) give and
receive notices and communications to or from Parent (on behalf of itself or any
other Indemnified Party) relating to this Agreement or the Promissory Note, or
any of the transactions and other matters contemplated hereby or thereby (except
to the extent that this Agreement or the Promissory Note expressly contemplates
that any such notice or communication shall be given or received by the
Equityholders individually); (ii) object to any claims pursuant to Section 9.4
or Section 9.5; (iii) consent or agree to, negotiate, enter into settlements and
compromises of, and agree to arbitration and comply with orders of courts and
awards of arbitrators with respect to, such claims; (iv) assert, negotiate,
enter into settlements and compromises of, and agree to arbitration and comply
with orders of courts and awards of arbitrators with respect to, any other claim
by any Indemnified Party relating to this Agreement, the Promissory Note or the
transactions contemplated hereby or thereby; (v) amend this Agreement or the
Promissory Note to reduce the principal amount of the Promissory Note as
contemplated by this Agreement); and (vi) take all actions necessary or
appropriate in the judgment of the Equityholders Representative for the
accomplishment of the foregoing, in each case without having to seek or obtain
the consent of any Person under any circumstance. Sphere hereby accepts such
appointment and agrees to act in such capacity. The Person serving as the
Equityholders Representative may be replaced at any time by the Equityholders
who held a majority of the shares of voting Common Stock immediately prior to
the Effective Time. No bond shall be required of the Equityholders
Representative, and the Equityholders Representative shall receive no
compensation for its services.

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(b)    The Equityholders Representative shall not be liable to any Person for
any act done or omitted hereunder as the Equityholders Representative while
acting in good faith and any act done or omitted pursuant to the advice of
counsel shall be conclusive evidence of such good faith. The Equityholders
Representative shall be reimbursed from the Equityholders Representative
Holdback Amount for any reasonable expenses (including the reasonable fees of
counsel) incurred in the performance of the Equityholders Representative’s
duties hereunder. Notwithstanding anything to the contrary in this Agreement, if
the Equityholders Representative reasonably believes that payments for which it
is to be reimbursed from the Representative Holdback Amount pursuant to this
Section 12.1(b) or payments in respect of indemnification obligations set forth
in Section 9.2(a) are likely to be made in the future, then the Equityholders
Representative may withhold the estimated amount of such future payments from
any amounts otherwise required to be distributed to the Equityholders under this
Agreement.
(c)    Each Stockholder Party agrees that Parent shall be entitled to
unconditionally assume that any action taken or omitted, or any document
executed by, Sphere purporting to act as Equityholders Representative under or
pursuant to this Agreement or in connection with any of the transactions
contemplated by this Agreement has been authorized by the Equityholders to be
taken, omitted to be taken or executed on such Equityholders’ behalf so that
such Equityholders will be legally bound thereby, and each Stockholder Party
agrees not to institute any claim, lawsuit, arbitration or other proceeding
against Parent alleging that Sphere did not have the authority to act as the
Equityholders Representative on behalf of the Equityholders in connection with
any such action, omission or execution. No modification or revocation of the
power of attorney granted by the Stockholder Parties to Sphere to serve as the
Equityholders Representative shall be effective as against Parent until Parent
has received a document signed by Stockholders holding Common Stock representing
a majority of the voting power of the Company immediately prior to the Effective
Time effecting said modification or revocation.
(d)    The Equityholders Representative may resign at any time by giving thirty
(30) days’ written notice to Parent and the Stockholders; provided, however,
that such resignation shall not be effective unless and until a successor
stockholders’ representative has been appointed by Stockholders holding Common
Stock representing a majority of the voting power of the Company immediately
prior to the Effective Time and such successor accepts such position and the
terms hereof.
(e)    If the Equityholders Representative is a natural Person and dies or is
otherwise unable to perform his or her obligations under this Agreement or, if
the Equityholders Representative is not a natural Person and becomes bankrupt,
insolvent or ceases to exist, then a successor to the Equityholders
Representative shall be appointed by Stockholders holding Common Stock
representing a majority of the voting power of the Company immediately prior to
the Effective Time.
12.2.    Expenses. Except as otherwise specifically provided herein, each Party
shall bear all fees, costs and expenses (including investment bankers and
financial advisors, attorneys’ and accountants’ fees, costs and expenses)
incurred by such Party in connection with the transactions contemplated by this
Agreement.

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12.3.    Public Announcements. No public release or announcement concerning the
Merger or the transactions contemplated hereby shall be issued by any Party
without the prior written consent of Parent and the Company (for any such
release or announcement prior to the Effective Time) or the Equityholders
Representative (for any such release or announcement after the Effective Time),
which consent shall not be unreasonably withheld or delayed, except as such
release or announcement may be required by Applicable Law or the rules or
regulations of any stock exchange or applicable Governmental Entity to which the
relevant Party is subject, in which case the Party required to make the release
or announcement shall use its commercially reasonable efforts to provide the
other Party reasonable time to comment on such release or announcement in
advance of such issuance, it being understood that the final form and content of
any such release or announcement, to the extent so required, shall be at the
final discretion of the disclosing Party; provided, that this Section 12.3 shall
not apply to (i) Parent’s filings with the Securities and Exchange Commission on
forms 10-Q, 10-K or 8-K, including any filing that includes this Agreement as an
exhibit or (ii) any regularly scheduled earnings call conducted by Parent.
12.4.    Notices. All notices and other communications hereunder shall be in
writing and shall be deemed given if properly addressed as provided below as
follows: (a) if delivered personally or by facsimile or other electronic
transmission (with acknowledgment of a complete transmission), on the day of
delivery; (b) if delivered by a nationally recognized courier (appropriately
marked for next day delivery), one (1) Business Day after dispatch; or (c) if
delivered by registered or certified mail (return receipt requested) or by first
class mail, three (3) Business Days after mailing. Notices shall be deemed to be
properly addressed if addressed to the following addresses or facsimile numbers
(or at such other address or facsimile number as shall be specified by like
notice):
(a)    if to Parent or Merger Sub (or to the Surviving Corporation after the
Effective Time), to:
LKQ Corporation
500 West Madison Street, Suite 2800
Chicago, Illinois 60661
Attention: General Counsel
Facsimile: (312) 207-1529
with a copy (which shall not constitute notice) to:
K&L Gates LLP
70 West Madison Street, Suite 3100    
Chicago, Illinois 60602
Attention: J. Craig Walker
Facsimile: (312) 827-8179
Email: craig.walker@klgates.com

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(b)    if to the Company prior to the Effective Time, to:
Keystone Automotive Holdings, Inc.
44 Tunkahannock Avenue
Exeter, PA 18643
Attention: President
Facsimile: (570) 655-8203
with a copy (which shall not constitute notice) to:
Bingham McCutchen LLP
600 Anton Boulevard, Suite 1800
Costa Mesa, CA 92626
Attention: James W. Loss, Esq.
Facsimile: (714) 830-0726

(c)    if to the Equityholders Representative to:
Sphere Capital, LLC-Series A
360 North Crescent Drive, South Building
Beverly Hills, CA 90210
Attention: General Counsel
Facsimile: (310) 712-1863
with a copy (which shall not constitute notice) to:
Bingham McCutchen LLP
600 Anton Boulevard, Suite 1800
Costa Mesa, CA 92626
Attention: James W. Loss, Esq.
Facsimile: (714) 830-0726
    
12.5.    Entire Agreement. This Agreement, the Exhibits and the Schedules
hereto, including the Disclosure Letter, the Transaction Documents and the
Confidentiality Agreement constitute the entire agreement among the Parties with
respect to the subject matter hereof and supersede all prior agreements and
understandings, both written and oral, among the Parties with respect to the
subject matter hereof.
12.6.    Severability. In the event that any provision of this Agreement or the
application thereof becomes or is declared by a court of competent jurisdiction
to be illegal, void or unenforceable, the remainder of this Agreement will
continue in full force and effect and the application of such provision will be
interpreted so as reasonably to effect the intent of the Parties. The Parties
further agree to replace such void or unenforceable provision of this Agreement
with a valid and enforceable provision that will achieve, to the greatest extent
possible, the economic, business and other purposes of such void or
unenforceable provision.
12.7.    Specific Performance. The Parties agree that irreparable damage would
occur in the event that any of the provisions of this Agreement were not
performed in accordance with their specific terms or were otherwise breached. It
is accordingly agreed that the Parties shall be

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entitled to seek an injunction or injunctions to prevent breaches of this
Agreement and to enforce specifically the terms and provisions hereof in any
court of the United States or any state having jurisdiction, this being in
addition to any other remedy to which they are entitled at Law or in equity.
12.8.    Successors and Assigns; Assignment; Parties in Interest. This Agreement
shall inure to the benefit of, and be binding on, the Parties and their
respective successors and assigns (if any). Except as otherwise specifically
provided herein, no Party may assign any of its rights or delegate any of its
obligations under this Agreement without the prior written consent of the other
Parties. Nothing in this Agreement, express or implied, is intended to or shall
confer upon any Person other than a Party any rights, interests, benefits or
other remedies of any nature under or by reason of this Agreement, except that
the indemnification provisions of this Agreement are intended to benefit the
Indemnified Parties, and the provisions of Section 6.4 are intended to benefit
the Covered Persons, and all such intended third-party beneficiaries shall be
entitled to enforce such provisions of this Agreement.
12.9.    Amendment; Waiver. This Agreement may be amended by the Parties only by
execution of an instrument in writing signed by (a) Parent and the Company if
such instrument is executed prior to the Effective Time or (b) Parent and the
Equityholders Representative if such instrument is executed after the Effective
Time. At any time prior to the Effective Time, Parent and Merger Sub, on the one
hand, and the Company, on the other, may, to the extent legally allowed,
(i) extend the time for the performance of any of the obligations of the other
Parties, (ii) waive any inaccuracies in the representations and warranties made
to such Party contained herein or in any document delivered pursuant hereto or
(iii) waive compliance with any of the agreements or conditions for the benefit
of such Party contained herein. Any agreement by any Party to any such extension
or waiver shall be valid only if, and to the extent, set forth in an instrument
in writing signed on behalf of such Party. No failure on the part of any Person
to exercise any power, right, privilege or remedy under this Agreement, and no
delay on the part of any Person in exercising any power, right, privilege or
remedy under this Agreement, shall operate as a waiver of such power, right,
privilege or remedy; and no single or partial exercise of any such power, right
privilege or remedy shall preclude any other or further exercise thereof or of
any other power, right, privilege or remedy.
12.10.    Governing Law; Venue.
(a)    This Agreement shall be construed in accordance with, and governed in all
respects by, the internal Laws of the State of Delaware, without giving effect
to conflicts of law or choice of law provisions thereof.
(b)    Unless otherwise explicitly provided in this Agreement, any Legal Action
relating to this Agreement or the enforcement of any provision of this Agreement
shall be brought or otherwise commenced in any state or federal court located in
the State of Delaware. Each Party (i) expressly and irrevocably consents and
submits to the jurisdiction of each such court, and each appellate court located
in the State of Delaware, in connection with any such Legal Action, (ii) agrees
that each such court shall be deemed to be a convenient forum and (iii) agrees
not to assert, by way of motion, as a defense or otherwise, in any such Legal
Action commenced in any such court, any claim that such Party is not subject
personally to the

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jurisdiction of such court, that such Legal Action has been brought in an
inconvenient forum, that the venue of such Legal Action is improper or that this
Agreement or the subject matter of this Agreement may not be enforced in or by
such court.
12.11.    Waiver of Jury Trial. EACH PARTY IRREVOCABLY AND UNCONDITIONALLY
WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION
DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY
TRANSACTION AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY. EACH
PARTY HERETO CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF THE OTHER
PARTIES HAS REPRESENTED, EXPRESSLY OR OTHERWISE THAT SUCH OTHER PARTY WOULD NOT,
IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND
ACKNOWLEDGES THAT IT HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG
OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 12.11.
12.12.    Other Remedies. Except as otherwise provided herein, any and all
remedies herein expressly conferred upon a Party will be deemed cumulative with
and not exclusive of any other remedy conferred hereby, or by law or equity upon
such Party, and the exercise by a Party of any one remedy will not preclude the
exercise of any other remedy.
12.13.    Counterparts; Electronic Delivery. This Agreement may be executed in
two or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument. Any signature page
delivered by facsimile or electronic image transmission shall be binding to the
same extent as an original signature page. Any Party that delivers a signature
page by facsimile or electronic image transmission shall deliver an original
counterpart to any other Party that requests such original counterpart, it being
understood and agreed that the failure to deliver any such original counterpart
upon request shall not affect the binding nature of the signature page delivered
by facsimile or electronic image transmission.
[Signature Page Follows]

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IN WITNESS WHEREOF, each of the Parties has caused this Agreement to be executed
and delivered by its duly authorized representative as of the date first written
above.
THE COMPANY:
 
PARENT:
KEYSTONE AUTOMOTIVE HOLDINGS, INC.
 
LKQ CORPORATION
 
 
 
 
 
By:
/s/ EVA M. KALAWSKI
 
By:
/s/ ROBERT L. WAGMAN
Name:
Eva M. Kalawski
 
Name:
Robert L. Wagman
Title:
Vice President and Secretary
 
Title:
President and CEO
 
 
 
 
 
 
 
 
 
 
 
 
 
MERGER SUB: 

 
 
 
KAH ACQUISITION SUB, INC.
 
 
 
 
 
 
 
 
By:
/s/ ROBERT L. WAGMAN
 
 
 
Name:
Robert L. Wagman
 
 
 
Title:
President
 
 
 
 
 
STOCKHOLDER PARTIES:
 
 
 
SPHERE CAPITAL, LLC - SERIES A
 
 
 
 
 
 
 
 
By:
/s/ EVA M. KALAWSKI
 
 
 
Name:
Eva M. Kalawski
 
 
 
Title:
Vice President and Secretary
 
 
 
 
 
 
 
 
 
 
 
 
 
CETUS CAPITAL, LLC
 
 
 
 
 
 
 
 
By:
/s/ ROBERT E. DAVIS
 
 
 
Name:
Robert E. Davis
 
 
 
Title:
Managing Director
 
 
 
 
 
 
 
 
 
 
 
 
 
EQUITYHOLDERS REPRESENTATIVE:
 
 
 
SPHERE CAPITAL, LLC - SERIES A
 
 
 
 
 
 
 
 
By:
/s/ EVA M. KALAWSKI
 
 
 
Name:
Eva M. Kalawski
 
 
 
Title:
Vice President and Secretary
 
 
 
 
 
 
 
 

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Exhibit A - Form of Promissory Note
Confidential

THE SECURITY REPRESENTED BY THIS NOTE (AS DEFINED BELOW) WAS ORIGINALLY ISSUED
ON THE ISSUE DATE (AS DEFINED BELOW), AND HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED. THIS NOTE IS SUBJECT TO CERTAIN RESTRICTIONS
ON TRANSFER AND CERTAIN RIGHTS OF OFFSET SET FORTH HEREIN.
The Stockholder Parties (as defined in the Merger Agreement) have made certain
representations and warranties, entered into certain covenants and agreed to
provide certain indemnities as set forth in the Merger Agreement (as defined
below). Holder agrees that, in addition to any other remedy that Maker (as
defined below) may have available at law or equity and subject in all cases to
the limitations set forth in the Merger Agreement, Maker may, subject to the
limitations and procedures set forth in the Merger Agreement and this Note (as
defined below), reduce the amount outstanding under this Note by any Loss (as
defined below) for which the Stockholder Parties are responsible under the
Merger Agreement.

NON-NEGOTIABLE SECURED
PROMISSORY NOTE
Issue Date:     Original Principal Amount:
[ ], 2014 $31,500,000
FOR VALUE RECEIVED, LKQ Corporation, a Delaware corporation (“Maker”), hereby
promises to pay to the order of Sphere Capital, LLC – Series A, a Delaware
limited liability company, in its capacity as the designated representative of
the Equityholders (as defined in the Merger Agreement) (together with its
successor and assigns in such capacity as permitted by the terms of the Merger
Agreement or applicable Laws, the “Holder”), the principal amount of
$31,500,000, or such lesser principal amount then outstanding, together with
interest thereon calculated in accordance with the provisions of this
non-negotiable secured promissory note (this “Note”).
This Note is the Promissory Note referred to in, and originally issued on [ ],
2014 (the “Issue Date”) pursuant to, the Merger Agreement. Each capitalized term
used but not otherwise defined herein shall have the meaning ascribed to such
term in Section 6 hereof or, if not so defined therein, the meaning ascribed to
such term in the Merger Agreement.
1.Interest. Commencing on the Issue Date and continuing until payment of all
amounts due hereunder, interest shall accrue on the then outstanding principal
amount of this Note at the rate (the “Interest Rate”) of one percent (1%) per
annum (based on a year of 365 days and computed on the number of days actually
elapsed).
2.    Payments on Note.
(a)    Scheduled Payment. Subject to Section 2(e) below, the outstanding
principal amount of this Note and unpaid accrued interest thereon shall be due
and payable on the fifteen (15) month anniversary of the Issue Date or such
earlier date as shall be specified pursuant to Section 5(b) or
as permitted pursuant to applicable Laws (the “Maturity Date”), and Maker shall

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pay such amounts on such date. Any payment shall be applied first to accrued
interest and then to outstanding principal.
(b)    Optional Prepayments. Maker may, at any time or from time to time,
without premium or penalty, prepay all or any portion of the unpaid principal
amount of this Note together with any unpaid interest which has accrued on the
portion of the principal so prepaid. Any payment shall be applied first to
accrued interest and then to outstanding principal.
(c)    Time of Payment. If any payment on this Note becomes due on a day that is
not a Business Day, then such payment shall be made on the next Business Day and
such extension of time will be included in computing interest in connection with
such payment.
(d)    Right of Setoff. The principal amount of this Note shall be reduced,
retroactive to the Closing Date, by any amounts for which Losses by Parent or
the Surviving Corporation is entitled to indemnification pursuant to Sections
9.2(a) or 10.1 of the Merger Agreement (whether now existing or hereinafter
arising) in accordance with Section 9.4(b) of the Merger Agreement.
Notwithstanding anything to the contrary set forth herein, the satisfaction or
reduction of any principal or interest hereunder pursuant to Maker’s right of
setoff under this Section 2(d) shall not be considered a prepayment for the
purposes hereof.
(e)    Payments in Cash. All payments on this Note shall be made in cash (it
being understood that any reduction pursuant to Section 2(d) or the Merger
Agreement in amounts owing under this Note shall not be deemed to be, or treated
as, payments or prepayments for purposes of this Section 2(e)).
(f)    Equityholders Representative. The Holder shall (i) disburse any payments
made to it under this Note to the Equityholders in accordance with Section
2.6(e) of the Merger Agreement and (ii) have authority on behalf of the
Equityholders, to contest or settle any Pending Claim, and any agreement between
Maker and the Holder with respect to any Pending Claim shall be binding on the
Equityholders.
(g)    Limitation on Repayment and Prepayment. For the avoidance of doubt,
notwithstanding any other provision of this Note or the Merger Agreement, no
repayment or prepayment of any amount owed under this Note, whether pursuant to
Section 2 or otherwise, shall be made, and no such failure to make such
repayment shall constitute an Event of Default pursuant to Section 5(a), in each
case if the principal amount outstanding under this Note after such repayment or
prepayment would be less than the amount that would be required to satisfy in
full the Aggregate Pending Claim Amount.
3.    Mortgage(s). The payment and performance in full of each of the
obligations hereunder, including, without limitation, the payment in full of the
amounts due hereunder by Maker, is secured by all that certain real estate and
improvements thereon, erected or to be erected, situate in the Borough of
Exeter, County of Luzerne, Commonwealth of Pennsylvania, and more particularly
described in Exhibit “A” attached hereto and made a part hereof.

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4.    Representations.
(a)    Organization and Standing. Maker is duly incorporated and validly
existing under the laws of Delaware. Maker is in good standing in those
jurisdictions in which its ownership of property or conduct of business requires
such qualification. Keystone Automotive Operations, Inc. (“Mortgagor”) is duly
incorporated and validly existing under the laws of Pennsylvania. Mortgagor is
in good standing in those jurisdictions in which its ownership of property or
conduct of business requires such qualification.
(b)    Authority. Maker has full right, power and authority to execute, deliver
and perform its obligations under this Note. Mortgagor has full right, power and
authority to execute, deliver and perform its obligations under the Mortgage.
(c)    Execution and Delivery. The execution and delivery by Maker of this Note
has been duly authorized by all necessary corporate action. The execution and
delivery by Mortgagor of the Mortgage has been duly authorized by all necessary
corporate action
(d)    Enforceability. Maker has duly executed and delivered this Note and this
Note constitutes Maker’s legal, valid and binding obligation, enforceable
against it in accordance with its terms, and Mortgagor has duly executed and
delivered the Mortgage and the Mortgage constitutes Mortgagor’s legal, valid and
binding obligation, enforceable against it in accordance with its terms, in each
case, except as such enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar Laws relating to or affecting the
enforcement of creditors’ rights in general and by general principles of equity.
(e)    No Conflicts. The execution, delivery and performance of this Note by
Maker and the execution and delivery of the Mortgage by Mortgagor, do not
conflict with, or result in any violation or breach of or default (with or
without notice or lapse of time, or both) under, result in acceleration of, or
give rise to a right of termination, cancellation, modification or acceleration
of any obligation under, require any notice under, or result in the imposition
or creation of any lien (other than in favor of Holder) upon any of the material
properties or assets of Maker or Mortgagor under, any provision of (i) the
organizational documents of Maker or Mortgagor, (ii) any material agreement to
which Maker or Mortgagor is a party or by which any of Maker or Mortgagor’s
material properties or assets is bound, or (iii) any judgment or law applicable
to Maker, Mortgagor or their respective material properties or assets.
5.    Defaults and Remedies.
(a)    Events of Default. An “Event of Default” shall occur under this Note if:
(i)    Maker shall fail to make any payment of unpaid principal or accrued
interest under this Note, when and as the same shall become due and payable upon
the occurrence of the Maturity Date pursuant to and in accordance with this
Note;
(ii)    An Insolvency Event shall occur;
(iii)    Maker or any of its Affiliates shall fail to perform or observe any
covenant or other agreement contained herein or in the Mortgage (other than as
set forth in clause (a)(i)

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above) and such failure continues for a period of 10 days after the earlier of
(A) the date on which such failure shall first become known to Maker or any of
its Affiliates or (B) the date on which written notice thereof is delivered to
Maker or Mortgagor;
(iv)    Any representation or warranty herein or in the Mortgage proves to be
untrue in any material respect when made or deemed made;
(v)     The validity or enforceability of this Note or the Mortgage shall at any
time for any reason be declared to be null and void, or a proceeding shall be
commenced by Maker, Mortgagor or any of their respective Affiliates, or by any
governmental authority having jurisdiction over Maker, Mortgagor or any of their
respective Affiliates, seeking to establish the invalidity or unenforceability
thereof, or Maker, Mortgagor or any of their respective Affiliates shall deny
(to the extent it is a party thereto) that it has any liability or obligation
under this Note or the Mortgage.
(b)    Remedies. So long as an Event of Default shall have occurred and is
continuing:
(i)    Upon and after the election of the Holder on behalf of the Equityholders,
the interest rate hereunder shall increase from one percent (1%) to five percent
(5%) per annum; provided, however, that such rate shall automatically increase
as a result of an Event of Default described in Sections 5(a)(i) or 5(a)(ii).
Any increase of the interest rate resulting from the operation of this Section
5(b)(i) shall, at the option of Holder, be retroactive to the date upon which
such Event of Default shall have occurred and terminate as of the close of the
business on the date on which such Event of Default is waived by the Holder.
(ii)    Upon and after the election of the Holder on behalf of the
Equityholders, declare the aggregate unpaid principal amount of this Note and
all accrued interest thereon to be immediately due and payable and Maker shall
immediately pay to the then holder of this Note all such amounts, in full,
without presentment, demand, protects or further notice or other requirements of
any kinds, all of which are hereby expressly waived by Maker; provided, however,
that if an Event of Default of the type described in Section 5(a)(ii) hereof
occurs, no such election shall be required and the aggregate unpaid principal
amount of this Note and all accrued interest thereon shall become immediately
due and payable without any action on the part of the Holder and Maker shall
immediately pay to the then holder of this Note, all such amounts, in full.
6.    Definitions.
“Aggregate Pending Claim Amount” at any time means the aggregate of all Losses,
as set forth in Claim Certificate delivered pursuant to Section 9.4(a) of the
Merger Agreement, in respect of Pending Claims.
“Insolvency Event” means if: (i) Maker or any of its Affiliates commence any
case, proceeding or other action (A) under any existing or future law of any
jurisdiction, domestic or foreign, relating to bankruptcy, insolvency,
reorganization or relief of debtors, seeking to have an order for relief entered
with respect to it, or seeking to adjudicate it a bankrupt or insolvent, or
seeking reorganization, arrangement, adjustment, winding-up, liquidation,
dissolution, composition or other relief with respect to it or its debts, or (B)
seeking appointment of a

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receiver, trustee, custodian, conservator or other similar official for it or
for all or any substantial part of its assets, or Maker or any of its Affiliates
shall make a general assignment for the benefit of its creditors; or (ii) there
is commenced against Maker or any of its Affiliates any case, proceeding or
other action of a nature referred to in clause (i) above that (A) results in the
entry of an order for relief or any such adjudication or appointment or (B)
remains undismissed, undischarged or unbonded for a period of 60 days; or (iii)
there is commenced against Maker or any of its Affiliates any case, proceeding
or other action seeking issuance of a warrant of attachment, execution,
distraint or similar process against all or any substantial part of its assets
that results in the entry of an order for any such relief that shall not have
been vacated, discharged, or stayed or bonded pending appeal within sixty (60)
days from the entry thereof.
“Merger Agreement” means the Agreement and Plan of Merger dated as of December
5, 2013, by and among the Keystone Automotive Holdings, Inc., Maker, Merger Sub,
the Stockholder Parties, and the Holder.
“Mortgage” means the Mortgage, effective as of the date hereof, by and between
Keystone Automotive Operations, Inc. and Holder, as the same may be amended,
restated, supplemented or otherwise modified from time to time in accordance
with its terms.
“Pending Claim” means any claim made by Parent or the Surviving Corporation as
reflected in a Claim Certificate delivered pursuant to Section 9.4(a) of the
Merger Agreement, other than a claim which theretofore has been finally resolved
in accordance with Section 9.4(b) of the Merger Agreement.
7.    Amendment and Waiver. The provisions of this Note may be amended if, and
Maker may take any action herein prohibited or omit to perform any act herein
required to be performed by it if, and only if, Maker has obtained the written
consent of the Holder, in its sole discretion. No failure on the part of either
party hereto to exercise any right or remedy hereunder shall constitute a waiver
of that right or remedy.
8.    Restrictions on Transfer. Maker may not sell, transfer, assign or
otherwise dispose of all or any part of its obligations under this Note. So long
as no Event of Default shall have occurred and be continuing, the Holder may not
sell, transfer, assign, negotiate, pledge or otherwise dispose of all or any
portion of or any interest in this Note (and any purported sale, transfer,
assignment, negotiation, pledge or other disposition in violation of this
provision shall be void) other than to any successor representative of the
Equityholders to the extent permitted by the terms of the Merger Agreement or
applicable Laws.
9.    Cancellation. After all principal and accrued interest at any time owed on
this Note has been paid in full, this Note shall be surrendered by the Holder to
Maker for cancellation and shall not be reissued; provided, however, that if any
amounts paid to Holder hereunder are required to be repaid, refunded, restored
or returned to Maker or any of its Affiliates for any reason, whether because
such payment is asserted or declared to be void, voidable or otherwise
recoverable under any law relating to fraudulent transfers, preferences,
creditors rights generally or otherwise, then as to any such amount, the
obligations under this Note shall be immediately and automatically revived,
restored and reinstated together with any corresponding lien on the assets or
Maker or

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any of its Affiliates to the extent such lien existed prior to payment in
respect of the obligations hereunder.
10.    Place of Payment; Notices. Payments of principal and interest are to be
made by Maker in the lawful money of the United States of America in immediately
available funds to the Holder on behalf of the Equityholders to the account
specified by the Holder not less than three (3) Business Days prior to the
Maturity Date.
11.    Governing Law. All issues and questions concerning the construction,
validity, enforcement and interpretation of this Note shall be governed by, and
construed in accordance with, the laws of the State of Delaware, without giving
effect to any choice of law or conflict of law rules or provisions (whether of
the State of Delaware or any other jurisdiction) that would cause the
application of the laws of any jurisdiction other than the State of Delaware.
12.    No Strict Construction. Maker and the Holder have participated jointly in
the negotiation and drafting of this Note. In the event an ambiguity or question
of intent or interpretation arises, this Note shall be construed as if drafted
jointly by Maker and the Holder, and no presumption or burden of proof shall
arise favoring or disfavoring any party by virtue of the authorship of any
provision of this Note.
13.    Waiver of Jury Trial. THIS NOTE IS ISSUED SUBJECT TO THE EXPRESS
UNDERSTANDING THAT EACH OF HOLDER AND MAKER HAS WAIVED, ON BEHALF OF ITSELF OR,
WITH RESPECT TO HOLDER, THE EQUITYHOLDERS UNDER THIS NOTE, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY RIGHT ANY SUCH PARTY MAY HAVE TO A TRIAL BY
JURY WITH RESPECT TO ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER
OR IN CONNECTION WITH THIS NOTE.
14.    Consent to Jurisdiction; Enforcement Expenses. Each of Maker and Holder
hereby irrevocably submits to the jurisdiction of any state or federal court
located in the State of Delaware, for the purposes of any suit, action or other
proceeding arising out of this Note. Each of Maker and Holder further agrees
that service of any process, summons, notice or document by U.S. registered mail
to such party’s respective address set forth below shall be effective service of
process for any action, suit or proceeding arising out of this Note. Each of
Maker and Holder irrevocably and unconditionally waives any objection to the
laying of venue of any action, suit or proceeding arising out of this Note or
the transactions contemplated hereby in any state or federal court located in
the State of Delaware and hereby further irrevocably and unconditionally waives
and agrees not to plead or claim in any such court that any such action, suit or
proceeding brought in any such court has been brought in an inconvenient forum.
15.    Notices. Notice shall be given as set forth in Section 12.4 of the Merger
Agreement.

* * * * * *

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IN WITNESS WHEREOF, Maker has executed and delivered this Note on the date first
above written.
 
LKQ CORPORATION

By:_________________________________
   Name:
   Title:

 
 
THE UNDERSIGNED HOLDER HEREBY ACKNOWLEDGES AND AGREES TO
THE TERMS SET FORTH ABOVE,
AS OF THE DATE ABOVE

SPHERE CAPITAL, LLC - SERIES A

By:______________________________________
   Name:
      Title:

 

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Exhibit A
Legal Description
PROPERTY 1:
Parcel 1: (DBK 2647, Pg 1196)
ALL THAT CERTAIN piece or parcel of land situated in the Borough of Exeter,
County of Luzerne and Commonwealth of Pennsylvania bounded and described as
follows, to wit:
BEGINNING at a concrete monument in the southerly sideline of Pennsylvania State
Highway, Legislative Route No. 11 (Extension), also known as Back Road, said
point monument also being in the dividing line between lands now or formerly of
Joseph and Anita DePascale as recorded in Luzerne County Deed Book 1680, Page
515 and the lands herein described;
THENCE from said concrete monument and along said dividing line, and along lands
now or formerly of Joseph Mirra, et. ux., South 34 degrees 13 minutes East, two
hundred thirty-seven and thirty one hundredths (237.30) feet to a point in the
northwesterly right-of-way line of the Lehigh Valley Railroad Company (West
Pittston Branch);
THENCE from said point and along said right-of-way line, South 43 degrees 36
minutes West, one thousand one hundred twenty-one and twenty-five one-hundredths
(1,121.25) feet to a point in the northeasterly sideline of Stevens Lane;
THENCE from said point and along said Stevens Lane sideline, North 29 degrees 28
minutes West, one hundred fifty-six and fifty-five one-hundredths (156.55) feet
to a point on the southerly bank of Hick's (Carpenter's) Creek;
THENCE from said point and along the southerly bank of said Creek, along the end
of Stevens Lane, along lands now or formerly State Automotive Corporation as
recorded in Luzerne County Deed Book 1865 at Page 401, and along lands now or
formerly of the Greater Pittston Chamber of Commerce as recorded in Luzerne
County Deed Book 1908 at Page 622, by the two (2) following described lines: (1)
North 79 degrees 00 minutes West, three hundred twenty-two and eighty-six
one-hundredths (322.86) feet to a point; (2) South 81 degrees 55 minutes West,
three hundred seventy-two and eighty-six one-hundredths (372.86) feet to a point
in line of lands now or formerly of The First Ward Social Club of Exeter as
recorded in Luzerne County-Deed Book 1529, at Page 458;
THENCE from said point and along said lands, North 12 degrees 01 minute West,
four hundred eighty-seven (487.00) feet to a point in the aforesaid sideline of
the Back Road;
THENCE from said point and along said sideline by the two (2) following
described lines: (1) North 74 degrees 03 minutes East, ninety-seven and
seventy-eight one-hundredths (97.78) feet to a point; (2) North 75 degrees 42
minutes East, one thousand four hundred fifty-five and twenty-eight
one-hundredths (1,455.28) feet to a point, the place of BEGINNING.
CONTAINING 20.087 acres, be the same more or less.

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PARCEL 2: (DBK 2293, Page 1197)
ALL the surface and right of soil of all that certain piece or parcel of land
situate in the Borough of Exeter, County of Luzerne and Commonwealth of
Pennsylvania, bounded and described as follows, to wit:
BEGINNING at a point in the southerly right-of-way line of State Highway Route
#11, Extension, known as the "Back Road", and located about one thousand nine
hundred eighty (1,980) feet westwardly along said highway from the center of
Exeter Avenue, said point also being the northwesterly corner of Parcel #1
conveyed to the Pittston Area Industrial Development by Deed dated April 15,
1957; THENCE along the westerly side of said Parcel #1 of Pittston Area
Industrial Development, South 14° 35' East, five hundred thirteen (513) feet,
more or less, to a point in the southerly side of Carpenter's Creek, said point
also being the southwesterly corner of Parcel #1 aforesaid; THENCE westwardly
along the said southerly side of Carpenter's Creek also being the northerly line
of Parcel #3 of Deed above-mentioned dated April 15, 1957, ninety (90) feet,
more or less, to a point; THENCE North 14° 35' West, five hundred (500) feet,
more or less, to a point in the southerly right-of-way line of State Highway
Route #11 Extension aforesaid; THENCE eastwardly along said right-of-way line,
ninety (90) feet, more or less, to the place of BEGINNING.
CONTAINING one acre, more or less.
PARCEL 3:
ALL those certain pieces or parcels of land situate in the Borough of Exeter,
County of Luzerne and State of Pennsylvania, bounded and described as follows,
to wit:
PURPART NO. 1: (DBK 2283, Page 930)
BEGINNING at a point in the southeasterly right-of-way line of State Highway
Route No. 11 extension, Back Road, said point being the Northwest corner of a
parcel of land conveyed by Troback Development Company to the First Ward Social
Club of Exeter, by Deed dated September 9, 1963, and recorded in Luzerne County
Deed Book 1529, page 458;
THENCE along said lands now or formerly of the First Ward Social Club of Exeter,
South fourteen degrees fifteen minutes East, four hundred eighty-three and
ninety-four hundredths (483.94) feet to a point in line of lands now or formerly
of Jewelcor Incorporated;
THENCE along lands now or formerly of Jewelcor Incorporated the following two
(2) courses and distances:
(1)    South seventy-six degrees forty-nine minutes forty-six seconds West,
twenty-eight and fifty-six hundredths (28.56) feet to a point;
(2)    South seventy-five degrees forty-seven minutes twenty-four seconds West,
seventy one and forty-four tenths (71.44) feet to a point:
THENCE through other lands of the Grantors herein, North fourteen degrees 15
minutes West (N. 14° 15' W.) four hundred seventy-two (472) feet more or less to
a point on the Southeasterly right-of-way of State Highway Rt. 11 extension,
Back Road;
THENCE along the Southeasterly right-of-way of State Highway Rt. 11, Back Road,
North sixty-six degrees thirty-nine minutes forty-three seconds East (N. 66° 39'
43" E.) one hundred (100) feet to the place of BEGINNING.

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PURPART NO. 2: (DBK 2283, Page 930)
BEGINNING at a point in the southeasterly right-of-way line of State Highway
Route No. 11 extension, Back Road, said point being the Northwest corner of a
parcel of land conveyed to Elvira Chiavacci, a/k/a Vera Chiavacci and Jacquelyn
E. Troback, by and through H. Deno Chiavacci, Attorney In Fact to James H.
Belmont and Carmena T. Belmont, his wife, by deed dated May 13, 1982, and
recorded in Luzerne County Deed Book 2073 at page 1027; THENCE along said lands
now or formerly of James S. Belmont and Carmena T. Belmont, South fourteen
degrees fifteen minutes East, (S. 14° 15' E.) four hundred seventy-two feet more
or less to a point in line of lands now or formerly of Jewelcor, Incorporated;
THENCE along the lands now or formerly of Jewelcor, Incorporated the following
three (3) courses and distances:
(1)    South seventy-five degrees forty-seven minutes twenty-four seconds West,
thirty-three and twenty-six hundredths (33.26) feet to a point;
(2)    South seventy-five degrees fifteen minutes fifty-seven seconds West,
fifty-two and twenty hundredths (52.20) feet to a point;
(3)    South forty degrees twenty minutes thirty-two seconds West, twenty-seven
feet plus or minus to a point;
THENCE through other lands of the Grantors herein, North fourteen degrees
fifteen minutes West (N. 14° 15' W) four hundred sixty-two feet (462) more or
less to a point on the Southeasterly right-of-way of State Highway Rt. 11,
extension, Back Road;
THENCE along the said Southeasterly right-of way of State Highway Rt. 11, Back
Road, North sixty-four degrees twenty-five minutes East (N. 64° 25' E.) fourteen
and fifty-eight hundredths (14.58) feet to a point;
THENCE along the said Southeasterly right-of-way of State Highway Rt. 11, Back
Road, North sixty-six degrees thirty-nine minutes forty-three seconds East,
eighty-five and forty-two hundredths (85.42) feet to the place of BEGINNING.
PARCEL 4: (RBK 3005, Page 185663)
ALL THAT CERTAIN piece or parcel of land situate in the Borough of Exeter,
County of Luzerne and State of Pennsylvania, bounded and described as follows,
to wit:
BEGINNING at a point in the southeasterly right-of-way line of State Highway
Route No. 11 extension, Back Road, said point being the Northwest corner of a
parcel of land conveyed by Elvira Chiavacci, a/k/a Vera Chiavacci and Jacquelyn
E. Troback by and through H. Deno Chiavacci, attorney in fact to James S.
Belmont and Carmena T. Belmont, his wife, by deed dated June 20, 1983 and
recorded in the Office of the Recorder of Deeds of Luzerne County In Deed Book
2105, page 170;
THENCE along said lands now or formerly of James S. Belmont and Carmena T.
Belmont, his wife, South fourteen degrees fifteen minutes East (S. 14° 15' E.)
four hundred sixty and ten one-hundredths (460.10) feet more or less to a point
in line of lands now or formerly of Jewelcor Incorporated;
THENCE along the lands now or formerly of Jewelcor Incorporated the following
two (2) courses and directions:
(1)    South forty degrees twenty minutes thirty-two seconds West, seventy-three
and twenty-five hundredths (73.25) feet to a point;

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(2)    South fifty-six degrees twenty-two minutes thirty-seven seconds West,
forty and sixty-five hundredths feet plus or minus to a point;
THENCE through other lands now or formerly of Chiavacci, North fourteen degrees
fifteen minutes West (N. 14° 15' W) four hundred ninety-six and thirty-seven
hundredths feet more or less to a point on the southeasterly right-of-way of
State Highway Rt. 11 extension, Back Road;
THENCE along the said southeasterly right-of-way of State Highway Rt. 11
extension, Back Road, North sixty-four degrees twenty-five minutes East (N. 64°
25' E) one hundred feet to the place of BEGINNING.
BEING the northerly half of Lot Number 3, Troback Development Number 1.
EXCEPTING AND RESERVING unto the appropriate person or other entity, the portion
of the demised premises to which a declaration of taking by eminent domain was
filed by the Borough of Exeter. The said declaration of taking is filed to No.
4123 of 1978 in the Office of the Prothonotary or the Court of Common Pleas of
Luzerne County.

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Exhibit B - Final Form of Mortgage
Confidential

MORTGAGE
THIS MORTGAGE (hereinafter referred to as “Mortgage”) is dated this      day of
            , 2014 and effective as of the ____ day of ____________, 2014 (the
“Effective Date”) between KEYSTONE AUTOMOTIVE OPERATIONS, INC., a Pennsylvania
corporation (hereinafter referred to as “Mortgagor”), and SPHERE CAPITAL, LLC -
SERIES A, a Delaware limited liability company (hereinafter referred to as
“Mortgagee”).
W I T N E S E T H:
WHEREAS, pursuant to the provisions of a Non-Negotiable Secured Promissory Note
dated the Effective Date executed by LKQ Corporation, a Delaware corporation
(the “Maker”), the parent company of Mortgagor, in favor of Mortgagee (the
“Note”), Maker agreed to pay to Mortgagee the principal sum of THIRTY ONE
MILLION FIVE HUNDRED THOUSAND AND NO/100 DOLLARS ($31,500,000.00), lawful money
of the United States of America, with interest thereon at the rate and times and
in the manner and according to the terms and conditions specified in the Note,
which is incorporated herein by reference; and
WHEREAS, Mortgagor has been directed by Maker to execute and deliver this
Mortgage to Mortgagee for the purpose of providing security to Mortgagee with
respect to the undertakings of Maker pursuant to the Note.
NOW THEREFORE, in consideration of the indebtedness, and as security for payment
to Mortgagee of the principal with interest, and all other sums provided for in
the Note, and in this Mortgage, and as further security for the full and
faithful performance by Maker of its obligations under the Note, according to
the terms and conditions thereof, and for performance of the agreements,
conditions, covenants, provisions and stipulations contained herein and therein,
Mortgagor has granted, conveyed, bargained, sold, aliened, enfeoffed, released,
confirmed, assigned to, granted a security interest in and mortgaged, and by
these presents does hereby grant, convey, bargain, sell, alien, enfeoff,
release, confirm, assign to, grant a security interest in and mortgage unto
Mortgagee:
(1)all that certain real estate situate in the Borough of Exeter, County of
Luzerne, Commonwealth of Pennsylvania, and more particularly described in
Exhibit “A” attached hereto and made a part hereof (the “Land”);
(2)    all buildings and other improvements erected or hereafter erected on the
Land (the “Improvements” and together with the Land, the “Real Estate”);
(3)    all fixtures, appliances, machinery, fittings, apparatus, furniture and
equipment of any nature whatsoever, and other articles of Mortgagor’s personal
property now or at any time hereafter installed in, attached to or situated in
or upon the Land or the Improvements, or used or intended to be used in
connection with the Land, or in the operation of the Improvements, or in the
operation or maintenance of the Improvements (but not including the inventory of
Mortgagor situated on the Real Estate);

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(4)    any and all tenements, hereditaments and appurtenances belonging to the
Land or any part thereof hereby mortgaged or intended so to be, or in any way
appertaining thereto, and all streets, alleys, passages, ways, water courses,
and all easements and covenants now existing or hereafter created for the
benefit of Mortgagor or any subsequent owner or tenant of the Real Estate over
ground adjoining the Real Estate and all rights to enforce the maintenance
thereof, and all other rights, liberties and privileges of whatsoever kind or
character, and the reversions and remainders, income, rents, issue and profits
arising therefrom, and all the estate, right, title, interest, property,
possession, claim and demand whatsoever, at law, of Mortgagor in and to the Real
Estate or any part thereof;
(5)    all proceeds of the conversion, voluntary or involuntary, of any of the
foregoing into cash or liquidated claims, including, without limitation,
proceeds of insurance and condemnation awards; and
(6)    all leases, licenses, occupancy agreements or agreements to lease all or
any part of the Real Estate and all extensions, renewals, amendments, and
modifications thereof, and any options, rights of first refusal, or guarantees
relating thereto (collectively, “Leases”); and all rents, income, receipts,
revenues, security deposits, escrow accounts, reserves, issues, profits, awards,
and payments of any kind payable under the Leases or otherwise arising from the
Real Estate (collectively, the “Income”).
All of the above-mentioned Land, Improvements, fixtures, machinery, furniture,
equipment, tenements, hereditaments and appurtenances, and other property
interests are sometimes collectively referred to herein as the “Mortgaged
Property”.
TO HAVE AND TO HOLD the Mortgaged Property hereby conveyed or mentioned and
intended so to be, unto Mortgagee, its successors and assigns to its own use
forever.
PROVIDED ALWAYS, and this instrument is upon the express condition that, if
Maker pays to Mortgagee the principal sum mentioned in the Note, the interest
thereon and all other sums payable by Mortgagor to Mortgagee as are secured
hereby, in accordance with the provisions of the Note and this Mortgage, then
this Mortgage and the estate hereby granted shall cease and become void.
Subject to Section 26 of this Mortgage, Mortgagor hereby irrevocably, absolutely
and unconditionally guarantees and becomes surety for the prompt payment by
Maker, as and when due and payable, whether by acceleration or otherwise of all
amounts now or hereafter owing by Maker in respect of the Note, whether for
principal, interest, fees, expenses or otherwise, and the due performance and
observance by Maker of its other obligations now or hereafter existing in
respect of any of the Note and any renewals, extensions and modifications
thereof. The liability of Mortgagor hereunder shall be absolute and
unconditional, irrespective of: (i) any lack of validity or enforceability of
the Note; (ii) any change in the time, manner or place of payment of, or in any
other term in respect of, the Note, or any other amendment or waiver of or
consent to any departure from the terms of the Note; (iii) any other
circumstance which might otherwise constitute a defense available to, or a
discharge of, Maker or Mortgagor

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in respect hereof; or (iv) the absence of any action on the part of Mortgagee to
obtain payment of the Note from Maker or from Mortgagor or from any other
guarantor or obligor.
The Mortgaged Property shall secure the following obligations (“Obligations”) of
Maker or Mortgagor to Mortgagee:
(a)all amounts at any time owing or payable under the Note as guaranteed by
Mortgagor in this Mortgage;
(b)    all covenants, agreements and obligations of Mortgagor under this
Mortgage; and
(c)    all future advances made by Mortgagee for taxes, levies, insurance, and
repairs to or maintenance of the Mortgaged Property.
MORTGAGOR REPRESENTS, COVENANTS AND WARRANTS to and with Mortgagee that until
the indebtedness secured hereby is fully repaid:
1.Title. Mortgagor hereby represents and warrants that [except as set forth in
Schedule 1] it has good and marketable title in fee simple (subject to the
Permitted Liens, as that term is defined in the Merger Agreement (as that term
is defined in the Note)) to the Real Estate.
2.    Maintenance of Mortgaged Property. Mortgagor shall keep and maintain or
cause to be kept and maintained the Improvements in good order and condition and
will promptly make or cause to be made, as and when necessary for such purpose,
all repairs, renewals and replacements, structural and nonstructural, exterior
and interior, ordinary and extraordinary, foreseen and unforeseen. Mortgagor
shall abstain from and shall not permit the commission of waste in or about the
Mortgaged Property.
3.    Insurance. Mortgagor shall keep the Mortgaged Property continuously
insured against loss or damage by fire or other casualty in an amount not less
than the full replacement cost (evidenced by a “Replacement Cost Endorsement”)
of the Mortgaged Property. The insurance coverage required under this Section
shall be insured under policies: (a) in form reasonably satisfactory to
Mortgagee; (b) endorsed with a standard mortgagee clause in favor of Mortgagee
providing not less than thirty days’ notice to Mortgagee of any cancellation or
change in coverage; and (c) endorsed to name Mortgagee as loss payee. If the
insurance, or any part thereof, shall expire, or be withdrawn or not renewed, or
become void or unsafe by Mortgagor’s breach of any condition thereof, or become
void or unsafe by reason of the failure or impairment of the capital of any
company in which the insurance may then be carried, Mortgagor shall place new
insurance on the Mortgaged Property. In the event that Mortgagor fails or
refuses to place such new insurance on the Mortgaged Property on or before the
expiration or withdrawal or nonrenewal of the existing coverage, then Mortgagee
may obtain such insurance as Mortgagee deems necessary to satisfy the terms and
conditions of this Mortgage. In such event, the cost of such insurance plus a
reasonable amount to reimburse Mortgagee for its administrative expenses in
obtaining such insurance shall be immediately paid to Mortgagee by Mortgagor. In
the event that such costs and expenses are not immediately paid to Mortgagee by
Mortgagor, then the amount of such costs and expenses shall be added to the
outstanding principal balance of the Note,

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shall accrue interest thereon and shall be secured by this Mortgage. Evidence of
all renewal policies, with premiums paid, shall be delivered to Mortgagee prior
to the expiration of the old policies. In the event of loss greater than $50,000
Mortgagor will give immediate notice thereof to Mortgagee, and Mortgagee may
make proof of loss if not timely made by Mortgagor.
4.    Taxes and Other Charges. Mortgagor shall pay when due and payable and
before interest or penalties are due thereon, without any deduction, defalcation
or abatement, all taxes, assessments, water and sewer rents and all other
charges or claims which may be assessed, levied, or filed at any time against
Mortgagor, the Mortgaged Property or any part thereof or against the interest of
Mortgagee therein, or which by any present or future law may have priority over
the indebtedness secured hereby either in lien or in distribution out of the
proceeds of any judicial sale; and Mortgagor shall produce to Mortgagee upon
request receipts for the payment thereof. If no Event of Default (as hereinafter
defined) is then continuing and Mortgagor in good faith and by appropriate legal
action shall contest the validity or amount of any such taxes, assessments,
water and sewer rents or other charges and shall have established a reserve for
the payment thereof in such form and amount as Mortgagee may reasonably require
(including any interest and penalties which may be payable in connection
therewith), then Mortgagor shall not be required to pay such taxes, assessments,
water and sewer rents or other charges or to produce the receipts while the
reserve is maintained and so long as the contest operates to prevent collection,
is maintained and prosecuted with diligence, and shall not have been terminated
or discontinued adversely to Mortgagor.
5.    Future Taxes. If hereafter any law or ordinance shall be adopted imposing
a tax directly or indirectly on Mortgagee with respect to the Mortgaged
Property, the value of Mortgagor’s equity therein, or the indebtedness evidenced
by the Note and secured by this Mortgage, then Mortgagor agrees to pay the tax
whenever it becomes due and payable thereafter, which agreement shall then
constitute a part of this Mortgage.
6.    Compliance with Laws and Regulations. Mortgagor, at its sole cost and
expense, shall promptly comply with all requirements of all laws, ordinances,
regulations and orders of all Federal, state, municipal and other governmental
authorities relating to the Mortgaged Property (“Legal Requirements”),
construction thereon and the use and occupancy thereof, including but not
limited to all laws and regulations relating to environmental matters.
7.    Further Assurances. Mortgagor will, from time to time, make, do execute
and acknowledge, as the situation may require from time to time, such further
acts, deeds, conveyances, mortgages, security agreements, financing statements,
continuation statements and other assurances in law as may be required for the
purpose of effectuating the intent hereof and for better assuring and confirming
to Mortgagee, its successors and assigns, the lien and security interest created
by this Mortgage.
8.    Declaration of No Set-Off. Within twenty (20) days after being requested
to do so by Mortgagee, Mortgagor shall certify to Mortgagee or to any proposed
assignee of this Mortgage, in a writing duly acknowledged, the amount of
principal, interest and other charges then owing on the Obligations secured by
this Mortgage and by prior liens, if any, and whether there are any setoffs or
defenses against them.

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9.    Additional Covenants. Mortgagor covenants and agrees that until the
Obligations secured hereunder have been paid in full, Mortgagor shall:
(a)    [subject to the matters described on Schedule 1,] maintain at all times
good and marketable title to all Mortgaged Property, and defend such title
against the claims and demands of all persons;
(b)    pay all charges for water, sewer, gas, electric and other utility
services provided to the Mortgaged Property promptly as and when due;
(c)    permit, and cause any lessee or occupant of the Mortgaged Property to
permit, Mortgagee and its agents and representatives, to enter upon the
Mortgaged Property at any reasonable time, and upon prior reasonable notice to
Mortgagor under the circumstances, to appraise and photograph the Mortgaged
Property and to inspect for compliance with Legal Requirements (excluding
subsurface or other invasive investigations), insurance requirements, and the
Obligations of Mortgagor under this Mortgage;
(d)    not commit or suffer waste with respect to the Mortgaged Property;
(e)    not remove or demolish any material portion of the Mortgaged Property
without the prior written consent of Mortgagee;
(f)    not make, install or permit to be made or installed, any additions or
improvements to the Mortgaged Property except in a good and workmanlike manner,
free of mechanic’s or materialmen’s liens, in compliance with Legal
Requirements; and
(g)    pay, upon demand, all amounts incurred by Mortgagee in connection with
any action or proceeding taken or commenced by Mortgagee to enforce or collect
this Mortgage or protect, insure or realize upon the Mortgaged Property,
including reasonable attorney’s fees and expenses.
10.    Required Notices. Mortgagor shall notify Mortgagee promptly of the
occurrence of any of the following:
(a)    a fire or other casualty causing damage to the Mortgaged Property in
excess of $50,000,
(b)    receipt of written notice of condemnation or threatened condemnation of
the Mortgaged Property, or any part thereof,
(c)    receipt of written notice from any governmental authority relating to any
material violation of any Legal Requirements;
(d)    commencement of any litigation affecting the Mortgaged Property; or
(e)    discovery, discharge or release of any hazardous materials for which
Mortgagor is or may be responsible under any Legal Requirements.

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11.    Condemnation; Casualty.
(a)    Condemnation.
(i)    In the event of any condemnation or taking of any part of the Mortgaged
Property by eminent domain, alteration of the grade of any street, or other
injury to or decrease in the value of the Mortgaged Property by any public or
quasi-public authority or corporation, all proceeds (that is, the award or
agreed compensation for the damages sustained) allocable to Mortgagor shall be
applicable first to payment of the indebtedness secured hereby, subject to the
terms of the Note. No settlement for the damages sustained shall be made by
Mortgagor without Mortgagee’s prior written approval. Receipt by Mortgagee of
any proceeds less than the full amount of the then outstanding debt secured
hereby shall not alter or modify Maker’s obligation to continue to pay the
installments of principal, interest and other charges specified in the Note. All
the proceeds shall be applied in the order and in the amounts that Mortgagee, in
Mortgagee’s sole discretion, may elect, to the payment of principal, interest or
any sums secured by this Mortgage, in each case, subject to the terms of the
Note, or toward payment to Mortgagor, on such reasonable terms as Mortgagee may
specify, to be used for the sole purpose of altering, restoring or rebuilding
any part of the Mortgaged Property which may have been altered, damaged or
destroyed as a result of the taking, alteration of grade or other injury to the
Mortgaged Property. Receipt of such proceeds by Mortgagee shall not be subject
to a prepayment penalty hereunder or under the Note.
(ii)    If prior to the receipt of the proceeds by Mortgagee the Mortgaged
Property shall have been sold by foreclosure of this Mortgage, Mortgagee shall
have the right to receive the proceeds, to the extent of:
(A)    any deficiency found to be due to Mortgagee in connection with the
foreclosure sale, with legal interest thereon, and
(B)    reasonable counsel fees, costs and disbursements incurred by Mortgagee in
connection with collection of the proceeds and the proceedings to establish the
deficiency.
(iii)    If the amount of the initial award of damages for the condemnation is
insufficient to pay in full the indebtedness secured hereby with interest and
other appropriate charges, Mortgagee shall have the right to prosecute to final
determination or settlement an appeal or other appropriate proceedings in the
name of Mortgagee or Mortgagor, for which Mortgagee is hereby appointed
irrevocably as attorney-in fact for Mortgagor (without requiring Mortgagee to
act as such), which appointment, being for security, is irrevocable. In that
event, the expenses of the proceedings, including reasonable counsel fees and
expenses, shall be paid first out of the proceeds and only the excess, if any,
paid to Mortgagee shall be credited against the amounts due under this Mortgage.
(iv)    Nothing herein shall limit the rights otherwise available to Mortgagee,
at law, including the right to intervene as a party to any condemnation
proceeding.

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(b)    Casualty. If the Mortgaged Property is damaged by fire or other casualty,
Mortgagor shall promptly repair and restore the same to its condition prior to
the damage. In the event of any fire or other casualty damaging any part of the
Mortgaged Property, all insurance proceeds shall, subject to the terms of the
Note, be applicable first to payment of the indebtedness secured hereby. No
settlement for the damages sustained shall be made by Mortgagor without
Mortgagee’s prior written approval. Receipt by Mortgagee of any insurance
proceeds less than the full amount of the then outstanding debt secured hereby
shall not alter or modify Maker’s obligation to continue to pay the installments
of principal, interest and other charges specified in the Note. All the
insurance proceeds shall be applied in the order and in the amounts that
Mortgagee, in Mortgagee’s sole discretion, may elect, to the payment of
principal (whether or not then due and payable), interest or any sums secured by
this Mortgage, or toward payment to Mortgagor, on such reasonable terms as
Mortgagee may specify, to be used for the sole purpose of altering, restoring or
rebuilding any part of the Mortgaged Property which may have been damaged or
destroyed as a result of the fire or other casualty to the Mortgaged Property.
Receipt of such proceeds by Mortgagee shall not be subject to a prepayment
penalty hereunder or under the Note. Notwithstanding anything to the contrary
contained herein, so long as no Event of Default shall exist under this
Mortgage, the insurance proceeds shall be delivered by Mortgagee to Mortgagor on
such reasonable terms as Mortgagee may specify for the sole purpose of restoring
or rebuilding any part of the Mortgaged Property which may have been damaged or
destroyed as a result of the event of fire or other casualty.
12.    No Transfer. For the purpose of protecting Mortgagee’s security,
Mortgagor agrees that (a) any sale or other transfer of title to the Mortgaged
Property, or (b) any transfer of any stock, partnership, company or other
ownership interests in Mortgagor (other than to an Affiliate (as that term is
defined in the Merger Agreement) of Maker), in either case, without Mortgagee’s
prior written consent, shall result in immediate acceleration of the
Obligations.
13.    Mortgagee’s Rights. In the event that Mortgagor should fail to pay real
estate or other taxes, assessments, water and sewer rents, charges and claims,
insurance premiums, or fail to make necessary repairs, or permit waste,
Mortgagee, at its election, shall have the right to make any payment or
expenditure and to take any action which Mortgagor should have made or taken, or
which Mortgagee deems advisable to protect the security of this Mortgage or the
Mortgaged Property, including, without limitation, any rights granted to
Mortgagee under the Note, without prejudice to any of Mortgagee’s rights or
remedies available hereunder or otherwise, at law. In addition, Mortgagor hereby
authorizes Mortgagee, and Mortgagee shall have the continuing right (but not the
obligation), at its sole option and discretion, to:
(a)    do anything which Mortgagor is required but fails to do hereunder, and in
particular Mortgagee may, if Mortgagor fails to do so within ten (10) business
days after receipt by Mortgagor of written notice from Mortgagee, (i) insure or
take any reasonable steps to protect the Mortgaged Property, (ii) pay all taxes,
levies, expenses and costs arising with respect to the Mortgaged Property, or
(iii) pay any premiums payable on any policy of insurance required to be
obtained or maintained hereunder, and add any amounts paid under this Section
13(a) to the principal amount of the indebtedness secured by this Mortgage; and

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(b)    pay any amounts Mortgagee elects to pay or advance hereunder following
the occurrence of an Event of Default on account of insurance, taxes or other
costs, fees or charges arising in connection with the Mortgaged Property, either
directly to the payee of such cost, fee or charge, directly to Mortgagor, or to
such payee(s) and Mortgagor jointly.
All such sums, as well as costs, advanced by Mortgagee pursuant to this Mortgage
shall be due immediately from Mortgagor to Mortgagee, shall be secured hereby,
and shall bear interest at a rate which shall be two and one-half percent (2.5
%) higher than the then highest effective rate specified in the Note (the
“Default Rate”) from the date of payment by Mortgagee until the date of
repayment.
14.    Events of Default. Each of the following shall constitute an “Event of
Default” hereunder:
(a)    The occurrence of an Event of Default, as that term is defined in the
Note;
(b)    Failure to comply with any term, obligation, covenant or condition
contained in this Mortgage. If such failure is curable and if Mortgagor has not
been given notice of a breach of the same provision of this Mortgage within the
preceding twelve (12) months, it may be cured (and no Event of Default will have
occurred) if Mortgagor, after Mortgagee sends written notice demanding cure of
such failure; (i) cures the failure within fifteen (15) days; or (ii) if the
cure requires more than fifteen (15) days, immediately initiates steps
sufficient to cure the failure and thereafter continues and completes all
reasonable and necessary steps sufficient to produce compliance as soon as
reasonably practical;
(c)    Any warranty, representation or statement made to Mortgagee by Mortgagor
under this Mortgage is false or misleading in any material respect as of the
date hereof; or
(d)    Commencement of foreclosure or forfeiture proceedings, whether by
judicial proceeding, self-help, repossession or any other method, by any
creditor of Mortgagor or by any governmental agency against any of the Mortgaged
Property; provided, however, that this subsection (d) shall not apply in the
event of a good faith dispute by Mortgagor as to the validity or reasonableness
of the claim which is the basis of the foreclosure or forfeiture proceeding,
provided that Mortgagor gives Mortgagee written notice of such claim and
furnishes reserves or a surety bond for the claim satisfactory to Mortgagee.
15.    Rights and Remedies On Default. Upon the occurrence of any Event of
Default under this Mortgage and at any time thereafter prior to the cure of such
Event of Default, Mortgagee, at its option, may exercise any one or more of the
following rights and remedies, in addition to any other rights or remedies
provided by law:
(a)    Subject to applicable law, Mortgagee shall have the right at is option
without notice to Mortgagor to declare the Obligations immediately due and
payable. Mortgagee shall have the right to obtain judgment for the Obligations
(including all amounts advanced or to be advanced by Mortgagee under Section 13
above, all costs and expenses of collection and suit, including any bankruptcy
or insolvency proceeding affecting Mortgagor, and

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reasonable attorneys’ fees incurred in connection with any of the foregoing)
together with interest on such judgment at the Default Rate until payment in
full is received by Mortgagee and Mortgagee shall have the right to obtain
execution upon the Mortgaged Property on account of such judgment;
(b)    Mortgagee shall have the right to have a receiver appointed to take
possession of all or any part of the Mortgaged Property, with the power to
protect and preserve the Mortgaged Property, to operate the Mortgaged Property
preceding foreclosure or sale, and to collect rents, if any, from the Mortgaged
Property and apply the proceeds, over and above the cost of the receivership,
against the Obligations. The receiver may serve without bond if permitted by
law. Mortgagee’s right to the appointment of a receiver shall exist whether or
not the apparent value of the Mortgaged Property exceeds the Obligations by a
substantial amount. Employment by Mortgagee shall not disqualify a person from
serving as a receiver;
(c)    Mortgagee may obtain a judicial decree foreclosing Mortgagor’s interest
in all or any part of the Mortgaged Property;
(d)    Mortgagee may obtain a judgment for any deficiency remaining in the
Obligations due to Mortgagee after application of all amounts received from the
exercise of the rights provided in this section;
(e)    If Mortgagor remains in possession of the Mortgaged Property after the
Mortgaged Property is sold as provided above or Mortgagee otherwise becomes
entitled to possession of the Mortgaged Property upon default of Mortgagor,
Mortgagor shall become a tenant at sufferance of Mortgagee or the purchaser of
the Mortgaged Property and shall, at Mortgagee’s option, either (i) pay a
reasonable rental for the use of the Mortgaged Property, or (ii) vacate the
Mortgaged Property immediately upon the demand of Mortgagee;
(f)    Mortgagee shall have the right to take possession of any portion of the
Mortgaged Property constituting fixtures or other personal property and any
records pertaining thereto. In addition, upon ten (10) calendar days’ prior
written notice to Mortgagor (which Mortgagor hereby acknowledges to be
sufficient and commercially reasonable) Mortgagee shall have the right to sell,
lease or otherwise dispose of all or any of such Mortgaged Property at any time
and from time to time at public or private sale, with or without advertisement
thereof, with the right of Mortgagee or its nominee to become purchaser at any
sale (unless prohibited by statute) free from any equity of redemption and from
all other claims, and after deducting all legal and other expenses for
maintaining or selling such Mortgaged Property, and all attorneys’ fees, legal
or other expenses for collection, sale and delivery, apply the remaining
proceeds of any sale to pay (or hold as a reserve against) the Obligations and
exercise all other rights and remedies of a secured party under the Uniform
Commercial Code or any other applicable law; and
(g)    Mortgagee shall have all other rights and remedies provided in this
Mortgage or available at law.
16.    Rights and Remedies Cumulative.

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(a)    The rights and remedies of Mortgagee as provided in this Mortgage and the
Note shall be cumulative and concurrent; may be pursued separately, successively
or together against Mortgagor, Maker or against the Mortgaged Property, or both,
at the sole discretion of Mortgagee, and may be exercised as often as occasion
therefor shall arise. The failure to exercise any such right or remedy shall in
no event be construed as a waiver or release thereof.
(b)    Any failure by Mortgagee to insist upon strict performance by Mortgagor
of any of the terms and provisions of this Mortgage shall not be deemed to be a
waiver of any of the terms or provisions of this Mortgage and Mortgagee shall
have the right thereafter to insist upon strict performance by Mortgagor of any
and all of them.
(c)    Neither Mortgagor nor any other person now or hereafter obligated for
payment of all or any part of the sums now or hereafter secured by this Mortgage
shall be relieved of such obligation by reason of the failure of Mortgagee to
comply with any request of Mortgagor or of any other person so obligated to take
action to foreclose on this Mortgage or otherwise enforce any provisions of this
Mortgage, or by reason of the release, regardless of consideration, of all or
any part of the security held for the indebtedness secured by this Mortgage, or
by reason of any agreement or stipulation between any subsequent owner of the
Mortgaged Property and Mortgagee extending the time of payment or modifying the
terms of this Mortgage without first having obtained the consent of Mortgagor or
such other person; and in the latter event Mortgagor and all such other persons
shall continue to be liable to make payments according to the terms of any such
extension or modification agreement, unless expressly released and discharged in
writing by Mortgagee.
(d)    Mortgagee may release, regardless of consideration, any part of the
security held for the indebtedness secured by this Mortgage without, as to the
remainder of the security, in any way impairing or affecting the lien of this
Mortgage or its priority over any subordinate lien.
17.    Assignment of Leases. This Mortgage is also an absolute and unconditional
assignment to Mortgagee of all Leases and Income, whether now in existence or
hereafter arising, for the purpose of vesting in Mortgagee a first priority,
perfected security interest in the Leases and the Income. Mortgagor hereby
assigns, transfers and sets over to Mortgagee all Leases, all Income and all
rights of Mortgagor to enforce the Leases and collect the Income. This
assignment includes any award received or receivable by Mortgagor in any legal
proceeding involving any tenant under a Lease whether under the Bankruptcy Code
or otherwise. Mortgagor shall notify any person which Mortgagee may from time to
time specify that the Income should be paid directly to Mortgagee and that any
modification of the Leases must be approved by Mortgagee. So long as no Event of
Default is then continuing, Mortgagor shall have a license, revocable at the
will of Mortgagee, to enforce the Leases and collect the Income. Mortgagor
hereby authorizes and directs that all other parties now or hereafter owing or
paying Income under any Lease or now or hereafter having in their possession or
control any Income from or allocated to the Mortgaged Property, or any part
thereof, shall, upon the request of Mortgagee and until Mortgagee directs
otherwise, pay and deliver such Income directly to Mortgagee at Mortgagee’s
address set forth below, or in such other manner as Mortgagee may direct such
parties in writing and this authorization shall continue until this Mortgage is
released

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of record. No payor making payments to Mortgagee at its request under the
assignment contained in this Mortgage shall have any responsibility to see to
the application of any of such funds, and any party paying or delivering Income
to Mortgagee under such assignment shall be released thereby from any and all
liability to Mortgagor to the full extent and amount of all such Income so
delivered. Notwithstanding any legal presumption to the contrary, Mortgagee
shall not be obligated by reason of its acceptance of this assignment to perform
any obligation of Mortgagor as lessor under any Lease. Neither the acceptance of
this assignment nor the collection of Income under the Leases shall constitute a
waiver of any rights of Mortgagee hereunder or under the Note or constitute a
cure of any default by Mortgagor hereunder or thereunder.
18.    Mortgagor’s Waivers. Mortgagor hereby waives and releases all benefit
that might accrue to Mortgagor by virtue of any present or future law exempting
the Mortgaged Property, or any part of the proceeds arising from any sale
thereof, from attachment, levy or sale on execution, or providing for any stay
of execution, exemption from civil process or extension of time for payment.
19.    Communications. All notices and other communications provided for in this
Mortgage shall be in writing and shall be given in the manner and become
effective as set forth in the Note, and addressed to the respective parties at
their addresses specified below or as to either party hereto at such other
address as shall be designated by such party in a written notice to the other
party hereto.
If to Mortgagor, to:
Keystone Automotive Operations, Inc.
c/o LKQ Corporation
500 West Madison Street, Suite 2800
Chicago, Illinois 60661
Attention: General Counsel
Facsimile: (312) 207-1529
If to Mortgagee, to:

Sphere Capital, LLC - Series A
360 North Crescent Drive, South Building
Beverly Hills, CA 90210
Attention: General Counsel
Facsimile: (310) 712-1863
20.    Covenant Running with the Land. Any act or agreement to be done or
performed by Mortgagor shall be construed as a covenant running with the land
and shall be binding upon Mortgagor and its successors and assigns as if they
had personally made such agreement.
21.    Amendment. This Mortgage cannot be changed or amended except by agreement
in writing signed by the party against whom enforcement of the change is sought.

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22.    Applicable Law. This Mortgage shall be governed by and construed
according to the laws of the Commonwealth of Pennsylvania, without regard to
conflicts of law analysis or choice of law provisions.
23.    Construction. Whenever used in this Mortgage, unless the context clearly
indicates a contrary intent:
(a)    The use of any gender shall include all genders;
(b)    The singular number shall include the plural and the plural the singular
as the context may require; and
(c)    Initially capitalized terms not defined herein shall have the meanings
ascribed thereto in the Note.
24.    Non-Usury and Severability Provisions. Notwithstanding anything in this
Mortgage or the Note to the contrary, neither this Mortgage nor the Note shall
be deemed to impose on Mortgagor or Maker, as the case may be, any obligation of
payment, except to the extent that the same may be legally enforceable, and any
provision to the contrary shall be of no force or effect. If any term or
provision of this Mortgage or the application thereof to any person, property or
circumstance shall to any extent be invalid or unenforceable, the remainder of
this Mortgage, or the application of such term or provision to persons,
properties and circumstances other than those as to which it is invalid or
unenforceable, shall not be affected thereby, and each term and provision of
this Mortgage shall be valid and enforceable to the fullest extent permitted by
law.
25.    Captions. The captions preceding the text of the paragraphs or
subparagraphs of this Mortgage are inserted only for convenience of reference
and shall not constitute a part of this Mortgage, nor shall they in any way
affect its meaning, construction or effect.
26.    Non-Recourse. Mortgagee acknowledges and agrees that Mortgagor shall have
no personal liability hereunder and that Mortgagee’s remedies against Mortgagor
shall be limited to enforcement of this Mortgage against the Mortgaged Property.
In no case shall Mortgagor have any claim against any other assets of Mortgagor.

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IN WITNESS WHEREOF, Mortgagor has duly executed this Mortgage the day and year
first above written.

        
KEYSTONE AUTOMOTIVE OPERATIONS, INC., a Pennsylvania corporation

By:_______________________________
Name:                     
Its:                     

ACKNOWLEDGMENT

STATE OF     )    
) SS:
COUNTY OF    )

On the _______ day of ____________, 2014, before me, a Notary Public in and for
the State and County aforesaid, personally appeared _________________________,
who acknowledged her/himself to be the ______________________________________ of
KEYSTONE AUTOMOTIVE OPERATIONS, INC., a Pennsylvania corporation, and that
she/he as such officer, being authorized to do so, executed the foregoing
instrument for the purposes therein contained by signing the name of the
corporation by her/himself as such officer.

IN WITNESS WHEREOF, I hereunto set my hand and official seal.

    
Notary Public

MY COMMISSION EXPIRES:

I hereby certify that the address    
of Mortgagee is:

360 North Crescent Drive, South Building
Beverly Hills, CA 90210
__________________________________
On behalf of Mortgagee

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Exhibit A
Legal Description
PROPERTY 1:
Parcel 1: (DBK 2647, Pg 1196)
ALL THAT CERTAIN piece or parcel of land situated in the Borough of Exeter,
County of Luzerne and Commonwealth of Pennsylvania bounded and described as
follows, to wit:
BEGINNING at a concrete monument in the southerly sideline of Pennsylvania State
Highway, Legislative Route No. 11 (Extension), also known as Back Road, said
point monument also being in the dividing line between lands now or formerly of
Joseph and Anita DePascale as recorded in Luzerne County Deed Book 1680, Page
515 and the lands herein described;
THENCE from said concrete monument and along said dividing line, and along lands
now or formerly of Joseph Mirra, et. ux., South 34 degrees 13 minutes East, two
hundred thirty-seven and thirty one hundredths (237.30) feet to a point in the
northwesterly right-of-way line of the Lehigh Valley Railroad Company (West
Pittston Branch);
THENCE from said point and along said right-of-way line, South 43 degrees 36
minutes West, one thousand one hundred twenty-one and twenty-five one-hundredths
(1,121.25) feet to a point in the northeasterly sideline of Stevens Lane;
THENCE from said point and along said Stevens Lane sideline, North 29 degrees 28
minutes West, one hundred fifty-six and fifty-five one-hundredths (156.55) feet
to a point on the southerly bank of Hick's (Carpenter's) Creek;
THENCE from said point and along the southerly bank of said Creek, along the end
of Stevens Lane, along lands now or formerly State Automotive Corporation as
recorded in Luzerne County Deed Book 1865 at Page 401, and along lands now or
formerly of the Greater Pittston Chamber of Commerce as recorded in Luzerne
County Deed Book 1908 at Page 622, by the two (2) following described lines: (1)
North 79 degrees 00 minutes West, three hundred twenty-two and eighty-six
one-hundredths (322.86) feet to a point; (2) South 81 degrees 55 minutes West,
three hundred seventy-two and eighty-six one-hundredths (372.86) feet to a point
in line of lands now or formerly of The First Ward Social Club of Exeter as
recorded in Luzerne County-Deed Book 1529, at Page 458;
THENCE from said point and along said lands, North 12 degrees 01 minute West,
four hundred eighty-seven (487.00) feet to a point in the aforesaid sideline of
the Back Road;
THENCE from said point and along said sideline by the two (2) following
described lines: (1) North 74 degrees 03 minutes East, ninety-seven and
seventy-eight one-hundredths (97.78) feet to a point; (2) North 75 degrees 42
minutes East, one thousand four hundred fifty-five and twenty-eight
one-hundredths (1,455.28) feet to a point, the place of BEGINNING.
CONTAINING 20.087 acres, be the same more or less.
PARCEL 2: (DBK 2293, Page 1197)

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ALL the surface and right of soil of all that certain piece or parcel of land
situate in the Borough of Exeter, County of Luzerne and Commonwealth of
Pennsylvania, bounded and described as follows, to wit:
BEGINNING at a point in the southerly right-of-way line of State Highway Route
#11, Extension, known as the "Back Road", and located about one thousand nine
hundred eighty (1,980) feet westwardly along said highway from the center of
Exeter Avenue, said point also being the northwesterly corner of Parcel #1
conveyed to the Pittston Area Industrial Development by Deed dated April 15,
1957; THENCE along the westerly side of said Parcel #1 of Pittston Area
Industrial Development, South 14° 35' East, five hundred thirteen (513) feet,
more or less, to a point in the southerly side of Carpenter's Creek, said point
also being the southwesterly corner of Parcel #1 aforesaid; THENCE westwardly
along the said southerly side of Carpenter's Creek also being the northerly line
of Parcel #3 of Deed above-mentioned dated April 15, 1957, ninety (90) feet,
more or less, to a point; THENCE North 14° 35' West, five hundred (500) feet,
more or less, to a point in the southerly right-of-way line of State Highway
Route #11 Extension aforesaid; THENCE eastwardly along said right-of-way line,
ninety (90) feet, more or less, to the place of BEGINNING.
CONTAINING one acre, more or less.
PARCEL 3:
ALL those certain pieces or parcels of land situate in the Borough of Exeter,
County of Luzerne and State of Pennsylvania, bounded and described as follows,
to wit:
PURPART NO. 1: (DBK 2283, Page 930)
BEGINNING at a point in the southeasterly right-of-way line of State Highway
Route No. 11 extension, Back Road, said point being the Northwest corner of a
parcel of land conveyed by Troback Development Company to the First Ward Social
Club of Exeter, by Deed dated September 9, 1963, and recorded in Luzerne County
Deed Book 1529, page 458;
THENCE along said lands now or formerly of the First Ward Social Club of Exeter,
South fourteen degrees fifteen minutes East, four hundred eighty-three and
ninety-four hundredths (483.94) feet to a point in line of lands now or formerly
of Jewelcor Incorporated;
THENCE along lands now or formerly of Jewelcor Incorporated the following two
(2) courses and distances:
(1)    South seventy-six degrees forty-nine minutes forty-six seconds West,
twenty-eight and fifty-six hundredths (28.56) feet to a point;
(2)    South seventy-five degrees forty-seven minutes twenty-four seconds West,
seventy one and forty-four tenths (71.44) feet to a point:
THENCE through other lands of the Grantors herein, North fourteen degrees 15
minutes West (N. 14° 15' W.) four hundred seventy-two (472) feet more or less to
a point on the Southeasterly right-of-way of State Highway Rt. 11 extension,
Back Road;
THENCE along the Southeasterly right-of-way of State Highway Rt. 11, Back Road,
North sixty-six degrees thirty-nine minutes forty-three seconds East (N. 66° 39'
43" E.) one hundred (100) feet to the place of BEGINNING
PURPART NO. 2: (DBK 2283, Page 930)

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BEGINNING at a point in the southeasterly right-of-way line of State Highway
Route No. 11 extension, Back Road, said point being the Northwest corner of a
parcel of land conveyed to Elvira Chiavacci, a/k/a Vera Chiavacci and Jacquelyn
E. Troback, by and through H. Deno Chiavacci, Attorney In Fact to James H.
Belmont and Carmena T. Belmont, his wife, by deed dated May 13, 1982, and
recorded in Luzerne County Deed Book 2073 at page 1027; THENCE along said lands
now or formerly of James S. Belmont and Carmena T. Belmont, South fourteen
degrees fifteen minutes East, (S. 14° 15' E.) four hundred seventy-two feet more
or less to a point in line of lands now or formerly of Jewelcor, Incorporated;
THENCE along the lands now or formerly of Jewelcor, Incorporated the following
three (3) courses and distances:
(1)    South seventy-five degrees forty-seven minutes twenty-four seconds West,
thirty-three and twenty-six hundredths (33.26) feet to a point;
(2)    South seventy-five degrees fifteen minutes fifty-seven seconds West,
fifty-two and twenty hundredths (52.20) feet to a point;
(3)    South forty degrees twenty minutes thirty-two seconds West, twenty-seven
feet plus or minus to a point;
THENCE through other lands of the Grantors herein, North fourteen degrees
fifteen minutes West (N. 14° 15' W) four hundred sixty-two feet (462) more or
less to a point on the Southeasterly right-of-way of State Highway Rt. 11,
extension, Back Road;
THENCE along the said Southeasterly right-of way of State Highway Rt. 11, Back
Road, North sixty-four degrees twenty-five minutes East (N. 64° 25' E.) fourteen
and fifty-eight hundredths (14.58) feet to a point;
THENCE along the said Southeasterly right-of-way of State Highway Rt. 11, Back
Road, North sixty-six degrees thirty-nine minutes forty-three seconds East,
eighty-five and forty-two hundredths (85.42) feet to the place of BEGINNING.
PARCEL 4: (RBK 3005, Page 185663)
ALL THAT CERTAIN piece or parcel of land situate in the Borough of Exeter,
County of Luzerne and State of Pennsylvania, bounded and described as follows,
to wit:
BEGINNING at a point in the southeasterly right-of-way line of State Highway
Route No. 11 extension, Back Road, said point being the Northwest corner of a
parcel of land conveyed by Elvira Chiavacci, a/k/a Vera Chiavacci and Jacquelyn
E. Troback by and through H. Deno Chiavacci, attorney in fact to James S.
Belmont and Carmena T. Belmont, his wife, by deed dated June 20, 1983 and
recorded in the Office of the Recorder of Deeds of Luzerne County In Deed Book
2105, page 170;
THENCE along said lands now or formerly of James S. Belmont and Carmena T.
Belmont, his wife, South fourteen degrees fifteen minutes East (S. 14° 15' E.)
four hundred sixty and ten one-hundredths (460.10) feet more or less to a point
in line of lands now or formerly of Jewelcor Incorporated;
THENCE along the lands now or formerly of Jewelcor Incorporated the following
two (2) courses and directions:
(1)    South forty degrees twenty minutes thirty-two seconds West, seventy-three
and twenty-five hundredths (73.25) feet to a point;
(2)    South fifty-six degrees twenty-two minutes thirty-seven seconds West,
forty and sixty-five hundredths feet plus or minus to a point;

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THENCE through other lands now or formerly of Chiavacci, North fourteen degrees
fifteen minutes West (N. 14° 15' W) four hundred ninety-six and thirty-seven
hundredths feet more or less to a point on the southeasterly right-of-way of
State Highway Rt. 11 extension, Back Road;
THENCE along the said southeasterly right-of-way of State Highway Rt. 11
extension, Back Road, North sixty-four degrees twenty-five minutes East (N. 64°
25' E) one hundred feet to the place of BEGINNING.
BEING the northerly half of Lot Number 3, Troback Development Number 1.
EXCEPTING AND RESERVING unto the appropriate person or other entity, the portion
of the demised premises to which a declaration of taking by eminent domain was
filed by the Borough of Exeter. The said declaration of taking is filed to No.
4123 of 1978 in the Office of the Prothonotary or the Court of Common Pleas of
Luzerne County.

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Schedule 1
The deeds evidencing the following parcels of the Mortgaged Property reflect a
grantee other than the Mortgagor:

 
Property Name/Use
Property Address
Record Book & Page Number of Vesting Deed
Grantee (Exactly as Appears on the Vesting Deed Provided to Date)
 
Exeter Warehouse
100 Slocum Avenue
Exeter, PA 18643
Bk 2647 Pg 1196
Keystone Automotive Warehouse, a partnership
Bk 2283 Pg 930
Keystone Automotive Warehouse
Bk 2293 Pg 1197
Keystone Automotive Warehouse

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Prepared by:

[name]
[address]
(___) ____- _____

Return to:

[name]
[address]
(___) ____- _____

Parcel No(s). _________________

MORTGAGE

From

KEYSTONE AUTOMOTIVE OPERATIONS, INC.

Mortgagor

To

SPHERE CAPITAL, LLC - SERIES A

Mortgagee

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