Execution Copy

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STOCK PURCHASE AGREEMENT
by and among
R&R ENTERPRISES, INC.
“SELLER”
SENTEL CORPORATION,
“ACQUIRED COMPANY”
VECTRUS SYSTEMS CORPORATION,
“PURCHASER”
and
RUSSELL T. WRIGHT
“SELLER SHAREHOLDER”
January 23, 2018

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Table of Contents
 
 
 
 
 
Page
 
 
 
ARTICLE I PURCHASE AND SALE OF THE SHARES
1
1.01
Basic Transaction
1
1.02
Purchase and Sale of Shares
1
1.03
The Closing
1
1.04
The Closing Transactions
2
1.05
Purchase Price Adjustments
3
1.06
Withholding Rights
4
 
 
 
ARTICLE II CONDITIONS TO CLOSING
4
2.01
Conditions to the Obligations of the Purchaser
4
2.02
Conditions to the Obligations of the Acquired Company and the Seller
5
 
 
 
ARTICLE III REPRESENTATIONS AND WARRANTIES OF THE ACQUIRED COMPANY
6
3.01
Organization and Power
6
3.02
Subsidiaries
6
3.03
Authorization; No Breach; Valid and Binding Agreement
7
3.04
Capital Stock
7
3.05
Financial Statements
7
3.06
Absence of Certain Developments
8
3.07
Title to Properties
10
3.08
Tax Matters
11
3.09
Contracts and Commitments
12
3.10
Intellectual Property
14
3.11
Litigation
16
3.12
Governmental Consents, etc.
16
3.13
Employee Matters
16
3.14
Employee Benefit Plans
18
3.15
Insurance
19
3.16
Compliance with Laws
19
3.17
Government Contracts and Government Bids
20
3.18
Environmental Compliance and Conditions
22
3.19
Affiliated Transactions
22
3.20
Brokerage
23
3.21
Certain Accounts
23
3.22
Assets
23
3.23
Accounts Receivable
23
3.24
Internal Controls
23
3.25
Suppliers and Customers
23
 
 
 

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Table of Contents
(Continued)
Page

ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE SELLER
24
4.01
Power
24
4.02
Authorization
24
4.03
No Violation
24
4.04
Ownership
24
4.05
Tax Matters
24
 
 
 
ARTICLE V REPRESENTATIONS AND WARRANTIES OF THE SELLER SHAREHOLDER
24
5.01
Power
24
5.02
Authorization
24
5.03
No Violation
25
5.04
Ownership
25
 
 
 
ARTICLE VI REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
25
6.01
Organization and Power
25
6.02
Authorization
25
6.03
No Violation
25
6.04
Governmental Authorities; Consents
25
6.05
Litigation
26
6.06
Brokerage
26
6.07
Investment Representation
26
6.08
Financing
26
6.09
Solvency
26
6.10
No Foreign Ownership
26
 
 
 
ARTICLE VII [INTENTIONALLY DELETED]
27
 
 
ARTICLE VIII CERTAIN COVENANTS
27
8.01
Access to Books and Records
27
8.02
Director and Officer Liability and Indemnification
27
8.03
Conditions
28
8.04
Contact with Employees, Customers and Suppliers
28
8.05
Employment and Benefit Arrangements
28
8.06
Employee Layoffs
28
8.07
Corporate Headquarters Lease
29
 
 
 
ARTICLE IX INDEMNIFICATION
29
9.01
Survival of Representations, Warranties, Covenants, Agreements and Other
Provisions
29
9.02
Indemnification from the Indemnity Escrow Account for the Benefit of the
Purchaser
29
9.03
Indemnification by the Purchaser for the Benefit of the Seller
30
9.04
Mitigation
31
9.05
Defense of Third Party Claims
31
9.06
Determination of Loss Amount
31

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Table of Contents
(Continued)
Page

9.07
Manner of Payment
32
9.08
Acknowledgment; No Reliance
32
9.09
Other Indemnification Matters
33
 
 
 
ARTICLE X [RESERVED]
33
 
 
ARTICLE XI ADDITIONAL COVENANTS
33
11.01
Tax Matters
33
11.02
Further Assurances
37
11.03
Consents
37
11.04
Regulatory Filings; Cooperation
37
11.05
Disclosure Generally
38
11.06
Sentel International
38
 
 
 
ARTICLE XII DEFINITIONS
39
12.01
Definitions
39
12.03
Other Definitional Provisions
45
 
 
 
ARTICLE XIII MISCELLANEOUS
45
13.01
Press Releases and Communications
45
13.02
Expenses
46
13.03
Notices
46
13.04
Assignment
47
13.05
Severability
47
13.06
References
47
13.07
Construction and Disclosure
47
13.08
Amendment and Waiver
48
13.09
Complete Agreement
48
13.10
Third-Party Beneficiaries
48
13.11
Waiver of Trial by Jury
48
13.12
Purchaser Deliveries
48
13.13
Specific Performance
48
13.14
Delivery by Electronic Mail
48
13.15
Counterparts
49
13.16
Governing Law
49
13.17
Consent to Jurisdiction
49
13.18
Prevailing Party
49
13.19
Acknowledgement Regarding Post-Closing Attorney-Client Matters
49
13.20
Tax Withholding on Compensatory Payments
50
13.21
Payments under this Agreement
51
13.22
Non-Solicit and Non-Compete
51

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EXHIBITS
Exhibit A        Escrow Agreement
Exhibit B        Example Calculation of Net Working Capital

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STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT (this "Agreement"), dated as of January 23, 2018,
is made by and among Vectrus Systems Corporation, a Delaware corporation (the
"Purchaser"), SENTEL Corporation, a Virginia corporation (the "Acquired
Company"), R&R Enterprises, Inc., a Delaware corporation (the "Seller"), and
Russell T. Wright (“Seller Shareholder”). Capitalized terms used and not
otherwise defined herein have the meanings set forth in Article XII below.
WHEREAS, Seller Shareholder owns all of the issued and outstanding capital stock
of the Seller;
WHEREAS, the Seller owns all of the issued and outstanding capital stock of the
Acquired Company (the "Shares"); and
WHEREAS, subject to the terms and conditions of this Agreement, the Purchaser
desires to purchase from the Seller, and the Seller desires to sell to the
Purchaser, all of the Shares in exchange for the consideration set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants contained herein and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties agree as follows:
ARTICLE I
PURCHASE AND SALE OF THE SHARES
1.01    Basic Transaction. On and subject to the terms and conditions of this
Agreement, at the Closing, the Purchaser agrees to purchase from the Seller, and
the Seller agrees to sell to the Purchaser, all of the Shares owned by the
Seller for the consideration specified below in this Article I.
1.02    Purchase and Sale of Shares.
(a)    Estimated Purchase Price. The "Estimated Purchase Price" means (i)
$36,000,000 (the "Base Value"), plus (ii) the amount, if any, by which Estimated
Net Working Capital exceeds Target Working Capital, minus (iii) the amount, if
any, by which Target Working Capital exceeds Estimated Net Working Capital, plus
(iv) the total amount of Estimated Cash on Hand, minus (v) the total amount of
Estimated Indebtedness, minus (vi) the Estimated Company Transaction Expenses.
(b)    Purchase and Sale of Shares. At the Closing, upon the terms and subject
to the conditions set forth in this Agreement, the Seller shall sell, assign,
transfer and convey to the Purchaser, and the Purchaser shall purchase and
acquire from the Seller, all of the Shares for and in consideration of the
Estimated Purchase Price (less the Indemnity Escrow Amount).
1.03    The Closing. The closing of the transactions contemplated by this
Agreement (the "Closing") shall take place by conference call and electronic
(i.e., email/pdf) correspondence on the second business day following full
satisfaction or due waiver of all of the closing conditions set forth in Article
II hereof (other than those to be satisfied at the Closing, but subject to the
satisfaction of those conditions) or on such other date as is mutually agreeable
to the Purchaser and the Seller. The date of the Closing is referred to herein
as the "Closing Date."

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1.04    The Closing Transactions. Subject to the terms and conditions set forth
in this Agreement, the parties shall consummate the following transactions on
the Closing Date:
(a)    the Seller shall deliver or cause to be delivered to the Purchaser:
(i)    all of the stock certificates evidencing the Shares, duly endorsed for
transfer or accompanied by duly executed stock powers or an express indemnity in
the Agreed Form in the case of any certificate found to be missing;
(ii)    a letter of resignation in the Agreed Form from Seller Shareholder as an
officer and director of any Member of the Company Group;
(iii)    evidence that all intercompany liabilities between the Company Group,
on one hand, and the Seller and its Affiliates and their respective family
members, on the other hand, have been settled; and
(iv)    a copy of the resolutions of the board of directors of the Acquired
Company approving the transactions contemplated hereby.
(b)    the Purchaser shall deliver to the Seller the Estimated Purchase Price
less the Indemnity Escrow Amount by wire transfer of immediately available funds
to the account(s) designated by the Seller (which account(s) shall be designated
by the Seller to the Purchaser in writing at least two business days before the
Closing Date);
(c)    the Acquired Company shall deliver to the Purchaser appropriate payoff
letters from the holders of Indebtedness set forth on the Indebtedness Payoff
Schedule attached hereto;
(d)    the Purchaser shall repay, or cause to be repaid, on behalf of the
Company Group and pursuant to the payoff letters delivered pursuant to Section
1.04(c), all amounts necessary to discharge fully the then outstanding balance
of the Indebtedness set forth on the Indebtedness Payoff Schedule, by wire
transfer of immediately available funds to the account(s) designated by the
holders of such Indebtedness;
(e)    the Purchaser shall pay on behalf of the Company Group the Estimated
Company Transaction Expenses;
(f)    the Purchaser shall deliver the Indemnity Escrow Amount by wire transfer
of immediately available funds to the Escrow Agent;
(g)    the Company Group shall provide evidence that the Acquired Company has
taken such actions, approved by the Purchaser (such approval not to be
unreasonably withheld), as required by Treasury Regulation §
1.409A-3(j)(4)(ix)(B) to provide for (a) termination of the Sentel Corporation
Deferred Compensation Plan and any other plan required to be aggregate with such
plan under Code Section 409A (collectively, “SENTEL DCPs”); (b) removal of all
special post-change in control provisions from the SENTEL DCPs; and (c) payment
of all benefits due under the SENTEL DCPs on or as soon as practical after the
Closing Date;
(h)    the Acquired Company shall pay to the employees, former employees, and
independent consultants of the Members of the Company Group (i) all annual
bonuses and other bonuses relating to periods ending on the Closing Date and
(ii) all bonuses and other payments,

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including payments under Management Incentive Interest Award Agreements,
relating to the consummation of the transactions contemplated by this Agreement;
and
(i)    the Purchaser and the Seller shall make such other deliveries as are
required by Article II hereof.
1.05    Purchase Price Adjustments.
(a)    At least two business days prior to the Closing Date, the Acquired
Company shall deliver to the Purchaser a good faith estimate of Net Working
Capital (the "Estimated Net Working Capital"), Cash on Hand (the "Estimated Cash
on Hand"), Indebtedness (the "Estimated Indebtedness"), and Company Transaction
Expenses (the “Estimated Company Transaction Expenses”) and the resulting
calculation of the Estimated Purchase Price.
(b)    As promptly as possible, but in any event within sixty days after the
Closing Date, the Purchaser will deliver to the Seller a statement showing the
Purchaser's calculation of Net Working Capital, Cash on Hand, Indebtedness, and
Company Transaction Expenses (the "Preliminary Closing Statement"). The
Preliminary Closing Statement shall be prepared in accordance with GAAP or in
accordance with this Agreement if different from GAAP, applied on a basis
consistent with the methods, policies, practices, procedures, classifications
and estimation techniques used in the preparation of the Audited Financial
Statements. The parties agree that the purpose of preparing the Preliminary
Closing Statement and determining Net Working Capital, Cash on Hand,
Indebtedness, and Company Transaction Expenses and the related purchase price
adjustments contemplated by this Section 1.05(b) is to measure changes in Net
Working Capital and the levels of Cash on Hand, Indebtedness, and Company
Transaction Expenses as of Closing, and such processes are not intended to
permit the introduction of different judgments, accounting methods, policies,
principles, practices, procedures, classifications or estimation methodologies
as those used in the preparation of the Audited Financial Statements. After
delivery of the Preliminary Closing Statement, the Purchaser shall give the
Seller and its accountants reasonable access to review the Purchaser's and the
Company Group's books and records and work papers related to the preparation of
the Preliminary Closing Statement. The Seller and its accountants may make
inquiries of the Purchaser and its Subsidiaries (including the Company Group)
and their respective accountants regarding questions concerning or disagreements
with the Preliminary Closing Statement arising in the course of its review
thereof, and the Purchaser shall, and shall cause its Subsidiaries to, cause any
such accountants to cooperate with and promptly respond to such inquiries. If
the Seller has any objections to the Preliminary Closing Statement, the Seller
shall deliver to the Purchaser a statement setting forth its objections thereto
(an "Objections Statement"). If an Objections Statement is not delivered to the
Purchaser within thirty days after delivery of the Preliminary Closing
Statement, the Preliminary Closing Statement shall be final, binding and
non-appealable. The Seller and the Purchaser shall negotiate in good faith to
resolve any such objections, but if they do not reach a final resolution within
thirty days after the delivery of the Objections Statement, the Seller and the
Purchaser shall submit such dispute to KPMG LLP or such other mutually
acceptable dispute resolution firm (the "Dispute Resolution Firm"). Any further
submissions to the Dispute Resolution Firm must be written and delivered to each
party to the dispute. The Dispute Resolution Firm shall consider only those
items and amounts which are identified in the Objections Statement as being
items which the Seller and the Purchaser are unable to resolve. The Dispute
Resolution Firm's determination will be based solely on the definitions of Net
Working Capital, Cash on Hand, Indebtedness, and Company Transaction Expenses,
as applicable, contained in this Agreement. The Seller and the Purchaser shall
use their commercially reasonable efforts to cause the Dispute Resolution Firm
to resolve all

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disagreements as soon as practicable and in any event within forty-five days
after the submission of any dispute. Further, the Dispute Resolution Firm's
determination shall be based solely on the submissions by the Purchaser and the
Seller which are in accordance with the terms and procedures set forth in this
Agreement, and not on the basis of an independent review. The resolution of the
dispute by the Dispute Resolution Firm shall be final, binding and
non-appealable. The costs and expenses of the Dispute Resolution Firm shall be
allocated based upon the percentage which the portion of the contested amount
not awarded to each party bears to the amount actually contested by such party
in the presentation to the Dispute Resolution Firm; however, the Seller and the
Purchaser shall equally advance any costs and expenses of the Dispute Resolution
Firm that are payable prior to rendering a determination. For example, if the
Seller submits an Objections Statement for $1,000, and if the Purchaser contests
only $500 of the amount claimed by the Seller, and if the Dispute Resolution
Firm ultimately resolves the dispute by awarding the Seller $300 of the $500
contested, then the costs and expenses of the Dispute Resolution Firm will be
allocated 60% (i.e., 300/500) to the Purchaser and 40% (i.e., 200/500) to the
Seller.
(c)    Post-Closing Adjustment.
(i)    If the Final Purchase Price is greater than the Estimated Purchase Price,
the Purchaser shall promptly (but in any event within five business days after
the determination of the Final Purchase Price) deliver to the Seller the amount
of such excess, by wire transfer of immediately available funds to an account or
accounts designated by the Seller.
(ii)    If the Final Purchase Price is less than the Estimated Purchase Price,
the Seller shall promptly (but in any event within five business days after the
determination of the Final Purchase Price) deliver to the Purchaser the amount
of such shortfall, by wire transfer of immediately available funds to an account
designated by the Seller.
1.06    Withholding Rights. The Purchaser or its designee and the Company Group
shall be entitled to withhold and deduct from the consideration otherwise
payable pursuant to this Agreement such amounts as such Person is required to
deduct and withhold with respect to the making of such payment under the Code or
any provision of state, local or foreign Tax law; provided that if the
Purchaser, the Acquired Company or any of their respective Subsidiaries
determines that an amount is required to be deducted and withheld, at least two
business days prior to the date the applicable payment is scheduled to be made,
the Purchaser shall provide the Seller with written notice of the intent to
deduct and withhold, which shall include a copy of the calculation of the amount
to be deducted and withheld and any applicable provision of state, local or
foreign Tax law pursuant to which such deduction and withholding is required and
provide the recipient of such payment a reasonable opportunity for such
recipient to provide forms or other evidence that would exempt such amounts from
withholding. To the extent that amounts are so withheld and paid over to the
appropriate Tax authority, such amounts shall be treated for all purposes of
this Agreement as having been paid to the Person in respect of which such
deduction and withholding were made.
ARTICLE II    

CONDITIONS TO CLOSING
2.01    Conditions to the Obligations of the Purchaser. The obligations of the
Purchaser to consummate the transactions contemplated by this Agreement are
subject to the satisfaction (or waiver by the Purchaser in writing) of the
following conditions as of the Closing:

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(a)    the representations and warranties of the Acquired Company set forth in
Article III, the representations and warranties of the Seller set forth in
Article IV, and the representations and warranties of the Seller Shareholder set
forth in Article V, disregarding all qualifications and exceptions contained
therein relating to materiality or Material Adverse Effect, shall be true and
correct as of the Closing with the same effect as though made on and as of the
Closing (except to the extent that such representation and warranty expressly
speaks as of an earlier date, in which case such representation and warranty
shall have been true and correct as of such earlier date), except, in each case,
(i) where the failure to be true and correct would not have a Material Adverse
Effect, and (ii) the representations and warranties of the Acquired Company set
forth in Section 3.04 shall have been true and correct in all respects as of the
date of this Agreement and the Closing;
(b)    from the date of this Agreement, there shall not have occurred any
Material Adverse Effect regarding the Company Group, nor shall any event or
events have occurred that, individually or in the aggregate, would reasonably be
expected to result in Material Adverse Effect regarding the Company Group.
(c)    the Seller and the Acquired Company shall have performed in all material
respects the covenants and agreements required to be performed by them under
this Agreement at or prior to the Closing;
(d)    no judgment, decree or order shall have been entered that would prevent
the performance of this Agreement or the consummation of any of the transactions
contemplated hereby, declare unlawful the transactions contemplated by this
Agreement or cause such transactions to be rescinded;
(e)    the Company Group shall have received and delivered to the Purchaser good
standing certificates, dated within five (5) days before the Closing, from the
Secretaries of State of the state of incorporation of each Member of the Company
Group.
(f)    each person listed on Schedule 2.01(f) attached hereto shall have each
executed and delivered mutually acceptable employment letters or retention
letters, as applicable, with the Acquired Company;
(g)    the Escrow Agent and the Seller shall have each executed and delivered
signatures to the Escrow Agreement to the Purchaser;
(h)    the Acquired Company shall have delivered to the Purchaser a certificate,
dated as of the Closing Date, stating that the preconditions specified in
Section 2.01(a), Section 2.01(b), and Section 2.01(c) have been satisfied.
If the Closing occurs, all closing conditions set forth in this Section 2.01
that have not been fully satisfied as of the Closing shall be deemed to have
been waived by the Purchaser.
2.02    Conditions to the Obligations of the Acquired Company and the Seller.
The obligations of the Acquired Company and the Seller to consummate the
transactions contemplated by this Agreement are subject to the satisfaction or
waiver of the following conditions as of the Closing:
(a)    the representations and warranties of the Purchaser contained in Article
VI, disregarding all qualifications and exceptions contained therein relating to
materiality, shall be true

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and correct as of the Closing with the same effect as though made on and as of
the Closing (except to the extent that such representation and warranty
expressly speaks as of an earlier date, in which case such representation and
warranty shall have been true and correct as of such earlier date), except, in
each case, where the failure to be true and correct would not have a material
adverse effect on the financial condition or operating results of the Purchaser
taken as a whole or on the ability of the Purchaser to consummate the
transactions contemplated by this Agreement;
(b)    the Purchaser shall have performed in all material respects the covenants
and agreements required to be performed by it under this Agreement at or prior
to the Closing;
(c)    no judgment, decree or order shall have been entered that would prevent
the performance of this Agreement or the consummation of any of the transactions
contemplated hereby, declare unlawful the transactions contemplated by this
Agreement or cause such transactions to be rescinded;
(d)    the Escrow Agent and the Purchaser shall have each executed and delivered
signatures to the Escrow Agreement to the Seller;
(e)    the Purchaser shall have provided the Seller with a copy of the
Representation and Warranty Policy;
(f)    the Purchaser shall have delivered to the Seller a certificate, dated as
of the Closing Date, stating that the preconditions specified in Section 2.02(a)
and Section 2.02(b) have been satisfied.
If the Closing occurs, all closing conditions set forth in this Section 2.02
which have not been fully satisfied as of the Closing shall be deemed to have
been waived by the Seller and the Acquired Company.
ARTICLE III    

REPRESENTATIONS AND WARRANTIES OF THE ACQUIRED COMPANY
The Acquired Company represents and warrants to the Purchaser that the
statements in this Article III are true and correct as of the date of this
Agreement, except as set forth in the schedules accompanying this Agreement (a
"Schedule" and, collectively, the "Disclosure Schedules"):
3.01    Organization and Power.
(a)    The Acquired Company is a corporation duly organized, validly existing
and in good standing under the laws of the Commonwealth of Virginia, has all
requisite corporate power and authority and all authorizations, licenses and
Permits necessary to own and operate its properties and to carry on its business
as now conducted.
(b)    The Acquired Company is qualified to do business in every jurisdiction in
which its ownership of property or the conduct of its businesses as now
conducted requires it to qualify, except where the failure to hold such
authorizations, licenses and Permits or to be so qualified would not be material
to the Business.
3.02    Subsidiaries.

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(a)    Schedule 3.02 sets forth a list of each of the Subsidiaries of the
Acquired Company. All of the issued and outstanding shares, units or other
equity securities of the Subsidiaries of the Acquired Company listed on Schedule
3.02 are owned by the Acquired Company, free and clear of all Liens, other than
Permitted Liens. Except as set forth on Schedule 3.02, no Member of the Company
Group owns or holds the right to acquire any stock, partnership interest or
joint venture interest or other equity ownership interest in any other
corporation, organization or entity. Each of the Acquired Company's Subsidiaries
is duly organized, validly existing and in good standing under the laws of the
jurisdiction of its organization, has all requisite power and authority and all
authorizations, licenses and Permits necessary to own its properties and to
carry on its businesses as now conducted.
(b)    Each of the Acquired Company’s Subsidiaries is qualified to do business
in every jurisdiction in which its ownership of property or the conduct of its
businesses as now conducted requires it to qualify, except in each such case
where the failure to hold such authorizations, licenses and Permits or to be so
qualified would not be material to the Business.
3.03    Authorization; No Breach; Valid and Binding Agreement. The execution,
delivery and performance of this Agreement by the Acquired Company and the
consummation of the transactions contemplated hereby have been duly and validly
authorized by all requisite corporate action, and no other corporate proceedings
on its part are necessary to authorize the execution, delivery or performance of
this Agreement. Except (i) as set forth on Schedule 3.03, or (ii) where the
failure of any of the following to be true would not be material to the
Business, the execution, delivery and performance of this Agreement by the
Acquired Company and the consummation of the transactions contemplated hereby do
not conflict with or result in any breach of, constitute a default under, result
in a violation of, result in the creation of any Lien upon any assets of the
Company Group under, or require any authorization, consent, approval, exemption
or other action by or notice to any court or other governmental body under, the
provisions of the organizational documents of any Member of the Company Group or
any Contract, indenture, mortgage, lease, loan agreement or similar other
agreement or instrument to which any Member of the Company Group is bound, or
any Law, order, writ, assessment, decision, injunction, decree, ruling or
judgment, or other restriction of any Governmental Authority to which the
Company Group is subject. Assuming that this Agreement is a valid and binding
obligation of the other parties, this Agreement constitutes a valid and binding
obligation of the Acquired Company and the Seller, enforceable in accordance
with its terms, except as enforceability may be limited by bankruptcy laws,
other similar laws affecting creditors' rights and general principles of equity
affecting the availability of specific performance and other equitable remedies.
3.04    Capital Stock. Schedule 3.04 sets forth the issued and outstanding
capital stock of the Acquired Company. The Seller is the record owner of the
Shares and owns the Shares free and clear of all Liens, other than restrictions
imposed by state and federal securities laws and the organizational documents of
the Acquired Company. All of the Shares have been duly authorized and are
validly issued, fully paid and nonassessable. Except as set forth on Schedule
3.04, the Acquired Company does not have any equity securities or securities
containing any equity features authorized, issued or outstanding, and there are
no agreements, options, warrants or other rights or arrangements existing or
outstanding which provide for the sale or issuance of any of the foregoing by
the Acquired Company. Except as set forth on Schedule 3.04, there are no
outstanding (a) shares, capital stock or other equity interests or voting
securities of the Acquired Company, (b) securities convertible or exchangeable
into shares or other equity interests of the Acquired Company, (c) any options,
warrants, purchase rights, subscription rights, preemptive rights, conversion
rights, exchange rights, calls, puts, rights of first refusal or other contracts
that could require the Acquired Company to issue, sell or otherwise cause to
become outstanding or to acquire, repurchase or redeem shares

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or other equity interests of the Acquired Company or (d) unit appreciation,
phantom equity, profit participation or similar rights with respect to the
Acquired Company.
3.05    Financial Statements.
(a)    Schedule 3.05(a) consists of the (i) audited consolidated balance sheet
of the Seller and its Subsidiaries as of each of September 30, 2015, 2016, and
2017, and the audited consolidated statements of income, stockholders' equity
and cash flows for each of the 12-month periods then ended (collectively, the
"Audited Financial Statements") and (ii) unaudited consolidated balance sheet of
the Acquired Company and its Subsidiaries and the Seller and its Subsidiaries,
both as of December 31, 2017 (the "Latest Balance Sheet"), and the unaudited
consolidated statements of income and cash flows for the three-month period then
ended (together with the Latest Balance Sheet and the Audited Financial
Statements, the "Financial Statements"). Except as set forth on Schedule 3.05,
the Financial Statements have been based upon the information contained in the
Sellers' and its Subsidiaries' books and records, have been prepared in
accordance with GAAP, consistently applied throughout the periods indicated, and
present fairly in all material respects the financial condition and results of
operations of the Seller and its Subsidiaries and the Acquired Company and its
Subsidiaries (taken as a whole) as of the times and for the periods referred to
therein, subject in the case of the unaudited financial statements to (i) the
absence of footnote disclosures and other presentation items and (ii) changes
resulting from immaterial normal year-end adjustments.
(b)    The Company Group has no liabilities (whether known or unknown, whether
asserted or unasserted, whether absolute or contingent, whether accrued or
unaccrued, whether liquidated or unliquidated, and whether due or to become
due), except (i) liabilities set forth on the Latest Balance Sheet, (ii)
liabilities that were incurred after the date of the Latest Balance Sheet in the
Ordinary Course of Business, (iii) liabilities not required by GAAP to be
reflected on a consolidated balance sheet of the Acquired Company and its
Subsidiaries (iv) liabilities arising under the executory portion of any
contract, (v) liabilities to be included in the computation of Indebtedness or
Net Working Capital and (vi) liabilities specifically disclosed in the
Disclosure Schedules. No representation or warranty is made under this Section
3.05(b) with respect to Taxes, employee benefits matters, environmental, health
or safety matters or employment matters, which are covered exclusively by
Section 3.08, Section 3.13, Section 3.17 and Section 3.19, respectively.
3.06    Absence of Certain Developments. Except as set forth on Schedule 3.06
and except as contemplated by this Agreement, since September 30, 2017, (x)
there has not been any Material Adverse Effect, and (y) the Company Group has
conducted its business in the Ordinary Course of Business. Without limiting the
generality of the foregoing, since September 30, 2017 until the date of this
Agreement no Member of the Company Group has:
(a)    borrowed any amount or incurred or become subject to any material
liabilities (other than liabilities incurred in the Ordinary Course of Business,
liabilities under contracts entered into in the Ordinary Course of Business or
disclosed on the Disclosure Schedules and borrowings from banks (or similar
financial institutions) necessary to meet ordinary course working capital
requirements);
(b)    mortgaged, pledged or subjected to any material lien, charge or other
encumbrance, other than Permitted Liens, any material portion of its assets;

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(c)    sold, assigned or transferred any material portion of the Company Group's
tangible assets;
(d)    sold, assigned or transferred any material Intellectual Property owned by
the Company Group, except for any rights granted to the federal government in
the Ordinary Course of Business;
(e)    issued, sold or transferred any of its capital stock or other equity
securities, securities convertible into its capital stock or other equity
securities or warrants, options or other rights to acquire its capital stock or
other equity securities, or any bonds or debt securities;
(f)    made any material capital investment in, or any material loan to, any
other Person (other than another Member of the Company Group);
(g)    (i) declared, set aside, or paid any non-cash dividend or made any
non-cash distribution with respect to its capital stock or redeemed, purchased,
or otherwise acquired any of its capital stock, except for dividends or
distributions made by a Subsidiary of the Acquired Company to such Subsidiary's
parent or (ii) declared or set aside any dividend payable after the Closing;
(h)    made any material capital expenditures or commitments therefor, except
for such capital expenditures or commitments therefor that are reflected in the
Company Group's budget for the fiscal year ending December 31, 2017;
(i)    made any loan to, or entered into any other material transaction with,
any of its directors, officers, or employees or family members thereof;
(j)    experienced any damage, destruction, or loss to any of its assets or
property involving at least $100,000 per occurrence or $300,000 in the aggregate
and not covered by insurance;
(k)    accelerated, terminated, amended, modified or canceled any Material
Contract required to be listed on Schedule 3.09(a);
(l)    other than in the Ordinary Course of Business, increased the compensation
(including bonuses) of any employee;
(m)    other than in the Ordinary Course of Business, adopted, entered into or
amended any Plan or other employee benefit plan or program or employment,
consulting, retention, change in control, bonus or severance agreement;
(n)    made any change in any method of accounting or accounting practice or
policy used by the Company Group, other than such changes required by GAAP or
pursuant to any pronouncements issued by the Financial Accounting Standards
Board;
(o)    issued or sold any equity securities;
(p)    effected any recapitalization, reclassification, equity dividend, equity
split or like change in the capitalization of any Member of the Company Group;
(q)    incurred, assumed, or guaranteed any Indebtedness of any kind other than
Indebtedness that is incurred in the Ordinary Course of Business;

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(r)    entered into any collective bargaining agreement;
(s)    other than in connection with the transactions contemplated hereby or as
otherwise disclosed to Purchaser, granted or paid any bonuses or other
discretionary compensation to employees outside the Ordinary Course of Business;
(t)    materially delayed, decreased or increased the rate of promotional or
marketing expenditures;
(u)    cancelled, compromised, settled or waived any Actions; or
(v)    entered into any Contract to do any of the actions referred to in clauses
(a)-(u) above (except as otherwise required or permitted by the terms of this
Agreement).
3.07    Title to Properties.
(a)    No Member of the Company Group owns, or has ever owned, any real
property. Except as set forth on Schedule 3.07(a), the Company Group owns good
title to, or holds pursuant to valid and enforceable leases, all of the tangible
personal property shown to be owned or leased by it on the Latest Balance Sheet,
free and clear of all Liens, other than Permitted Liens.
(b)    The real property demised by the leases (the “Leases”) described on
Schedule 3.07(b) (the "Leased Real Property") constitutes all of the real
property leased by the Company Group. Except as set forth on Schedule 3.07(b),
the Leased Real Property leases are in full force and effect, and the Company
Group holds a valid and existing leasehold interest under each such lease,
subject to proper authorization and execution of such lease by the other party
and the application of any bankruptcy or creditor's rights laws. The Company
Group has delivered or made available to the Purchaser complete and accurate
copies of each of the leases described on Schedule 3.07(b), and none of such
leases have been modified in any material respect, except to the extent that
such modifications are disclosed by the copies delivered or made available to
the Purchaser. No Member of the Company Group is in default in any material
respect under any of such leases.
(c)    No Member of the Company Group has given any mortgagee or other Person
any estoppel certificate or similar instrument that would preclude assertion of
any claim under any Lease, affect any right or obligation under any Lease or
otherwise be binding upon any successor to the Member of the Company Group’s
position under any Lease; no Member of the Company Group has contested, and is
not currently contesting, any operating cost, real estate Tax or assessment or
other charge payable by the Member of the Company Group under any Lease; there
is no purchase option, right of first refusal, first option or other right held
by any Member of the Company Group with respect to, or any real estate or
building affected by, any Lease that is not contained within such Lease; and no
Member of the Company Group has exercised any option or right to terminate,
renew or extend or otherwise affect any right or obligation of the tenant under
any Lease or to purchase the real property subject to any Lease.
(d)    To the Knowledge of the Company Group, all buildings, structures,
improvements, fixtures, building systems and equipment, and all components
thereof, included in the Leased Real Property (the “Improvements”) are in
working condition. There are no structural deficiencies or

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latent defects affecting any of the Improvements and there are no facts or
conditions affecting any of the Improvements which would, individually or in the
aggregate, have a Material Adverse Effect.
(e)    All of the land, buildings, structures and other improvements used by the
Company Group in the conduct of its business are included in the Leased Real
Property. Except for the Leases, there is no lease (including sublease) or
occupancy agreement in effect with respect to any Leased Real Property. There is
no pending or, to the Knowledge of the Company Group, threatened condemnation or
other eminent domain proceeding affecting any Leased Real Property or any sale
or other disposition of any Leased Real Property in lieu of condemnation. To the
Knowledge of the Company Group, no Leased Real Property has suffered any
material damage by fire or other casualty that has not been completely repaired
and restored.
(f)    The Company Group’s use and occupancy of the Leased Real Property are in
material compliance with all Laws and all applicable insurance requirements,
including those pertaining to zoning matters and the Americans with Disabilities
Act, and conform to all such Laws on a current basis without reliance on any
variance or other special limitation or conditional or special use Permit. To
the Knowledge of the Company Group, no portion of the Leased Real Property
relies on any facility (other than a facility of a public utility or community
water and sewer company) not located on the Leased Real Property to fulfill any
zoning, building code or other requirement under any Law.
3.08    Tax Matters. Except for Tax periods (or portions thereof) prior to the
date that the Seller acquired the Acquired Company and except as set forth on
Schedule 3.08:
(a)    The Members of the Company Group (together, the “Taxpayer Companies”)
have filed all Tax Returns that are required to be filed by them (taking into
account any extensions of time to file). All material Taxes owed by the Taxpayer
Companies have been paid (whether or not shown as due on any Tax Return). All
material Taxes that the Company Group is obligated to withhold from amounts paid
to any employee, creditor or third party of the Taxpayer Companies have been
timely paid or properly accrued.
(b)    None of the Taxpayer Companies (i) is, nor has it ever been, a member of
an affiliated group of corporations within the meaning of Section 1504 of the
Internal Revenue Code of 1986, as amended (the "Code") or consolidated/combined
state income/franchise tax return or (ii) has liability for the Taxes of any
Person (other than such member of the Affiliated Group) under Treasury
Regulations Section 1.1502-6 (or any similar provision of state, local or
foreign law), as a transferee or successor, or by contract (other than an
Ordinary Course Agreement).
(c)    There are no pending audits, disputes or written claims with respect to
any Tax Returns for the Taxpayer Companies.
(d)    None of the Taxpayer Companies has waived any statute of limitations
beyond the date hereof in respect of any Taxes or agreed to any extension of
time beyond the date hereof with respect to a Tax assessment or deficiency.
(e)    No Taxpayer Company has distributed stock of another Person, or has had
its stock distributed by another Person, in a transaction that was purported or
intended to be governed in whole or in part by Section 355 or Section 361 of the
Code.

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(f)    None of the Taxpayer Companies has participated in a "listed transaction"
within the meaning of Treas. Reg. Section 1.6011-4.
(g)    There are no Liens for Taxes (other than for current Taxes not yet due
and payable) upon any of the assets of any Taxpayer Company.
(h)    The Seller has been a validly electing S Corporation within the meaning
of Sections 1361 and 1362 of the Code and all applicable state and local Tax
laws where such treatment is allowed for all Tax periods since formation and
will be an S corporation for such purposes up to and including the Closing Date.
The Acquired Company is a qualified S Corporation subsidiary under Section
1361(b)(3)(B) of the Code and has been a qualified S Corporation subsidiary of
the Seller at all times since its acquisition by the Seller and will be a
qualified S Corporation subsidiary up to and including the end of the day
immediately prior to the Closing Date. Each Subsidiary of the Acquired Company
is a qualified S Corporation subsidiary under Section 1361(b)(3)(B) of the Code
and has been a qualified S Corporation subsidiary of the Acquired Company at all
times since its formation and will be a qualified S Corporation subsidiary up to
and including the end of the day immediately prior to the Closing Date.
(i)    No Taxpayer Company is a party to or bound by any Tax sharing or
allocation agreement or similar agreement in effect between that Taxpayer
Company and any other Person other than an Ordinary Course Agreement.
(j)    No Taxpayer Company has entered into any closing agreement pursuant to
Section 7121 of the Code, or any similar provision of state or local Law, the
terms of which would apply to the computation of Tax liability for any taxable
period of the Taxpayer Company that begins after the Closing Date.
(k)    No written or other claim has been made in the last five years by a
Governmental Authority in a jurisdiction where a Taxpayer Company does not
file Tax Returns that such Company is subject to taxation by that jurisdiction.
3.09    Contracts and Commitments.
(a)    Schedule 3.09 sets forth a true, correct and complete list (and to the
extent that a Material Contract is oral, such Section of the Disclosure
Schedules contains an accurate description of the material terms thereof, and
such Section of the Disclosure Schedules indicates the applicable clause(s)
among the following to which each such Material Contract relates) of each of the
following Contracts, whether written or oral, to any Member of the Company Group
is a party or by which it or its assets is bound as of the date of this
Agreement; provided, however, that for purposes of this Section 3.09, the term
Material Contract shall not include any Government Contracts, Government Bids or
Plans, so long as such Government Contracts, Government Bids and Plans are
disclosed on Schedule 3.14(a) or Schedule 3.17(a), as applicable, if required to
be disclosed thereon:
(i)    any Contract with any officer, independent contractor, or employee of any
Member of the Company Group that (A) provides for payments by the Acquired
Company in excess of $100,000 per annum, or (B) provides for a loan;
(ii)    any Contract providing employment services for any Member of the Company
Group, including with a professional employment organization;

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(iii)    any employee collective bargaining agreement;
(iv)    any agreements listed or required to be listed on Schedule 3.10(b)(1);
(v)    any Contract providing for any transaction, sale, retention, change of
control, or other extraordinary compensation or other similar payments to
employees;
(vi)    any joint venture;
(vii)    any Contract that imposes any restrictions upon the ability of any
Member of the Company Group to freely engage in its business anywhere in the
world;
(viii)    any lease or similar agreement under which (A) any Member of the
Company Group is lessee of, or holds or uses, any machinery, equipment, vehicle
or other tangible personal property owned by a third party or (B) any Member of
the Company Group is a lessor or sublessor of, or makes available for use by any
third party, any tangible personal property owned or leased by any Member of the
Company Group, in each case which provides for future payments by any Member of
the Company Group in excess of $100,000 per annum and is not terminable by the
Member of the Company Group upon notice of ninety (90) days or less, for a cost
of less than $100,000;
(ix)    any Contract under which any Member of the Company Group has incurred
any Indebtedness, in each case having an outstanding principal amount in excess
of $100,000;
(x)    any Contract under which any Member of the Company Group remains
obligated to lend or make any investment in (in the form of a loan, capital
contribution or otherwise) any other Person;
(xi)    any Contract that relates to the supply (including distribution, dealer,
broker, and sales representative Contracts), manufacturing, distribution,
marketing, advertising or promotion of products or services involving, in each
case, payments by any Member of the Company Group of more than $100,000 per
annum (other than any such Contract that is or on the Closing Date will be
terminable by the Member of the Company Group at will or upon not more than 30
days’ notice without any liability of the Member of the Company Group);
(xii)    any Contract which relates to a pending acquisition of a business or to
an acquisition or sale of a business pursuant to which any Member of the Company
Group has any continuing obligation;
(xiii)     any Contract that relates to the grant or receipt of a franchise;
(xiv)    any Contract that relates to capital expenditures or the acquisition of
fixed assets with expected aggregate expenditures in excess of $100,000 after
the date hereof;
(xv)    any Contract that contains a power of attorney;
(xvi)    any Contract that relates to hedging of risk or contains a swap or
similar arrangement;

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(xvii)    any Contract that contains any form of most-favored-nation clause,
right of first refusal clause, take-or-pay clause, grants any party exclusivity,
or contains any similar provision;
(xviii)    any Contract providing for (or under which any Member of the Company
Group provides) allowances or rebates in excess of $100,000 per annum; or
(xix)    any other Contract not included in subsections (i) through (xviii) or
set forth on Schedule 3.09(a) that provides for future payments by any Member of
the Company Group in excess of $150,000 per annum and is not terminable by the
Member of the Company Group upon notice of ninety (90) days or less for a cost
of less than $150,000 (other than Leases).
(b)    The Acquired Company has made available to the Purchaser a copy of each
Contract listed on Schedule 3.09(a) (except in the case of oral Contracts)
(collectively, the “Material Contracts”). To the Knowledge of the Company Group,
no Member of the Company Group has received any written notice of any material
breach or default or event that with or without notice or lapse of time, or
both, would constitute a material breach or default by any Member of the Company
Group under any Material Contract. The applicable Member of the Company Group
has performed all material obligations required to be performed by it under each
Material Contract and, to the Knowledge of the Company Group, each other party
thereto has performed all material obligations required to be performed by such
party under the Material Contracts. Each Material Contract is a valid and
legally binding obligation of the applicable Member of the Company Group and, to
the Knowledge of the Company Group, each other party thereto, and is enforceable
against the applicable Member of the Company Group and, to the Knowledge of the
Company Group, each other party thereto in accordance with its terms (except as
such enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar Laws affecting creditors’ rights generally or by general
equitable principles). No event has occurred that (with or without giving of
notice) would constitute a material breach or default of, or permit termination,
modification, acceleration or cancellation of, any Material Contract or of any
material right or obligation thereunder. Since December 31, 2016 through the
date hereof, (i) the applicable Member of the Company Group has not waived any
material right under any Material Contract and (ii) no party to any Material
Contract has communicated in writing such party’s intent to terminate, modify,
amend, accelerate or cancel any Material Contract. The applicable Member of the
Company Group has not received any prepayment under any Material Contract for
any service that has not been fully performed or good that has not been supplied
(other than as is fully reflected in the Financial Statements and will be in
Final Working Capital). As of the date hereof, the applicable Member of the
Company Group has not received any written notice of a party’s desire or intent
to renegotiate or reduce its commitment under a Material Contract.
3.10    Intellectual Property.
(a)    Schedule 3.10(a) identifies each item of Registered IP that is owned by
any Member of the Company Group as of the date hereof, including the
jurisdiction in which such Registered IP has been registered or filed and the
applicable registration or serial number. Each item of Registered IP was
properly registered and is in good standing, valid and enforceable.
(b)    Schedule 3.10(b)(1) identifies (i) all material license agreements
pursuant to which Intellectual Property used in the business of the Company
Group is licensed to the Company Group

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(other than any license agreements for commercially available off-the-shelf
software), and (ii) all material license agreements pursuant to which a Member
of the Company Group has licensed to any third party any Intellectual Property
(other than licenses to customers, distributors, dealers, resellers, sales
representatives, suppliers, vendors, consultants, contractors or other business
relationships in the Ordinary Course of Business). As of the date hereof, all
material licenses are in full force and effect and are valid and enforceable in
accordance with their terms. Except as set forth in Schedule 3.10(b)(2), a
Member of the Company Group has entered into binding, written agreements with
every current and former employee or independent contractor of each Member of
the Company Group who developed any patented or copyrighted materials set forth
in Schedule 3.10(a) such that the applicable employees and independent
contractors are obligated to (i) assign to the applicable Member of the Company
Group any ownership interest and right they may have in such patented or
copyrighted materials developed for the applicable Member of the Company Group;
and (ii) acknowledge the applicable Member of the Company Group’s exclusive
ownership of such patented or copyrighted materials created for the applicable
Member of the Company Group. Except as set forth in Schedule 3.10(b)(2), the
Acquired Company has provided the Purchaser with true and complete copies of all
written agreements (i) existing between the applicable Member of the Company
Group and the applicable employees or independent contractors who developed such
Intellectual Property and (ii) setting forth the foregoing obligations of
assignment and acknowledgement.
(c)    Except as provided in Schedule 3.10(c), a Member of the Company Group
owns, licenses or otherwise has the right to use, free and clear of any Lien
other than Permitted Liens, all of the Intellectual Property necessary for the
operation of the business of the Company Group, taken as a whole, as currently
conducted. The consummation of the transactions contemplated hereunder will not
result in the loss or impairment of or payment of any additional amounts with
respect to, nor require the consent of any other Person in respect of, the
Company Group’s right to own, use or hold for use any Intellectual Property as
owned, used or held for use in the conduct of the Business as currently
conducted and as proposed to be conducted under an Active Government Contract or
Active Government Bid.
(d)    (i) The operation of the business of the Company Group as presently
conducted is not infringing or misappropriating any Intellectual Property of any
third party, and (ii) to the Knowledge of the Company Group, no third party is
infringing or misappropriating any Intellectual Property owned by any Member of
the Company Group.
(e)    No written claim has been received and, to the Knowledge of the Company
Group, no proceeding has been instituted or threatened in writing against any
Member of the Company Group in which any Member of the Company Group is alleged
to infringe or misappropriate any Intellectual Property of any third party. No
offer of license has been received by any Member of the Company Group with
respect to any Intellectual Property of a third party.
(f)    A privacy statement (the “Privacy Statement”) is posted and accessible to
individuals on the website of the Acquired Company. Each Member of the Company
Group (i) complies in all material respects with a corresponding Privacy
Statement applicable to any given set of personally identifiable information
collected by each Member of the Company Group; and (ii) complies in all material
respects with all applicable Laws regarding the collection, retention, use and
disclosure of personally identifiable information. Each Member of the Company
Group has taken reasonable measures to protect and maintain the confidential
nature of the personally identifiable information provided to such Member of the
Company Group by individuals and the personal information

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collected from individuals against loss, theft and unauthorized access or
disclosure, which measures are, as a whole, not less protective and
comprehensive than those that would be taken by reasonably prudent business
persons operating in the Company Group’s industry. No Member of the Company
Group has received in the past three (3) years any written claims, notices or
complaints regarding such Member of the Company Group’s information practices or
the disclosure, retention, or misuse of any personally identifiable information
by the Federal Trade Commission, any similar foreign bodies, or any other
Governmental Authority.
(g)    Each Member of the Company Group takes commercially reasonable
precautions to protect the confidentiality, integrity, operation and security of
its software and information technology systems against any unauthorized use,
access, interruption, modification or corruption. To the Knowledge of the
Company Group, there have been no material security breaches of the information
technology systems of such Member of the Company Group.
(h)    Software and Information Technology.
(i)    Each Member of the Company Group is in material compliance with the terms
under which such Member of the Company Group has licensed any Open Source
Software.
(ii)    No litigation is pending or, to the Knowledge of the Company Group, has
been threatened against any Member of the Company Group which challenges the
legality, validity, enforceability or ownership of any license, sublicense or
other Contract covering or relating to any software used by any Member of the
Company Group.
(iii)    Each Member of the Company Group has sufficient rights to use all
software, information technology equipment, databases, websites, content, social
media accounts, e-commerce platforms and associated documentation used or held
for use in connection with the operation of such Member of the Company Group as
presently conducted and as proposed to be conducted under an Active Government
Contract or Active Government Bid (the “IT Assets”), all of which rights shall
survive unchanged immediately following the consummation and performance of the
transactions contemplated hereby. The IT Assets are sufficient to conduct the
Business as currently conducted and as proposed to be conducted under an Active
Government Contract or Active Government Bid. Each Member of the Company Group
has reasonable written agreements in place with respect to the third party
owners and operators of all data centers which provide material services to such
Member of the Company Group.
3.11    Litigation. Except as set forth on Schedule 3.11, there are no Actions
pending or, to the Knowledge of the Company Group, threatened in writing against
any Member of the Company Group, at law or in equity, before or by any
Governmental Authority, and no Member of the Company Group is subject to any
material outstanding judgment, order or decree of any Governmental Authority.
3.12    Governmental Consents, etc. Except as set forth on Schedule 3.12, no
Permit, consent, approval or authorization of, or declaration to or filing with,
any Governmental Authority is required in connection with any of the execution,
delivery or performance of this Agreement by the Acquired Company or the
consummation by the Acquired Company of any other transaction contemplated
hereby, except for (i) any filing or termination of the waiting period or other
approval required pursuant to the Antitrust Laws; (ii) compliance with any
applicable requirements and filings with the Defense Security Service ("DSS") of

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the United States Department of Defense under the National Industrial Security
Program Operating Manual (the "NISPOM"); (iii) any such other Governmental
Approval, the failure of which to make or obtain would not have, individually or
in the aggregate, a Material Adverse Effect.
3.13    Employee Matters
(a)    Schedule 3.13(a) contains a list identifying all employees of the Company
Group as of January 15, 2018, and specifying with respect to each such employee,
as of the date hereof: (i) the employee’s job title, primary work location,
start date, current base salary or regular hourly wage rate, target bonus for
2017 (if applicable), classification as full-time or part-time and as exempt or
non-exempt under the Fair Labor Standards Act; (ii) whether the employee is
currently on or expected to start any disability leave or other leave of absence
(other than the use of vacation leave in the Ordinary Course of Business); and
(iii) whether the employee is subject to any agreement with the Company Group
that makes the relationship between the employee and the Company Group anything
other than an “at-will” relationship that may be terminated by either party at
any time, with or without notice, without any liability to the Company Group.
(b)    Schedule 3.13(b) sets forth a list of all material Company Group
policies, procedures, handbooks or codes of conduct that apply to any current
employee of the Company Group. All such documents have been made available to
Purchaser.
(c)    (i) Except as set forth on Schedule 3.13(c), there is no pending or
otherwise unresolved or, to the Knowledge of the Company Group, threatened
workers’ compensation Action with respect to any former or current employee of
the Company Group; (ii) there is no pending or, to the Knowledge of the Company
Group, threatened Action with respect to any former or current employee of the
Company Group that involves any alleged violation or breach by the Company Group
(or any of its officers or directors) of any applicable Law or Contract; (iii)
the Company Group has not been the subject of any complaints or investigations
conducted by the Occupational Safety and Health Administration or similar state
Governmental Authority; and (iv) the Company Group has not experienced any
material liability with respect to the termination of any former employee during
the last five (5) years.
(d)    Except as set forth on Schedule 3.13(d), the Company Group is not a party
to any collective bargaining agreement or collective bargaining relationship
with respect to employees of the Company Group with any labor organization. The
Company Group is not a party or subject to any pending or, to the Knowledge of
the Company Group, threatened labor strike, organized work stoppage, slowdown,
lock out, unfair labor practice charge or similar labor activity or dispute
affecting the Company Group.
(e)    Except as set forth on Schedule 3.13(e), the Company Group has complied
in all material respects with all Laws relating to the employment of labor,
including provisions thereof relating to wages, hours, employee classification,
equal opportunity, employment discrimination, disability rights, plant closure
or mass layoff issues, affirmative action, leaves of absence, occupational
health and safety, workers compensation and unemployment insurance, collective
bargaining and the payment of social security and other employment Taxes. There
are no Actions pending or, to the Knowledge of the Company Group, threatened in
writing against the Company Group before the U.S. Equal Employment Opportunity
Commission or any Governmental Authority or arbitrator concerning or relating to
any labor, safety or employment matters.

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(f)    The Company Group has in its files a Form I-9 that is validly and
properly completed in accordance with applicable Law for each employee of the
Company Group with respect to whom such form is required under applicable Law.
The Company Group has not received any written notice or other communication
from any Governmental Authority or other Person regarding any violation or
alleged violation of any applicable Law relating to hiring, recruiting,
employing (or continuing to employ) anyone not authorized to work in the United
States.
(g)    To the Knowledge of the Company Group, no current employee of the Company
Group is subject to any obligation of confidentiality, non-solicitation or
non-competition that would restrict or impede the activities of any such
employee on behalf of the Company Group.
(h)    To the Knowledge of the Company Group, no member of the senior management
team of the Company Group has any intention to terminate such employee’s
relationship with the Company Group before or immediately after the Closing.
(i)    During the past three years, no Member of the Company Group has
implemented any plant closing or layoff of employees governed by the WARN Act or
any similar Law.
3.14    Employee Benefit Plans.
(a)    Except as listed on Schedule 3.14(a), no Member of the Company Group or
any ERISA Affiliate maintains, contributes to, sponsors or as any liability with
respect to any "pension plans" (as defined under Section 3(2) of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA") whether or not
subject to ERISA), "welfare plans" (as defined under Section 3(1) of ERISA
whether or not subject to ERISA), stock option or other equity based program,
bonus, incentive award or commission plans, severance pay arrangements, deferred
compensation, change in control, supplemental income, executive compensation,
vacation or other paid time off arrangements, fringe benefits or other material
employee benefit plans, programs or arrangements ("Plans"). Each of the Plans
that is intended to be qualified under Section 401(a) of the Code, has received
a current favorable determination letter from the Internal Revenue Service or is
a prototype plan that is entitled to rely on a current opinion letter issued by
the Internal Revenue Service to the prototype plan sponsor regarding
qualification of the form of the prototype plan. The Plans comply in form and in
operation in all material respects with the requirements of the Code and ERISA
or any similar local Law.
(b)    With respect to the Plans, all required material payments and
contributions have been timely made when due, or to the extent not yet due, have
been properly accrued on the applicable Member of the Company Group’s books and
records in accordance with its prior accounting practices.
(c)    The Company Group has made available to the Purchaser true and complete
copies of (i) each Plan, (ii) the most recent determination or advisory or
opinion letter received from the Internal Revenue Service regarding the Plans,
if any, (iii) the Form 5500 annual report (if required under ERISA) for each
Plan for the last three (3) years, (iv) a copy of the summary plan description
with respect to such Plan, (v) all trust agreements, insurance contracts, and
similar instruments with respect to each funded or insured Plan, and (vi) copies
of all nondiscrimination and minimum coverage testing reports for the last three
(3) years.
(d)    With respect to each applicable Plan: (i) no non-exempt “prohibited
transaction,” within the meaning of Section 4975 of the Code or Section 406 of
ERISA, has occurred which will

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reasonably be expected to result in material liability; (ii) there are no
actions, suits or claims pending, or, to the Knowledge of the Company Group,
threatened or anticipated (other than routine claims for benefits) against any
such Plan or fiduciary thereto or against the assets of any such Plan; (iii)
there are no audits or proceedings pending or, to the Knowledge of the Company
Group, threatened by any Governmental Authority with respect to any such Plan;
and (iv) there has been no breach of fiduciary duty which has resulted or could
reasonably be expected to result in a material liability to any Member of the
Company Group.
(e)    Each Plan, to the extent applicable, is in compliance, in all material
respects, with the continuation coverage requirements of Section 4980B of the
Code and Sections 601 through 608 of ERISA.
(f)    No Member of the Company Group or any ERISA Affiliate maintains,
sponsors, contributes to, or has any liability with respect to (i) any employee
benefit plan that is subject to Title IV of ERISA, (ii) any "multiemployer plan"
(as such term is defined under Section 3(37) of ERISA), (iii) any “multiple
employer plan” (within the meaning of Section 413(c) of the Code), or (iv) any
“multiple employer welfare arrangement” (within the meaning of Section 3(40) of
ERISA). No Member of the Company Group or any ERISA Affiliate has any obligation
to provide post-employment health, life or other welfare benefits other than as
required under Section 4980B of the Code or any similar applicable Law.
3.15    Insurance. Schedule 3.15 lists each insurance policy maintained by the
Company Group; provided, however, that Schedule 3.15 shall not include any Plans
that are required to be disclosed on Schedule 3.14(a). All such insurance
policies are legal, valid, binding, enforceable and in full force and effect and
the Company Group is not and, to the Knowledge of the Company Group, no other
party to such insurance policies is, in default or otherwise in breach of any of
its obligations under any of such insurance policies (including regarding
payment of premiums or giving of notices). All premiums due and payable on such
insurance policies have been paid (other than retroactive or retrospective
premium adjustments that are not yet but may be required to be paid with respect
to any period ending prior to the Closing Date) and no written notice of
cancellation or termination has been received with respect to any such policy
which has not been replaced on substantially similar terms prior to the date of
such cancellation. The Company Group is in compliance with all Material
Contracts requiring the Company Group to list a third party as an additional or
named insured.
3.16    Compliance with Laws.
(a)     The Company Group is, and for the three (3) years immediately preceding
the date of this Agreement has been, in compliance with all Laws applicable to
the ownership and operation of the Company Group, including such Laws that
require the Company Group to possess Permits, licenses and registrations of
Governmental Authorities for the current operation of its business, including
the Laws of the U.S. Department of Defense and Federal Aviation Administration.
Since October 1, 2014, the Company Group has not received any written notice of
the violation of any Laws by the Company Group. The Company Group currently has
all Permits required for the operation of its business as presently conducted,
and each such Permit is listed in Schedule 3.16. The Company Group is in
compliance in all material respects with the terms of the Permits to which it is
a party. Since October 1, 2014, the Company Group has not received any written
notice of revocation, suspension, modification, or termination with respect to
any Permit.

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(b)    The Company Group is in compliance in all material respects with all
United States and foreign import and export Legal Requirements, including
without limitation the U.S. Arms Export Control Act and International Traffic in
Arms Regulations; the U.S. Export Administration Act and Export Administration
Regulations; and economic sanctions regulations and Executive Orders
administered by the U.S. Treasury Department’s Office of Foreign Assets Control.
Except as set forth on Schedule 3.16(b)(i), the Company has not manufactured,
exported, or reexported “defense articles” or furnished “defense services” or
“technical data” to foreign nationals in the United States or abroad, as those
terms are defined in 22 Code of Federal Regulations Sections 120.6, 120.9 and
120.10, respectively. Without limiting the foregoing sentences, (A) the Company
Group has obtained all export licenses, registrations, commodity classifications
and other approvals to the extent required, for its exports of products,
equipment, software and technology, including release or disclosure of technical
information to foreign nationals in the United States or elsewhere and (B) to
the Knowledge of the Company Group, there are no actions, conditions or
circumstances pertaining to the Company Group’s export transactions that would
reasonably be expected to give rise to any future claims for violations of such
Laws.
(c)    The Company Group has complied with the U.S. Foreign Corrupt Practices
Act (15 U.S.C. § 78m and 15 U.S.C. § 78dd-1 et seq.), and analogous applicable
laws and regulations of all other jurisdictions in which the Company Group
conducts business pertaining to improper payments to government officials or
other Persons and the related books and records provisions of such laws and
regulations.
3.17    Government Contracts and Government Bids.
(a)    Schedule 3.17(a) sets forth a true and correct list of the following: (i)
each Government Contract or material subcontract under which the period of
performance has not yet expired or terminated ("Active Government Contract");
(ii) each Government Bid that has not expired and for which an award has not
been issued ("Active Government Bid"), and (iii) each Government Contract under
which the period of performance has expired or terminated, but which has not
been closed out (“Closeout Government Contract”) in the case of (i) and (ii)
above, with actual or expected revenue in excess of $200,000 per annum in the
year immediately preceding or immediately following the execution of this
Agreement. Schedule 3.17(a), with respect to each Active Government Contract and
Closeout Government Contract, sets forth the contract number, the contract start
date, the customer, and the contract end date; and with respect to each Active
Government Bid, lists the request for proposal number, the date of submission to
the Governmental Authority or prime contractor, the expected award date, if
known, the estimated period of performance, and the estimated value based on the
proposal. To the Knowledge of the Company Group, all of the Active Government
Contracts were legally awarded and are binding on the parties thereto. The
Company Group has made available to Purchaser true and complete copies of all
Active Government Contracts, Active Government Bids, and Closeout Government
Contracts.
(b)    Except as set forth on Schedule 3.17(b), none of the Active Government
Contracts are premised or were awarded based on the status of any Member of the
Company Group as, nor did any Member of the Company Group represent itself at
time of submission of such Government Contract, as an 8(a), small business,
small disadvantaged business, historically underutilized business zone small
business, women owned small business, veteran-owned small business or
service-disabled veteran-owned small business status and/or other preferential
status. Except as set forth on Schedule 3.17(b), none of the Active Government
Bids are premised or made based on the status of any Member of the Company Group
as, nor did any Member of the Company Group represent itself

20

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at time of submission of such Government Bid, as an 8(a), small business, small
disadvantaged business, historically underutilized business zone small business,
women owned small business, veteran-owned small business or service-disabled
veteran-owned small business status and/or other preferential status.
(c)    Except as set forth on Schedule 3.17(c), each Member of the Company Group
has complied with all terms and conditions of each Active Government Contract,
Active Government Bid, and Closeout Government Contract to which it is a party
or in each material subcontract, teaming agreement, or other third-party
agreement that any Member of the Company Group has entered into under a
Government Contract or related program (or in any certificate, statement, list,
schedule or other document submitted or furnished in connection with the
foregoing), including any applicable Law incorporated therein (including, as
applicable) the Truth in Negotiations Act of 1962, as amended, the Service
Contract Act of 1963, as amended, the Office of Federal Procurement Policy Act,
as amended, the FAR, the FAA’s Acquisition Management System, the Cost
Accounting Standards, the Criminal False Statements Act, Civil False Claim Act,
and any other applicable procurement law, except where any failure to so comply
does not have, and would not reasonably be expected to have, a Material Adverse
Effect. With respect to each Government Contract and each Government Bid, all
representations and certifications executed by a Member of the Company Group or
otherwise attributed by law to the Company Group were complete and correct in
all material respects as of their effective date.
(d)    Except as set forth on Schedule 3.17(d), to the Knowledge of the Company
Group, as of the date of this Agreement there is no pending civil fraud or
criminal investigation by any Governmental Authority related to any Government
Contract; or suspension or debarment proceeding (or equivalent proceeding)
against any Member of the Company Group.
(e)    Except as set forth on Schedule 3.17(e), in the past three years, (i) the
Company Group has not received any written or, to the Knowledge of the Company
Group, oral show cause, cure, deficiency, default or similar written notice
relating to the Active Government Contracts or Closeout Government Contracts;
(ii) no termination for default, and no written cure notice or show cause notice
has been issued or, to the Knowledge of the Company Group, threatened, and
remains unresolved with respect to any Active Government Contract or Closeout
Government Contract; and (iii) there has not been any material withholding or
setoff under any Active Government Contract. None of the execution, delivery or
performance of this Agreement does or will conflict with or result in a breach
of or default under any Active Government Contract or Closeout Government
Contract. Except as set forth on Schedule 3.17(e), the Company Group is not a
party to any outstanding claims or contract disputes relating to the Active
Government Contracts, Closeout Government Contracts, or Active Government Bids.
(f)    To the Knowledge of the Company Group, in the past three years, neither
any Member of the Company Group nor any of their respective Principals (as
defined in FAR 2.101 and 52.209-5) have been debarred, suspended, or proposed
for suspension or debarment, declared non-responsible or ineligible, or
otherwise excluded from participation in the award of any Government Contract or
for any reason been listed on the List of Parties Excluded from Federal
Procurement and Non-procurement Programs. To the Knowledge of the Company Group,
no circumstances exist that would reasonably warrant the institution of
suspension or debarment proceedings against the Company Group or any of their
respective Principals in connection with the performance of the duties for or on
behalf of any Member of the Company Group.

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(g)    Except as set forth on Schedule 3.17(g), in the past three years, the
Company Group has made no disclosure in writing to any Governmental Authority or
other customer or prime contractor or higher-tier subcontractor related to any
suspected or alleged violation of an applicable Law by the Company Group or any
of its Principals relating to any Active Government Contract, Closeout
Government Contracts, or Active Government Bid. During the past three (3) years,
no Member of the Company Group has received any adverse or negative government
past performance evaluation or rating that could adversely affect the evaluation
by a Governmental Authority or other potential customer of any government
contract bid or proposal.
(h)    Schedule 3.17(h) sets forth all facility security clearances held by the
Company Group. Each Member of the Company Group is in compliance with all
applicable national security obligations, including those specified in the
NISPOM. There are no facts or circumstances that could reasonably result in the
suspension or termination of any facility clearance held by the Company Group or
any personnel security clearance held by any employee. The Company has complied
in all material respects with all applicable requirements under each Government
Contract relating to the safeguarding of and access to classified information.
(i)    No Governmental Authority has any rights with respect to any "technical
data" or "computer software" that are material to the Business (other than
rights granted in the Ordinary Course of Business). The Company Group has
retained all such rights with respect to any "technical data" or "computer
software" that are material to the Business. All software developed
independently of any Government Contracts or prior to the applicable Government
Contracts and delivered under such Government Contracts have been developed at
private expense and has been properly and sufficiently marked and protected so
that no Governmental Authority has been provided with unlimited rights in such
software under applicable regulations and contract terms.
(j)    Except as set forth on Schedule 3.17(j), there are no Active Government
Contracts with respect to which (a) the period of performance is scheduled or
reasonably expected to expire or terminate within 120 days of the date hereof
and (b) such expiration or termination would reasonably be expected to result in
a Member of the Company Group being obligated to make notifications under the
WARN Act.
(k)    No favorable National Interest Determinations in accordance with the
NISPOM or similar determinations under any applicable national or industrial
security regulations authorizing access to proscribed or other information by
the Acquired Company following the Closing are needed for the Company Group to
continue to perform the Active Government Contracts following the Closing.
3.18    Environmental Compliance and Conditions. Except as set forth on Schedule
3.18:
(a)    The Company Group has obtained and possesses all material Permits,
licenses and other authorizations required under federal, state and local laws
and regulations concerning occupational health and safety, pollution or
protection of the environment that were enacted and in effect on or prior to the
date hereof, including all such laws and regulations relating to the emission,
discharge, release or threatened release of any chemicals, petroleum,
pollutants, contaminants or hazardous or toxic materials, substances or wastes
into ambient air, surface water, groundwater or lands or otherwise relating to
the manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of any chemicals, petroleum, pollutants, contaminants or
hazardous

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or toxic materials, substances or waste ("Environmental and Safety
Requirements"), except where the failure to possess such licenses, Permits and
authorizations would not be material to the Business.
(b)    The Company Group is in compliance in all material respects with all
terms and conditions of such Permits, licenses and authorizations and all other
Environmental and Safety Requirements, except where the failure to comply would
not be material to the Business.
(c)    No Member of the Company Group has received, within the two years prior
to the date hereof, any written notice of material violations or liabilities
arising under Environmental and Safety Requirements, including any
investigatory, remedial or corrective obligation, relating to the Company Group
or its facilities and arising under Environmental and Safety Requirements, the
subject of which is unresolved and which would be material to the Business.
3.19    Affiliated Transactions. Except as set forth on Schedule 3.19, no
officer, director or Affiliate of the Company Group is a party, or at any point
during the three (3) years immediately preceding the date of this Agreement was
a party, to any material agreement, contract, commitment or transaction with the
Company Group (other than in respect of employment, consulting or similar
services) or has any material interest in any material property used by the
Company Group.
3.20    Brokerage. Except for the fees and expenses of Bluestone Capital
Partners that will be paid by the Seller, there are no claims for brokerage
commissions, finders' fees or similar compensation in connection with the
transactions contemplated by this Agreement based on any arrangement or
agreement made by or on behalf of the Company Group.
3.21    Certain Accounts. Schedule 3.21 contains a list of each bank account,
cash account, brokerage account, lockbox and other similar account in which the
Company Group has any interest.
3.22    Assets. Each member of the Company Group has good and marketable title
to, or a valid leasehold interest in or a valid license for, each material asset
used by it, located on any of its premises, shown on the Latest Balance Sheet or
acquired by it after the date of the Latest Balance Sheet or as is otherwise
necessary for the conduct of its business as conducted and as presently proposed
to be conducted, free and clear of any Liens other than any Permitted Liens,
except for any asset disposed of in its Ordinary Course of Business since the
date of the Latest Balance Sheet or as listed in Schedule 3.22. Schedule 3.22
lists all motor vehicles related to the Business. Each such asset that is
personal property is free from defects (patent and latent), has been maintained
in accordance with normal applicable industry practice, is in satisfactory
operating condition and repair (except normal wear and tear) and is suitable and
sufficient for the purposes for which it is used. The Company Group has
exclusive possession and control of each such asset that is personal property.
3.23    Accounts Receivable. All of the accounts receivable (billed and
unbilled) of the Company Group set forth in the Latest Balance Sheet or acquired
subsequent to the date thereof are valid and enforceable claims, subject to no
set off or counterclaim, and are collectible when due in the Ordinary Course of
Business, net of any reserves for uncollectible accounts included in the
calculation of Net Working Capital. All accounts receivable (billed and
unbilled) of the Company Group are determined in accordance with GAAP and arose
out of bona fide transactions in the Ordinary Course of Business.
3.24    Internal Controls. The Company Group has in place internal controls and
procedures designed and maintained to give reasonable assurance that
(a) transactions are executed in accordance with the Company Group’s
management’s general or specific authorizations, (b) transactions are recorded
as

23

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necessary to permit preparing financial statements in conformity with GAAP and
to maintain accountability for assets, (c) access to assets is permitted only in
a manner designed to prevent or timely detect unauthorized acquisition, use or
disposition that could have a material effect on the Company Group’s financial
statements and (d) the recorded accountability for assets is compared with
existing assets at reasonable intervals and appropriate action is taken with
respect to any differences. Each Member of the Company Group has established and
maintained acceptable business systems in accordance with the terms and
conditions of its Contracts, as required by 48 CFR 252.242.7004 through
252.242.7006, including, as applicable, an approved Accounting System and
Property Management System. The Company Group does not maintain an Earned Value
Management System, Estimating System, Material Management and Accounting, or
Purchasing System, each as defined under 48 CFR 252.242.7004 through
252.242.7006. No Earned Value Management System, Estimating System, Material
Management and Accounting, or Purchasing System previously established or
maintained by the Company Group (if any) has been disapproved by any
Governmental Authority.

3.25    Suppliers and Customers. Schedule 3.25 lists the 15 largest suppliers by
dollar volume (listing the dollar volume for each) of products and services to
the Company Group and the 15 largest customers by dollar volume (listing the
dollar volume for each) of products and services of the Company Group, in each
case for the 12‑month period ended on September 30, 2017. Except as listed in
Schedule 3.25, no Member of the Company Group has received any written
communication indicating that, and, to the Knowledge of the Company Group, there
are no circumstances indicating that, any such supplier or customer is
terminating or materially reducing or making any materially adverse change in,
or desires or intends to terminate or materially reduce or make any materially
adverse change in, any aspect of its or any of its Affiliates’ business
relationship with the Company Group. To the Knowledge of the Company Group, the
consummation of the transactions contemplated herein will not adversely affect
in any material manner, the Company Group’s business relationship with any such
supplier or customer.
ARTICLE IV    

REPRESENTATIONS AND WARRANTIES OF THE SELLER
The Seller represents and warrants to the Purchaser that:
4.01    Power. The Seller is a corporation, duly organized, validly existing and
in good standing under the laws of the State of Delaware, with full power and
authority to enter into this Agreement and perform its obligations hereunder.
4.02    Authorization. The execution, delivery and performance of this Agreement
by the Seller has been authorized by all requisite action, and no other
proceedings on the part of the Seller are necessary to authorize the execution,
delivery or performance of this Agreement. This Agreement has been duly executed
and delivered by the Seller and assuming that this Agreement is a valid and
binding obligation of the other parties, this Agreement constitutes a valid and
binding obligation of the Seller, enforceable in accordance with its terms,
except as enforceability may be limited by bankruptcy laws, other similar laws
affecting creditors' rights and general principles of equity effecting the
availability of specific performance and other equitable remedies.
4.03    No Violation. The Seller is not subject to or obligated under any
applicable law, or rule or regulation of any governmental authority, or subject
to any order, writ, injunction or decree, which would

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be breached or violated in any material respect by the Seller's execution,
delivery or performance of this Agreement or the consummation of the
transactions contemplated hereby.
4.04    Ownership. The Seller is the record and beneficial owner of the Shares.
Upon consummation of the transactions contemplated hereby, the Seller will
transfer to the Purchaser good title to the Shares, free and clear of all Liens,
options, proxies, voting trusts or agreements and other restrictions and
limitations of any kind, other than applicable federal and state securities law
restrictions.
4.05    Tax Matters. The Seller has been a validly electing S Corporation within
the meaning of Sections 1361 and 1362 of the Code and all applicable state and
local Tax laws where such treatment is allowed since prior to the date that it
acquired the Acquired Company and for all Tax periods thereafter and will be an
S corporation up to and including the Closing Date.
ARTICLE V    

REPRESENTATIONS AND WARRANTIES OF THE SELLER SHAREHOLDER
The Seller Shareholder represents and warrants to the Purchaser that:
5.01    Power. The Seller Shareholder is an individual and has full power and
authority to enter into this Agreement and perform his obligations hereunder.
5.02    Authorization. The execution, delivery and performance of this Agreement
by the Seller Shareholder has been authorized by all requisite action, and no
other proceedings on the part of the Seller are necessary to authorize the
execution, delivery or performance of this Agreement. This Agreement has been
duly executed and delivered by the Seller Shareholder and assuming that this
Agreement is a valid and binding obligation of the other parties, this Agreement
constitutes a valid and binding obligation of the Seller Shareholder,
enforceable in accordance with its terms, except as enforceability may be
limited by bankruptcy laws, other similar laws affecting creditors' rights and
general principles of equity effecting the availability of specific performance
and other equitable remedies.
5.03    No Violation. The Seller Shareholder is not subject to or obligated
under any applicable law, or rule or regulation of any governmental authority,
or subject to any order, writ, injunction or decree, which would be breached or
violated in any material respect by the Seller Shareholder's execution, delivery
or performance of this Agreement or the consummation of the transactions
contemplated hereby.
5.04    Ownership. The Seller Shareholder is the record owner of all of the
capital stock of Seller.
ARTICLE VI    

REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
The Purchaser represents and warrants to the Seller and the Acquired Company
that:
6.01    Organization and Power. The Purchaser is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware,
with full power and authority to enter into this Agreement and perform its
obligations hereunder.
6.02    Authorization. The execution, delivery and performance of this Agreement
by the Purchaser and the consummation of the transactions contemplated hereby
have been duly and validly authorized by

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all requisite action, and no other proceedings on their part are necessary to
authorize the execution, delivery or performance of this Agreement. This
Agreement has been duly executed and delivered by the Purchaser and assuming
that this Agreement is a valid and binding obligation of the other parties, this
Agreement constitutes a valid and binding obligation of the Purchaser,
enforceable in accordance with its terms, except as enforceability may be
limited by bankruptcy laws, other similar laws affecting creditors' rights and
general principles of equity effecting the availability of specific performance
and other equitable remedies.
6.03    No Violation. The Purchaser is not subject to or obligated under its
organizational documents, any applicable law, or rule or regulation of any
governmental authority, or any material agreement or instrument, or any license,
franchise or Permit, or subject to any order, writ, injunction or decree, which
would be breached or violated in any material respect by the Purchaser's
execution, delivery or performance of this Agreement or the consummation of the
transactions contemplated hereby.
6.04    Governmental Authorities; Consents. Except as set forth on Schedule
6.04, the Purchaser is not required to submit any notice, report or other filing
with any Governmental Authority in connection with the execution, delivery or
performance by it of this Agreement or the consummation of the transactions
contemplated hereby. No consent, approval or authorization of any Governmental
Authority or any other party or Person is required to be obtained by the
Purchaser in connection with its execution, delivery and performance of this
Agreement or the consummation of the transactions contemplated hereby.
6.05    Litigation. There are no actions, suits or proceedings pending or, to
the Purchaser's knowledge, threatened in writing against the Purchaser at law or
in equity, or before or by any federal, state, municipal or other governmental
department, commission, board, bureau, agency or instrumentality, domestic or
foreign, which would adversely affect the Purchaser's performance under this
Agreement or the consummation of the transactions contemplated hereby. The
Purchaser is not subject to any outstanding judgment, order or decree of any
court or governmental body.
6.06    Brokerage. There are no claims for brokerage commissions, finders' fees
or similar compensation in connection with the transactions contemplated by this
Agreement based on any arrangement or agreement made by or on behalf of the
Purchaser.
6.07    Investment Representation. The Purchaser is acquiring the Shares for its
own account with the present intention of holding such securities for investment
purposes and not with a view to, or for sale in connection with, any
distribution of such securities in violation of any federal or state securities
laws. The Purchaser is an "accredited investor" as defined in Regulation D
promulgated by the Securities and Exchange Commission under the Securities Act
of 1933, as amended. The Purchaser acknowledges that it is informed as to the
risks of the transactions contemplated hereby and of ownership of the Shares.
The Purchaser acknowledges that the Shares have not been registered under the
Securities Act of 1933, as amended, or any state or foreign securities laws and
that the Shares may not be sold, transferred, offered for sale, pledged,
hypothecated or otherwise disposed of unless such transfer, sale, assignment,
pledge, hypothecation or other disposition is pursuant to the terms of an
effective registration statement under the Securities Act of 1933 and the Shares
are registered under any applicable state or foreign securities laws or sold
pursuant to an exemption from registration under the Securities Act of 1933, as
amended, and any applicable state or foreign securities laws.
6.08    Financing. The Purchaser has, and at the Closing shall have, sufficient
cash, available lines of credit or other sources of immediately available funds
to make payment of all amounts to be paid by it hereunder on and after the
Closing Date.

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6.09    Solvency. Immediately after giving effect to the transactions
contemplated by this Agreement, the Purchaser and each of its Subsidiaries shall
be able to pay their respective debts as they become due and shall own property
which has a fair saleable value greater than the amounts required to pay their
respective debts (including a reasonable estimate of the amount of all
contingent liabilities). Immediately after giving effect to the transactions
contemplated by this Agreement, the Purchaser and each of its Subsidiaries shall
have adequate capital to carry on their respective businesses. 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 either present or future creditors of the Purchaser or its
Subsidiaries.
6.10    No Foreign Ownership. To the Knowledge of Purchaser, no foreign
government, agency of a foreign government, or representative of a foreign
government; no business enterprise or other entity organized, chartered or
incorporated under the laws of any country other than the United States or its
territories; nor any person who is not a citizen or national of the United
States (each a "Foreign Interest") (a) individually or in the aggregate with
other Foreign Interests, owns or has a beneficial ownership of five percent (5%)
or more of Purchaser or if Purchaser does not issue stock, indirectly or
directly, subscribed for five percent (5%) or more of Purchaser's total capital
commitment, or (b) has the power, direct or indirect, whether or not exercised,
and whether or not exercisable through the ownership of Purchaser, by
contractual arrangements or other means, to direct or decide matters affecting
the management or operations of Purchaser. The Purchaser acknowledges the
restrictions that affiliation with or significant influence by a Foreign
Interest may put on the prospects of the Acquired Company, and shall fully
comply with the Law with respect to mitigation of any such affiliation or
influence of such Foreign Interest. Purchaser further acknowledges that neither
the Company Group nor the Acquired Company shall have liability for any breach
of any representation or warranty to the extent such breach results from
Purchaser having any direct or indirect foreign ownership.
ARTICLE VII    

[INTENTIONALLY DELETED]

ARTICLE VIII    

CERTAIN COVENANTS
8.01    Access to Books and Records. From and after the Closing, the Purchaser
shall, and shall cause each of its Subsidiaries to, provide the Seller and its
authorized representatives with reasonable access, during normal business hours,
to the books and records and personnel of the Company Group in connection with
any matter relating to or arising out of this Agreement or the transactions
contemplated hereby or with respect to periods or occurrences prior to or on the
Closing Date, including for the purpose of preparing final Tax Returns and
providing assistance relating to final accounting functions relating to the
Company Group or any member thereof. Unless otherwise consented to in writing by
the Seller, the Purchaser shall not, and shall not permit any of its
Subsidiaries to, for a period of six years following the Closing Date (or, with
respect to any Tax records, if later, the period during which the relevant
statute of limitations remains open), destroy, alter or otherwise dispose of any
of the books and records of any of its Subsidiaries relating to the Business for
any period prior to the Closing without first giving reasonable prior notice to
the Seller and offering to surrender to the Seller such books and records or any
portion thereof which the Purchaser or any of its Subsidiaries may intend to
destroy, alter or dispose of.

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8.02    Director and Officer Liability and Indemnification. For a period of six
years after the Closing Date, the Purchaser shall not, and shall not permit any
Member of the Company Group to amend, repeal or modify any provision in the
organizational documents of any Member of the Company Group relating to the
exculpation or indemnification of any current or former officer or director (the
"D&O Indemnified Persons") (unless required by law), it being the intent of the
parties that the D&O Indemnified Persons shall continue to be entitled to such
exculpation and indemnification to the fullest extent permitted by law. At the
Closing, the Purchaser shall, or shall cause the Acquired Company to, on behalf
of the Company Group, obtain, maintain and fully pay for irrevocable "tail"
insurance policies naming the D&O Indemnified Persons as direct beneficiaries
with a claims period of at least six years from the Closing Date from an
insurance carrier with the same or better credit rating as the Acquired
Company's current insurance carrier with respect to directors' liability
insurance in an amount and scope at least as favorable as the Acquired Company's
existing policies with respect to matters existing or occurring at or prior to
the Closing Date. The Purchaser shall not, and shall cause each Member of the
Company Group not to, cancel or change such insurance policies in any respect.
If the Purchaser, any Member of the Company Group or any of their respective
successors or assigns (i) shall consolidate with or merge into any other Person
and shall not be the continuing or surviving corporation or entity of such
consolidation or merger or (ii) shall transfer all or substantially all of its
properties and assets to any Person, then, and in each such case, proper
provisions shall be made so that the successors and assigns of the Purchaser and
the Company Group shall assume all of the obligations set forth in this Section
8.02. The provisions of this Section 8.02 are intended for the benefit of, and
will be enforceable by, each D&O Indemnified Person and his or her heirs and
representatives, and are in addition to, and not in substitution for, any other
rights to indemnification or contribution that any such person may have had by
contract or otherwise.
8.03    Conditions. The Purchaser shall use its reasonable best efforts to cause
the conditions set forth in Section 2.02 to be satisfied and to consummate the
transactions contemplated hereby as soon as reasonably possible after the
satisfaction of the conditions set forth in Article II (other than those to be
satisfied at the Closing).
8.04    Contact with Employees, Customers and Suppliers. Prior to the Closing,
the Purchaser and the Purchaser's Representatives shall contact and communicate
with the employees, customers and suppliers of the Company Group in connection
with the transactions contemplated hereby only after prior consultation with and
written approval of the Seller, Seller Shareholder, or Acquired Company.
8.05    Employment and Benefit Arrangements. From and after the Closing and
solely to the extent disclosed or made available to the Purchaser in the
Intralinks data site prior to the Closing, the Purchaser shall cause the Company
Group to honor all employment, consulting, retirement and other compensation and
benefit plans, arrangements and agreements to which the Company Group is a party
with respect to employees of the Company Group, as such plans, arrangements and
agreements are in effect on the date hereof. The Purchaser shall cause the
Company Group to provide severance and termination arrangements and agreements
to which the Company Group is a party with respect to the employees of the
Company Group; provided that such arrangements and agreement do not require the
payment of more than two weeks’ salary for each full year of employment with the
Company Group. This Section 8.05 shall not be deemed to prohibit the Purchaser
or the Company Group from amending, modifying, replacing, or terminating the
plans, arrangements, or agreements referred to in the first two sentences of
this Section 8.05 in accordance with their terms and applicable Law, subject to
the Purchaser’s obligations under this Section 8.05 provided, however, that
until December 31, 2018, Purchaser shall cause the Company and its Subsidiary to
offer employees who are terminated without cause, severance of two weeks salary
(or wages) for each full year of employment with the Company Group. The
Purchaser shall take all actions required so that employees of the Company Group
as of the Closing shall receive service credit for periods of employment with
the

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Company Group for eligibility and vesting purposes and for purposes of
determining future vacation accruals and severance amounts under any employee
benefit plans and arrangements in which they participate following the Closing.
Until December 31, 2018, the Purchaser shall cause the Company Group to maintain
the welfare benefit plan coverage provided prior to the Closing in all material
respects. This Section 8.05 shall survive the Closing, and shall be binding on
all successors and assigns of the Purchaser and the Company Group. Until
December 31, 2018, the Purchaser shall take all actions required so that the
employees of the Company Group (determined as of the Closing) (i) receive base
compensation and bonus opportunities that are no less favorable individually and
in the aggregate than that provided immediately prior to the Closing, (ii)
receive benefits that, in the aggregate, are substantially comparable to those
benefits provided to such employees immediately prior to the Closing, and (iii)
who involuntarily terminate employment from the Company Group during such period
receive severance compensation and benefits that are no less favorable than
those which would have been payable as a result of involuntary termination of
employment under the severance plans, policies, agreements or arrangements that
applied to such employees immediately prior to the Closing to the extent such
compensation, bonus opportunities, benefits, severance plans, policies,
agreements, or arrangements under (i), (ii), and (iii) have been disclosed or
made available to the Purchaser in the Intralinks data site prior to the
Closing. To the extent this Section 8.05 conflicts with an employment letter or
retention letter, the employment letter or retention letter governs and
controls.
8.06    Employee Layoffs. Assuming the accuracy of the representations and
warranties in Sections 3.13(i) and 3.17(j), for a period of ninety days after
the Closing Date, neither the Purchaser nor the Acquired Company shall, and
neither shall permit any Member of the Company Group to, terminate employees of
the Company Group, except in full compliance with all requirements of the WARN
Act or any similar requirements under local or foreign Law. The Purchaser and
the Acquired Company shall, and shall cause the Members of the Company Group to,
comply with any and all applicable notice or filing requirements under the WARN
Act or any similar requirements under local or foreign Law, and will indemnify
and hold harmless the Seller from any liabilities, losses, damages, obligations,
costs or expenses, arising as a result of or related to, in whole or in part,
the Purchaser's or the Acquired Company's actions or omissions occurring on or
after the Closing Date.
8.07    Corporate Headquarters Lease. Subsequent to Closing, Purchaser and the
Company Group shall use their reasonable best efforts to have the landlord for
the Corporate Headquarters Lease agree to the assignment of such lease from the
Seller to the Purchaser and the Acquired Company and the release of the Seller
from any ongoing obligations thereunder. Subsequent to Closing, the Purchaser
shall pay or cause the Acquired Company to pay all lease and other payments
under the Corporate Headquarters Lease in accordance with the terms of the
Corporate Headquarters Lease and the Purchaser and the Acquired Company shall
comply with all the terms, conditions and obligations of the Corporate
Headquarters Lease as if it was the tenant thereunder. In the event that within
30 days of the date hereof the Purchaser and the Company Group have not had the
Corporate Headquarters Lease assigned as contemplated herein (and the Seller
released from any ongoing obligations thereunder) at the Seller’s request, the
Purchaser and the Acquired Company, as subtenants, will enter into a sublease
with the Seller that fully incorporates all of the terms, conditions and
obligations of the Corporate Headquarters Lease.
ARTICLE IX    

INDEMNIFICATION
9.01    Survival of Representations, Warranties, Covenants, Agreements and Other
Provisions. Except to the extent a different period is expressly set forth
herein, the representations, warranties, covenants (other than with respect to
the covenants contained in Section 11.01, which shall survive until the
obligations

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set forth therein are fully performed in accordance with the terms thereof, or,
if earlier, the date that is thirty (30) days after the expiration of the
applicable statute of limitations), agreements and other provisions in this
Agreement shall survive the Closing and shall terminate on the date which is
twelve months after the Closing Date provided, however, that the representations
and warranties of the Acquired Company set forth in Section 3.01(a)
(Organization and Power), Section 3.02(a) (Subsidiaries), Section 3.03
(Authorization; No Breach; Valid and Binding Agreement), Section 3.04 (Capital
Stock), Section 3.08 (Tax Matters), Section 3.14 (Employee Benefit Plans), and
Section 3.20 (Broker’s Fees) (collectively, the “Fundamental Representations”)
shall survive the execution and delivery of this Agreement and the consummation
of the transactions contemplated hereby and shall continue in full force and
effect for a period thereafter ending on the sixth (6th) anniversary of the
Closing Date (the twelve month or six year anniversary, the "Survival Period
Termination Date"). No Person shall be liable for any claim for indemnification
under this Article IX unless written notice specifying in reasonable detail the
facts, circumstances and nature of the claim for indemnification is delivered by
the Person seeking indemnification to the Person from whom indemnification is
sought prior to the Survival Period Termination Date, in which case the
representation, warranty, covenant or agreement which is the subject of such
claim shall survive, only to the extent of such claim, until such claim is
resolved.
9.02    Indemnification from the Indemnity Escrow Account for the Benefit of the
Purchaser.
(a)    From and after the Closing (but subject to the provisions of this Article
IX), the Seller and Seller Shareholder shall, jointly and severally, indemnify
the Purchaser in respect of any Loss suffered or incurred by the Purchaser or
any of its Affiliates, officers, directors, employees or agents (each a
"Purchaser Indemnified Party" and collectively, the "Purchaser Indemnified
Parties") resulting from or arising out of (i) the breach or inaccuracy of any
representation or warranty made by the Acquired Company in Article III
(Representations and Warranties of the Acquired Company), by the Seller in
Article IV (Representation and Warranties of the Seller), or the Seller
Shareholder in Article V (Representations and Warranties of the Seller
Shareholder); or (ii) the breach by the Seller or the Acquired Company of any
covenant or agreement to be performed by it under this Agreement.
(b)    No Purchaser Indemnified Party shall be entitled to recover for an
indemnification claim under Section 9.02(a)(i), other than for breaches of or
inaccuracies with respect to Fundamental Representations, unless and until the
aggregate amount of Losses that would otherwise be payable hereunder exceeds on
a cumulative basis an amount equal to $250,000 (the "Deductible"), and then only
to the extent such Losses exceed the Deductible.  
(c)    Amounts available in the Indemnity Escrow Account shall be the sole
source of recourse against the Seller or Seller Shareholder for Losses suffered
or incurred by Purchaser Indemnified Parties to the extent arising from any
nonfulfillment or breach of any representation or warranty other than a
Fundamental Representation. The maximum aggregate liability of Seller or the
Seller Shareholder for Losses related to indemnification claims hereunder,
including claims arising from any nonfulfillment or breach of any Fundamental
Representation, shall not exceed the Final Purchase Price.
(d)    The Purchaser Indemnified Parties shall have no right to indemnification
hereunder with respect to any Loss to the extent such Loss is included in the
calculation of any component of Final Purchase Price or if the Purchaser shall
have received a reduction in the Final Closing Statement on account of any
matter forming the basis for such Loss.

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(e)    All payments pursuant to this Article IX shall be treated by the parties
as an adjustment to the proceeds payable to the Seller pursuant to Section 1.02
hereof.
(f)    (i) Except for the Purchaser pursuant to the terms hereof, no Person
(including the Seller or any of its respective Affiliates) shall have any
obligation to fund the Indemnity Escrow Account, (ii) except for the amount in
respect of which the Purchaser shall have, prior to the Survival Period
Termination Date, previously made a claim pursuant to the procedures set forth
in this Article IX and for which the obligations to indemnify, if any, shall not
have been satisfied from the Indemnity Escrow Amount (the "Outstanding Escrow
Claims"), title and all rights to all funds in the Indemnity Escrow Account
shall automatically transfer to the Seller on the Survival Period Termination
Date, and (iii) the Purchaser shall take all actions reasonably necessary to
cause the Escrow Agent to release all funds in the Indemnity Escrow Account,
less the amount of the Outstanding Escrow Claims, to the Seller on the business
day following the twelve-month Survival Period Termination Date. As soon as the
Outstanding Escrow Claims are resolved pursuant to the procedures set forth in
this Article IX, the Purchaser shall cause the Escrow Agent to release any
remaining cash held by the Escrow Agent pursuant to the terms of the Escrow
Agreement to the Seller.
9.03    Indemnification by the Purchaser for the Benefit of the Seller. From and
after the Closing (but subject to the provisions of this Article IX), the Seller
shall be entitled to assert, as its sole and exclusive remedy for any action
relating (directly or indirectly) to this Agreement and the transactions
contemplated hereby and only in accordance with the terms of this Agreement,
claims against the Purchaser in respect of any Loss suffered or incurred by the
Seller, or any of its respective Affiliates, officers, directors, employees or
agents ("Seller Indemnified Parties") to the extent arising from any
nonfulfillment or breach of any representation, warranty, covenant, agreement or
other provision set forth herein or in any or certificate delivered hereunder by
the Purchaser or, following the Closing, by the Acquired Company.
9.04    Mitigation. Each Person entitled to indemnification hereunder shall take
commercially reasonable steps to mitigate all Losses, costs and expenses as
required by applicable Law.
9.05    Defense of Third Party Claims. Any Person making a claim for
indemnification under Section 9.02 or Section 9.03 (an "Indemnitee") shall
notify the indemnifying party (an "Indemnitor") of the claim in writing promptly
after receiving written notice of any action, lawsuit, proceeding, investigation
or other claim against it (if by a third party), describing the claim, the
amount thereof (if known and quantifiable) and the basis therefor. Any
Indemnitor shall, subject to the right of any insurer under a representation and
warranty insurance policy, be entitled to participate in the defense of such
action, lawsuit, proceeding, investigation or other claim giving rise to an
Indemnitee's claim for indemnification at such Indemnitor's expense and, subject
to the right of any insurer under a representation and warranty insurance
policy, at such Indemnitor's option, shall be entitled to assume the defense
thereof by appointing a reputable counsel to be the lead counsel in connection
with such defense; provided that such Indemnitor shall continue to be entitled
to assert any limitation on any claims contained herein; provided further that
the Indemnitee shall be entitled to participate in the defense of such claim and
to employ counsel of its choice for such purpose; provided, however, that the
fees and expenses of such separate counsel shall be borne by the Indemnitee. If
the Indemnitor shall control the defense of any such claim, the Indemnitor
shall, subject to the right of any insurer under a representation and warranty
insurance policy, be entitled to settle such claim; provided that the Indemnitor
shall obtain the prior written consent of the Indemnitee (which consent shall
not be unreasonably withheld, conditioned, or delayed) before entering into any
settlement of a claim or ceasing to defend such claim if, pursuant to or as a
result of such settlement or cessation, injunctive or other equitable relief
will be imposed against the Indemnitee or if such settlement does not expressly
and unconditionally release the Indemnitee from all liabilities and obligations
with respect to such claim. If the Indemnitor assumes the

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defense of and/or settles or compromises any third party claim as provided
herein and the Deductible applies to such claim and has not been met with
respect to the Indemnitor's liability under Section 9.02, then (1) until such
time as the Deductible has been met, the Indemnitee will promptly reimburse the
Indemnitor for any out-of-pocket costs and expenses (including attorney's fees)
incurred in the assumption of such defense and (2) if the settlement or
compromise of such third party claim is equal to or less than the remaining
Deductible at such time (after taking into account any reimbursements pursuant
to clause (1) above), then within five business days after the settlement or
compromise of such claim, the Indemnitee shall pay to the Indemnitor the
aggregate amount of the third party claim settled or compromised up to the
amount of the then remaining Deductible. In no event will an Indemnitee consent
to the entry of any judgment or enter into any settlement with respect to any
third party claim for which an Indemnitee is seeking indemnification hereunder
without the prior written consent of the Indemnitor.
9.06    Determination of Loss Amount.
(a)    The amount of any Loss subject to indemnification under Section 9.02 or
Section 9.03 shall be calculated net of any insurance proceeds (net of direct
collection expenses) or any indemnity, contribution or other similar payment
received by the Indemnitee or its Affiliates from any third party with respect
thereto. The Indemnitee shall seek full recovery under all insurance policies
covering any Loss to the same extent as they would if such Loss were not subject
to indemnification hereunder; provided that seeking such coverage shall not be a
condition to Indemnitee making a claim for indemnification under this Agreement.
In the event that an insurance or other recovery is made by any Indemnitee with
respect to any Loss for which any such Person has been indemnified hereunder,
then a refund equal to the aggregate amount of the recovery shall be made
promptly to the Indemnitor. To the extent allowed under the terms of the
applicable insurance policies, the Indemnitors shall be subrogated to all rights
of the Indemnitees and their Affiliates in respect of any Losses indemnified by
the Indemnitors.
(b)    The Purchaser Indemnified Parties shall have no right to indemnification
hereunder with respect to any Loss to the extent such Loss is attributable to
(i) Taxes that result from any breach of the covenant in Section 11.01(d); (ii)
Taxes attributable to any transaction or action outside of the Ordinary Course
of Business taken, caused or requested by the Purchaser or any of its Affiliates
that occur on or after the Closing; (iii) Transfer Taxes that are the
responsibility of Purchaser pursuant to Section 11.01(c), or (iv) the
unavailability in any taxable period (or portion thereof) beginning after the
Closing Date of any Tax attribute of the Acquired Company or any of its
Subsidiaries.
9.07    Manner of Payment. Any indemnification of the Seller Indemnified Parties
pursuant to this Article IX shall be effected by wire transfer of immediately
available funds from the Purchaser to an account designated by the Indemnitee
within ten days after the determination thereof.
9.08    Acknowledgment; No Reliance.
(a)    The representations and warranties of the Acquired Company expressly set
forth in Article III of this Agreement and the representations and warranties of
the Seller expressly set forth in Article V of this Agreement constitute the
sole and exclusive representations and warranties made to the Purchaser, its
Affiliates or any other Person in connection with the transactions contemplated
hereby, and the Purchaser, on its own behalf and on behalf of its Affiliates,
acknowledges and agrees that any other representations and warranties of any
kind or nature, express or implied (including any relating to the future or
historical financial condition or position, results of operations, assets or
liabilities of the Company Group, or the quality or condition of the Company
Group's assets), are specifically disclaimed by the Seller and

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the Acquired Company and shall not form the basis of any claim against the
Seller, its members, or any of their respective Affiliates, the Indemnity Escrow
Account, any other Person or otherwise. Without limiting the foregoing, the
Purchaser, on its own behalf and on behalf of its Affiliates, acknowledges and
agrees that neither the Purchaser nor any of its Affiliates has relied on any
representations or warranties whatsoever, whether express or implied, other than
the representations and warranties of the Acquired Company expressly set forth
in Article III of this Agreement and the representations and warranties of the
Seller expressly set forth in Article IV of this Agreement. In furtherance of
the foregoing, the Purchaser acknowledges, on its own behalf and on behalf of
its Affiliates, that the Purchaser and its Affiliates have conducted, to their
respective satisfactions, an independent investigation of the financial
condition and position, results of operations, assets, liabilities, properties
and projected operations of the Company Group and, in making its determination
to proceed with the transactions contemplated by this Agreement, the Purchaser
and its Affiliates have relied only on the results of its own independent
investigation and the representations and warranties of the Acquired Company
expressly set forth in Article III of this Agreement and the representations and
warranties of the Seller expressly set forth in Article IV of this Agreement. In
connection with the Purchaser's and its Affiliates' investigation of the Company
Group, the Purchaser and its Affiliates have received certain projections,
including projected statements of operating revenues and income from operations
of the Company Group, and certain business plan information. The Purchaser
acknowledges, on its own behalf and on behalf of its Affiliates, that there are
uncertainties inherent in attempting to make such estimates, projections and
other forecasts and plans, that the Purchaser and its Affiliates are familiar
with such uncertainties and that the Purchaser and its Affiliates are taking
full responsibility for making their own evaluation of the adequacy and accuracy
of all estimates, projections and other forecasts and plans so furnished to
them, including the reasonableness of the assumptions underlying such estimates,
projections and forecasts. Accordingly, the Purchaser, on its own behalf and on
behalf of its Affiliates, hereby acknowledges that none of the Seller, the
Seller Shareholder, any Member of the Company Group or any other Person is
making any representation or warranty with respect to such estimates,
projections and other forecasts and plans, including the reasonableness of the
assumptions underlying such estimates, projections and forecasts, and that
neither the Purchaser nor any of its Affiliates has relied on any such
estimates, projections or other forecasts or plans. The Purchaser further
agrees, on its own behalf and on behalf of its Affiliates, that (i) none of the
Seller, the Acquired Company or any other Person will have or be subject to any
liability to the Purchaser, its Affiliates or any other Person resulting from
the distribution to the Purchaser or any other Person, or the Purchaser's use
of, any such information, including any information, document or material made
available to the Purchaser or any other Person in certain "data rooms,"
management presentations or any other form in expectation of the transactions
contemplated by this Agreement, and (ii) the Purchaser and such other Persons
have not relied on any such information.
Each party acknowledges and agrees that, from and after the Closing (except for
actions seeking equitable relief pursuant to Section 13.13 and disputes under
Sections 1.05 or 11.01(h), which disputes will be resolved in accordance with
the dispute mechanism set forth in such Sections), its sole and exclusive remedy
with respect to any and all rights, claims and causes of action it may have
against any other party, any member of the Seller or any of their respective
Affiliates relating to the operation of the Company Group or its businesses, or
resulting from or relating to the subject matter of this Agreement and the
transactions contemplated hereby, whether arising under or based upon any law or
otherwise, shall be pursuant to the indemnification and escrow recovery
provisions set forth in this Article IX.
9.09    Other Indemnification Matters. For purposes of determining whether there
has been any breach or inaccuracy of a representation or warranty, and for
purposes of determining the amount of Losses resulting therefrom, all
qualifications or exceptions in any representation or warranty relating to or
referring

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to the terms “material,” “materiality,” “in all material respects,” “material
adverse effect,” “Material Adverse Effect” or any similar term or phrase shall
be disregarded, it being the understanding of the Parties that for purposes of
determining liability under this ARTICLE IX, the representations and warranties
of the Parties contained in this Agreement shall be read as if such terms and
phrases were not included; provided, that the foregoing shall not apply in
determining whether Schedules 3.09(a), 3.10(b)(1), 3.13(b), or 3.17(a) correctly
list contracts, licenses, obligations or similar items based on the
“materiality” of such items.
ARTICLE X    

[RESERVED]
ARTICLE XI    

ADDITIONAL COVENANTS
11.01    Tax Matters.
(a)    Payment of Taxes. All Taxes with respect to (1) any Member of the Company
Group with respect to any Pre-Closing Tax Period, (2) any member of an
affiliated, consolidated, combined or unitary group of which any Member of the
Company Group (or any predecessor thereto) is or was a member before Closing to
which one or more entities other than a Member of the Company Group is or was
also a member, including Taxes pursuant to Treasury Regulation 1.1502-6 or any
similar Law, and (3) any Person (other than a Member of the Company Group)
imposed on any Member of the Company Group for any period as a transferee or
successor with respect to a transaction occurring on or before the Closing Date,
by Law, Contract (other than pursuant to an Ordinary Course Agreement) or
otherwise (all of such Taxes being the “Pre-Closing Taxes”) shall be recovered
or satisfied first from the Representation and Warranty insurance policy, or if
not covered by such policy, such Taxes shall be satisfied from the Indemnity
Escrow Account. Seller shall satisfy (or cause to be satisfied) such Taxes if
and to the extent such Taxes are not covered by the Representation and Warranty
insurance policy and the Indemnity Escrow Account is not adequate to cover such
Taxes. Purchaser shall satisfy (or cause to be satisfied) in full when due all
Tax liabilities with respect to any period that is not a Pre-Closing Tax Period.
If Purchaser is required under Section 11.01(b) to file a Tax Return that
involves Pre-Closing Taxes, then no later than the later of the date that is (i)
five Business Days after the date that Seller receives from Purchaser a copy of
such Tax Return and written notice that such payment is or was due and (ii) five
Business Days before the due date (including extensions) of any such Tax Return,
then an amount equal to the amount of Taxes shown due on such Tax Return for
which Seller is obligated with respect to such Tax Return.
(b)    Filing Responsibility. Seller shall prepare or cause to be prepared and
timely file or cause to be timely filed all Tax Returns for the Members of the
Company Group for Tax Periods ending on or prior to the Closing Date and Tax
Returns of Seller which include activities of Members of the Company Group
pursuant to applicable Law. Purchaser shall prepare and timely file (or cause to
be prepared and timely filed) all Tax Returns required to be filed by the
Members of the Company Group that Seller is not obligated to prepare and timely
file (or cause to be prepared and timely filed) pursuant to this Section
11.01(b). If any such Tax Return (whether original or amended) prepared (or
caused to be prepared) by Purchaser relates to any Pre-Closing Tax Period or if
any such Tax Return (whether original or amended) prepared (or caused to be
prepared) by Seller relates to any period that is not a Pre-Closing Tax Period,
then such Tax Return will be prepared in accordance with the past practice of
the Company Group (except to the extent otherwise required by Applicable

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Law) and the preparing Party shall give to the other Parties a copy of such Tax
Return as soon as practicable after the preparation thereof, but not less than
fifteen (15) days prior to the due date for the filing of such Tax Return, for
such other’s review and comment. Such preparing Party shall consider in good
faith any changes to such Tax Return that are reasonably requested.
(c)    Transfer Taxes. The Purchaser will file any Tax Returns due with respect
to any transfer, documentary, sales, use, registration and real property
transfer, value added or gains tax, stamp duty, stamp duty reserve tax, stamp
duty land tax, excise tax, stock transfer tax, or other similar Tax imposed on
any Member of the Company Group, or the Seller as a result of the transactions
contemplated by this Agreement (including associated interest and penalties)
(collectively, "Transfer Taxes"). The Seller agrees to reasonably cooperate with
the Purchaser in the filing of any returns with respect to the Transfer Taxes,
including by promptly supplying any information in its possession that is
reasonably necessary to complete such returns. The Purchaser agrees that it will
pay all such Transfer Taxes and the Purchaser will be entitled to be reimbursed
from the Escrow for one-half of the amount of such Transfer Taxes.
(d)    Pre-Closing Tax Matters. Without the prior consent of the Seller, which
consent shall not be unreasonably withheld, conditioned, delayed, after the
Closing, the Purchaser and its Affiliates shall not, and the Purchaser and its
Affiliates shall not permit any Member of the Company Group to, (a) other than
Tax Returns that are filed by Purchaser pursuant to Section 11.01(a), file or
amend or otherwise modify any Tax Return relating to a Pre-Closing Tax Period,
(b) after the date on which any Tax Return filed pursuant to Section11.01(a) is
filed, amend or otherwise modify any such Tax Return unless required by
applicable Law, (c) make or change any Tax election or accounting method or
practice with respect to, or that has retroactive effect to, any Pre-Closing Tax
Period, or (d) make or initiate any voluntary contact with a Governmental
Authority regarding Taxes in any Pre-Closing Tax Period.
(e)    Transaction Tax Deductions. Any and all Transaction Tax Deductions shall,
to the greatest extent permissible under Law, be allocated to a Pre-Closing Tax
Period, and shall be claimed by the Company Group for a Pre-Closing Tax Period
(and shall not be claimed by Purchaser or allocated to a Post-Closing Tax
Period).
(f)    Records. At the request of the Seller, the Purchaser shall deliver to the
Seller copies of all Tax Returns relating to the tax periods (or portions
thereof) ending on or prior to the Closing prepared in accordance with Section
11.01(a).
(g)    Tax Proceedings.
(i)    The Purchaser shall promptly notify the Seller in writing upon receiving
notice from any taxing authority of the commencement of any claim, audit,
examination, or administrative or court proceeding relating to any audits or
assessments or other disputes regarding any Taxes or any Tax Return filed by any
Member of the Company Group with respect to tax periods (or portions thereof)
that end on or before the Closing Date (including any settlement or disposition
thereof) ("Tax Proceeding"), if the Purchaser is entitled to make a claim for
payment or indemnification pursuant to this Agreement (including pursuant to
Section 9.02(a)) with respect to such Tax Proceeding.
(ii)    Notwithstanding any other provision of this Agreement, the Seller shall
have the sole right in its discretion to elect to represent the interests of the
Company Group

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in any Tax Proceeding with respect to Tax periods that end on or before the
Closing Date; provided, however, that for Tax Proceedings that do not involve
Pass-through Tax Returns, Seller shall keep Purchaser reasonably informed with
respect to any such Tax Proceeding and Seller shall not settle or compromise any
such Tax Proceeding without the prior written consent of Purchaser, which it
shall not unreasonably withhold, condition, or delay.
(iii)     Purchaser shall have the right to control any Tax Proceeding for any
Straddle Period of the Company; provided, that with respect to any such Tax
Proceeding, (A) Purchaser shall keep Seller reasonably informed with respect to
such Tax Proceeding, (B) Purchaser shall consult with Seller before taking any
significant action in connection with such Tax Proceeding and (C) Purchaser
shall not settle or compromise any such Tax Proceeding without the prior written
consent of Seller, which it shall not unreasonably withhold, condition, or
delay.
(iv)    The Purchaser shall take all actions reasonably necessary (including
providing a power of attorney) to enable the Seller to exercise its control
rights as set forth in this Section 11.01.
(h)    Cooperation. The Purchaser, each Member of the Company Group and the
Seller shall cooperate fully, as and to the extent reasonably requested by any
other party, in connection with the preparation and the filing of Tax Returns
pursuant to this Section 11.01 and any audit, litigation or other proceeding
with respect to Taxes and the computation and verification of any amounts paid
or payable under this Section 11.01 (including any supporting work papers,
schedules and documents). Such cooperation shall include the retention and (upon
any other party's request) provision of records and information which are
reasonably relevant to any such 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 Purchaser
shall, and shall cause the Company Group to, retain all books and records with
respect to Tax matters pertinent to the Company Group relating to any tax
periods and shall abide by all record retention agreements entered into with any
Taxing authority, and shall give the Seller reasonable written notice prior to
transferring, destroying or discarding any such books and records prior to the
expiration of the applicable statute of limitations for that tax period, and if
the Seller so requests, the Purchaser shall, and shall cause the Company Group
to, allow the Seller to take possession of such books and records rather than
destroying or discarding such books and records.
(i)    Tax Refunds. The Seller shall be entitled to any Tax refunds (or credits
in lieu of refunds) that are received by the Purchaser or any Member of the
Company Group attributable to Taxes paid by any Member of the Company Group with
respect to any Pre-Closing Tax Period or Taxes taken into account in the
determination of Final Purchase Price (or with respect to which Purchaser
received a reduction in the Final Closing Statement) (unless the refund was also
taken into account in connection with such determination). The Purchaser shall
pay over to the Seller any such refund (or credit in lieu of refund) within 10
business days after receipt or entitlement to such refund (or credit in lieu of
such refund). After the Closing, the Purchaser shall cause the Company Group to
use its commercially reasonable efforts to claim any Tax refund. To the extent
permitted by applicable law, the Purchaser shall request a refund (rather than a
credit in lieu of refund) with respect to all Pre-Closing Tax Periods.

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(j)    Closing of Tax Period. The parties shall, to the extent permitted or
required under applicable law, treat the Closing Date as the last day of the
taxable period of the Company Group for all Tax purposes.
(k)    Straddle Periods. To the extent it is necessary for purposes of this
Agreement to determine the allocation of Taxes of the Company Group among a
Straddle Period, (i) the amount of any real, personal and intangible property
Taxes or similar ad valorem Taxes (“Property Taxes”) that relates to the
Pre-Closing Tax Period shall be deemed to be the amount of such Tax for the
entire Straddle Period multiplied by a fraction the numerator of which is the
number of days in the portion of the Straddle Period ending on the Closing Date
and the denominator of which is the number of days in the entire Straddle
Period, and (ii) the amount of any other Taxes of the Company Group shall be
allocated between the Pre-Closing Tax Period and the Post-Closing Tax Period
based on an interim closing of the books as of the close of business on the
Closing Date.
(l)    S Corporation Further Assurances. If the Acquired Company’s status as a
qualified S Corporation subsidiary is found to be invalid or to have terminated
prior to the Closing (either directly or because Seller’s S Corporation election
is determined to be invalid or to have inadvertently terminated prior to
Closing), Purchaser, Seller and Seller Shareholder shall use their reasonable
best efforts to obtain from the Internal Revenue Service a waiver of the
invalidity or terminating event on the grounds of inadvertency, including taking
such steps, and making such adjustments, in each case as are reasonable and may
be reasonably required by the Internal Revenue Service to issue such waiver.
(m)    The Final Purchase Price, liabilities of Seller and other relevant items
shall be allocated among the assets of the Acquired Company in accordance with
Section 1060 of the Code and any comparable provisions of state, local or
foreign law, as appropriate. Such allocation shall be set forth on a schedule
prepared by Purchaser and delivered to Seller (along with any internal or
outside valuation or other information used by Purchaser in connection with or
otherwise relevant to the preparation of the schedule) within 120 days after the
determination of the Net Working Capital pursuant to Section 1.05. Seller shall
have 30 days following delivery of the allocation schedule to give written
notice to Purchaser that Seller disputes the allocation set forth on such
schedule (which notice shall contain Seller’s reasons for objecting to the
allocation set forth on such schedule). If Seller does not respond to Purchaser
within 30 days following delivery of the allocation schedule, Seller shall be
deemed to have objected to the allocation set forth on such schedule. If Seller
timely provides written notice to Purchaser of Seller’s disagreement with such
schedule (or is deemed to have objected to such schedule) and the parties are
unable to resolve the dispute within 20 days, then Seller and Purchaser shall
utilize their own separate versions of the allocation for all purposes. The
allocation, if agreed upon by the parties, shall be the final allocation for
purposes of Section 1060 of the Code (the “Allocation”). If agreed, none of the
parties shall take any position on any Tax Return inconsistent with the
Allocation and each of the parties shall reflect the Allocation where relevant
in all Tax filings, including IRS Form 8594.
11.02    Further Assurances. From time to time, as and when requested by any
other party and at such other party's expense, each party shall execute and
deliver, or cause to be executed and delivered, all such documents and
instruments and shall take, or cause to be taken, all such further or other
actions as such requesting party may reasonably deem necessary or desirable to
evidence and effectuate the transactions contemplated by this Agreement.

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11.03    Consents. After the Closing, Seller and Seller Shareholder shall use
reasonable best efforts to cooperate and assist the Company Group in obtaining
any consents required in connection with the change of control resulting from
the transactions contemplated by this Agreement
11.04    Regulatory Filings; Cooperation.
(a)    Subject to the terms and conditions of this Agreement, the parties shall
cooperate with one another and use their respective commercially reasonable
efforts to promptly (i) take, or cause to be taken, all actions, and do, or
cause to be done, all things, necessary, proper or advisable to cause the
conditions to Closing to be satisfied as promptly as practicable and to
consummate and make effective, in the most expeditious manner practicable, the
transactions contemplated hereby, including preparing and filing promptly and
fully all documentation to effect all necessary filings, notices, petitions,
statements, registrations, submissions of information, applications and other
documents and (ii) obtain all approvals, consents, registrations, Permits,
authorizations and other confirmations from any Governmental Authority or other
Person necessary, proper or advisable to consummate the transactions
contemplated hereby; provided that none of Seller, the Acquired Company,
Purchaser, or any of their respective Affiliates shall be obligated to pay any
fees, costs, or consideration to any Person from whom any such approval,
consent, registration, Permit, authorization or other confirmation is requested.
(b)    As soon as practicable after the date of this Agreement, the Parties
shall prepare and submit to the DSS and, to the extent applicable, any other
Governmental Authority, notification of the transactions contemplated hereby
pursuant to the NISPOM and any other applicable national or industrial security
regulations; and
(c)    Each of the Acquired Company and Purchaser, as applicable, shall use its
commercially reasonable efforts to (i) cooperate with the other parties in
connection with any filing or submission with a Governmental Authority in
connection with the transactions contemplated hereby and in connection with any
investigation or other inquiry by or before a Governmental Authority relating to
the transactions contemplated hereby, including any proceeding initiated by a
private party and (ii) keep the others informed in all material respects and on
a current basis of any material communication received by such party from, or
given by such party to, any other Governmental Authority and of any material
communication received or given in connection with any proceeding by a private
party, in each case regarding the transactions contemplated hereby. Subject to
applicable Laws relating to the exchange of information and to the extent
practicable, each of the Acquired Company and Purchaser shall have the right to
review in advance, and each will consult the other on, any filing made with, or
written materials submitted to, any Governmental Authority in connection with
the transactions contemplated hereby. The parties may, as they deem advisable
and necessary, designate any competitively or commercially sensitive materials
provided to the other under this Section 11.03 or otherwise as "outside counsel
only." Such materials and the information contained therein shall be given only
to outside counsel of the recipient and will not be disclosed by such outside
counsel to employees, officers, or directors of the recipient without the
advance written consent of the party providing such materials. In addition, to
the extent reasonably practicable, all in-person meetings with a Governmental
Authority regarding the transactions contemplated hereby shall include
representatives of all parties. Subject to applicable Law, the parties will
consult and cooperate with each other in connection with any analyses,
appearances, presentations, memoranda, briefs, arguments and proposals made or
submitted to any Governmental Authority regarding the transactions contemplated
hereby by or on behalf of any party.
(d)    Neither party shall: (i) take any action the effect of which, or refrain
from taking any action the effect of refraining from which, would be to delay or
impede the ability of the parties to

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consummate the transaction contemplated by this Agreement, or (ii) directly or
indirectly acquire or agree to acquire (by merging or consolidating with, or by
purchasing a substantial portion of the assets of or equity in, or by any other
manner), any Person or portion thereof, or otherwise acquire or agree to acquire
any assets, if the entering into a definitive agreement relating to, or the
consummation of, such acquisition, merger or consolidation could reasonably be
expected to (A) impose any material delay in obtaining, or materially increase
the risk of not obtaining, any Permits, orders or other approvals of any
Governmental Authority necessary to consummate the transactions contemplated
hereby or the expiration or termination of any applicable waiting period, (B)
materially increase the risk of any Governmental Authority seeking an order
prohibiting the consummation of the transactions contemplated hereby,
(C) increase the risk of not being able to remove any such order on appeal or
otherwise, or (D) delay or prevent the consummation of the transactions
contemplated hereby.
(e)    Nothing in this Agreement shall be construed as requiring the Acquired
Company to agree to any terms or restrictions as a condition to, or in
connection with, obtaining any approvals, consents, registrations, Permits,
authorizations or confirmation from any Governmental Authority or other Person
unless such terms or restrictions are conditioned upon the Closing.
11.05    Disclosure Generally. All Disclosure Schedules are incorporated herein
and expressly made a part of this Agreement as though completely set forth
herein. All references to this Agreement herein or in any of the Disclosure
Schedules shall be deemed to refer to this entire Agreement, including all
Disclosure Schedules.
11.06    Sentel International. As soon as practicable, but in no case later than
30 days after closing, the Seller and Seller Shareholder shall cause the
articles of incorporation of Sentel International Corporation to be amended such
that its name no longer includes the term “Sentel.”
ARTICLE XII    

DEFINITIONS
12.01    Definitions. For purposes hereof, the following terms when used herein
shall have the respective meanings set forth below:
“Action” means any action, suit, charge, complaint, arbitration, hearing,
litigation, proceeding, investigation, audit or government order (whether civil,
criminal, administrative, investigative or for damages, injunctive relief or
otherwise), in each case, that is commenced, brought, conducted, or heard by or
before, or otherwise involving, any Governmental Authority.
"Adjustment Calculation Time" means 11:59 p.m. Colorado Springs, Colorado time
on the day immediately before the Closing Date.
"Affiliate" of any particular Person means any other Person controlling,
controlled by or under common control with such particular Person, where
"control" means the possession, directly or indirectly, of the power to direct
the management and policies of a Person whether through the ownership of voting
securities, contract or otherwise.
"Affiliated Group" means an affiliated group as defined in Section 1504 of the
Code (or any analogous combined, consolidated or unitary group defined under
state, local or foreign income Tax law).

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"Agreed Form" with respect to a document means a form of that document agreed by
each of the Seller and the Purchaser.
“Allocation” shall have the meaning set forth in Section 11.01(m).
"Antitrust Laws" means any applicable Laws regarding competitive or antitrust
matters or relating to the control or approval of mergers or other business
combinations as may be in effect in any applicable jurisdiction, including the
HSR Act.
"Attorney-Client Communication" means any communication occurring on or prior to
Closing between Pillsbury Winthrop Shaw Pittman LLP, on the one hand, and the
Company Group, the Seller or any of their respective Affiliates, on the other
hand, that in any way relates to the Covered Transaction, including any
representation, warranty, or covenant of any party under this Agreement or any
related agreement.
"Audited Financial Statements" shall have the meaning set forth in Section
3.05(a).
"Base Value" has the meaning set forth in Section 1.02(a).
"Bid" means any firm quotation, bid or proposal made by a Person that if
accepted or awarded would lead to a Contract legally binding upon such Person.
"Business" means the business of the Company Group as conducted on the date
hereof.
"Cash on Hand" means, as of the Adjustment Calculation Time (but before taking
into account the consummation of the transactions contemplated hereby), all cash
and cash equivalents with a maturity of three months or less excluding amounts
in Rabbi Trusts and net of any outstanding checks (provided that the obligations
being paid with such checks shall not be included as liabilities in the
calculation of Net Working Capital), of the Company Group as determined on a
consolidated basis and in accordance with GAAP, applied on a basis consistent
with the methods, policies, practices, procedures, classifications and
estimation techniques used in the preparation of the Audited Financial
Statements.
"Company Group" means the Acquired Company and its Subsidiaries.
“Company Transaction Expenses” means expenses of any Member of the Company Group
in connection with the transactions contemplated by this Agreement (including
attorneys’ and other professionals’ fees, and any severance, redundancy, bonus,
other change in control agreement or other similar employee benefit obligation
that are not payable under Section 1.04(h) arising as a result of the
announcement or consummation of any such transaction), in each case that are
unpaid as of the Closing. For the avoidance of doubt, Company Transaction
Expenses do not include any costs, expenses, or premiums associated with the
Representation and Warranty Policy or the “tail” insurance policy in favor of
the D&O Indemnified Persons.
“Competitive Business” means the business of developing, producing, marketing,
or providing (i) government services in the areas of information technology and
network communication services, and facility and logistics services that are
competitive with the services provided by the Company Group; or (ii) any
process, system, or service conducted by the Company Group or the Purchaser as
of and during the one-year period preceding the Closing.

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"Contract" means any oral or written agreement, contract, arrangement,
obligation, undertaking, commitment, purchase order, task order, guarantee, use
agreement, instrument, indenture, note, mortgage, bond, lease, or license, in
each case that creates a legally binding obligation.
“Corporate Headquarters Lease” means that certain Agreement of Lease dated June
10, 2015 by and between the Seller and ATC 2800, LLC, a Delaware limited
liability company.
"Covered Transaction" means the negotiation, preparation, execution and delivery
of this Agreement and related agreements and the consummation of the
transactions contemplated hereby or thereby.
“ERISA Affiliate” means any entity that would have ever been considered a single
employer with a Member of the Company Group under Section 414 of the Code,
Section 4001(b) of ERISA or part of the same “controlled group” for purposes of
Section 302(d)(3) of ERISA.
"Escrow Agent" means U.S. Bank, National Association.
"Escrow Agreement" means the Escrow Agreement to be dated as of the Closing Date
by and among the Seller, the Purchaser and the Escrow Agent, in substantially
the form attached as Exhibit A hereto.
"Estimated Purchase Price" shall have the meaning set forth in Section 1.02(a).
"FAR" means the Federal Acquisition Regulations.
"Final Purchase Price" means an aggregate amount equal to (i) the Base Value,
plus (ii) the amount by which Net Working Capital exceeds Target Working
Capital, minus (iii) the amount by which Target Working Capital exceeds Net
Working Capital, plus (iv) the total amount of Cash on Hand, minus (v) the total
amount of Indebtedness, minus (vi) Company Transaction Expenses.
"GAAP" means United States generally accepted accounting principles consistently
applied by the Seller or the Acquired Company, as applicable.
"Government Bid" means a Bid issued by a contractor that, if accepted or
awarded, would result in a Government Contract.
"Government Contract" means any prime contract, subcontract, facility contract,
teaming agreement, basic ordering agreement, pricing agreement, letter contract,
purchase order, delivery order, task order, modification, or change order
between the Company Group and (i) any Governmental Authority, (ii) any prime
contractor of a Governmental Authority, or (iii) any higher-tier subcontractor
with respect to any contract of a type described in (i) or (ii) above.
"Governmental Authority" means any (a) federal, state, local, municipal,
foreign, or other government; (b) governmental or quasi-governmental authority
of any nature (including any governmental agency, branch, department, official,
arbitrator or entity and any court or other tribunal); or (c) body exercising,
or entitled to exercise, any administrative, executive, judicial, legislative,
police, regulatory or taxing authority or power of any nature.
"Income Tax" means any federal, state, local or foreign Tax based on or measured
by reference to income.

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"Indebtedness" means, without duplication, (i) any indebtedness of the Company
Group for borrowed money, (ii) any indebtedness evidenced by any note, bond,
debenture or other debt security issued by a Member of the Company Group, (iii)
any liabilities or obligations for the deferred purchase price of property or
services with respect to which the Company Group is liable, as obligor or
otherwise (other than trade payables and other current liabilities), (iv) any
indebtedness of any Person other than a Member of the Company Group guaranteed
by the Company Group, (v) any liabilities or obligations under capitalized
leases with respect to which the Company Group is liable, determined on a
consolidated basis in accordance with GAAP, (vi) any indebtedness or liabilities
secured by a lien on the Company Group's assets, (vii) all obligations in
respect of letters of credit, performance bonds or surety bonds to the extent
drawn (excluding, for the avoidance of doubt, any obligations under letters of
credit to the extent they remain open or undrawn), and bankers’ acceptances
issued for the account of the Company Group, (viii) obligations under any
existing interest rate, commodity or other swap, hedge or financial derivative
agreement entered into by the Company Group prior to Closing, (ix) Off-Balance
Sheet Financing of the Company Group in existence immediately prior to the
Closing, (x) obligations in respect of the SENTEL DCPs and any other
nonqualified deferred compensation arrangements to the extent unfunded or
underfunded (including funds in a Rabbi Trust for the SENTEL DCPs as funded),
and (xi) unfunded or underfunded pension or retiree health liabilities
(including funds in Rabbi Trusts as funded). For the avoidance of doubt,
"Indebtedness" shall not include (A) any operating lease obligations, or (B) any
intercompany obligations between or among the Seller, Members of the Company
Group, and their respective Affiliates that is settled at Closing and shall
include any interest, penalties, or fees payable on items (i) –(xi) above.
"Indemnity Escrow Account" means an account established by the Escrow Agent
pursuant to the Escrow Agreement.
"Indemnity Escrow Amount" means an amount deposited at the Closing in the
Indemnity Escrow Account with the Escrow Agent pursuant to the terms and
conditions of the Escrow Agreement, which shall be $250,000.
"Intellectual Property" means trademarks and service marks, trade dress, trade
names, logos, and internet domain names (together with goodwill associated with
any of the foregoing), patents, patent applications, copyrights, and
registrations and applications for any of the foregoing, and trade secrets.
"Knowledge of the Company Group" means the actual knowledge of Russell T.
Wright, William E. Ward, and Michael W. Royer.
"Law" means any law, rule, regulations, judgment, injunction, order, decree or
other restriction of any court or governmental entity.
"Liens" means liens, security interests, charges or encumbrances.
"Loss(es)" means losses, liabilities, damages and expenses, including reasonable
out-of-pocket legal fees and expenses; provided that "Losses" does not include,
and the Purchaser shall not be entitled to seek or recover from the Acquired
Company, the Seller or the Seller Shareholder any punitive damages or losses,
except to the extent paid to a third party.
"Material Adverse Effect" means any change, effect, event, occurrence, state of
facts or development that is materially adverse to the financial condition or
results of operations of the Company Group taken as a whole; provided, however,
that none of the following shall be deemed, either alone or in combination, to
constitute, and none of the following shall be taken into account in determining
whether

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there has been or will be, a Material Adverse Effect: any adverse change,
effect, event, occurrence, state of facts or development attributable to (i) the
announcement or pendency of the transactions contemplated by this Agreement,
including any employee attrition and any impact on revenues or relationships
with suppliers, customers or any other Persons having business dealings with the
Company Group; (ii) conditions affecting (A) the industry in which the Company
Group participates that are not unique to the Company Group, including, without
limitation, as a result of any "shutdown" of the U.S. federal government, (B)
the U.S. economy as a whole or (C) the financial, banking, or capital markets in
general or the markets in which the Company Group operates; (iii) compliance
with the terms of, or the taking of any action permitted by, this Agreement;
(iv) any change in applicable Laws or the interpretation thereof; (v) any change
in GAAP or the interpretation thereof; (vi) the commencement, continuation or
escalation of a war, material armed hostilities or other material international
or national calamity or act of terrorism and (vii) the failure of any Member of
the Company Group to meet or achieve the results set forth in any internal
projection of the Company Group.
"Member of the Company Group" the Acquired Company or any of its Subsidiaries.
"Net Working Capital" means (i) all current assets (excluding Cash On Hand,
intercompany receivables, related party receivables, accounts receivable (billed
and unbilled) associated with the ISS Yuma contract, advances to shareholders
and employees and their respective Affiliates, assets in Rabbi Trusts, and Tax
assets) of the Company Group as of the Adjustment Calculation Time (but before
taking into account the consummation of the transactions contemplated hereby),
minus (ii) all current liabilities (excluding Indebtedness, Company Transaction
Expenses, intercompany payables, liabilities associated with payments on
termination of the SENTEL DCPs, and the “tail” insurance policy in favor of the
D&O Indemnified Persons) of the Company Group as of the Adjustment Calculation
Time (but before taking into account the consummation of the transactions
contemplated hereby), in each case calculated on a consolidated basis and in
accordance with GAAP, applied on a basis consistent with (i) the methods,
policies, practices, procedures, classifications and estimation techniques
specified in the calculation of Net Working Capital set forth in Exhibit B
hereto (which amounts included in Exhibit B are for illustrative purposes only)
and (ii) the methods, policies, practices, procedures, classifications and
estimation techniques used in the preparation of the Audited Financial
Statements to the extent they are not inconsistent with those set forth in
Exhibit B. For the avoidance of doubt, current liabilities in Net Working
Capital do not include any costs, expenses, or premiums associated with the
Representation and Warranty Policy.
“Off-Balance Sheet Financing” means (a) any liability of the Company Group under
any sale and leaseback transactions which does not create a liability on the
balance sheet of the Company Group and (b) any liability of the Company Group
under any synthetic lease, Tax retention operating lease, off-balance sheet loan
or similar off-balance sheet financing product where the transaction is
considered indebtedness for borrowed money for federal Income Tax purposes but
is classified as an operating lease in accordance with GAAP for financial
reporting purposes.
“Open Source Software” means any software distributed under any license that
requires that any other software incorporated into, derived from, or distributed
with such software (i) be disclosed, distributed or made available in source
code form, (ii) be licensed for the purposes of preparing derivative works, or
(iii) be licensed under terms that allow such other software to be reverse
engineered (other than by operation of Law).
"Options" means all options issued by the Acquired Company to acquire shares of
its common stock that are vested and exercisable (or will become vested and
exercisable as a result of the transactions contemplated hereby) and outstanding
as of immediately prior to the Closing.

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“Ordinary Course Agreement” means (i) any customary agreements with customers,
vendors, lenders or, lessors entered into in the Ordinary Course of Business,
(ii) agreements related to property Taxes payable with respect to properties
leased and (iii) other agreements for which Taxes is not the principal subject
matter.
“Ordinary Course of Business” means the ordinary course of business, consistent
with past practice and custom.
“Pass-through Tax Returns” means Tax Returns that reflect Tax Items that pass
through to holders (such as IRS Forms 1120S and any comparable state or local
Tax Returns).
"Permits" means all federal, state, local or foreign permits, grants, easements,
consents, approvals, authorizations, exemptions, licenses, franchises,
certificates or orders of, any Governmental Authority or any other Person,
required for any Company Party to own its respective assets or conduct its
respective business as is now being conducted.
"Permitted Liens" means (i) statutory liens for current Taxes or other
governmental charges not yet due and payable or the amount or validity of which
is being contested in good faith by appropriate proceedings by the Company Group
and for which appropriate reserves have been established in accordance with
GAAP; (ii) mechanics', carriers', workers', repairers' and similar statutory
liens arising or incurred in the Ordinary Course of Business for amounts which
are not delinquent and which are not, individually or in the aggregate,
material; (iii) zoning, entitlement, building and other land use regulations
imposed by governmental agencies having jurisdiction over the Leased Real
Property which are not violated by the current use and operation of the Leased
Real Property; (iv) covenants, conditions, restrictions, easements and other
similar matters of record affecting title to the Leased Real Property which do
not materially impair the occupancy or use of the Leased Real Property for the
purposes for which it is currently used or proposed to be used in connection
with the Business; (v) public roads and highways; (vi) matters which would be
disclosed by an inspection or accurate survey of each parcel of Leased Real
Property; (vii) liens arising under worker's compensation, unemployment
insurance, social security, retirement and similar legislation; (viii) liens on
goods in transit incurred pursuant to documentary letters of credit; (ix)
purchase money liens and liens securing rental payments under capital lease
arrangements; and (x) non-exclusive licenses to Intellectual Property granted in
the ordinary course of business.
"Person" means an individual, a partnership, a corporation, a limited liability
company, an association, a joint stock company, a trust, a joint venture, an
unincorporated organization or a governmental entity or any department, agency
or political subdivision thereof.
"Post-Closing Tax Period" means any taxable period beginning after the Closing
Date and, for any Straddle Period, the portion of such Straddle Period beginning
after the Closing Date.
"Pre-Closing Tax Period" means any taxable period ending on or before the
Closing Date and, for any Straddle Period, the portion of such Straddle Period
up to and including the Closing Date.
"Property Tax" shall have the meaning set forth in Section 11.01(k).
“Registered IP” means issued patents, registered copyrights and registered
trademarks granted under the authority of any Governmental Authority.

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"Representation and Warranty Policy" means the representation and warranty
policy issued by Lloyds, London in favor of Purchaser.
"Straddle Period" means any taxable period that begins on or before and ends
after the Closing Date.
"Subsidiary" means, with respect to any Person, any corporation of which a
majority of the total voting power of stock entitled (without regard to the
occurrence of any contingency) to vote in the election of directors, managers or
trustees thereof is at the time owned or controlled, directly or indirectly, by
such Person or one or more of the other Subsidiaries of such Person or a
combination thereof, or any partnership, association or other business entity of
which a majority of the partnership or other similar ownership interest is at
the time owned or controlled, directly or indirectly, by such Person or one or
more Subsidiaries of such Person or a combination thereof. For purposes of this
definition, a Person is deemed to have a majority ownership interest in a
partnership, association or other business entity if such Person is allocated a
majority of the gains or losses of such partnership, association or other
business entity or is or controls the managing director or general partner of
such partnership, association or other business entity.
"Target Working Capital" means $6.5 million.
"Tax" or "Taxes" means any federal, state, local or foreign income, gross
receipts, franchise, estimated, alternative minimum, add-on minimum, sales, use,
transfer, real property gains, registration, value added, excise, natural
resources, severance, stamp, occupation, premium, windfall profit,
environmental, customs, duties, real property, special assessment, personal
property, capital stock, social security, unemployment, disability, payroll,
license, Medicare, real property, net worth, business, professional, and
occupational license, employee or other withholding tax, including any interest,
penalties or additions to tax or additional amounts in respect of the foregoing.
"Tax Proceeding" shall have the meaning set forth in Section 11.01(g)(i).
"Tax Returns" means any return, report, information return or other document
(including schedules or any related or supporting information) filed or required
to be filed with any governmental entity or other authority in connection with
the determination, assessment or collection of any Tax or the administration of
any Laws, regulations or administrative requirements relating to any Tax.
"Transaction Tax Deductions" means any deduction permitted for Income Tax
purposes that is attributable to, without duplication, the aggregate amount of
(A) all compensatory payments (including bonuses, change in control payments,
retention payments, synthetic or phantom equity payments, or similar payments or
payment of benefits under the Sentel DCP) made or to be made by any Member of
the Company Group on or before the Closing or in connection with or resulting
from the Closing (or included as a liability in Net Working Capital or
Indebtedness); (B) all fees, expenses, prepayment premiums and interest
(including amounts treated as interest for U.S. federal income Tax purposes) and
any breakage fees or accelerated deferred financing fees incurred by any Member
of the Company Group with respect to the payment of Indebtedness on or before
the Closing or in connection with the Closing or included as a liability in Net
Working Capital or as Indebtedness; (C) all fees, costs and expenses (including
Taxes) incurred by any Member of the Company Group in connection with or
incident to this Agreement and the transactions contemplated hereby, including
any such legal, accounting and investment banking fees, costs and expenses; (D)
any other fees, costs or expenses (including Taxes) reflected in, reserved for
or taken into account in the determination of Final Purchase Price, including in
connection with the determination of Net Working Capital, Indebtedness and/or
Company Transaction Expenses (or with respect to which Purchaser received a
reduction

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in the Final Closing Statement), (E) the amount of any deductions for U.S.
federal income Tax purposes as a result of the exercise or payment for
cancellation of the Options on or around the Closing and (F) any employment
Taxes (including, for the avoidance of doubt, any social security contributions)
with respect to the amounts set forth in clauses (A) and (E) of this definition.
"WARN Act" means the Worker Adjustment Retraining Notification Act of 1988, as
amended.
12.03    Other Definitional Provisions
(a)    Accounting Terms. Accounting terms which are not otherwise defined in
this Agreement have the meanings given to them under GAAP. To the extent that
the definition of an accounting term defined in this Agreement is inconsistent
with the meaning of such term under GAAP, the definition set forth in this
Agreement will control.
(b)    Successor Laws. Any reference to any particular Code section or any other
Law or regulation will be interpreted to include any revision of or successor to
that Code section or Law, regardless of how it is numbered or classified.
ARTICLE XIII    

MISCELLANEOUS
13.01    Press Releases and Communications. No press release or public
announcement related to this Agreement or the transactions contemplated herein,
or prior to the Closing any other announcement or communication to the
employees, equityholders, customers or suppliers of any Member of the Company
Group, shall be issued or made by any party without the joint approval of the
Purchaser and the Seller, unless required by Law (in the reasonable opinion of
counsel) or by the applicable rules of any stock exchange, in which case the
Purchaser and the Seller shall have the right to review such press release,
announcement or communication prior to issuance, distribution or publication.
The Parties agree that the initial press release to be issued in connection with
the transactions contemplated hereby shall be in a form mutually agreed. The
Purchaser is permitted to file this Agreement and any other disclosure regarding
this Agreement and the transactions contemplated hereby as it reasonably deems
necessary or appropriate with the Securities and Exchange Commission.
Notwithstanding the foregoing, on and after the Closing Date, the Purchaser
shall be permitted (a) to disclose that the Closing has occurred, the
consideration paid hereunder and other items directly relating to the
consideration; (b) to disclose on its websites and in its marketing materials
the nature and publicly available terms of the transactions contemplated
hereunder; and (c) to disclose information required by legal process.
13.02    Expenses. Except as otherwise expressly provided herein, the Seller, on
the one hand, and the Purchaser, on the other hand, shall pay all of their own
expenses (including attorneys' and accountants' fees and expenses) in connection
with the negotiation of this Agreement, the performance of their obligations
hereunder and the consummation of the transactions contemplated by this
Agreement.
13.03    Notices. All notices, demands and other communications to be given or
delivered under or by reason of the provisions of this Agreement shall be in
writing and shall be deemed to have been given (a) (i) when personally
delivered, (ii) the day following the day (except if not a business day then the
next business day) on which the same has been delivered prepaid to a reputable
national overnight air courier service or (iii) the third business day following
the day on which the same is sent by certified or registered

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mail, postage prepaid or (b) when transmitted via electronic mail to the e-mail
addresses set out below. Notices, demands and communications, in each case to
the respective parties, shall be sent to the applicable address set forth below,
unless another address has been previously specified in writing:
Notices to the Purchaser (and, after the Closing, the Acquired Company):
Vectrus Systems Corporation
655 Space Center Drive
Colorado Springs, Colorado 80915
Attention: Chief Legal Officer
Telephone: 719-637-5795
Email: michele.tyler@vectrus.com

with a copy to:

Faegre Baker Daniels LLP
3200 Wells Fargo Center
1700 Lincoln Street
Denver, Colorado 80203
Attention: Douglas R. Wright
Telephone: 303-607-3671
Email: douglas.wright@faegrebd.com

Notices to the Seller and Seller Shareholder:

143 Waterfront Street, #303
Oxon Hill, MD 20745
Attention: Russell T. Wright

with a copy to:
Pillsbury Winthrop Shaw Pittman LLP
1650 Tysons Boulevard, 14th Floor
McLean, Virginia 22102
Attention: Craig Chason
Telephone: (703) 770-7947
Email: craig.chason@pillsburylaw.com
13.04    Assignment. This Agreement and all of the provisions hereof shall be
binding upon and inure to the benefit of the parties and their respective
successors and permitted assigns, except that neither this Agreement nor any of
the rights, interests or obligations hereunder may be assigned or delegated by
either the Purchaser, on the one hand, or the Acquired Company or the Seller, on
the other hand, without the prior written consent of the other party.
13.05    Severability. Whenever possible, each provision of this Agreement shall
be interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Agreement is held to be prohibited by or invalid
under applicable law, such provision shall be ineffective only to the extent of

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such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Agreement.
13.06    References. The table of contents and the section and other headings
and subheadings contained in this Agreement and the exhibits hereto are solely
for the purpose of reference, are not part of the agreement of the parties, and
shall not in any way affect the meaning or interpretation of this Agreement or
any exhibit hereto. All references to days or months shall be deemed references
to calendar days or months. All references to "$" shall be deemed references to
United States dollars. Unless the context otherwise requires, any reference to a
"Section," "Exhibit," "Disclosure Schedule" or "Schedule" shall be deemed to
refer to a section of this Agreement, exhibit to this Agreement or a schedule to
this Agreement, as applicable. The words "hereof," "herein" and "hereunder" and
words of similar import referring to this Agreement refer to this Agreement as a
whole and not to any particular provision of this Agreement. English shall be
the governing language of this Agreement. The word "including" means "including,
without limitation."
13.07    Construction and Disclosure. Each of the Purchaser, the Seller and the
Acquired Company confirms that its and its counsel have reviewed, negotiated and
adopted this Agreement as the joint agreement and understanding of the parties,
and the language used in this Agreement shall be deemed to be the language
chosen by the parties to express their mutual intent, and no rule of strict
construction shall be applied against any Person. The specification of any
dollar amount or the inclusion of any item in the representations and warranties
contained in this Agreement or the Schedules is not intended to imply that the
amounts, or higher or lower amounts, or the items so included, or other items,
are or are not required to be disclosed (including whether such amounts or items
are required to be disclosed as material or threatened) or are within or outside
of the Ordinary Course of Business, and no party shall use the fact of the
setting of the amounts or the fact of the inclusion of any item in this
Agreement or the Schedules in any dispute or controversy between the parties as
to whether any obligation, item or matter not described or included in this
Agreement or in any Schedule is or is not required to be disclosed (including
whether the amount or items are required to be disclosed as material or
threatened) or is within or outside of the Ordinary Course of Business for
purposes of this Agreement. The information contained in this Agreement and in
the Schedules hereto is disclosed solely for purposes of this Agreement, and no
information contained herein or therein shall be deemed to be an admission by
any party of any matter whatsoever (including any violation of law or breach of
contract). The Schedules and the information and disclosures contained therein
are intended only to qualify and limit the representations, warranties and
covenants of the Acquired Company and the Seller contained in this Agreement and
shall not be deemed to expand in any way the scope or effect of any of such
representations, warranties or covenants. In disclosing the information in the
Schedules, neither the Seller, nor the Acquired Company waives any
attorney-client privilege associated with such information or any protection
afforded by the work-product doctrine with respect to any of the matters
disclosed or discussed therein. The disclosures in the Schedules are to be taken
as relating to the representations and warranties as a whole, notwithstanding
the fact that the Schedules are arranged by sections corresponding to the
sections in this Agreement, or that a particular section of this Agreement makes
reference to a specific section of the Schedules, and notwithstanding that a
particular representation and warranty may not make a reference to the
Schedules. Disclosure of an item on one Schedule shall be deemed disclosed on
all other Schedules to the extent its relevance is reasonably apparent.
Capitalized terms used in the Schedules and not otherwise defined therein have
the meanings given to them in this Agreement. Time is of the essence in the
performance of each of the parties' respective obligations contained herein.
13.08    Amendment and Waiver. Any provision of this Agreement or the Disclosure
Schedules or Exhibits hereto may be amended or waived only in a writing signed
by the Purchaser and the Seller. No

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waiver of any provision hereunder or any breach or default thereof shall extend
to or affect in any way any other provision or prior or subsequent breach or
default.
13.09    Complete Agreement. This Agreement and the documents referred to herein
(including the Escrow Agreement and Confidentiality Agreement) contain the
complete agreement between the parties and supersede any prior understandings,
agreements or representations by or between the parties, written or oral, which
may have related to the subject matter hereof in any way.
13.10    Third-Party Beneficiaries. Except as otherwise expressly provided
herein, nothing expressed or referred to in this Agreement will be construed to
give any Person other than the parties to this Agreement any legal or equitable
right, remedy, or claim under or with respect to this Agreement or any provision
of this Agreement. For avoidance of doubt, nothing in Section 8.05 conveys any
legal or equitable right, remedy, or claim to or for any employee of the Company
Group.
13.11    Waiver of Trial by Jury. EACH PARTY HEREBY WAIVES THE RIGHT TO A TRIAL
BY JURY IN ANY ACTION OR PROCEEDING UNDER THIS AGREEMENT OR ANY ACTION OR
PROCEEDING ARISING OUT OF THE TRANSACTIONS CONTEMPLATED HEREBY, REGARDLESS OF
WHICH PARTY INITIATES SUCH ACTION OR PROCEEDING.
13.12    Purchaser Deliveries. The Purchaser agrees and acknowledges that all
documents or other items delivered or made available to the Purchaser's
Representatives (including by posting to any virtual data rooms managed by or on
behalf of the Seller and/or the Acquired Company) shall be deemed to be
delivered or made available, as the case may be, to the Purchaser for all
purposes hereunder.
13.13    Specific Performance. Each of the parties acknowledges that the rights
of each party to consummate the transactions contemplated hereby are unique and
recognize and affirm that in the event of a breach of this Agreement by any
party, money damages may be inadequate and the non-breaching party may have no
adequate remedy at law. Accordingly, the parties agree that such non-breaching
party shall have the right, in addition to any other rights and remedies
existing in its favor at law or in equity, to enforce its rights and the other
parties' obligations hereunder not only by an action or actions for damages but
also by an action or actions for specific performance, injunctive and/or other
equitable relief (without posting of bond or other security).
13.14    Delivery by Electronic Mail. This Agreement and any signed agreement
entered into in connection herewith or contemplated hereby, and any amendments
hereto or thereto, to the extent signed and delivered by means of electronic
mail, shall be treated in all manner and respects as an original contract and
shall be considered to have the same binding legal effects as if it were the
original signed version thereof delivered in person. At the request of any party
hereto or to any such contract, each other party hereto or thereto shall
re-execute original forms hereof or thereof and deliver them to all other
parties. No party hereto or to any such contract shall raise the use of
electronic mail to deliver a signature or the fact that any signature or
contract was transmitted or communicated through the use of electronic or
digital form as a defense to the formation of a contract and each such party
forever waives any such defense.
13.15    Counterparts. This Agreement may be executed in multiple counterparts,
any one of which need not contain the signature of more than one party, but all
such counterparts taken together shall constitute one and the same instrument.
13.16    Governing Law. All issues and questions concerning the construction,
validity, interpretation and enforceability of this Agreement and the exhibits
and schedules hereto (whether in contract or tort) that

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may be based upon, arise out of or relate to this Agreement or the negotiation,
execution or performance of this Agreement (including any claim or cause of
action based upon, arising out of or related to any representation or warranty
made in or in connection with this Agreement) shall be governed by, and
construed in accordance with, the laws of the Commonwealth of Delaware
applicable to agreements executed and performed entirely within such State,
without giving effect to any choice of law or conflict of law rules or
provisions (whether of the Commonwealth of Virginia or any other jurisdiction)
that would cause the application of the laws of any jurisdiction other than the
Commonwealth of Virginia.
13.17    Consent to Jurisdiction. THE PARTIES AGREE THAT JURISDICTION AND VENUE
IN ANY SUIT, ACTION, OR PROCEEDING BROUGHT BY ANY PARTY IN CONNECTION WITH THIS
AGREEMENT, THE TRANSACTIONS CONTEMPLATED HEREBY, OR THE PERFORMANCE OF THE
OBLIGATIONS IMPOSED HEREUNDER SHALL PROPERLY AND EXCLUSIVELY LIE IN ANY FEDERAL
OR STATE COURT LOCATED IN THE STATE OF DELAWARE. EACH PARTY ALSO AGREES NOT TO
BRING ANY SUIT, ACTION, OR PROCEEDING IN CONNECTION WITH THIS AGREEMENT, THE
TRANSACTIONS CONTEMPLATED HEREBY, OR THE PERFORMANCE OF THE OBLIGATIONS IMPOSED
HEREUNDER IN ANY OTHER COURT. BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH
PARTY IRREVOCABLY SUBMITS TO THE JURISDICTION OF SUCH COURTS FOR ITSELF AND IN
RESPECT OF ITS PROPERTY WITH RESPECT TO ANY SUCH SUIT, ACTION, OR PROCEEDING.
THE PARTIES IRREVOCABLY AGREE THAT VENUE WOULD BE PROPER IN SUCH COURT, AND
HEREBY WAIVE ANY OBJECTION THAT ANY SUCH COURT IS AN IMPROPER OR INCONVENIENT
FORUM FOR THE RESOLUTION OF SUCH SUIT, ACTION, OR PROCEEDING. THE PARTIES
FURTHER AGREE THAT THE MAILING BY CERTIFIED OR REGISTERED MAIL, RETURN RECEIPT
REQUESTED, OF ANY PROCESS REQUIRED BY ANY SUCH COURT SHALL CONSTITUTE VALID AND
LAWFUL SERVICE OF PROCESS AGAINST THEM, WITHOUT NECESSITY FOR SERVICE BY ANY
OTHER MEANS PROVIDED BY STATUTE OR RULE OF COURT.
13.18    Prevailing Party. Except as contemplated by Sections 1.05 and 11.01(a),
if there shall occur any dispute or proceeding between the parties relating to
this Agreement or the transactions contemplated hereby, the non‑prevailing party
shall pay all reasonable costs and fees (including reasonable attorneys' fees
and expenses) of the prevailing party.
13.19    Acknowledgement Regarding Post-Closing Attorney-Client Matters.
(a)    Each party to this Agreement acknowledges that (i) the Company Group and
the Seller have retained Pillsbury Winthrop Shaw Pittman LLP (the, "Law Firm" or
“Pillsbury”) to act as their counsel in connection with the Covered Transaction
as well as other past and ongoing matters, (ii) Law Firm has not acted as
counsel for any other Person in connection with the Covered Transaction, and
(iii) no Person other than the Members of the Company Group and the Seller has
the status of a client of Law Firm for conflict of interest or any other purpose
as a result thereof. The Purchaser (1) waives and will not assert, and will
cause each of its Subsidiaries (including, after Closing, the Members of the
Company Group) to waive and not assert, any conflict of interest relating to Law
Firm's representation after the Closing of the Seller, or any of its respective
Affiliates in any matter involving the Covered Transaction (including any
litigation, arbitration, mediation or other proceeding), and (2) consents to,
and will cause each of its Subsidiaries (including, after Closing, the Members
of the Company Group) to consent to, any such representation, even though in
each case (x) the interests of the Seller, and/or such Affiliate of the Seller
may be directly adverse to the Purchaser, the Acquired Company or any of their
Subsidiaries, (y) Law Firm may have represented the Acquired Company or its
Subsidiaries in a substantially related matter, or (z) Law Firm may be

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handling other ongoing matters for the Purchaser, the Acquired Company or any of
their respective Subsidiaries.
(b)    The Purchaser agrees that, after the Closing, neither the Acquired
Company, not the Purchaser, nor any of their respective Subsidiaries will have
any right to access or control any of Law Firm's records relating to or
affecting the Covered Transaction, which will be the property of (and be
controlled by) the Seller. In addition, the Purchaser agrees that it would be
impractical to remove all Attorney-Client Communications from the records
(including e-mails and other electronic files) of the Company Group.
Accordingly, the Purchaser shall not, and shall cause each of its Subsidiaries
(including, after Closing, the Members of the Company Group) not to, use any
Attorney-Client Communication remaining in the records of the Company Group
after Closing in a manner that may be adverse to the Seller or any of the
Seller's Affiliates.
(c)    The Purchaser agrees, on its own behalf and on behalf of its Subsidiaries
(including, after Closing, the Company Group), that from and after Closing (i)
the attorney-client privilege, all other evidentiary privileges, and the
expectation of client confidence as to all Attorney-Client Communications belong
to the Seller and will not pass to or be claimed by the Purchaser, the Acquired
Company or any of their respective Subsidiaries, and (ii) the Sellers will have
the exclusive right to control, assert or waive the attorney-client privilege,
any other evidentiary privilege and the expectation of client confidence with
respect to such Attorney-Client Communications. Accordingly, the Purchaser shall
not, and shall cause each of its Subsidiaries (including, after Closing, the
Company Group) not to, (x) assert any attorney-client privilege, other
evidentiary privilege or expectation of client confidence with respect to any
Attorney-Client Communication, except in the event of a post-Closing dispute
with a Person that is not the Seller or any of the Seller's Affiliates, or (y)
take any action which could cause any Attorney-Client Communication to cease
being a confidential communication or to otherwise lose protection under the
attorney-client privilege or any other evidentiary privilege, including waiving
such protection in any dispute with a Person that is not the Seller or any of
the Seller's Affiliates. Furthermore, the Purchaser agrees, on its own behalf
and on behalf of each of its Subsidiaries (including, after Closing, the Company
Group), that in the event of a dispute between the Seller or any of the Seller's
Affiliates, on the one hand, and the Acquired Company or any of its
Subsidiaries, on the other hand, arising out of or relating to any matter in
which Law Firm jointly represented both parties, neither the attorney-client
privilege, nor the expectation of client confidence nor any right to any other
evidentiary privilege will protect from disclosure to the Seller or such
Affiliate of the Seller any information or documents developed or shared during
the course of Law Firm's joint representation.
13.20    Tax Withholding on Compensatory Payments. Notwithstanding anything to
the contrary in this Agreement, to the extent that an amount is paid or is
payable to the Seller pursuant to this Agreement for the benefit of any service
provider of the Company Group and such amount may be subject to payroll and
employment tax withholding under applicable law (e.g., such amounts are payable
by the Seller to an employee of the Company Group and those amount are treated
as "wages" under Code Sections 3121, 3306, or 3402), then, at the written
request and direction of the Seller, the Purchaser shall, or shall cause the
applicable Member of the Company Group to, pay such amounts through the
applicable payroll system of the Purchaser or the applicable Member of the
Company Group and make all applicable employment and payroll tax withholding on
such amounts in accordance with applicable law; provided that, if such amount
has already been paid to the Seller, then the Seller agrees to promptly deliver
such amount to an account designated by the Purchaser.

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13.21    Payments under this Agreement. Each party agrees that all amounts
required to be paid hereunder shall, except as otherwise expressly set forth in
this Agreement, be paid without discount, rebate, reduction or withholding.
13.22    Non-Solicit and Non-Compete.
(a)    During the period beginning immediately following the Closing and ending
on the fifth (5th) anniversary of the Closing Date, neither Seller nor Seller
Shareholder shall, directly or indirectly, solicit or hire for employment any
individual who, as of immediately prior to the Closing, was an officer or
management employee is employed by the Company Group (each, a “Specified
Individual”); provided that nothing herein shall prohibit Seller or Seller
Shareholder from (i) conducting a general solicitation of prospective employees
in the ordinary course of business if not specifically directed towards any
Specified Individual, or hiring any Specified Individual where the initial
contact with such Person regarding such hiring primarily arose as a result of
such general solicitation or (ii) soliciting or hiring any Specified Individual
whose employment with the Company Group (or the Purchaser), has terminated.
(b)    During the period beginning immediately following the Closing and ending
on the fifth (5th) anniversary of the Closing, neither Seller nor Seller
Shareholder shall control, manage, operate, be employed or engaged by, or
otherwise participate or engage in any business as, or have any interest in, a
Competitive Business. Notwithstanding the foregoing, nothing in this Agreement
shall prevent such Person from acquiring or owning as a passive investment, up
to five percent (5%) of the outstanding voting securities of any entity engaged
in a Competitive Business that is publicly traded on any recognized national
securities market.
(c)    In no event will the aggregate amount of the Purchase Price allocated to
the foregoing restrictive covenants exceed $25,000 in the aggregate.

* * * * *

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IN WITNESS WHEREOF, the parties have executed this Stock Purchase Agreement as
of the date first above written.
SELLER:
R&R ENTERPRISES, INC.

By:                        

Name:                        

Its:                        
ACQUIRED COMPANY:
SENTEL CORPORATION

By:                        

Name:                        

Its:                        
PURCHASER:
VECTRUS SYSTEMS CORPORATION

By:                        

Name:                        

Its:                        
SELLER SHAREHOLDER:

                        
Russell T. Wright

Signature Page to Stock Purchase Agreement
 

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Exhibit A – Escrow Agreement
(See Attached)

 

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Exhibit B – Example Calculation Of Net Working Capital

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Indebtedness Payoff Schedule
Bank of America

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Schedule 2.01(f) – Names of Persons to Sign Employment Letters with Purchaser
Continuing Employment Letters
Sandra Brucker
Patricia Curtis
Michael Smith
Chet Young
Transition Letters
Kip Ward
Michael Royer